How to set up a law firm ...

How to open a law firm.

The first step is to get a letter from your local law society stating that you are an attorney. The bank will require the letter when opening your attorney's trust and business accounts. Some banks still require also opening a third account to deduct your trust fees, but with the major banks, those two accounts are enough. The bank will likely require a R500.00 deposit into your business account, and a later R 100.00 deposit into your trust account when you have sent them your Fidelity Fund certificate and they have unfrozen it. The deposits are not bank fees, and remain your money. Make sure you are emailed statements from both accounts on at least a monthly basis. Also, be sure to set up online banking, as you will need this for your trust account, unless you like cheques very much. The law society may want proof of your accounts being opened, the bank employee can get you that while you are sitting there, opening the account.

You should at this point be opening a trust cashbook, journals and ledgers and a business cashbook, journals and ledgers, either in physical form or on your computer, as you will need to record all your transactions as an attorney, by the end of the month after each month's transactions occur. The cheapest solution is to do your books in Microsoft Excel, if you have it on your computer. Many hire bookkeepers or use specialised software.

Go through to the law society, with the forms for opening a new firm filled out, including the application on paper for a fidelity fund certificate. Also fill out the application for your membership card, and bring your Identity Document and two passport sized photographs of you with. Take these forms and such to the records department. If you don't have the forms to fill out, request them, and also be sure to request information as to the amount that payment will be from the same department.

You will be expected to pay your ordinary membership fees if you are not yet a practising member of the law society, and your registration fees for your firm.

Once you have registered, the next step is to log onto the website of the Financial Intelligence Centre, and register as an accounting organisation with them. You should at this point begin planning for your processes for complying with FICA, wherein you need to request certain documents from clients before you first serve them, such as proof of address, proof of identity, and proof of their tax number. FICA now also requires you to establish if a client is a person of national interest, and the corporate and ownership structure of corporate clients and the like. A good guide may be to download your local bank's FICA compliance document and use it as a loose guide on how you yourself will comply.

Once you have received your Fidelity Fund certificate, you are allowed to set up practice. Make sure you are not sharing offices with any non-attorney, that your law practice is clearly marked and demarcated, and that your client will be able to brief you privately.

Your invoices and receipts to clients will need to comply with the Consumer Protection Act and the rules governing attorneys. You should create an attorney client-contract for your clients to sign, it should at a minimum contain the required details set out in the Legal Practice Act. It is a good idea to insist on a top-up method, where you only work when there is money in your trust account, and where money is always deposited well in advance of any emergencies in the matter. Also, be sure to know how to tell if a matter has prescribed, or is about to, so you don't get into very avoidable trouble for negligence.

It is a good idea to get yourself a filing system for when your clients bring documents for their matters, and often a good idea to keep digital copies, which you should safely back up, as many attorneys have found themselves up a creek without a paddle, upon their computer being damaged or stolen. You should also consider creating a hard copy and digital record of your clients' personal contact details, and for alternative contacts if you can't reach your client in some emergency.

If you use computers in your practice, make sure you have a good and regularly updated anti-virus program installed. If you use Android for your phone, also get a good anti-virus for your phone. Also be sure you have some sort of backup of important emails. Printing them and printing them to PDF can be useful. When you save files, put the date first, to help you organise them, and consider having separate folders on your computer for each matter, and separating research files and precedents from the matters they are for, so that they can be of future use.

It is advisable to record all your phone calls in terms of s 4 of the Regulation of Interception of Communications Act. That way, you have proof of what conversations entailed. Store these recordings securely. Also, consider encrypting your phone and computer hard drives. A good written record of all phone calls and what they entailed is also important and good notes of consultations are essential. Also, consider recording consultations with a dictaphone. You often miss details in the moment, that become clear on a recording.

Have some standard questions you ask your clients, and always get their basic identifying and contact information.

It is also important to fill out the survey of the AIIF each year. You want to be covered if you act negligently.

Once you have been in practice for four months, you will need to have your trust account and trust accounting books audited by an auditor accredited by the law society. Make sure you contact one in advance, so you know what they charge and can save up. The audit needs to be delivered to the law society along with your annual statement, within your first six months of practice.

You will need to sign up for Practice Management Training (PMT), and pass it, so as to make sure you receive your next Fidelity Fund certificate. Remember, without a Fidelity Fund certificate, you cannot practise.

It is also important that you design your letterhead in terms of the rules governing the profession. Also important, but less so than the letterhead, is to get your stamps made. You need a firm stamp, a received without prejudice stamp, and will do well to have certified copy and commissioner of oaths stamps.

If you are new to law, or a long practising attorney, friends and contacts are important. Be sure to ask for guidance from colleagues who know the answers when you are new to something. Also, try to create a good law library. Books like Amlers and collections like LAWSA and Butterworths Forms and Precedents can save you hours of research, and can be accessed online for a reasonable monthly fee as part of a LegalSelect package. Stay up to date on legal news and regulations, and be sure you are writing and reading regardless of how many clients you have.

Your office is your primary tool as an attorney, other than your own transport, and it is important to have a decent printer that works, some form of computer, a desk, and chairs for you and clients. I also believe that tea and coffee, and some rusks or biscuits can do a world of good for getting clients to open up. Also make sure you have an accurate way to record your time spent on a client's matter.

Writing and speaking are essential tools for lawyers. Consider keeping a blog, and write how you would write a legal letter in all your social communications. Get into the habit. Speak politely with everyone, also, get out of habits like using swear words. You don't want to accidentally use one in court. Practise the art of conversation, and of debate, and record yourself speaking. Consider doing mock trial with attorneys in your area, get your confidence up. Attend trials and see how other attorneys do them, especially unopposed and opposed motion court, divorces, and urgent court. Also, see how more experienced colleagues draft, but don't use their drafting as a precedent, use it as a guide. Remember, good legal drafting is about accurately setting out the positions of the parties, whether in pleadings, or contract, or a legal letter. Also, remember, you are a creature of instruction, your client's problem is theirs, not yours. You merely represent them.

Beyond that all, remember law is a business, and take joy in your work. Working from home can be difficult, and a routine such as walking to your office each morning can be helpful. Instead of setting goals to do work, set goals for work opportunities. Say: I will open client X's file, and look at it. Suddenly, you will find you are working away on it. Make sure you have savings for six months before opening a firm, and put a good amount of whatever you earn into savings. Don't take on too much work at once, or too many too-big clients to start. Slowly does it. Set up the right processes and procedures before even opening your door. Too many law firms have grown too fast and collapsed, others, too, have got a ton of work immediately, only to see work dry up in a bad economy without savings to get them by.

To those who go on this journey of entrepreneurship, we your fellow small to medium sized enterprises welcome you.

Nothing herein should be relied upon as legal advice. For that, make an appointment with your attorney and fully brief them of all the nuances of your matter.