As dealer groups grow, their legal needs grow as well. Because of the many state and federal regulations with which auto dealers must comply, along with franchise and general business legal issues, having experienced automotive industry legal counsel is a necessity.
The challenges for these dealer groups are as follows:
- Accurately assessing legal needs – Does the company really have enough legal work to justify the expense of a lawyer’s full salary and benefits? If not, the company still has legal needs. So the company utilizes law firms on an hourly basis, sometimes amassing large legal bills to take care of relatively minor legal issues at high hourly rates.
- Hiring an attorney – Once a company decides that it has enough work to keep an in-house lawyer busy, finding and hiring a lawyer can be a challenge. First, there is a fairly small universe of lawyers with the knowledge and experience necessary to capably handle the full range of most dealers’ work. Second, most lawyers are not risk takers; they may be unwilling to leave the comfort and security of a prestigious law firm with many clients to work in-house for a single client. Third, most attorneys with the requisite automotive industry experience are used to very large salaries that many dealer groups may not be willing to offer.
- Finding the right fit – assuming the company can overcome these obstacles and find a full-time attorney with the requisite experience willing to accept a reduced salary, if that attorney does not fit into the company’s culture, that attorney now has the protections of employment laws, which can present additional obstacles to quickly and amicably terminating that relationship.
Using outside general counsel services resolves each of these problems.
- It provides complete and affordable coverage while the dealership assesses its legal needs. Provided for a flat monthly fee, outside general counsel enables the company to assess its needs without committing to the expense of hiring a full-time lawyer of unknown quality and fit. After a few months of utilizing this service, it will become clear whether a full-time lawyer is needed.
- If a company’s legal needs do not require a full-time lawyer, Ican provide the same level of service that an in-house lawyer would provide, but at a fraction of what an hourly-billing law firm would charge. The mere fact that there isn’t enough legal work to merit the expense of hiring a full-time lawyer does not mean that you do not need a lawyer who is dedicated to the success of your business. I am intimately familiar with the legal landscape confronting dealers, have a proven record of advancing and protecting their interests, and would do so as outside general counsel no less than I would if I were employed by that company full-time. And, with the exception of litigation, I can provide that high level of service at a flat monthly rate.
- If the company’s legal needs require a full-time lawyer, I will help the company in find and transitiona full-time lawyer into the organization. While I can’t eliminate every obstacle to finding an attorney, the knowledge and experience of the company’s needs and culture that I will have gained by serving as its outside legal counsel will enable me to assess the experience level and cultural fit of an appropriate in-house attorney. Utilizing my network of contacts in the dealer attorney community, I can help the company find and train an appropriate full-time attorney. This will reduce the risk of over-hiring or training someone to get up to speed in the automobile retail sales industry.
- This arrangement can be as temporary or permanent as the company desiresit to be. An employee is only a good fit if the company culture matches his or her personality and temperament. The benefit of having an independent contractor provide these services is that if the fit does not work, the relationship can end without dispute. Likewise, if it becomes clear that a full-time attorney is not needed and it’s a good fit, continuing to utilize the outside general counsel services program provides a lower-cost alternative to obtain all of the legal and regulatory compliance, HR, franchise, contract review and drafting, and general legal advice and counsel necessary without the expense or risk of an employment relationship.
Our team provides 24/7 advice and counsel as well as negotiation and drafting in all areas of the law affecting dealerships, including:
- Franchise relationship issues
- State legal and regulatory issues
- Corporate governance
- Real estate
- Financial records/business insurance
- Loan documents and bank relationships
- Consumer relations/sales practices
- Succession issues
- Co-ownership issues
- Safety/Emergency issues
- General advice and counsel