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NEW YORK — A question that many solo practitioners ask themselves is: Should I look for partners? After experiencing the recent economic highs and lows, many lawyers have considered becoming part of a boutique or midsize firm to reduce the burden of solo practice.

There are many positive aspects to joining forces with other attorneys. The two biggest advantages are that the new practice can attract a larger market of potential clients and that the new firm can offer a broader range of legal services, which ultimately leads to new revenue streams.

On the other side of the argument is the issue of whether the new combination is a good fit for existing partners, associates, staff and clientele. Partnering with others is a process that should be undertaken carefully, without haste and after extensive due diligence.

There are two primary warning signs that indicate when a practitioner should consider a partnership. One tip-off is that the existing work is now more than what the firm can handle. The other is that an increasing number of the requests for legal representation received by the firm are referred to other firms because the specialized expertise is not available.

The solution is either to partner with others or to hire additional attorneys. Bringing in less-experienced attorneys may present its own problems. One additional concern includes the time spent supervising attorneys and reviewing their work product. For an attorney who already lacks sufficient time in the day, this may make things worse. If a practice relies on contingency fees, then as a business entity, the senior, experienced lawyer is still fronting the time and the costs. Depending on the types of cases, the time between settlement and receipt of money may be so large as to put an undue financial hardship on the bottom line. Partners, however, share the risk with you.

If the decision has been made to form a new partnership, the next step is to decide what mix is best. Before forming a partnership, pay attention to conflicts. Chemistry, even in a professional atmosphere, is a strong factor in assuring that a partnership will be successful, so the merger should be structured with that in mind. The bottom line is that new arrangements require work.

&# 149 Try to avoid the many potential pitfalls. Before forming a partnership, give thought to the following issues:

&# 149 Do the philosophies of each partner or each firm mesh well? Simply providing a new revenue source is not enough. Ask whether you would want to spend a large part of your professional career with these people. Are their morals and ethics a match with yours?

• Talk to the prospective partner’s or firm’s existing clients and find out what they have to say. Are they happy with the legal representation they have received?

• Talk to other attorneys in the community and see what they have to say about the potential partner’s or firm’s reputations and practices.

• What is the financial viability of the potential partner’s current organization? Is it financially sound? Look at their debt structure and ascertain whether their net income is growing or relatively stable. If the financials are misleading or confusing, this is a red flag to proceed with caution.

• Know in advance each partner’s expectations. Learn early on what each partner’s business plan entails and what they foresee their future to be.

• Make sure to consider a shareholder’s agreement and that every partner is involved in the drafting of the new agreement. While complete consensus may never exist, including a group from the outset allows them to “buy in” to the partnership concept. Make sure the agreement is a comprehensive document that covers all, or most, conceivable contingencies.

A new partnership has both advantages and disadvantages. On the pro side, there are increased revenues from services that neither party previously offered. There is also the ability to recruit partners and associates that neither of the firms could attract separately. Other advantages include the pooling of resources and spreading of overhead risk, as well as maintaining for one’s clients the personal attention that very large firms can’t offer.

On the con side, one should consider the lost revenue from legal and commercial conflicts and from departing clients who do not want to be served by the new firm. There is also the possible departure of partners, associates or staff who are not happy in the new firm or venture.

Someone practicing alone has only so many hours in each day, thereby limiting the revenue that can be generated. Many solo practitioners have begun to accept that fact. Solo practitioners now recognize the advantages of a broader scope by joining forces with other attorneys to form small, boutique or midsize firms.

Forming a partnership may be the wave of the future, as legal practices become more national and more specialized. The challenge is to undertake the next step with both eyes open, aware of all of the legal and ethical implications.

Jeffrey M. Ostrow is the managing partner of Fort Lauderdale, Fla.’s Gelch Taylor Hodkin Kopelowitz & Ostrow. This article originally appeared in the National Law Journal , a Recorder affiliate based in New York City.

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