Three business situations where a paralegal may be a better option than instructing a solicitor

Article
Amanda Hamilton, CEO of National Association of Licensed Paralegals
Amanda Hamilton
Three business situations where a paralegal may be a better option than instructing a solicitor

It’s always sensible to keep an eye on costs within a business, but it’s more important than ever now – after all, who knows what is around the corner?

If you have a legal issue that you need help with, most people turn to a solicitor. But these can be expensive, charging upwards of £200 per hour, putting them out of reach for many small businesses and for many smaller legal issues, where the fees simply don’t make sense.

However, not all legal problems need a solicitor. Some can be handled, from start to finish, just as well by a paralegal – and they will cost you a lot less.

Let’s look at three business situations where using a paralegal is likely to be the best, and most cost-effective option if you are looking for legal help:

1: Your business is owed money, or you owe money to another business

Many businesses rely on invoicing others which in turn means that there is an element of trust between you and your contractors/suppliers – especially if you/they are invoicing after the job has started, or perhaps when it’s complete.

If you, or your client, can’t pay an invoice then it is always best to talk first. Don’t jump straight to legal action. These days with many employees being furloughed, the idea that part payment would be acceptable, is a much easier pill to swallow than before, and a much better alternative to receiving no payment at all. So, the first thing to do when knowing that you cannot pay your bills or invoices, is to contact the company/individual owed, and to arrange part payments in order to clear the debt over time. Some will accept this and other will not.

If this doesn’t work, or the person promising to make the payments fails to do so, then it may be time to take legal action to recover the debt. This is where a paralegal can help, and will keep the costs down, making smaller debts more financially viable to recover. If you are the person owing the money and the other party starts legal action against you, a paralegal can help you defend yourself.

A paralegal can deal with the paperwork needed and contact the other party on your behalf. If the claim ends up in court, then your paralegal can represent you and speak on your behalf if it is a small claim (up to £10k).

The likely outcome is that if it’s agreed that the debt is owed, but the person owing the money cannot pay the full amount in one go, then the court will look at their financial circumstances and order instalment payments to be made according to their means.

It’s always best to avoid going to court if you can, but if going to court is necessary, then using a paralegal will save you money. This is important to consider, as although costs are usually awarded to the winning party, often these issues are settled before the case actually reaches the court: The person owing the money pays the debt in order to halt the proceedings, but they don’t pay your costs. So, if you’ve racked up a huge solicitor’s bill, you may find yourself out of pocket.

2: An employment matter

Running a business means you are likely to employ people to help you operate it. Employment contracts are a minefield to the lay person, and if not done properly can end up costing you a fortune should things go wrong. Engaging the services of a specialist employment paralegal will save you money at the outset and could save you much more in the future.

Unfortunately, sometimes disputes arise over an employment issue that results in either you taking your employee to a tribunal, or your employee making allegations of an employment nature against your business. A paralegal can assist and advise you through the tribunal process and ultimately can represent you in that tribunal if necessary.

Having professional help at a time like this can relieve some of the stress, free up your time, and ensure you put the best case forward to achieve the outcome you need. Preparing for a tribunal can take up a lot of time, so keeping the hourly costs down is important and means that the process doesn’t need to take up more of your valuable time and money, than it undoubtably already has!

3: Business to business contracts

Contracts are an everyday part of business, whether it is with suppliers and/or clients.
Drafting commercial contracts is something that a specialist paralegal can do on your behalf. You may also need a specialist to cast an eye over a draft contract that comes your way in order to ensure that there is nothing detrimental within it. It is not unknown for companies to change wording in a standard clause without bringing it to your attention.

For example: a clause expressing that there is a 90 day notice to terminate the agreement, which is a commonly used termination period, may go on to state that notice can only be given prior to the renewal of the contractual term, which may be 12 months. Therefore, if you try to terminate the contract in the thirteenth month, the contract will not come to an end until a further eleven months have passed. This may have financial consequences for which you have not budgeted. A specialist paralegal should be able to spot this on first reading, advise accordingly, and/or suggest an alternative form of words that helps protect you.

These are just three common examples of when using a paralegal can save you money and ensure you get the advice you need without having to pay high solicitor’s fees.

When choosing a paralegal, be sure to engage one that is both sufficiently qualified and, like any professional, appropriately insured. One way to ensure this it to choose a paralegal that is has a Licence to Practise. You can search for paralegals in your area, or with the specialism needed at https://www.nationalparalegals.co.uk/paralegal-register

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Amanda Hamilton, CEO of National Association of Licensed Paralegals
Amanda Hamilton

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