A long-time observer of the corporate legal scene in Australia, Peter Turner believes that “Maintaining professional standards and independence in an increasingly tough and unforgiving business environment is perhaps the greatest single challenge that the in-house profession will face in coming years.” Turner is the former CEO of the venerable Australian Corporate Lawyers Association (ACLA) and before that the general counsel of Fosters, so his views cannot be taken lightly. He wrote this for his chapter in Benny Tabalujan, ed. Leadership and Management Challenges of In-House Legal Counsel(LexisNexis Australia 2008) at 10.

Remaining professional as a lawyer counts significantly and poses periodic challenges, I will concede. Even so, as compared to productivity, cost, knowledge of the business, and team contribution, is independence the Achilles heel of in-side lawyers? Do outside counsel tout their supposed independence and objectivity, and make much of the employed lawyer as bending under pressure, as a significant truth or more as a marketing ploy? If business executives want pliant lawyers, why would they see stiff-necked hardliners outside as attractive?

Has anyone encountered or heard of such a strange request?

A lawyer from a fair-sized department wrote me with a strange story. The Board of Directors is looking for “compliance certificates” from each area of the Law Department. My email friend wrote that “While other parts of the Law department can sign off on a compliance certificate because it is most likely they receive every matter that falls within their purview, I as head of the commercial group have refused to sign anything regarding commercial work.

My friend explained why she couldn’t sign such a certificate. “The commercial lawyers see only a very small percentage of the contracts that the organization enters into. We have prepared a number of templates for use by other departments but these documents are not locked down, so we know that they are changed, and, as well, many contracts are entered that don’t even use one of the templates. Because we are subject to specific legislative limitations, if someone in the organization signs off on a deal using vendor paper, we will without a doubt be in breach of at least one of those limitations (respecting indemnification).”

My problem is that my GC is pushing me to sign a certificate for the Board stating that to the best of my knowledge, the organization’s contracting is in compliance with all laws, regulations, policies, etc. My issue is that the Board will rely on this certificate, but there is no way that I can conduct the necessary due diligence to meet even the “best of my knowledge”

Some legal problems left in baskets on the doorstep of a law department come from the corporate compliance line. Hotlines, as they are called, generate some wheat for lawyers but mostly chaff. This post offers some snippets I have gathered about help lines.

From a small sample of experience, it seems that many calls are trivial. For example, a large chunk allege favoritism. Relatively small numbers of calls come; at one company they averaged 3-7 per month. Most of the services that handle calls use a template to gather the facts and allegations. One company added a step for themselves, to code each item afterward: “was this a valid complaint?”, and estimated that only half were valid.

Callers can remain anonymous at all companies and some 90 percent or so choose anonymity. If anonymous they get a call back number and call within a week or two to hear what was done. While on the call the person will tell you what to call and when. Some companies create a website to let someone fill in the same information they would have been asked for by a person

A half-dozen posts before this have referred to hotline services (See my post of Dec. 19, 2005: BP hotline for employees; Dec. 31, 2006: ethics hotlines and compliance officers at Raytheon; June 19, 2006: systems that allow employees to report legal and ethical infractions; July 5, 2006: reporting software as a cottage industry; May 8, 2007: McKesson and its ethics hotline, plus third parties who answer hotline calls; and Feb. 13, 2009 #2: ILTA survey on ethics/crisis hotlines.).

Two of the in-house lawyers profiled in the Columbia L. School Mag., Summer 2011 at 28, singled out the explosion of intellectual property issues. You could say that being a lawyer for Warner Music Group and the Jacksonville Jaguars football team would obviously entail extensive intellectual property rights. True, but they both stressed the spiraling amount, prominence, and complexity of those issues. They and many other in-house lawyers want to maximize the value of the intellectual capital and property owned by their companies and that campaign has taken on more prominence.

Global commerce and the internet, cited frequently as forces that have compounded legal needs and complexity, both link closely to IP rights. As trade spreads you have to be more protective in more areas; as technology untethers physical products to online domains (and abuses), IP advice takes on ever more importance. IP as a strategic tool looks set to soak up increasing amounts of law department time.

An article packed with sound advice gracefully written cautions in-house lawyers to call meetings with their clients judiciously. Writing in ACC Docket, Nov. 2010 at 82, the authors urge you to have a clear purpose “and not be overly long (you should generally not schedule a meeting longer than 30 minutes.). Meetings tend to expand to fill the available time, so this is good advice.

This reminds me of analogous advice about brevity. Keep memos short; stop loquacity in e-mails, prune PowerPoint decks; and give clear, crisp answers. Smaller is better.

The law department looks to reduce its budget or headcount by shifting some tasks back to clients, such as minor contracts, administrative help (terminate a secretary in a remote office and have the lawyer there double up on a business unit secretary), review of some marketing material, IT support, etc.). At the same time, a business unit or staff function that has to cut back wants to terminate a contract administrator who had helped the law department, cut back on preventive law training, reduce anti-counterfeiting efforts, or have sales people request contract reviews prematurely.

Both sides want to slough off on the other some of their former obligations. Unlike me to have no opinion, but I do not have any overall sense how the back and forth transfer of costs or work nets out.

That hurts, that view really hurts.

That business managers resent laws and kick the dog of the department that reminds them about its costs and constraints can’t be denied. That it takes time for a lawyer to look at an agreement or an advertisement or a potential patent or a lease is absolutely true. Legal review takes longer than a handshake or just plunging ahead. That clients sometimes skirt the edge of the law, race toward the volcanic center, or go over the precipice – yes, lawyers may stop that and sense the resentment of clients who view them as perpetual obstacles.

In a New Jersey L.J, July 8, 2011 profile, the general counsel of Mercedes-Benz USA remarks, without cavil "I want them [his nine-lawyer department] to feel like they're part of the solution and not part of the problem because legal departments are always viewed as roadblocks.” Ironic, the car manufacture and the metaphor of roadblock and speed bumps.

How can general counsel believe that their team provides value if they also believe that they will always be seen as a hindrance?

According to an ACC Docket article (June 2011 at 78), partners in some law firms are gatekeepers “acting as channels through which communications and legal advice must be directed.” Such an arrangement, by my lights, obstructs, slows, and costs. It obstructs because if someone in a law department has a question, why filter it through a partner who can’t answer it? It delays because of the baton-handoff as well as transmission errors and it costs money any time someone in a law firm touches anything. Assuming you know, go straight to the lawyer in the firm who can best provide the service or answer the question.

The same philosophy ought to govern within the corporation. If an internal client knows the right lawyer in your department for something, they should be encouraged to go straight to that lawyer. They shouldn’t need to clear the question or pass it through the Associate General Counsel who supervises that lawyer.

All granted, this straight-to-the lawyer approach breaks down when law departments want to intermediate requests from internal clients to law firms. Only sometimes do departments allow senior executives to pick up the phone directly.

During a recent consulting project, the general counsel said that about two years ago he had systematically met with nearly two dozen of his department’s major clients. He had asked all them basically the same questions – “How are we doing?” and “How can we do better?” – and compiled the results.

I commend this practice. It’s all well and good for a general counsel to pick up comments here and there from clients. Such remarks have immediacy and value. Far better, a deliberate effort reaches key constituents, tells them ahead of time what you want to hear about so they can prepare, compiles a fairly comprehensive picture of client opinion, and thinks about it as a whole -- a far superior practice.

How to get bulky board books to members of the board of directors has always been a problem, if only for the simple minded logistics of photocopying, collating, binding, and shipping the complicated tomes. Some corporate secretarial functions have turned to online software platforms to expedite delivery (and to benefit from other functions such as calendars, secure e-mail, and document repositories (See my post of Sept. 2, 2009: software for corporate secretaries with 11 references.).

In the latest twist I have heard about a law department uses IPads to deliver the materials. At first the idea seems outlandish, but if you have ever used an IPad to read material and annotate it, you start to see the allure of this medium. I presume the directors turn in their IPad at each meeting.