You may decide to provide a separate service in your Early Warning organisation focused on specialised legal assistance provided by top level insolvency lawyers.
You may decide to provide a separate service in your Early Warning organisation focused on specialised legal assistance provided by top level insolvency lawyers. This approach stems from Early Warning Denmark where the original concept from the beginning of 2007 did not pay any attention to the possible need for support by insolvency lawyers, but soon we realized the need for legal advice in many cases – between 20 and 45 percent of all cases. During the last part of 2008 we developed cooperation with app. 20 highly experienced insolvency lawyers around in Denmark.
This close cooperation also meant that the consultants soon got an overview over insolvency law and possible solutions in this context. Further it meant that the involved lawyers became acquainted with the Early Warning tasks and types of cases, and they were used as teachers at different events and meetings. Today insolvency law is on the agenda for a whole day once a year, open both for consultants and volunteer advisers.
It is important to mention that the lawyers are not paid by the project – they earn their money via case companies ending up as costumers, often paid in connection with a possible following bankruptcy procedure. Important learnings from this approach include:
- It is easy to get experienced, specialised lawyers to give one or two meetings for free
- You should only cooperate with highly experienced lawyers. If you use the wrong lawyers there is a high risk of losing golden opportunities.
- In case of a foreseen bankruptcy: Always remember to draw a plan or a roadmap for the company owner after the potential bankruptcy leading to unsurmountable debt
- Only cooperate with the necessary number of lawyers. You ought to bring the individual lawyer enough cases to be sure that he/she gives priority to you as most cases will be very urgent
- On the other hand: Do not bring so many cases that the lawyer, in case you stop cooperation with him/her, could put him/her in danger of going bankrupt
It should be mentioned that national regulation may have to be considered in the way you cooperate with lawyers. You can find further advice on the cooperation with lawyers here
Dealing with other private sector advisors:
The close cooperation with insolvency lawyers is quite unique, and in itself it represents a close cooperation with private sector advisers.
Nevertheless, it is vital that you do not get other parts of private sector advisors as opponents, as this could actually be a threat to establishing a successful Early Warning mechanism. You can find a paper giving advice on how to handle the private sector advisors avoiding trouble here