Other than when a firm is being formed, there is no better or more organic time to test a law firm’s continued commitment to one another than when nearing the expiration of an office lease.
Typically, when a firm is formed, two or three or a handful of individuals gravitate to one another, become increasingly aware that they share some combination of values, dreams and aspirations, and form a firm.
Time brings changes — in market and working conditions, and in the individuals. What was once important becomes less critical. What one was looking for when the partnership was formed has shifted. The greater the divide, the more the relationship is stressed. And “stressed” is shorthand for pulling in different directions.
To the extent members of a firm conclude that their aspirations have shifted to a point that it no longer makes sense to practice together, it is prudent to execute the separation in a way that causes the least economic (and other forms of) pain.
The firm’s lease can often be the source of a great deal of economic pain. But it doesn’t have to be.
What does all of this point to?
As a firm nears the end of a lease term on office space — often its largest fixed expense — a partnership has an organic opportunity to pause . . . and assess the degree to which the members of the firm are still on the same page. Does the partnership still share basic hopes and dreams?
Though no one really enjoys conversations that focus on disagreements and differences, a conversation today will help with one of two eventualities: either it will facilitate a discussion around clarifying shared aspirations or, a conclusion that dissolution is a better answer for all involved.
We recommend this process begin no later that 18 months prior to the scheduled lease expiration. The “glue testing” should be conducted with a laser focus on the core of how firm members really feel about the firm, where it is and where it is headed.
An impartial third party can insure that the process is collegial and effective.
One firm that seems to have successfully been through this process is the Dallas based litigation firm Hermes Sargent Bates. The firm, which had been in business for 15 years, has a lease expiring in 2016. As the partners discussed professional and personal goals and objectives, the decision was made to dissolve rather than extend or sign a new lease. According to reports, the members of the firm remain friends and have respect for one another; but the group had simply developed differences with respect to the types of law they want to practice, the types of clients they want to serve, and area of town in which they wanted to sign a new lease.
Having reached this conclusion, the firm seems to be taking an orderly approach to what is, for many firms, a disorganized, angst-filled experience.
What is the degree to which you and your partners are still on one page? Does your firm have the experience to really test the degree of continuing shared aspirations?