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Law firmite rebuts GC’s ramblings: Law Firms do and will continue to generate value

A law firm pro has penned a response to the controversial Ramblings of a GC column from last week. Read it first, if you haven’t yet, before you proceed.

‘Healthy detachment’ you say? I thought that was quite the rant that indicates a fair degree of resentment.

But I won’t make it personal. Neither is this an in-house versus law firm debate.

The two operate in entirely different realms. They don’t even compete with each other, but rather serve each other’s purpose.

I would like to refute some of the claims made in the last post and to provide clarity to many a confused associate who may wrongly suffer from similar ‘all is lost’ delusions.

Precedential preference

On using a precedent, I don’t see what’s wrong with that. These transactions emerged from the West and are filled with US concepts; it is only natural that foreign law firms have better precedents. They’ve been at this far longer.

Where we Indian law firms come in is to assist funds / entrepreneurs on how these rights work in the Indian context. And also how these rights, which are taken for granted in the US or other countries, will require quite a fight.

We fight this fight for our clients.

Furthermore, the implications of many rights are yet to be tested. From drag rights to liquidation preference, and even indemnities!

Right now we’re all just trying to get with the program and best safeguard our client’s interests. So it does take more than a few iterations.

Rue diligence

On diligences, how many deals fall through because of compliance issues that come up in the legal diligence? In my experience, not many.

And that’s not because first years ran the diligence and weren’t skilled to dig up some dirt. It’s mostly the same issues that come up in every other diligence. Labour law issues, under-stamped agreements, trademarks not registered in all the relevant classes, some company secretarial issues and a host of other issues on the same scale.

It’s not rocket science. And what a shame that first years can’t pick up on these issues after having gone through a few reports in the first few months.

I too generalise. There are serious issues on structures, FEMA and SEBI compliances in some cases. And that’s when the partner and senior associate involvement changes and also a consultant / specialist may be roped in, depending on the complexity of the issue.

Back to the usual suspects, we all like to scare our phoren clients on criminal liabilities for labour law non-compliances, though I’m not aware of any officer that has gone to prison for not having contract labour registrations. I can safely assume that no one has.

At the end of the day, it’s our job to inform clients of these consequences on paper and what the realities are in India and assist them in making decisions.

Opinionated somethings

On opinions, law firms simply do not have the luxury of concluding an opinion with absolute certainty. But it’s not that partners are not ballsy enough. Many like to be cowboys and go guns blazing to stand out. But the laws in our country are that grey.

Where is round-tripping codified? Which law entitles income tax officers to question capital gains tax exemptions availed under legitimate tax treaties? Tell me the provision that precisely defines “unpublished price sensitive information”. Tell me the provision under law that says just because shares of a public company are freely transferable, shareholders cannot enter into private arrangements to deal with their inter-se rights?

You can’t. Not without a lot of case law to explain the convoluted state of these issues. In any case, we always verbally convey what our opinion is going to be. If its negative, the client drops it. If it’s grey, depending on the need, the client still goes ahead and asks for it and keeps it on file.

Soft skills

If you stayed long enough to appreciate and understand the dynamics of a law firm, you may not have been so pessimistic or jaded. Being technically sound or brilliant isn’t all that it takes. A good managing partner recognises the strengths and weaknesses of each partner / associate and slots them into roles. Sometimes wrongly, sometimes rightly.

If you feel you are better, prove it and you will most certainly have the benefit of your actions.

For the others: if you can’t draft or negotiate, then don’t be bitter about being stuck with diligences all your life. If you can’t interact with clients, then don’t complain about being made to work behind the scenes.

Law firms are competitive. And things are not always what they seem to be. A seemingly moronic partner may be bringing in a lot of clients. A partner with no BD skills may be great with his team and possess magnificent leadership skills. A technically sound partner may very well be the leader of some Dothraki clan in another life.

The straight story

Miraculously, it all comes together once you know what you have to contribute and where you want to slot yourself.

For the newbies / associates who feel that their time is not respected or that Mondays are hell on earth –which profession entitles you to a lakh a month (excluding bonuses) straight out of college with no experience whatsoever?

And about being made to “wait” – the associate is not staring at the ceiling while you wait is he? If he is, let’s write to Dexter.

But more often than not, you may be made to wait a little improperly because sometimes the timing can’t be helped. What are you missing out on – the One Directions movie? Skinnier jeans? Sure, money doesn’t justify everything. But every law firm’s reputation precedes it. You made your choice. So why is it suddenly criminal that you spent a few late nights or Sundays in the office?

“In conclusion”, it’s easier to crib. About the senile managing partner. About time slips. About how overburdened you are. How you’re surrounded by dimwits and how you’re the only one keeping it together. Oh the unfairness of it all. Boo Hoo.

Prove your worth, and you are most likely to succeed. It’s not easy. But it’s that simple.

Voice your concern to the people who matter instead of trashing the people around you over a smoke. Don’t go in bouncing off the walls or like some victim that’s about to be made road kill. And for the love of Batman, please don’t cry. Just say it like it is.

If things still don’t work out, then it’s time to introspect and gauge what your skills really are and accept the facts. This is not idealism. Or sanctimonious preaching. It worked for me. It can for others. This is also not to say that working in a law firm is like a trip to Disney Land. It has its issues – but assess what they are sensibly and then try to resolve them.

Carefully worded opinions on grey areas, using good precedents and such things are not really issues.

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