What Makes A Good Lawyer

I hear folks frequently talking about "getting a good divorce or trial attorney."  I also get calls asking if I or my partner are "good" attorneys.  That's an interesting question, as it's a question that is posed to many professions.  Everyone is looking for a good something, be it a contractor, doctor, or lawyer.  Seinfeld had a good stand up bit talking about referring someone to a doctor, and because that patient was referred by a particular person, that patient would receive better treatment and actual medicine as opposed to tic-tacs that were being handed out to everyone else.  So what makes one lawyer different from another, or better than another? 

Well, most lawyers generally can do the work needed to get from point A to point B.  Using divorce, for example, a lawyer can help you get from being married to being divorced.  Somewhat similarly, a cab driver can drive you from point A to point B.  However, different cab drivers take different routes, have different personalities (some like to talk to you, some talk incessantly on their cell phones, some don't utter a word), offer different services (some will get your luggage, some won't move from the driver's seat as if they were luggage), etc.. 

Lawyers are not necessarily very different.  Different clients have different personalities, different needs, and every case and every client is unique and different.  Some clients want the most aggressive lawyer.  And, being bulldog aggressive can be an effective way to handle a case.  Some clients want a lawyer that listens and is readily available.  Some clients want to micro-manage the case and be involved in much of the strategy and decision making.  Others take a more hands-off approach and only want to be consulted on matters that require a decision from them. 

To me, the best lawyer is a lawyer that listens to you.  A lawyer has to work, day in and day out, with a myriad of different people.  A lawyer has to be flexible and know when aggressive works, and when conciliation and understanding are more appropriate tools.  For example, in complex high asset divorce cases, the goal may not be to cross the finish line and be divorced.  The focus, instead, may be developing  strategies to best divide assets to ensure children's schools and activities are not jeopardized and stay minimally impacted and counsel for financial change and independence.  Aggression and assertiveness are certainly frequently used and are effective tools, but a good lawyer knows when to use them.  Over use of aggression, or aggression without a plan and without forethought, results in chainsaw surgery that has little chance of effecting a positive outcome. 

A good lawyer must also know the art and skill of poker.  Many lawyers file motions and set hearings thinking that the other side will back down instead of having to spend time responding and attending hearings.  I call this strategy a war of attrition, where the strategy is to try to wear the other side down and win based upon intimidation, not merit.  A good lawyer recognizes this strategy for what it is, and works with the client to prepare strategies and initiate drama control.  Often, drama outside the legal arena is used to apply pressure in conjunction with this strategy.  If a client is counselled that drama will be coming and is ready for it, then the effectiveness of this strategy diminishes significantly. 

I guess what I'm trying to say is that to me, a good lawyer is someone that you communicate well with, have faith in, and trust to worry about your problems for you.  I tell my clients that they pay me to worry for them, and that my job is to worry about what could go wrong and how to avoid or minimize it.  In interviewing lawyers, try talking to him/her and seeing how well he/she listens, because to me listening is where a good lawyer starts to work.  

Construction Lien Basics and Collection Tools

The construction industry has been hit very hard by the economy.  Construction has slowed as consumers and businesses find ways to save money and delay construction that is not absolutely essential.  This environment has also created an aggressive market for collections in the construction industry.  Contractors, subcontractors, and vendors are having to ensure prompt and proper payment as margins shrink more and more.  This environment has also created issues where construction professionals are undertaking collections themselves, using only what they believe to be correct or what they may find on the internet.  The internet can be an excellent source of information, however there is also a lot of misinformation that can create liability for improper liens and collections undertaken improperly. 

The mechanics and materialmens lien, or construction lien, is a very powerful collection tool.  When used properly, it is very effective at ensuring payment to the contractor, sub, or vendor.  Texas law is unique from every other state in the Union when it comes to construction liens.  If you are researching lien law in Texas, using forms and information from other states is not recommended.  Texas has very specific requirements, found in Chapter 53 of the Texas Property Code, that must be strictly and precisely followed in order to properly lien property that has been improved by construction.  Failure to abide by and follow the deadlines, notice requirements, and contract requirements of the Texas Property Code will result in the lien being invalid.  The possible penalties for filing a fraudulent lien are harsh, and they start at minimum statutory damages of $10,000 per Section 12.002 of the Texas Civil Practices & Remedies Code. 

The requirements are also written in a way that is difficult to understand.  For example, in order to calculate the notice and filing deadlines, a subcontractor must know when the indebtedness he is seeking payment for accrues, or becomes due.  This is not determined when the subcontractor invoices the work performed or labor/materials provided, but instead, the Property Code states that "Indebtedness to a subcontractor, or to any person not covered by Subsection (b) or (d), who has furnished labor or material to an original contractor or to another subcontractor accrues on the last day of the last month in which the labor was performed or the material furnished."  This is important, because it means that a subcontractor that performs labor or work on a project over several months may not be able to lien all of that work unless he/she has sent proper notices and made timely filings as the work progressed. 

Many clients ask me why we can't just post or provide a deadlines calendar and list on our website.  The answer is that it would be difficult to do, and even more difficult to follow, because deadlines and notice requirements vary depending upon whether you are a general contractor, a subcontractor, one of multiple subcontractors, or a provider of specially fabricated materials.  They also vary depending upon whether the project is a commercial project, residential/homestead project, or a public works project.  There are so many variables and contingencies, that it such an undertaking would be difficult at best.  The law also changes and clarifies from time to time so what may be current one day may be different the next. 

The dangers of not knowing the specific notice and lien deadlines and requirements for your scope of work and your specific project can be illustrated like this.  Let's say you are a contractor that ordinarily does commercial roofing, but with the economy you have undertaken a few larger residential roofs, one or two of which are homestead.  In order to effectively lien homestead property, among the many other requirements, a contractor must have a written contract for the work, if the property owners are married then both spouses must sign it, and the contract must be filed in the real property records of the county in which work is to be done.  These are not required for commercial projects, and if you do not ordinarily do residential/homestead work you may not be aware of these additional requirements.  Danger lurks here because if these requirements are not met, any lien filed against the property is invalid and subjects the contractor to possible statutory penalties for filing a fraudulent lien, as well as possible damages to the homeowner for clouding the title to the property.   And, simply filing a release of the lien does not moot or undo the damages. 

My firm represents and assists construction companies and professionals with the lien process and collections.  It is well worth the investment to meet with a qualified lawyer to understand and learn the lien process for your specific business.  A lawyer can help you understand your deadlines, can undertake efforts to send timely notices of intent to lien with proper language that notices must have, can prepare proper lien affidavits, and give you the tools you need to successfully collect payment for your hard work.  It takes only one fraudulent lien to create significant liability exposure to your company, and that's before we get to the legal costs to defend and resolve that situation.  Our website, www.DrewMcCallum.com, has a construction page with many valuable resources for the construction professional, including links to the Texas Property Code and other resources.  Take advantage of the tools in your toolbox, but know when you need a professional and it's not a "do it yourself" job.   

Where can you contact me?

I've received some comments asking where I practice and where can I be contacted?  I am an attorney with Drew & McCallum, 25231 Grogan's Mill, Suite 350, The Woodlands, Texas  77380.  I can be reached at (281) 252-9300.  My firm's website is http://www.drewmccallum.com/.  Also, you can click on the links on the left side of the blog page for more information about me.  Thank you for the great comments and feedback.

Receivership - The Hot New Collections Tool

In this economy, many businesses and entrepreneurs find themselves falling behind with creditors and bills.  While they fully intend to pay these obligations, and frequently see money coming in the near future to satisfy these obligations and get caught up, aggressive creditors often file suit and secure judgments for their obligations.  In Texas, collecting a judgment can be difficult.  As the proverbial saying goes, you can't get blood from a turnip.  One of the current new collection tools creditors are using are receivers.  A receiver is someone appointed by the Court to take possession of non-exempt assets of  the judgment debtor and arrange for their sale to satisfy the judgment. 

There are two different types of receivers, and each is appointed pursuant to a specific statutory scheme.  Chapter 64 of the Texas Civil Practices and Remedies Code is the general receivership statute.  It permits the appointment of a receiver under certain, specific circumstances.  One of those circumstances is "in an action by a creditor to subject any property or fund to his claim."  However, when a creditor seeks appointment of a receiver based upon this statutory circumstance, the right to a receiver applies only to funds and property on which the creditor has a lien for satisfaction of the debt.  This provision would apply to creditors with perfected security interests, such as purchase money or perfected UCC-1 liens.  However, a general unsecured judgment creditor does not satisfy the requirements of this statute and therefore receivership under this statute would not be permissible for a general unsecured judgment creditor.

A judgment creditor does have the option of seeking turnover and receivership pursuant to Chapter 31 of the Texas Civil Practices and Remedies Code.  In order to secure a receiver under this statutory provision, the judgment creditor must show the Court that:
  1)  the Plaintiff is a creditor under a valid and enforceable judgment;
  2)  the Judgment Debtor owns property;
  3)  the Judgment Debtor's property cannot be reached by ordinary legal processes and applied to satisfy    the judgment;
  4)  the property is not exempt from forced sale;
  5)  the Plaintiff needs the Court's aid to collect the judgment; and
  6)  Reasonable attorney's fees have and will be incurred in the process.

These requirements are important, because if they are not met then receivership is not warranted or appropriate.  Texas law does not per se require that a Plaintiff execute on a judgment, abstract a judgment, undertake post-judgment discovery, or other action before seeking turnover and receivership relief.  However, the statutory requirements for receivership practically necessitate some less severe post-judgment collection efforts be undertaken before turnover and receivership is sought.  Otherwise, a Plaintiff is not able to prove elements two through four. 

Additionally, a receiver has limited powers and many collection lawyers seek to give receivers powers that vastly exceed those allowed by Texas law.  A Chapter 31 receiver may not step into the shoes of a business owner and take over the running of a business.  Nor may such a receiver seize and sell assets that have not been determined to be non-exempt.  Texas law has held that a trial court abuses its discretion when it signs a turnover order that does not identify specific non-exempt property subject to the order.  "Such an order must be definite, clear, and concise leaving the person enjoined in no doubt about his duties, and should not be such as would call upon him for interpretations, inferences, or conclusions."  Bergman v. Bergman, 828 S.W.2d 555, 557 (Tex.App.—El Paso 1992, no writ) (citations omitted).  Such an order also may not extend to property owned by third parties.

While receivership may be the "hot new tool" used by collection lawyers, it is subject to many specific requirements and must be used properly.  Failure to meet the elements may result in having receivership set aside, expensive trial court and appellate actions, and many distractions and delays in securing payment of judgments or otherwise resolving the issues so both parties can get back to business.  There are many pitfalls to seeking receivership in collecting a judgment.  My firm has successfully defended attempts to appoint receivers, and we handle post-judgment collection matters for both creditors and debtors.  It would be a wise investment to seek the advise of an attorney if you are seeking to collect a judgment, or if you are seeking to defend aggressive collection efforts.