Missouri Business Attorney Clients
A Missouri business attorney can represent a business and people associated with that business. But that can be a problem.
Businesses organized through the state, like LLCs and corporations, are legal entities. They are their own persons, so to speak. As such, an LLC can hire its own attorney. But an LLC cannot speak. It must therefore rely on people to speak on its behalf. Such persons are usually the LLC’s members and managers. However, the people speaking on behalf of the LLC often have a personal interest in the business’ legal matters. A question might then arise as to whether the attorney is representing the business, the people speaking for the business, or both. Likewise, other people associated with the business with whom the business’s attorney communicates might also have personal interests in the business, which raises the question of whether the business’s attorney is also representing them.
For example, when the business’s attorney explains to eligible employees how the business’s stock option plan works and answers their questions about the plan, is the attorney representing those employees? Or, when an LLC’s attorney explains to a member of the LLC the terms of the LLC’s redemption of their membership interest, is the attorney also representing that member? Or, if an LLC’s attorney drafts an amendment to an operating agreement, is the attorney representing the members? In each instance, both the attorney and the people communicating with the attorney must be clear about who the attorney is representing. Answering legal questions or providing legal information does not always create an attorney-client relationship. Therefore, people receiving legal information from a business’ attorney need to know whether that attorney is representing them, or whether they need to retain their own attorney to look after their own interests.
Although not always conclusive, the retainer agreement is the first place to look for indications of who an attorney represents. The agreement should clearly identify the attorney’s clients. If the agreement indicates that the attorney has agreed to represent more than one entity, such as the business and its owners, then the agreement should include an “informed consent” clause that tells the clients that the attorney can represent none of them if any dispute arises between them.
When hiring a Missouri business attorney, always insist on a written agreement that clearly identifies the attorney’s clients. If you are ever unsure about who the attorney represents, then ask that attorney to clarify who within the organization they represent. Depending on the answer, you might need to hire your own attorney to protect your interests in the business.
This article is for general informational purposes only. It is not intended as legal advice.
Sewell Law, LC represents clients in business and real estate matters and in civil litigation. Please contact Michael Sewell at (314) 942-3232 or at michael@sewelllaw.net to discuss your legal matters.
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