Please note that this section is written from the viewpoint of a small business owner or advisor, not as a definitive legal brief. If you have any questions concerning legal issues, you should consult with an attorney.

Many business owners ask us when and how to use lawyers. Rarely does a business owner say that legal services are reasonably priced. How do you get the legal issues taken care of with minimal cost and hassle, while still avoiding most exposure?

The starting point may be by distinguishing amongst what simple things you can do for yourself, and what matters are truly complicated enough to require a lawyer. Commercial leases between you and your company, an employment agreement with your company, and similar documents can be purchased at your local office supply store. These fill-in-the-blank forms can be completed by almost anyone in little time. The main purpose of such documents is usually to appease the IRS. Many of these forms are now on time-saving computer disks.

Small claims court, magistrate warrants ( for bad checks in some states), and various liens are all relatively simple procedures that many business owners discover by visiting their local county courthouse. The county clerk's office, sheriff, or court clerk can either walk you through the forms necessary or direct you to someone who can show you the ropes. Again, most of these items are handled by business owners themselves.

Forming a corporation or limited liability company is another area where many business owners are dispensing with legal fees. Almost every state government Secretary of State (the department where such entities are formed) now has a single page fill-in-the-blank form which you can use to obtain your own corporation or limited liability company. Be aware, however, that if you are a corporation, you are required to hold an initial incorporater's meeting, then at least one stockholder's meeting and one board of director's meeting every year. You must also keep minutes of these meetings to document that they were held, although there is no set format required. Again, your local office supply store or computer store can provide a "fill-in-the-blanks" set of preprinted minutes (and even stock certificates) for you to use. Keeping up with the minutes is a chore that will become very important if you ever are sued, or if the IRS chooses to audit you.

With the new-found freedom to do your own legal paperwork and save all those big fees on simple legal chores, are lawyers now obsolete? There are several times when business owners will typically want to consider using a lawyer. Obviously, if you are sued you should consult an attorney. Also, if you simply cannot get a stale receivable to pay you, you might consider asking a lawyer to send a stern letter you write on his letterhead for a fixed, modest fee. This may or may not get a response. Most business owners say that letting a lawyer take a large percentage of anything he collects is rarely worth the cost, and often does not generate any cash.

The most important time a small business owner may need legal services is in commercial disputes - particularly in dealing with minority shareholders or partners where the relationship has soured. In these types of dealings a lawyer can be very valuable. Be sure to learn what your rights are first. For example, you may be able to simply "freeze out" a minority shareholder without the need to incur expensive legal fees. Increasing your wages, not declaring dividends in an "S" corporation while racking up taxable income or initiating additional stock sales and/or stock splits have all been used by stockholders to encourage problem shareholders to work out a settlement.