Personal Injury and Malpractice Law


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Balance the Cash Flow Equation

Well, not quite ten dollars a day, but you couldn’t really see Europe on 10 dollars a day either.  If you are starting your own practice, you are not going to see Europe for a while anyway.  It is a true cliché that most starting businesses, including new law practices, fail as a result of inadequate cash flow.  In order for the cash flow to be adequate, you simply must cover your operating costs.   Early in your practice, it is easier to balance the cash flow equation by reducing your expenses then by increasing your revenue.  You will be your own technology expert, receptionist, paralegal, printer, researcher and bookkeeper.

Eliminate Expenses

The single largest expense when you begin is your own salary.  Rent, student loans, health care, and corn flakes: it starts to add up.  Do not be too proud to take a paying job in addition to your fledgling law practice to cover those costs.  By removing your own salary from your cash flow needs, you may well have moved your practice into positive cash flow.  An excellent source of revenue is per diem work, in which you make appearances for attorneys on their case and take a fee for that.  There are “temp services” that specialize in placing attorneys for legal work and legal proof reading.  There is some part time work as hearing officers available at times from government agencies. In addition to legal skills, many lawyers have actual skills that contribute to the gross national product, remnants of formerly useful lives before they began law school.  Small firm practitioners have started practices by continuing night jobs, including work in nursing, hotel management, restaurant management, waiting tables and technical writing.  Any paying work that allows you to keep at least your mornings free to meet clients and go to court will qualify. 

The second largest expense is office rent.  Stop paying office rent.  There are two ways to do this: either work out of your home or enter into a space for services arrangement.  Many attorneys have successful practices based on one of these arrangements. 

If you work from your own home, you ought to have a space that you can lock out the pets and family members under 4 feet tall.  You must have at least one phone line that is your very own with your answering message on it.  A cell phone line is perfectly adequate to the task.  A separate entrance is appropriate if you will see clients, but you may meet clients at the county bar association building, or at the client’s home.


Space for services is an arrangement whereby, in exchange for office or desk space, one attorney provides legal services for another attorney.  Generally the parties attempt to determine the value of the space provided and agree to an equal time value for the “tenant’s” services.  This can range from one or two court appearances a month up to 30 or more hours of services in the office.  There may be some mentoring thrown into the deal and there may be some opportunity to develop a client base from the established attorney’s over flow.  This arrangement works so long as the “tenant” in the arrangement has the free time to perform the services. 

In the long run, both of these arrangements may begin to chafe, but if you enter the arrangement recognizing this eventuality, you will minimize the discomfort when the time for change arrives. Working at home becomes frustrating, as your young son who loves to help puts the court mail in the coupon drawer.  Space for services may become inequitable as the “tenant’s” time becomes more valuable.  This is the time to fly out of the nest and make your own way, it will coincide with your increase in income. 

In addition to eliminating, in the beginning, these large expenses, efficient use of the money you do have to spend will stretch those dollars until the cash flows.  In particular, know where you have to spend money, and where you can skimp.

Invest in Hardware

Where to skimp: Close- to- leading- edge computers are selling from reputable venders for $700.  You don’t really need the pretty 17-inch flat screen monitor, keep the monitor from your old computer.  The software you can use on a powerful computer will save you money every day.  Add a few more items to your office set up and get a swivel chair.  You will never have to leave the desk as you swivel from printer to fax to file cabinet, spewing out paper that will bury your adversary.  Indeed, when the set up is just perfect, your only worry will be bed sores if you don’t stand up once in a while. 

Where to economize:  Buy a scanner with a paper feeder and you won’t need a photocopy machine.  The scanner will come with software that allows that turns the scanner into a photocopier!  Do not skimp by buying a combined printer-fax machine because this set up will slow you down when you are doing three things at once, as you will be most of the time.   Buy a color fax machine for under $200 and attach it to your scanner to create a color copy machine. 

Where not to skimp: Spend money on an excellent laser printer, it will cost between $400 and $500 and will more than pay for itself in the long run.  Documents printed on ink jet printers will bleed ink if they get a drop of water on them.   Even worse, poor quality printers screech to a halt at the precise moment that you are printing a last minute brief as you toss on a suit to run for your court appearance.  You need a printer that is more reliable than a Labrador retriever and a little faster than a speeding bullet.  It is truly your best friend. 

Select the Best Software

Where else not to skimp: The money you spend on hardware will allow you to run the case management software that turns your small firm into a sophisticated operation.  Each specialty has its own case management software. Personal injury case management software includes SAGA, Needles and Trialworks.  Estates & Trusts software is sold as ProBate.  Matrimonial case management software is put out as Matlaw, and Bankruptcy software has Best Case Bankruptcy for Windows and Bankruptcy Plus.  Good case management software, which will cost between $600 to $2,500, is the heart of your practice.  Hiring support staff is often prohibitively expensive, but by running case management software, a solo litigation practioner can maintain a hundred active cases without hiring paralegals or secretarial staff, lowering your overhead costs. 

What you get: Case management software performs three basic functions: 

First, each client has a database so that all of the important information for each client is readily available with less than 5 keystrokes.  The database allows for the easy documentation of all case activities, from conversations with clients and adversaries to the creation and service of court filings 

Second, the software generates and tracks all critical deadlines from statutes of limitation to ticklers when responsive letters and documents are overdue. 

Finally, the software generates documents quickly and easily with 2 or 3 keystrokes, by merging the accrued database information with boilerplate forms.  Documents including every kind of letter, pleading, motion or filing can be generated with good case management software. 

Be your own bookkeeper.  Spend $100 - $200 on good accounting software.  Many small firms run QuickBooks or PC Law.  This software is sufficiently user-friendly that you can keep track of all of your office expenses and reconcile your accounts on a monthly basis without bringing in a bookkeeper every month.  The software will generate your paycheck with the proper deductions, create IRS 1099 forms and quarterly payroll filings.  The software will force you to observe proper accounting procedures so that in January you can give your accountant a disk with your data and the accountant can generate your income filings without a visit to your office. 

You must keep track of your time efficiently and accurately to get paid.  Spend $100 for time keeping software.  Timeslips is the most popular timekeeping software.  PC Law has time management features, which rival Timeslips.

The case management, time management and accounting software will save will save thousands of dollars each year on bookkeeping and support services.

Beware of Vendors Selling Pretty Things

The vendors who sell things to the people who actually do things make a lot of money.  Glossy flyers will blanket your doorstep, selling every imaginable compilation of expert wisdom, advice, and knowledge.  Each one appears to be the very item you need to make yourself a leaner, smarter attorney and get you your dream date.  Most give you the opportunity to pay over a period of time, examine free for thirty days or otherwise commit yourself without the pain of paying up front.  These pretty books will drain your resources quickly and wind up as dust catchers on your bookshelf.   Resist the consumer urge to assuage your insecurities by buying something.  Until you have disposable income, call friends and friendly lawyers for sage advice and information and write it down yourself. 

Don’t Forget the Internet

Use the Internet to keep track of your cases. has a free service to allow you to track cases yourself or a paid service to send you updates by email. provides a service that allows you to check all of your cases in about 3 minutes for a few dollars.  The Unified Court system, at is free.  The bar associations have excellent websites which links to all the best free legal research websites.

Initially, cash flow will seem to evaporate before the end of the quarter, sometimes before the end of the month.  Remember that small firm practitioners are the best attorneys in the universe.  The same true grit and ingenuity that you relied on to go out on your own will sustain you through your first couple of years, until cash actually begins to flow and you can fill the reservoir.  Now where did you hide that guidebook to Europe?  What was David Sedaris’ advice about France?