Legal Definitions - law practice

"Law practice" refers to the entire professional enterprise or business operation of an attorney or law firm. It encompasses not only the legal services provided but also the ongoing relationships built with clients, the firm's reputation, and the intangible value (often called "goodwill") that develops from those relationships and the quality of service over time. Essentially, it is the attorney's professional business and its accumulated standing in the legal community.

• Example 1: A Retiring Attorney Sells Their Practice

  An experienced attorney, Ms. Chen, decides to retire after 35 years of serving her community. She chooses to sell her "law practice" to a younger attorney, Mr. Davies.

  How it illustrates the term: Ms. Chen isn't just selling her office furniture or files; she is transferring the entire professional enterprise. This includes her established client base, the ongoing cases, the firm's name recognition, and the trust and loyalty her clients have developed in her firm over decades. This entire professional business, encompassing client relationships and a positive reputation (goodwill), constitutes her "law practice" and is a valuable asset that can be bought and sold.

• Example 2: Building a New Law Firm

  After working for several years at a large corporate firm, Sarah decides to open her own solo practice specializing in environmental law. She dedicates her first few years to diligently working to build her "law practice."

  How it illustrates the term: Sarah isn't merely performing legal tasks; she is actively developing a professional business. This involves attracting new clients, nurturing relationships with existing ones, establishing a strong professional reputation through successful cases and ethical conduct, and creating a sustainable business model. All these efforts contribute to building her "law practice" as a viable and respected professional enterprise.

• Example 3: Valuing a Law Firm for a Merger

  Two mid-sized law firms, "Summit Legal" and "Apex Advocates," decide to merge to expand their services. During the merger negotiations, they assess the value of each firm's "law practice."

  How it illustrates the term: This assessment goes beyond just counting tangible assets like office buildings or bank accounts. It involves evaluating the strength of their respective client rosters, their referral networks, the loyalty of their clients, and their overall professional standing and reputation in the community. These intangible assets, built on client relationships and goodwill, are crucial components of each firm's "law practice" and contribute significantly to their combined value in the merger.