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65 ยป VISIT US ONLINE @ DSNEWS.COM NATIONAL LAW PRACTICE MANAGEMENT: EXPERIENCE V. EXPEDIENCY By Marlon L. Bates, Scalley Reading Bates Hansen & Rasmussen, P.C. I have practiced in the area of foreclosure and bankruptcy for over twenty-nine years. Many people reading this article were not born when I began my career. When my grandchildren read the Bible, they think "Papa" was person- ally acquainted with the people they read about. Over this lengthy period of time, I have seen many processes and procedures come and go. In fact, the work I do today bears little relationship to the work I did three decades ago. As everyone knows, the laws relating to fore- closure, bankruptcy and eviction have changed significantly over the years. In addition to changes in the law, there have been monumental changes in the way lenders and servicers super- vise the default work of lawyers and trustees. At the beginning of my career, I spent 100% of my time doing the actual work. Virtually no time was spent reporting to my clients. My clients viewed me as a professional who could be trusted to do the work in accordance with the law. When I needed bidding instruc- tions, I called the client on the telephone and asked them to prepare my instructions. When I had questions about a bankruptcy work-out proposal, again, I called the client and spoke to a human being to receive instructions. When the referral was completed, I mailed a copy of the documents which showed the completion of the matter. But enough about ancient history. e real purpose of this article is to identify a current trend in the industry which I believe will even- tually be placed on the trash heap marked "On Paper It Looked Good." At the end of last year, a national lender approached us about doing its foreclosure and bankruptcy work in Utah. I congratulated it on finding the best law firm in Utah and asked when I could start. Of course, nothing today can be that simple. e lender already had one legal vendor for Utah and needed another to divide the work equally. I was informed that I would need to go through a detailed vetting process which in- cluded both a massive amount of paperwork and an on-site audit. Having represented national lenders and having been around the block a few times, I told them to bring it on. I estimate that the total time spent by me and my staff in providing documents and responses to question- naires was approximately 100 hours. In addition, as promised, the lender sent an auditor on-site to inspect every crack and crevasse of our facility and systems. is took another 20 hours of at- torney and staff time. e attorneys reading this article are saying: "Been there. Done that. Got the tee-shirt." After all, this is the normal process of being vetted by a national lender, right? At the end of the vetting process, the auditor told us that we were the easiest firm he had ever audited. Our systems and policies were already in line with the requirements of the lender. Very few changes needed to be made. We subsequently received a list of three relatively minor changes that needed to be made. ese changes were immediately done. Shortly thereafter, we received the official letter congratulating us on passing the audit and welcoming us on board. e letter said we were being placed into the system and would begin receiving approximately one-half of the lender's referrals for Utah. We even received the opportunity to donate to the lender's favorite charitable organization. One month passed; then another; and then another. No referrals came. Emails to our con- tact person went unanswered. Finally, I received a telephone call from the lender informing me that the lender had decided to use a multi-state firm instead of our firm. By using this multi- state law firm, the lender explained, it would reduce the time the lender would spend auditing firms. is was, indeed, an expedient plan. Somewhere, a very important person concluded that because doing audits is hard and takes a lot of time and money, doing only one is better than doing two. at only makes sense, right? If law firms were fungible goods, then this policy makes absolute sense. But law firms are not fungible. ere are only a handful of at- torneys in Utah who have handled a significant number of foreclosures and bankruptcies. And none of them happens to belong to a multi-state firm. If a multi-state law firm is doing work in Utah, it is hiring a lawyer without much experi- ence to set up shop and do its work in Utah. And since Utah laws are not the same as other states' laws in many respects, the experience of a California lawyer, for example, does not neces- sarily make him or her a competent supervisor of Utah work. ere are multi-state law firms who do an excellent job of having experienced local counsel in every state in which they practice. But if a lender or servicer is vetting a law firm for work in one state, it should make very little differ- ence how well that law firm performs in another state. Each state has unique laws and practices. Unless there is experience in each state, the benefit of auditing fewer firms is quickly lost to the liability that arises from the work being done improperly. e main takeaway: experience is more valu- able than expedience. In the long run, hiring the best law firm in each state will always be the wisest choice, irrespective of whether the audit process would be more. "As everyone knows, the laws relating to foreclosure, bankruptcy and eviction have changed significantly over the years. In addition to changes in the law, there have been monumental changes in the way lenders and servicers supervise the default work of lawyers and trustees."