Do you have questions about your company’s legal risks or want to understand the legal implications of a proposed transaction? If so, a legal opinion letter can provide the information and clarity you need to make informed decisions.
What Is a Legal Opinion Letter?
A legal opinion letter is a written statement that provides an attorney’s interpretation of how the law applies to a specific situation. An attorney who authors a legal opinion letter will review various statutes, regulations, and court opinions to analyze the relevant law and apply the facts of the client’s present situation, a hypothetical situation, or a future action contemplated by the client. The legal opinion letter will state the attorney’s opinion, to a reasonable degree of certainty, on how the law would apply to the facts and affect the client’s rights and responsibilities.
Attorneys and law firms in private practice may send legal opinion letters to their clients to help them understand how the law applies to their situation and make informed decisions. Government attorneys, including attorneys in public agencies or the attorney general’s office, may draft legal opinion letters to advise government officials or citizens on the state of the law or how the law might apply to various factual scenarios.
Because an attorney may erroneously interpret the law, a legal opinion letter does not carry the same force as a court judgment. However, in some situations, clients may rely on their counsel’s legal opinion letter as a defense to liability in civil or criminal cases where knowledge or intent becomes an issue. A client can argue they acted in good faith based on their counsel’s opinion.
When Do You Need a Legal Opinion Letter?
Typical situations where clients may ask their legal counsel for an opinion letter include:
- Mergers and acquisitions, where legal opinion letters may cover topics such as antitrust concerns, securities compliance, shareholder approval, and tax considerations
- Financing agreements, including debt or equity financing
- State/federal regulatory compliance, including securities, environmental, and consumer protection regulations
- Investor due diligence
- Risk assessments
- Contract negotiations
Benefits for New York Entrepreneurs
Obtaining legal opinion letters can provide entrepreneurs and business owners/managers in New York City with essential benefits, such as:
- Greater legal certainty: A legal opinion letter can inform your business of legal risks or compliance issues in your current situation or with a proposed transaction.
- Credibility and trust: Having an opinion letter can increase confidence with your company’s leaders, investors, or business partners.
- Regulatory compliance: Opinion letters will let you know what steps your company should take to ensure regulatory compliance.
- Risk mitigation: An opinion letter can help your business avoid legal disputes and unexpected liabilities.
How to Obtain and Understand a Legal Opinion Letter
Obtaining a legal opinion letter for your business will involve various steps, including:
- Choosing an attorney: Your business will need an attorney with extensive knowledge and experience in the relevant law and circumstances.
- Providing documents and information: Your attorney will need various documents and information to understand your company’s situation in order to provide you with an informed legal opinion.
- Reviewing the letter: Once you receive your attorney’s opinion letter, review it carefully and follow up with your counsel with any questions.
- Understanding the scope and limitations of the letter: An attorney drafting a legal opinion letter will usually include language thoroughly explaining the letter’s scope, including what the letter addresses and does not address. The letter may also include disclaimers about its limitations; namely, it only contains the author’s opinion, which may not accurately interpret the law, and that the law can change with new statutes and court opinions.
Contact Us Today to Learn More
Before committing to a significant major business transaction or pursuing a legal dispute, talk to a knowledgeable Manhattan business litigation attorney about obtaining a legal opinion letter. Contact Levy Goldenberg LLP today for an initial consultation to discuss your legal options in your case.