Well, it seems my Solo Attorney Estate Plan posts are few and far between! Strange when I consider that I have usually presented on the topic at continuing legal education (CLE) programs at least a couple times a year. I’m always updating my materials (and looking for more cartoons about death and dying) and am particularly grateful to my colleague Mark Masters, a community resource for trust and estate lawyers who is of counsel at Glatstein & O’Brien. Mark was kind enough in December to take a close look at my forms that I use in my CLE presentations to get the planning going. Though I have shared these forms over the years with dozens of attorneys, I am always looking for comments and suggestions. I will be presenting on Friday at the ABI Rocky Mountain Bankruptcy Conference, January 23, 2015 as a panel member of Consumer Workshop III: Practical and Ethical Issues in Succession Planning.
The other panel members include Charles “Chip” Mortimer, Jr. from the Office of Attorney Regulation Counsel, Colorado Supreme Court, Mark Dennis, of Dennis & Co., P.C. and our moderator, Nancy Miller, of Nemirow Perez.
As an estate and elder law attorney, I am familiar with detour, dissolution, disability and death. I am one of a small number (as far as I can tell) of attorneys who has a plan of some sort in place. Fact is, most people put off thinking about these things and making plans. I think it proves that lawyers are people too. What are the barriers to making a plan? Well, there are many. There is the first hurdle of the emotional issues we face in coming to terms with uncertain certainties (death) and certain uncertainties (some catastrophe or a disability of a physical or cognitive variety). This freezes many of us right in our tracks. It may be the biggest reason that most people die without any estate plan in place. Perhaps you have heard the estate planners’ adage about the people most in need of estate planning (people with young children and small business owners) being the least likely to have it? Many of us, especially the solo and small firm types, have kids or family members who depend on us and our law practice as a source of income. We need to make our own plans.
I don’t like to scare people, and so that is one of the reasons I share my forms – it’s kind of a “hey kids, try this at home” approach. For this post I will begin with the end in mind – yes, the plan itself, and a few documents that are must haves. Where to start? Well, I recommend Rudyard Kipling’s six honest serving men to help overcome that most potent physical and psychological force – inertia:
I keep six honest serving-men
(They taught me all I knew);
Their names are What and Why and When
And How and Where and Who.
. . .
The Elephant’s Child, by Rudyard Kipling.
Let’s start at the beginning with WHAT. . . this is the most important part to begin with. What do you want to happen in the event of your disability, incapacity or death? You as the person making the plan will sometimes be referred to as the planning attorney or the affected lawyer. I know, the second moniker doesn’t sound so nice. The person you have selected to help you will be known as the assisting lawyer. Here are a few questions to get the ball rolling.
- What will happen if you become disabled? Begin with a conversation with another lawyer or perhaps a staff member about how to make arrangements for you, a/k/a your law firm, as an affected lawyer or law firm to continue, close, or transfer your practice on your behalf.
- What can you put in place to cover your disability? Have appropriate powers of attorney in place so that your assisting lawyer(s) can step in if needed to run your practice. They will need to be able to sign checks, handle the COLTAF accounts, manage employees, and generally conduct your law practice business on your behalf.
- What will happen to your law practice upon your death? Consider naming at least one personal representative in your will who is a lawyer to be charged with the responsibility of selling or closing the practice.
- What can you do now that could help your assisting attorney? Maintain an easily understandable system of client records to help the assisting or successor lawyer to carry out his or her responsibilities.
Sure, there’s the detail of how your assisting attorney will get paid, but don’t let that detail hold you back!
The second serving man is WHY.
Think of this planning as putting in place a management plan. Even if you don’t have a business plan, let alone a management plan for your current practice, it is imperative that you get one for these “if” and the “when” scenarios. Think of the plan as putting together a management team. They will manage according to the plan you have put in place.
Whether you have a plan [or not] should be a conscious choice. I know this sounds familiar to all of you reading this because, well . . . many of us do this planning for a living and some of us do litigation when there wasn’t a plan or a badly constructed plan. So, at the risk of singling you out as your own cautionary tale, wouldn’t you rather make a conscious and deliberate decision? It doesn’t have to be perfect and it can be changed and updated as needed. What it is that fits your goals, personality, your business plan and your longevity and estate planning goals? Most of us would rather be in charge of deciding this and not leaving it to be a burden on someone else. Here are a few “why” things to consider – just in case you forgot that you have to think about the same things as your clients:
- Longevity planning (for incapacity or disability to avoid guardianship, conservatorship or OARC appointment of inventory counsel)
- Making a will or trust that addresses or has provision relating to your law practice
- Tax issues
- Providing for some financial management in the event the firm can go on without you
- Caring for and protecting beneficiaries with a stream of income or other benefit they might be depending on
- Considering carefully and choosing your key people: agents, assisting lawyers, personal representatives, trustees, etc.
- Maintaining privacy and confidentiality during times of uncertainty or transition
- Ensuring there is no breach of fiduciary duty owed to clients by the lawyer or law firm
Kipling’s third serving man is WHEN.
There is no time like the present! Some would argue that there is no other time besides the present, that the rest of it is . . . theoretical. So get busy and start now.
That’s all I can fit in this post for now. . . . stay tuned for the continuation!
©Barbara Cashman 2015 www.DenverElderLaw.org