If you become ill, who will handle your cases? What would happen to your practice if you became disabled? How long do you intend to practice law? Who will be your successor?
For many of us, these are really tough questions that we worry about but have yet to fully address.
“These are the fundamental business issues involving management and business planning that should be ideally considered before hanging out one’s shingle and definitely before approaching retirement,” advises Max Elliott, principal and owner of The Law Offices of Max Elliot, an estate planning and administration firm that focuses on the unique needs of today’s families and small business owners.
From a risk-management perspective, failure to address the tough questions can result in a disciplinary or malpractice claim. There are countless disciplinary cases involving neglect of client matters by attorneys who became ill or abandoned their practice for reasons unknown.
While it may seem at first blush unfair to sanction an attorney who neglected a case while he or she was battling cancer, for example, the imposition of the sanction is meant to be a deterrent for attorneys who fail to plan for such occurrences.
The adverse impact on clients who are serviced by solo attorneys who avoid the tough questions can be devastating.
For example, consider the case of In re Hunt, 09 CH 80 (2010). The Attorney Registration & Disciplinary Commission received multiple grievances from the subject’s clients and sent him a request for information.
When he failed to respond — and it appeared he had abandoned his practice — the ARDC was appointed receiver of his practice pursuant to Supreme Court Rule 776. This rule authorizes the appointment of a receiver to perform certain duties when a lawyer is unable to discharge his responsibilities to his clients due to disappearance or death.
The ARDC took possession of 35 boxes of client files, documents and bank account records. When the smoke cleared, two of his clients had their cases dismissed for want of prosecution; two were subject to foreclosure; and one had to proceed pro se because they did not have the funds to pay another attorney.
He was disbarred for neglecting seven client matters, failure to communicate with clients, misappropriating $10,275 and abandoning his law practice.
The ethics rules and at least one ethics opinion address the need for solo attorneys to make contingency plans.
Comment 5 to Rule 1.3 states: “To prevent neglect of client matters in the event of a sole practitioner’s death or disability, the duty of diligence may require that each sole practitioner prepare a plan, in conformity with applicable rules, that designates another competent lawyer to review client files, notify each client of the lawyer’s death or disability and determine whether there is a need for immediate protective action. See Illinois Supreme Court Rule 776 appointment of receiver in certain cases.”
ABA Formal Opinion 92-369 states in part, “The death of a sole practitioner could have serious effects on the sole practitioner’s clients. … Important client matters, such as court dates, statutes of limitations or document filings, could be neglected until the clients discover that their lawyer has died. As a precaution to safeguard client interests, the sole practitioner should have a plan in place that will ensure insofar as is reasonably practicable that client matters will not be neglected in the event of the sole practitioner’s death.”
To be sure, solo practitioners are not the only lawyers who need to face the tough questions. Clients who are serviced by larger firms can experience an adverse impact when the attorney assigned to their file becomes ill; or if the head of the practice group leaves the firm; or if the managing partner retires. Clumsy leadership transitions with no formal written plan can disrupt the workflow, reduce the quality of services rendered and expose the firm to disciplinary and malpractice claims.
According to lawyer John Mitchell — who works with law firm leaders to maximize their leadership potential and to help them attract and develop talented lawyers to effectively lead groups, committees, clients and the entire firm — “Law firm leaders commonly talk about succession planning and rarely take action to actually do it.
Leaders often want to anoint their successor, stay in the job forever or hope the right person will show up just as the leader is ready to move on.”
No matter how long we have been in practice or how many attorneys we practice with, it is never too early to discuss and address these tough issues. The failure to do so not only puts our clients in harm’s way, it places an incredible burden on partners, colleagues and loved ones who will bear the challenge of putting the pieces together.
Don’t let your discomfort with the issues prevent you from taking action. Consult with your business adviser and an ethics attorney to create a comprehensive contingency, emergency or succession plan, and protect your legacy.
As Winston Churchill is quoted as saying, “Let our advance worrying become advance thinking and planning.”