KENTUCKY BAR ASSOCIATION TASKFORCE CLOSED AND ABANDONED PRACTICES. Chair: George Long II

Transcription

1 KENTUCKY BAR ASSOCIATION TASKFORCE ON CLOSED AND ABANDONED PRACTICES Chair: George Long II Committee Members: Bradford Breeding Justice Bill Cunningham Larry Deener Glenn Denton William G. Francis Jay Garrett Tommy Glover James Harris John Meyers Jerry Miniard Sandra Reeves J. Stephen Smith Matthew Tierney Robert Watson Christian Worth George Long II 1 P a g e

2 INTRODUCTION There are many different reasons why a law practice closes, some are planned, for example retirement, merging firms or entering public office, and others can be unplanned, such as an unexpected disability or death. The duties as a lawyer in each of these situations, however, are similar -- to protect the clients interest. The forms and suggested procedures provided here are meant to assist lawyers in accomplishing a smooth and efficient transition that meets a lawyer s ethical obligations. The attached (handbook) forms are designed to assist Kentucky attorneys who may be contemplating or actively involved in the closure of an existing law practice. While no single document or checklist can address all the possible questions or circumstances that an attorney will encounter in the process of closing his/her practice and/or another s practice, these forms/handbook attempt to address some of the basic guidelines/recommendations for an effective closure of one s practice. Included within this packet are sample letters to clients for both active and closed files, although there may be questions that may arise for which this packet provides no answer. Those thus involved in the closure of an existing law practice are encouraged to consult others who have experience in closing a practice. Please note that the attached forms do not address a situation where a law firm continues to exist notwithstanding the departure of an attorney and clients may choose to continue representation by that firm. 2 P a g e

3 DISCLAIMER The directions and forms provided herein are designed to merely serve as suggestions/recommendations for the effective closure of an existing law practice and to assist those tasked with such responsibility to ensure a smooth transaction and protect one s clients interests. Any material presented herein does not establish, report or create the standard of care for attorneys and is not a complete analysis of the topic. All sample forms must be viewed simply as such and all those relying upon the same must realize that all attorneys practices are unique and that the attached forms will require editing to conform to the practice which you are closing. Neither the Kentucky Bar Association nor any preparers of the attached packet/forms assume any responsibility and/or liability in connection with the utilization of the direction/guidance and/or forms provided herewith. 3 P a g e

4 TABLE OF CONTENTS Front Cover... 1 Introduction...2 Disclaimer...3 Table of Contents...4 Kentucky Supreme Court Rule Definitions...8 Cover Page: Preplanning: Planning (Affected Attorney) Forms and Checklist...9 Preplanning Checklist...10 Contract with Assisting Attorney...12 Limited Power of Attorney...17 Will Provision...20 Law Office List of Contacts...21 Frequently Asked Questions for Preplanning...35 Cover Page: Closing the Law Office Planning (Affected Attorney) Closing His/her Own Office Forms and Checklist...38 Written Acknowledgement of Client for Receipt of Client File...39 Written Request /Authorization to Transfer/Deliver File to New Attorney...40 Client s Written Request to Pick UP File or For Mailing To Client...41 Intra-Office File Closing Tracking Chart...42 Affected Attorney s Notification to Client of Intent to Close Law Practice...43 Checklist for Planning/Affected Attorney Closing his/her Own Office...44 Cover Page: Closing the Law Office Assisting Attorney With Preplanning by Affected Attorney Forms and Checklist...47 Checklist for Assisting Attorney With Preplanning by Affected Attorney...48 Intra-Office File Closing Tracking Chart P a g e

5 TABLE OF CONTENTS, Continued Assisting Attorney s Notification to Client of Affected Attorney s Inability to Represent Client...53 Assisting Attorney s Notification to Client of Affected Attorney s Death and Resulting Inability to Represent Client...55 Written Acknowledgement of Client for Receipt of Client File...57 Written Request /Authorization to Transfer/Deliver File to New Attorney...58 Client s Written Request to Pick UP File or For Mailing To Client...59 Executor s Motion in Probate Action for the Appointment of Trustee to Manage Closing of Law Practice, when Advanced Provision have been Made to Appoint Trustee...60 Probate Court s Order for Appointment of Trustee...65 Frequently Asked Questions for Assisting Attorney...70 Cover Page: Closing the Law Office Special Commissioner, - Without Preplanning by Affected Attorney Forms and Checklist...78 Checklist for Special Commissioner Attorney...79 Petition filed by KBA to Supreme Court...82 Order From Supreme Court Directing Chief Regional Judge to Appoint Special Commissioner to Close Affected Attorney s Law Practice...84 Order From Chief Regional Judge Appointing Special Commissioner to Close Affected Attorney s Law Practice...86 Frequently Asked Questions for Special Commissioner...88 Cover Page: Questions and Answers For Clients of Planning/Affected Attorney...94 Questions and Answers for the Client...95 Back Cover P a g e

6 KENTUCKY BAR ASSOCIATION RULES OF THE SUPREME COURT OF KENTUCKY PRACTICE OF LAW KENTUCKY BAR ASSOCIATION RULES OF THE SUPREME COURT OF KENTUCKY PRACTICE OF LAW SCR Appointment of special commissioner to protect clients interests (1) When it comes to the attention of the Director that: (a) an attorney has been temporarily suspended pursuant to SCR and has failed to notify his/her clients of the suspension as required by Court order; or (b) an attorney has been suspended or disbarred pursuant to SCR and has failed to notify his/her clients of his/her suspension or disbarment pursuant to SCR 3.390; or (c) an attorney has resigned pursuant to SCR and has failed to notify his/her clients of his/her resignation as required by Court order; or (d) an attorney dies; or (e) an attorney has been declared incompetent; or (f) an attorney abandons his/her law practice or his/her whereabouts are unknown, and no law partner, personal representative of the deceased attorney s estate, or other responsible person capable of conducting the attorney s business affairs is known to exist, the Director may petition the Court, and the Court for good cause may order the Chief Circuit Judge of the Judicial Circuit for the attorney s last known address to order the appointment of 1 or more members of the Association to serve as Special Commissioners of the Court. The Director shall give notice to the attorney by mailing a copy of the petition to the attorney s last known address, except where the attorney is deceased. If the attorney is deceased, the notice shall be sent to the attorney s personal representative, if known. Within 20 days after the date on which the Director files the petition with the Court, the attorney may file a response to the petition with the Court. The Clerk of the Court shall mail a copy of the Court s order ruling on the petition to the attorney s last known address, to the Director and to the Chief Circuit Judge. (2) A Special Commissioner appointed under this rule may be authorized by the Court to take possession of the files and records of an attorney described in subsection (1) above, to make an inventory of the files, to give notice to the attorney's clients of the unavailability or inability of the attorney to continue to represent the clients, to deliver to the clients all papers and other property to which the clients are entitled, to take any other action which the clients are entitled and to take any other action which the Court deems necessary to protect the interests of the clients. (3) The Special Commissioner shall not disclose any information contained in any files which are the subject of an inventory without the consent of the client to whom such files relate, except as reasonably necessary to carry out the orders of the Court. (4) The Special Commissioner shall file a written report within 6 months, with the Court containing a summary and explanation of the actions taken by the Special Commissioner to fulfill the duties assigned to the Special Commissioner by the Court. This time frame may be extended for good 6 P a g e

7 cause shown. The Special Commissioner shall mail a copy of the report to the Director and to the attorney s last known address. (5) If the Special Commissioner takes possession of files of an attorney and the Special Commissioner is unable after a diligent effort to deliver the files to the clients or to new attorneys representing the clients, the Special Commissioner may request the Court to enter an order providing for the storage and safekeeping or destruction, as appropriate, of such files. (6) The Special Commissioner shall be entitled to reasonable compensation with the amount to be determined by the Court and to also be reimbursed for necessary expenses actually incurred. In order to receive such compensation or reimbursement of expenses, the Special Commissioner shall file with the Court a motion containing an itemized list of the time spent on the case, the work performed, and receipts for the expenses incurred. The Special Commissioner s compensation and expenses which are approved by the Court shall be paid by the Association, but any amounts disbursed by the Association to the Special Commissioner shall be assessed as costs against the attorney pursuant to SCR if the appointment of the Special Commissioner arose out of, (a) disciplinary proceeding, resignation or an abandonment of the practice or, (b) if the appointment arose out of a mental illness or disease and a guardian has been appointed for the attorney, the cost shall be presented to the attorney s guardian or, (c) if the appointment arose from the death of the attorney, from the estate of the decedent by presenting the fiduciary of the estate the costs and, when possible, to file a proof of claim with the appropriate district court clerk. HISTORY: Amended by Order , eff , prior amendment(s) eff (Order 98-1); adopted by Order 84-2, eff P a g e

8 DEFINITIONS Throughout the forms and documents provided by the Kentucky Bar Association, and contained within the Supreme Court Rules specific words are used repeatedly, which warrant definition or explanation. Contained below is a list of terms and their ordinary meaning. AFFECTED ATTORNEY This is the attorney who for whatever reason, whether that be death, disbarment, suspension, impairment, or retirement, will no longer be engaged in the practice of law, and whose practice, clients, and possibly former clients will be affected. This attorney is sometimes referred to as the planning attorney, impacted attorney or disabled attorney. ASSISTING ATTORNEY This is the attorney, licensed in the Commonwealth of Kentucky, who has consented to assist in the closing of the law practice of the affected attorney, whether that consent be by oral or written agreement, or by appointment of the Court of competent jurisdiction, generally the Circuit Court of the county where the affected attorney s principal office is/was located. The duties and responsibilities of the assisting attorney will vary on a case by case basis, depending on the agreement or appointment, and may include but are not necessarily limited to court appearances on behalf of the affected attorney, notifying clients and former clients of the affected attorney of the closing of the affected attorney s law practice, distribution and/or storage of the affected attorney s files, collecting accounts belonging to the affected attorney and distribution of funds remaining in the affected attorney s trust account. When the assisting attorney has been appointed by the Court to assist in the closing of the affected attorney s law practice, he/she is referred to as a special commissioner. SPECIAL COMMISSIONER This is the attorney, licensed in the Commonwealth of Kentucky, who has been appointed pursuant to SCR 3.395, by a Court of competent jurisdiction, generally the Circuit Court of the county where the affected attorney s principal office is/was located to assist in closing out the law practice of the affected attorney. The duties and responsibilities of the Special Commissioner are determined by Order of the Court, and will vary on a case by case basis, depending on the agreement or appointment, and may include but are not necessarily limited to court appearances on behalf of the affected attorney, notifying clients and former clients of the affected attorney of the closing of the affected attorney s law practice, distribution and/or storage of the affected attorney s files, collecting accounts belonging to the affected attorney and distribution of funds remaining in the affected attorney s trust account. Once appointed by the Court, the Special Commissioner may also be referred to as an assisting attorney. 8 P a g e

9 SUBSECTION 1: PREPLANNING: PLANNING ATTONREY (AFFECTED ATTOREY) FORMS AND CHECKLISTS 9 P a g e

10 CHECKLIST FOR KENTUCKY LAWYERS PLANNING TO PROTECT CLIENTS INTERESTS IN THE EVENT OF THE LAWYER S DEATH, DISABILITY, IMPAIRMENT OR INCAPACITY 1. Download from the Kentucky Bar Association website ( copies of forms, letters and checklists that will assist you with planning to protect your clients interests in the event of death, disability, impairment or incapacity. 2. Use fee agreements that state you have arranged for an Assisting Attorney to close your practice in the event of death, disability, impairment, or incapacity. 3. Have a thorough and up-to-date office procedure manual that includes information on: a. How to check for a conflict of interest; b. How to use the calendaring system; c. How to generate a list of active client files, including client names, addresses, and phone numbers; d. Where client ledgers are kept; e. How the open/active files are organized; f. How the closed files are organized and assigned numbers; g. Where the closed files are kept and how to access them; h. The office policy on keeping original client documents; i. Where original client documents are kept; j. Where the safe deposit box is located and how to access it; k. The bank name, address, account signers, and account numbers for all law office bank accounts; l. The location of all law office bank accounts records (trust and general); m. Where to find, or who knows about, the computer passwords; n. How to access your voic (or answering machine) and the access code numbers; and o. Where the post office or other mail service box is located and how to access it. 4. Make sure all your file deadlines (including follow-up deadlines) are calendared. 5. Document your files. 6. Keep your time and billing records up-to-date. 7. Avoid keeping original client documents, such as wills and other estate planning documents. 8. Have a written agreement with an attorney who will close your practice (the Assisting Attorney ) that outlines the responsibilities involved in closing your practice. Determine whether the Assisting Attorney will also be your personal attorney. Choose an Assisting Attorney who is sensitive to conflict-of-interest issues. 10 P a g e

11 9. Add your Assisting Attorney s contact information to your KBA Member Profile by logging in to the KBA website and editing your bio. 10. If your written agreement authorizes the Assisting Attorney to sign general account checks, follow the procedures required by your local bank. Decide whether you want to authorize access at all times, at specific times, or only on the happening of a specific event. In some instances, you and the Assisting Attorney will have to sign bank forms authorizing the Assisting Attorney to have access to your general account. 11. If your written agreement provides for an Authorized Signer for your trust account checks, follow the procedures required by your local bank. Decide whether you want to authorize access at all times, at specific times, or only on the happening of a specific event. In most instances, you and the Authorized Signer will have to sign bank forms providing for access to your trust account. Choose your Authorized Signer wisely; he or she will have access to your clients funds. 12. Familiarize you Assisting Attorney with your office systems and keep him or her apprised of office changes. 13. Introduce your Assisting Attorney and/or Authorized Signer to your office staff. Make certain your staff knows where you keep the written agreement and how to contact the Assisting Attorney and/or Authorized Signer if an emergency occurs before or after office hours. If you practice without regular staff, make sure your Assisting Attorney and/or Authorized Signer knows whom to contact (the landlord, for example) to gain access to your office. 14. Inform your spouse or closest living relative and the personal representative of your estate of existence of this agreement and how to contact the Assisting Attorney and/or Authorized Signer. 15. Renew your written agreement with your Assisting Attorney and/or Authorized Signer annually. 16. Review your fee agreement each year to make sure that the name of your Assisting Attorney is current. 17. Fill out the Law office List of Contacts and insure your Assisting Attorney has a copy. 11 P a g e

12 AGREEMENT TO CLOSE LAW PRACTICE Between:, hereinafter referred to as Planning Attorney, And:, hereinafter referred to as Assisting Attorney. 1. Purpose. The purpose of this agreement is to protect the legal interests of the clients of Planning Attorney in the event Planning Attorney is unable to continue Planning Attorney s law practice due to death, disability, impairment, or incapacity. 2. Parties. The term Assisting Attorney refers to the attorney designated in the caption above or the Assisting Attorney s alternate. The term Planning Attorney refers to the attorney designated in the caption above and the Planning Attorney s representatives, heirs, or assigns. 3. Establishing Death, Disability, Impairment or Incapacity. In determining whether Planning Attorney is dead, disabled, impaired, or incapacitated, Assisting Attorney may act upon such evidence as Assisting Attorney shall deem reasonably reliable, including but not limited to, communications with Planning Attorney s family members, representative or a written opinion of one or more medical doctors duly licensed to practice medicine. Similar evidence or medical opinions may be relied upon to establish that Planning Attorney s disability, impairment or incapacity has terminated. Assisting Attorney is relieved from any responsibility and liability for acting in good faith upon such evidence in carrying out the provisions of this Agreement. 4. Consent to Close Practice. Planning Attorney hereby gives consent to Assisting Attorney to take all actions necessary to close Planning Attorney s legal practice in the event that Planning Attorney is unable to continue in the private practice of law and Planning Attorney is unable to close Planning Attorney s own practice due to death, disability, impairment or incapacity. Planning Attorney hereby appoints Assisting Attorney as attorney-in-fact, with full power to do and accomplish all of the actions contemplated by this Agreement as fully and as completely as Planning Attorney could do personally if Planning Attorney were able. It is Planning Attorney s specific intent that this appointment of assisting attorney as attorney-in-fact shall become effective only upon Planning Attorney s death, disability, impairment, or incapacity. The appointment of Assisting Attorney shall not be invalidated because of Planning Attorney s death, disability, impairment, or incapacity, but instead the appointment shall fully survive such death, disability, impairment, or incapacity and shall be in full force and effect so long as it is necessary or convenient to carry out the terms of this Agreement. In the event of Planning Attorney s death, disability, impairment, or incapacity, Planning Attorney designates Assisting Attorney as signature, or in substitution of Planning Attorney s signatures, on all of Planning Attorney s law office accounts with any bank or financial institution, including, but not 12 P a g e

13 limited to, checking accounts, savings accounts, and trust accounts. Planning Attorney s consent includes but is not limited to: Entering Planning Attorney s office and using the Planning Attorney s equipment and supplies as needed to close Planning attorney s practice; Opening Planning Attorney s mail and processing it; Taking possession and control of all property comprising Planning Attorney s law office, including client files and records; Examining files and records of Planning Attorney s law practice and obtaining information as to any pending matters that may require attention; Notifying clients, potential clients, and others who appear to be clients, that planning Attorney has given this authorization and that it is in their best interest to obtain other legal counsel; Copying Planning Attorney s files; Obtaining client consent to transfer files and client property to new attorneys; Transferring client files and property to clients or their new attorneys; Obtaining client consent to obtain extensions of time and contacting opposing counsel and courts/administrative agencies to obtain extensions of time; Applying for extensions of time pending employment of other counsel by the clients; Filing notices, motions, and pleadings on behalf of clients where the clients interests must be immediately protected and other legal counsel has not yet been retained; Contacting all appropriate persons and entities who may be affected, and informing them that Planning Attorney has given this authorization; Arranging for transfer and storage of closed files; Winding down the financial affairs of Planning Attorney s practice, including providing Planning Attorney s clients with a final accounting and statement for services rendered by Assisting Attorney, return of client funds, collection of fees on Planning Attorney s behalf or on behalf of Planning Attorney s estates, payment of business expenses, and closure of business accounts when appropriate; Advertising Planning Attorney s law practice or any of its assets to find a buyer for the practice; Arranging for an appraisal of Planning Attorney s practice for the purpose of selling Planning Attorney s practice; Employ professionals and incur debt as needed; and Planning Attorney s bank or financial institution may rely on the authorizations in the agreement unless such bank or financial institution has actual knowledge that this Agreement has been terminated or is no longer in effect. 13 P a g e

14 5. Payment for Services. Planning Attorney agrees to pay Assisting Attorney a reasonable sum for services rendered by Assisting Attorney while closing the law practice of Planning Attorney. Assisting attorney agrees to keep accurate time records for the purpose of determining amounts due for services rendered. Assisting Attorney agrees to provide the services specified herein as an independent contractor. 6. Preserving Attorney-Client Privilege. Assisting Attorney agrees to preserve confidences and secrets of Planning Attorney s clients and their attorney-client privilege and shall only make disclosures of information reasonably necessary to carry out the purpose of this Agreement. 7. Assisting Attorney is Attorney for Planning Attorney (delete one of the following paragraphs as appropriate). Assisting Attorney is the attorney for Planning Attorney. Assisting Attorney will protect the attorney-client relationship and follow the Kentucky Rules of Professional Responsibility. OR Assisting Attorney is Not Attorney for Planning Attorney. 8. Providing Legal Services. Planning Attorney authorizes Assisting Attorney to provide legal services to Planning Attorney s former clients providing Assisting Attorney has no conflict of interest and obtains the consent of Planning attorney s former clients to do so. Assisting Attorney has the right to enter into an attorney-client relationship with Planning Attorney s former clients and to have clients pay Assisting attorney for his or her legal services. Assisting Attorney agrees to check for conflicts of interest, and when necessary, to refer the clients to another attorney. 9. Informing Kentucky Bar Association. Assisting Attorney agrees to inform the Kentucky Bar Association where Planning Attorney s closed files will be stored and the name, address, and phone number of the contact person for retrieving those files by completing the KBA s online form located at Contacting Lawyer s Malpractice Insurance Company (or other Carrier). Planning Attorney authorizes Assisting Attorney to contact Lawyer s Malpractice Insurance Company or other professional liability insurance carrier concerning any legal malpractice claims or potential claims. 14 P a g e

15 11. Providing Clients with Accounting. Assisting Attorney agrees to provide Planning Attorney s former clients with a final accounting and statement for legal services of Planning Attorney based on the Planning Attorney s records. Assisting Attorney agrees to return client funds to Planning Attorney s former clients and to submit funds collected on behalf of Planning Attorney to Planning Attorney or Planning Attorney s estate representative. 12. Indemnification. Planning Attorney agrees to indemnify Assisting Attorney against any claims, loss, or damages arising out of any act or omissions by Assisting Attorney under this agreement, provided the actions or omissions of Assisting Attorney were made in good faith, were made in a manner reasonably believed to be in Planning Attorney s best interest, and occurred while Assisting Attorney was assisting Planning Attorney with the closure of Planning Attorney s office. This indemnification agreement does not extend to any acts, errors or omissions of Assisting Attorney while rendering or failing to render professional services in Assisting Attorney s capacity as attorney for the former clients of Planning Attorney. Assisting Attorney shall be responsible for all acts and omissions of gross negligence and willful misconduct. 13. Option to Purchase Practice. Assisting Attorney shall have the first option to purchase the practice of Planning Attorney under the terms and conditions specified by Planning Attorney or Planning Attorney s representative in accordance with the Kentucky Rules of Professional Responsibility and other applicable law. 14. Arranging to Sell Practice. If Assisting attorney opts not to purchase Planning Attorney s practice, Assisting Attorney will make all reasonable efforts to sell Planning attorney s practice and will pay Planning Attorney or Planning Attorney s estate all monies received. 15. Fee Disputes to be Arbitrated. Planning Attorney and Assisting Attorney agree that all fee disputes between them will be decided by the Kentucky Bar Association Fee Arbitration Program. 16. Termination. This Agreement shall terminate upon: (1) delivery of written notice of termination by planning Attorney to Assisting Attorney during any time that Planning Attorney is not under disability, impairment, or incapacity as established under Section 3 of this Agreement; (2) delivery of written notice of termination by Planning Attorney s legal representative upon a showing of good cause; or 3) delivery of a written notice of termination given by Assisting Attorney to Planning Attorney, subject to any ethical obligation to continue or complete any matter undertaken by Assisting 15 P a g e

16 Attorney pursuant to this Agreement. If Assisting attorney or Assisting Attorney s Alternate for any reason terminates this agreement or is terminated, Assisting Attorney or Assisting Attorney s Alternate acting on his or her behalf shall (1) provide a full and accurate account of financial activities undertaken on Planning Attorney s behalf within 30 days of termination or resignation and (2) provide Planning Attorney or Planning Attorney s legal representatives with Planning Attorney s files, records and funds. COMMONWEALTH OF KENTUCKY COUNTY OF Planning Attorney/Date Assisting Attorney/Date I,, a Notary Public of the County and State aforesaid mentioned, certify that, personally appeared before me this day and acknowledged the execution of the foregoing instrument. Witness my hand and official stamp or seal, this the day of, 20. My commission expires: NOTARY PUBLIC/STATE AT LARGE 16 P a g e

17 LIMITED POWER OF ATTORNEY TO MANAGE AND/OR CLOSE LAW PRACTICE AT A FUTURE DATE I,, residing at, an attorney duly licensed to practice law in the Commonwealth of Kentucky, with offices located at, do hereby appoint, an attorney licensed and in good standing to practice law in the Commonwealth of Kentucky, with offices located at, as my agent and attorney-in-fact (hereinafter Agent ) to act for me, in my name and in my behalf as hereinafter provided. This limited power of attorney shall become and remain effective, however, only upon and during a period of my incapacity by reason of my disappearance, disability, or other inability to act which renders me incapable of conducting my law practice in a competent manner. Such determination of incapacity shall be made by me or written certification by: (i) (ii) a physician duly licensed to practice medicine who has treated me within one year preceding the date of such certification; OR my Agent, who shall base his/her findings on reliable sources, including one or more members of my immediate family, a written opinion of one or more licensed physicians who diagnosed or treated me within one year preceding the date of my incapacity, my law firm colleagues and/or my office staff with whom I maintained a close and continuous relationship during the period immediately preceding my incapacity As part of the process of determining whether I lack decision-making capacity, all individually identifiable health information and medical records may be released to my Agent even though such representative s appointment has not yet become effective. This release and authorization applies to any information governed by the Health Insurance Portability and Accountability Act of 1996 ( HIPAA ), 42 U.S.C. Section 1320d and 45 C.F.R. Section I hereby appoint my Agent, for the sole and limited purpose and in my name and stead, of conducting all matters and managing all property, whether real or personal, that are related to or associated with my law practice in any way wherein I myself might act if I personally were present and to the extent that I am permitted by law to act through such an agent. These powers shall include and shall be limited to the following: a. Entering my office and using my office equipment and supplies as needed to manage or close my practice; b. Opening my mail and processing it; c. Taking possession and control of all property comprising my law office, including client files and records; d. Examining files and records of my law practice and obtaining information as to any pending matters that may require attention; 17 P a g e

18 e. Notifying clients, potential clients, and other who appear to be clients, that my Agent has been given this authorization and that it is in their best interest to obtain other legal counsel (AND that my Agent may provide legal services to my former clients providing there is no conflict of interest and my Agent obtains my former client s consent to do so.); f. Copying my office files; g. Obtaining client consent to transfer files and client property to new attorneys; h. Transferring client files and property to clients or their new attorneys; i. Obtaining client consent to obtain extensions of time and contacting opposing counsel and courts/ administrative agencies to obtain extension of time; j. Applying for extensions of time pending employment of other counsel by the clients; k. Filing notices, motions, and pleadings on behalf of clients where the clients interests must be immediately protected and other legal counsel has not yet been retained; l. Contacting all appropriate persons and entities who may be affected, and informing them of my authorization of Agent; m. Arranging for transfer and storage of closed files; n. Winding down the financial affairs of my practice, including providing my clients with a final accounting and statement for services rendered by myself, return of client funds, collection of fees on my behalf or on behalf of my estates, payment of business expenses and closure of business accounts where appropriate; o. Advertising my law practice or any of its assets to find a buyer for the practice; p. Arranging for an appraisal of my practice for the purpose of selling my practice; q. Paying Agent a reasonable sum for services rendered with Agent to keep accurate time records for the purpose of determining amounts due for services rendered, which shall be provided by Agent as an independent contractor; r. Employ professionals and incur debt as needed; AND s. Managing accounts maintained at my bank or financial institution for my practice, including my operating, IOLTA and business savings account, without any further authorizations being necessary unless such bank or financial institution has actual knowledge that this authorization has been terminated or is no longer in effect. I hereby reserve the right to revoke this Limited Power of Attorney by written instrument, which shall not affect the validity of any actions taken by my Agent prior to such revocation. To induce third parties to act hereunder, I hereby agree that any such third party receiving a duly executed original copy of this instrument, or a copy certified in such manner as to make it viable and effective as provided by law, may act hereunder, and that the revocation or termination of this instrument shall be ineffective as to any such third party unless and until such third party s knowledge or receipt of notice of such revocation or termination, and I, for myself, my heirs, executors, administrators, legal representatives, successors and assigns hereby agree to indemnify and hold harmless any such third party against any claim(s) that may arise against such third party by reason of his or her having so relied upon the provisions of this instrument. 18 P a g e

19 If is unable or unwilling to serve as my Agent hereunder, or no longer practices law, I hereby appoint, an attorney licensed and in good standing to practice law in the Commonwealth of Kentucky, with offices located at, to be my Agent for the limited purposes set forth herein, This Limited Power of Attorney shall not be affected by my subsequent disability or incapacity. COMMONWEALTH OF KENTUCKY } } COUNTY OF } The foregoing instrument was acknowledged before me this the day of 20, by to be her free act and deed. My commission expires:, 20. (Name) NOTARY PUBLIC, STATE AT LARGE 19 P a g e

20 WILL PROVISIONS TO BE INCLUDED IN PLANNING ATTORNEY S LAST WILL AND TESTAMENT With respect to my law practice, namely the law office of, my personal representative is expressly authorized and directed to carry out the terms of the Contract with Assisting Attorney, (hereinafter the Agreement ), between myself and Attorney,, also identified as Assisting Attorney, dated. If that Agreement is not in effect, or if Assisting Attorney is unwilling or unable to perform under the terms of that Agreement, my personal representative is authorized and directed to enter into a similar agreement with another attorney that my personal representative, in his or her sole discretion, may determine to be necessary or desirable to protect the interests of my clients and wind down or dispose of that practice. If a Special Commissioner has been appointed by the appropriate Court of jurisdiction for that purpose either prior to or after my death, my personal representative is authorized and directed to cooperate fully consistent with the orders of appointment. I have provided for the payment of the costs reasonably associated with the process of winding down or disposing of my law practice that would not be covered by existing funds in my operating/business account by designating my estate as the beneficiary of term insurance policy #, in the amount of $ through Insurance Company, the location of which is known to, and direct my personal representative to pay the Assisting Attorney as invoiced per the terms of the Agreement or any Special Commissioner consistent with orders of appointment. OR So long as he or she is an attorney duly licensed and in good standing in the Commonwealth of Kentucky, my personal representative is expressly authorized and directed to take such steps as he or she deems necessary or desirable, in my personal representative s sole discretion, to protect the interests of the clients of my law practice,, and to wind down or dispose of that practice, including but not limited to, selling that practice, collecting accounts receivable, paying expenses related to the practice, employing an attorney or attorneys to provide trust accounting and to issue unused trust balances owing to my clients, to review my files, complete unfinished work, notify my clients of my death and assist my clients in finding other attorneys, and returning files to my clients and/or providing access to my files. I have provided for the payment of the costs reasonably associated with the process of winding down or disposing of my law practice that would not be covered by existing funds in my operating/business account by designating my estate as the beneficiary of term insurance policy #, in the amount of $ through Insurance Company, the location of which is known to, and direct my personal representative to pay these costs in his/her sole discretion. 20 P a g e

21 KENTUCKY LAW OFFICE LIST OF CONTACTS DATE COMPLETED: ATTORNEY: SSN: KBA Bar # FEIN State Tax ID# Date of Birth Office Address Office Phone Home Address Home Phone Cell Phone Fax Address SPOUSE Work Phone Cell Phone Fax Address Employer ASSISTING ATTORNEY(S) TO HELP WITH PRACTICE CLOSURE First Name Address Work Phone Cell Phone Location of Agreement to Close Law Practice Second Name 21 P a g e

22 Address Work Phone Cell Phone Location of Agreement to Close Law Practice IDENTITY OF PERSON WITH LOCATION OF WILL AND/OR TRUST Name Home Address Home Phone Cell Phone Fax Address PERSONAL REPRESENTATIVE Address Phone Cell Phone Fax Address OFFICE MANAGER Home Address Home Phone Cell Phone Fax Address OFFICE-SHARER OR OF COUNSEL 22 P a g e

23 Name Home Address Home Phone Cell Phone Fax Address IDENTITY OF PERSON WITH COMPUTER AND TELEPHONE PASSWORDS Name Home Address Home Phone Cell Phone Fax Address POSTOFFICE OR OTHER MAIL SERVICE BOX Location Box Number Obtain Key From Address Phone Other Signatory Address Phone SECRETARY Home Address Home Phone 23 P a g e

24 Cell Phone Fax Address PARALEGAL Home Address Home Phone Cell Phone Fax Address BOOKKEEPER/CPA Office Address Office Phone Home Address Home Phone Cell Phone Fax Address LANDLORD Address Phone Cell Phone Fax Address Location of Office Lease Lease Expiration Date 24 P a g e

25 PROFESSIONAL CORPORATION(S) Date Incorporated Location of Corporate Minute Book Location of Corporate Stock Certificate Location of Corporate Tax Returns Fiscal Year-End Date Corporate Attorney OFFICE PROPERTY/LIABILITY COVERAGE Insurer Address Phone Cell Phone Fax Address Policy No. Contact Person Location of Policy GENERAL LIABILITY COVERAGE Insurer Address Phone Cell Phone Fax Address Policy No. 25 P a g e

26 Contact Person Location of Policy LEGAL MALPRACTICE PRIMARY COVERAGE Insurer Address Phone Cell Phone Fax Address Policy No. Contact Person Location of Policy LEGAL MALPRACTICE EXCESS COVERAGE Insurer Address Phone Cell Phone Fax Address Policy No. Contact Person Location of Policy VALUABLE PAPERS COVERAGE Insurer Address 26 P a g e

27 Phone Cell Phone Fax Address Policy No. Contact Person Location of Policy OFFICE OVERHEAD COVERAGE Insurer Address Phone Cell Phone Fax Address Policy No. Contact Person Location of Policy HEALTH INSURANCE COVERAGE Insurer Address Phone Cell Phone Fax Address Policy No. 27 P a g e

28 Contact Person Location of Policy DISABILITY INSURANCE Insurer Address Phone Cell Phone Fax Address Policy No. Contact Person Location of Policy LIFE INSURANCE Insurer Address Phone Cell Phone Fax Address Policy No. Contact Person Location of Policy WORKERS COMPENSATION COVERAGE Insurer Address 28 P a g e

29 Phone Cell Phone Fax Address Policy No. Contact Person Location of Policy PROCESS SERVER Name Address Phone Contact Account Number STORAGE LOCKER LOCATION Storage Company Locker No. Address Phone Items Stored Obtain Key From Address Phone FILE STORAGE LOCATION Storage Company Account No. 29 P a g e

30 Address Phone Items Stored Person With Access Address Phone SAFE DEPOSIT BOXES Institution Box No. Address Phone Obtain Key From Address Phone Other Signatory Address Phone Items Stored LEASES Item Leased Lessor Address Location of Lease Agreement Expiration Date Item Leased 30 P a g e

31 Lessor Address Location of Lease Agreement Expiration Date Item Leased Lessor Address Location of Lease Agreement Expiration Date LAWYER TRUST ACCOUNT (IOLTA) Institution Address Phone Account Number Other Signatory Address Phone INDIVIDUAL TRUST ACCOUNT Client Name Institution Address Phone Account Number Other Signatory Address 31 P a g e

32 Phone GENERAL OPERATING ACCOUNT(S) Institution Address Phone Account Number Other Signatory Address Phone Institution Address Phone Account Number Other Signatory Address Phone BUSINESS CREDIT CARDS Institution Address Phone Account Number Other Signatory Address Phone Institution 32 P a g e

33 Address Phone Account Number Other Signatory Address Phone MAINTENANCE CONTRACTS Item Covered Vendor Name Address Phone Item Covered Vendor Name Address Phone Item Covered Vendor Name Address Phone ALSO ADMITTED TO PRACTICE IN THE FOLLOWING STATES State Bar Address Bar Phone Bar ID # State 33 P a g e

34 Bar Address Bar Phone Bar ID # 34 P a g e

35 ANSWERS TO FREQUENTLY ASKED QUESTIONS FOR PREPLANNING ATTORNEY The following questions and answers are attempted to guide the Planning Attorney and Assisting Attorney in dealing with various issues that could present themselves during the preplanning stage. It does not provide for every situation but simply attempts to cover those most frequently asked questions pertaining to the usual arrangement between the Planning Attorney and the Assisting Attorney. 1. How can the Planning Attorney make arrangements to give the Assisting Attorney access to all necessary financial accounts? If you decide to allow your Assisting Attorney to be an authorized signer, you must decide if you want to give the Assisting Attorney (1) access only during a specific time period, (2) when a specific event occurs; or, (3) access all the time. All steps necessary to effectuate this arrangement should be discussed with the appropriate financial institution where the Planning Attorney s accounts are located. Get written confirmation that the bank will honor your authorizing document no matter the situation. Additionally, it should be clearly delineated in the initial documentation and agreement entered into between the Planning Attorney and the Assisting Attorney. 2. If the access is going to be contingent, whom should I allow to hold on to the vesting document? You may want to have someone (such as your spouse, family member, personal representative, etc.) hold the document until the contingency occurs. This can be documented in the agreement signed between yourself and the Assisting Attorney. When the event occurs, the individual would provide the Assisting Attorney with the power of attorney or vesting document allowing the necessary access. Again, this is largely contingent on the specific terms in your agreement and should be clearly delineated and discussed. Additionally, you should insure that whatever arrangement you make is satisfactory with your individual financial institution. 3. If the authorization occurs on a contingent basis or a specific time period, how does one determine when this event or period begins? This will be largely based on the specific terms and requirements in the agreement between the parties. For example, the agreement may authorize the Assisting Attorney to sign on your accounts only after obtaining a letter from your regular, treating physician that you are disabled or incapacitated. Likewise, it may also specifically authorize access only during a period of your vacation. Any way the parties choose to rectify should be clearly defined in 35 P a g e

36 the agreement, and the terms should be specific to allow the financial institution to make an easy determination whether the terms are met. 4. If I authorize my Assisting Attorney as a signer on all my financial accounts, is the Assisting Attorney still permitted to be counsel for me? Although this generally works out fine, the arrangement may result in a conflict of fiduciary interests. As an authorized signer on the Planning Attorney s accounts, the Assisting Attorney would have a duty to properly account for the funds belonging to the former clients of the Planning Attorney. To avoid this potential conflict of fiduciary interests, the most conservative approach is to EITHER be an authorized signer OR to represent the Planning Attorney on issues related to the closure of the practice. However, it is possible to do both, but extreme care should be taken by all parties to insure that any and all ethical obligations and rules of professional conduct are followed to limit any possibility of liability as a result. 5. Once my plan is in place, do I need to inform my current clients and future clients? If so, what and how do I do this? Yes, it is crucial that once you have entered into an agreement with an Assisting Attorney, you inform your current clients and future clients of its existence. It is not necessary to inform each of them of the specific terms contained in the agreement just its existence and the identity of the person named as the Assisting Attorney. The easiest way to do this is to include the information in your fee agreements and engagement letters. This provides clients with information about your arrangement. 6. Do I, the Planning Attorney, have malpractice coverage if and when I am no longer practicing law? Most malpractice policies include an automatic short extended reporting period of 60 to 90 days, providing the opportunity to report known or potential malpractice claims when a policy ends and will not be renewed. Additionally, most malpractice policies provide an option to purchase extended reporting period endorsement for longer periods of time. These endorsements do not provide ongoing coverage for new errors, but they will provide the opportunity to lock in coverage under the expiring policy for errors surfacing after the end of the policy, but within the extended reporting endorsement timeframe. This may pose a significant conflict for the Assisting Attorney, unless a provision exists in the agreement between the attorneys that allows the Assisting Attorney to alert former clients in this circumstance because otherwise the former clients will not know of the error within the applicable reporting period and any endorsements covering same. The best protection for the Planning Attorney is to have an agreement with the Assisting Attorney that requires (1) a 36 P a g e

37 specific time period for the purchase of extended coverage after departure including a requirement to verify its existence with the Planning Attorney, and (2) a source of funds available to the Assisting Attorney to adequately pay for the extended coverage after the Planning Attorney s departure. 7. What other steps should I take other than the execution of an agreement with my Assisting Attorney to insure a smooth closure of my office? There are a significant number of steps necessary to effectuate a smooth transition and this information does not claim to list them all. However, some necessary and needed steps include (1) making sure that your office procedures manual explains how to produce a list of client names and addresses for open files, (2) keeping all deadlines and follow-up dates on your calendaring system, (3) thoroughly documenting client files, (4) keeping your time and billing records up-to-date, (5) familiarizing your Assisting Attorney with your office systems, (6) renewing your written agreement with the Assisting Attorney each year, and (7) Adding/verifying your Assisting Attorney s contact information on your KBA Member Profile by logging in to the KBA website and editing/viewing your information. 37 P a g e

38 SUBSECTION 2: CLOSING THE LAW OFFICE PLANNING ATTORNEY (AFFECTED ATTORNEY) CLOSING HIS/HER OWN OFFICE FORMS AND CHECKLISTS 38 P a g e

39 ACKNOWLEDGEMENT OF RECEIPT OF CLIENT FILE *** *** *** I,, hereby acknowledge that I have received all requested materials from my file in the matter of, from the law office of. I acknowledge further that the law office of has not retained a copy of my file. Client Name Date 39 P a g e

40 CLIENT REQUEST/AUTHORIZATION TO TRANSFER CLIENT FILE *** *** *** I,, hereby request and authorize the law office of to deliver a copy of my file in the matter of to my new attorney named herein below, at the following address: New Attorney Name: New Attorney Address: Client Name Date 40 P a g e

41 CLIENT REQUEST FOR FILE *** *** *** I,, hereby acknowledge that the law office of may not turn my file over to a non-attorney third party. I hereby request that the law office of provide me with a copy of my file in the matter of. Check One Only: on / / at approximately a.m. /p.m. OR my file to my attention at the following address: Client Name Date *** *** *** Note to Client: Client files will be available for retrieval at the law office of, located at on the following dates/times: 41 P a g e