Category Archives: The Practice

I Can’t Say It Enough…

…good estate planning requires advice from more than one discipline.

I was talking this morning with a friend of mine who is an estate planner.  I haven’t known him for a long time, but I like his approach, and I think it differentiates him from other financial planners I’ve known, because he’s got a passion that you can’t really fake, and it is clearly about doing the right thing for the client.  In this case, it means that he spends a considerable amount of time helping clients protect what they already have before he talks to them about using the wealth they have to accumulate more to fund whatever their end goal is.

I’ve been doing this long enough to understand that not everyone is wealthy, but I think that most people want to build what wealth they have.  Sure, some people have come to see me about their estate planning because they have gotten the bad news from a doctor, and that distant inevitability is now an impending certainty.  A holistic approach is probably not foremost in their minds, but an awful lot of people I’ve represented have more wealth than they think they do, and when we sort that out as part of the process, it often requires consulting with other professionals.  Granted, if we’re doing the estate planning because someone has stage four cancer, then we aren’t likely to be talking with them about life insurance, but we might be talking with them about brokerage accounts, 401(k)s, individual retirement accounts, and their interests in closely-held corporations and LLCs, which means that we will be talking  about transfer-on-death or payable-on-death designations on accounts, and how those designations can impact their estates, which means that we will be talking with their financial planners.  We will be talking about potential tax consequences for various potential courses of action, which means that we will be talking with CPA’s and accountants.  And sometimes, I even end up talking to representatives of charities about gifts that clients want to make.  When I am doing this for the clients who know that they aren’t long for this world, I’m not just sad for the client’s approaching demise.  I’m sad for the opportunities that they lost by not acting sooner.  Sometimes, this is because of procrastination, and sometimes, it’s because people don’t understand that estate planning shouldn’t be a mass of disjointed pieces, but a comprehensive plan, focused on the goals they rate as most important, and executed with a series of coordinated steps which have been considered and mapped out with the assistance of a team of professionals who want to help them succeed.  Once I help clients to fully understand this approach, I don’t often end up having  conversations about cost, because they understand that compared to the return they can achieve, the cost is minimal.

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Filed under Pieces of the puzzle, Planning, Probates and Estates, The Practice

The Bad News Is…

One of the things that law school didn’t really prepare me for was the clients who you can’t help.

When I first started practicing law, I was eager to help clients and potential clients, and there was one who stands out in my memory as the first one I couldn’t help.  He had cosigned on a car for a relative, who had defaulted, and he came to see me, because the bank had come calling on him.  I saw nothing in the documents or the circumstance he described that would permit me to be of any meaningful assistance, but I was slightly worried that he might try to hurt me after I told him that I couldn’t help him.

He was very deliberate as he pushed back from the table, and left the room, never saying a word, and his jaw set like a rock.  After my initial relief at not having to dodge a punch or three wore off, I recall thinking “Well, that’s one person whom I’ll never see again.”

But I was wrong.

Before I moved on from that firm, the man came back to see me two more times.  The next time I met with him, he had a contract he wanted me to review before he would decide whether or not to sign it.  I was delighted that he consulted with me first.  I read through the document, noted a few points that I though he should be aware of, which prompted him to tell me that he was going to think about it before deciding to sign or not.  After wrapping up my notes, I looked up and said “Can I ask you something?”

He smiled and said “Let me guess.  You want to know why I came back.”

I nodded my head and said “Yes.  I could tell you were pretty upset when you left last time.”

He laughed and said “You’re not wrong, but I will tell you that I wasn’t upset with YOU.  In fact, I liked the way that you didn’t sugar coat it, even though you didn’t like telling me that there was nothing you could do.  You were honest with me, you didn’t waste my time, and you told me what I did wrong without making me feel stupid.  I knew I had found someone I could trust, and that makes you worth the money you charge.”

I saw him one more time, when I wrote a Will and powers of attorney for him.  Again, he expressed his thanks for the straightforward advice, and the no-nonsense approach.  I still think of him often, because I still encounter people whom I can’t help.  I won’t say that it’s easier telling clients this now than it was then, but I find that by trying to be respectful of their time, and by trying to not make them feel stupid because they made a mistake, I give them something of value, even if it was only allowing them to leave with the dignity they had when they walked in to my office.  Not everyone reacts well to such news, but I have managed to keep a few of them as clients because I approached their problems in this manner, which turns a negative into a much larger positive.

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Filed under Contracts and Agreements, Empathy, Logic Isn't Always The Life Of The Law, Pieces of the puzzle, Planning, The Practice, Wills

Initiative 594’s Inheritance Trap

I-594 isn’t just a compounding of previous violations of the Second Amendment, it is also fraught with traps for the unwary, including one for those who inherit pistols. The language in question is as follows: (4) This section does not apply to: (g) A person who (i) acquired a firearm other than a pistol by the operation of law upon the death of the former owner of the firearm of (ii) acquired a pistol by operation by operation of law upon the death of the former owner of the pistol within the preceding sixty-day period, the person must either have lawfully transferred the pistol or must have contacted the department of licensing to notify the department that he or she has possession of the pistol and intends to retain possession of the pistol in compliance with all federal and state laws. This means that as part of the probate process, the Personal Representative/Administrator of the estate and the attorney need to determine as soon as possible if the deceased owned pistols.  If no one checks, and the designee or heir takes possession without following these steps, then they have broken the law…even if it is the spouse of the deceased.  What can make an error a travesty is that the transfer or notification to the Department of Licensing must take place for every pistol that is acquired, meaning that if someone inherits more than one pistol, and doesn’t follow these steps, they may now be convicted of a misdemeanor for the first pistol, and a felony for each subsequent one. As a practical matter, if you are actually planning ahead, and you want to leave your pistols to someone, you should probably discuss this requirement with the intended recipient, and put language in your Will requiring your Personal Representative to make sure that these steps are followed, and to name a backup recipient if your first choice cannot pass a background check, or has had their concealed weapons permit revoked.

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Filed under Pieces of the puzzle, Planning, Probates and Estates, The Practice

Successor Liability…The Hazard Many Never See Coming

I was at an event recently where another attendee found out that I am a business attorney, and he asked me what I thought was the number one thing that people who try to buy a business without hiring an attorney should worry about.

I had to consider it for a moment, because I didn’t think the Inquisitor would be amused by my saying “Everything.”  After mentally flipping through the various traps and pitfalls, I finally said “Successor Liability”.  The Inquisitor’s face wrinkled up, and he said “What’s that?”

I told him “The short answer is that Successor Liability is when you think that you’re just buying a business, and then you discover that you’ve also bought your predecessor’s obligations and debts.”  Apparently that answer wasn’t sexy enough, because he soon found an excuse to drift to the other side of the room.  My feelings weren’t hurt, but I found his reaction to be illustrative of the way many people enter into the purchase of someone else’s business: sometimes the biggest problems receive the least attention.

Sometimes,  I encounter someone who thinks that they have found a clever way around a potential problem, such as when someone decides that rather than purchasing the seller’s business entity, they will instead just purchase the assets, because “then the debts of the business are still the Seller’s problem.”  Sometimes, this will end well for the buyer, which may be purely coincidental, because these Buyers rarely check to see if the business has any sort of tax liens, tax warrants filed against the business (and consequently the assets) in the local Superior Court, or if there are any UCC filings that apply to the assets they want to purchase.  But invariably, the situation that creates the most heartburn is when a Purchaser is unaware of unpaid taxes owed by the Seller, and the Purchaser learns about it for the first time when the taxing authorities inform them of the lien against the property, or inform them of a pending Sheriff’s sale.  When this happens, things are frequently already at the point where an attorney can’t stop what is going to happen, leaving the Purchaser to have to resort to the courts to try to get a remedy that may not come until years later, when the process is complete, and they have had to spend thousands of dollars to get a judgment that they may or may not be able to collect on.

Buying a business is supposed to be a time of anticipation and optimism.  Risks that you never even anticipated can wreck those emotions, and make an occasion that you make have worked years for into a curse that will take you on a journey through the court system that will take years, and thousands, or hundreds of thousands of dollars before you are through.  This will make the cost of a consultation with a knowledgeable attorney to help you with the purchase seem miniscule by comparison…or as a client of mine has stated on more than one occasion, “It’s just cheap insurance.”

 

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Filed under Business Law, Contracts and Agreements, Pieces of the puzzle, The Practice

Always Learning…

I was helping out on the grounds at church this morning, and my pastor and I got talking about the things that school doesn’t teach you about either of our professions.  And I told him that one of the things about doing estate and probate work is that I bring clients face to face with their own mortality.  But the lesson they didn’t teach in law school is that they also bring me face-to-face with mine.

You expect that you will deal with people dying in this line of work, but nothing prepares you for how you feel about it when you actually liked them, or came to consider them as friends.  Or how you’ll feel when you watch their kids squabble over what was left behind, and end up squandering the estate left to them with love, and the hopes that it would be a blessing, rather than a curse.  It isn’t much of a legacy, and there have been times when I have been glad that some of these clients and friends didn’t live to see what knuckleheads their children turned out to be.

It isn’t always doom and gloom.  I’ve seen some remarkable acts of kindness and reconciliation, some recognized as such, and some not so much, but it helps me to maintain the perspective that some people can’t help it.  And in some cases, Mom and Dad knew, and planned accordingly.

Being an attorney, you get used to keeping people’s secrets, and when it comes to family, some of them are doozies.  But when you see the effect of some of these secrets up close, you realize that they aren’t really secrets at all, but just the individual manifestations of problems that some people want to pretend society doesn’t have, or that society is capable of “fixing” by itself, with yet another law, or regulation, as if addressing the behavior is the same thing as addressing the cause of the behavior.   But then, if law school taught these things, maybe our professional role would be much more about counsel than it would be about law, and there are days when I’m not so sure that some members of our tribe are equipped for that, either.  But that is an observation for another time.

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Filed under It Ain't Perry Mason, Logic Isn't Always The Life Of The Law, Pieces of the puzzle, Probates and Estates, The Practice

Sometimes, The Popcorn Bites Back

When I was a new baby lawyer, I once went to get an order signed by the commissioner before he went back on the bench.  I stood in the doorway of the chambers, waiting for him to motion me back.  He looked up, and motioned me in.  He took my order, signed it, and handed it back to me.  He let out a long sigh, and asked “Did you see that?”  He was referring to the parties who were arguing right before he ruled, and took a recess.

“Yes.” I said.  I wasn’t about to offer an opinion.

“Sometimes, I feel like people are pelting me with popcorn.”

This exchange stuck with me over the years.

Today, I went to Court late in the afternoon with an Amended Order.  The Commissioner on the bench was the one officially assigned to that location, although in 8 years of practicing in that court, it was the first time I actually came before him.  I gave my Order to the Bailiff and sat down.  A woman was before the court, seeking a restraining order against her ex husband, who was represented by his attorney who was appearing on the phone.  After a few minutes, the Commissioner asked the attorney “Was your client served with the papers for today’s hearing?”

There was a long pause.  The attorney said “I have not been authorized by my client to accept service of process, your Honor.”  At this point, the ex-wife started in, talking about how she’s NEVER had an address for him, which has always created problems.  The Commissioner stopped her, and said “Well here is how we’re going to fix this, Counselor.  You will be here in my Courtroom, tomorrow afternoon at 2 p.m.  You will have a permanent address for service of process for your client.  I don’t care if it is a P.O. Box, your office, or a diner.  But if there is no address, I will advise this woman that the court rule…CR 70 or 71, that if she has no good address, she can serve by mail to the last known address.  And you know what that means, right Counselor?”  The Attorney said “Yes.”

By now, I couldn’t conceal my grin, having encountered a similar situation years before when I practiced family law, but not having been fortunate enough to a have a Commissioner willing to deal with the issue so...directly.  The Commissioner saw my grin, and had trouble concealing his own.  “Make sure your client understands that if you aren’t here with an address for service of process, or having authorized you to accept service of process going forward, she will end up getting whatever she asks for in petitions to the Court by default.  I’ll see you tomorrow, Counselor.”

The next party got up, when he called out her name.  She got up, and was reluctant to come forward.  If I wasn’t an attorney, and had just witnessed that exchange, I’d have been reluctant to approach the bench, too.  She approached.   He asked her “You want to withdraw this restraining order?”  I could barely hear her mumble “Yes.”  His brow furrowed as he flipped through the pages.  “Why do you want to withdraw this?”  I couldn’t make out her response.  He asked her “How about I remove it all but the paragraph that says he can’t hit you?”  She replied “Ok.”  He looked at the order again.  “Is this what you want?”  She answered “Yes.”  He looked at the order again and asked “Did he ask you to this?”  “Yes.”, she replied.   He looked at her and said “I’ve looked at his record.  The police are very familiar with him.  Like they know him on sight.  From the front and back.  I’ll alter this order like we have agreed, but there is very likely a criminal restraining order in place also.”  He signed the order and gave it to her.  [There was more to this exchange, but I omitted it because I see no need to recount details that could detract from what dignity she had.  But a very telling part of the exchange was when he asked her about several social programs set up to help women in her circumstances, and was told in response to each one he named that they couldn’t help her or didn’t help her.]

During this exchange, I sat listening quietly, and thinking “I couldn’t do this.  I couldn’t listen to this stuff day after day, and not either lose my mind, or become so mean and bitter that I still couldn’t do my job.”  I am thankful for people like this Commissioner, and a great many family law attorneys who are good at what they do, and can retain a professional composure.  God bless them, because the alternative of NOT having them would be even more awful.

Anyone who thinks that the answer to society’s problems is MORE government should have to spend a week in their local court that has jurisdiction over felonies and family law cases.  Sit in court and listen to the things said in the hearings.  Walk the halls and listen to the conversations.  Listen to people as you walk through the parking lots.  And if you still think that more government is the answer, you will never understand.

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Thank You Very Much, Your Honor. May I Have Another?

When I first started practicing law, I worked at a firm where 1/3 to 1/2 of my practice at any given time was family law.  One of the cases I got was a post-secondary educational support motion.  In the state of Washington, we embrace the fiction that going to college makes people smart and employable, so even if a non-custodial parent pays their child support until their kid is 18, they can still be forced under some circumstances to contribute to their children’s college education.  One of those conditions is that the child achieves and maintains a certain grade point average.

My client was the non-custodial parent, and had been unemployed for a long period, despite having gone through job retraining.  The ex-spouse, who brought the motion for contribution, was a teacher.  The kid, despite being the spawn of an educator, was dramatically underachieving at the local community college.  We tried to get the transcript, but were not having any luck.  Finally my client got the kid’s password, and printed off the transcript that proved the kid was NOT making the grade.  I had my defense.

We showed up on the date of the hearing, and we walked into a packed court room.  The Commissioner that day was a pro tem (meaning that it was a practicing attorney who was substituting).  I wasn’t alarmed, because I had argued motions before him before, and believed him to be fair.  What I hadn’t considered is that when the adjudicator is also an advocate, sometimes the advocate wins.

We were the second case to be heard, so the court room was still packed.  My adversary made his case, and then it was my turn.  I reminded the court of the GPA requirement, and passed a copy of the transcript to the Commissioner and opposing counsel, pointing out that the “student” wasn’t a good student, and that perhaps their time might be better spent asking “Do you want fries with that?”  My adversary looked deflated.  I watched from the corner of my eye as he kept stealing glances at the transcript.  I finished my argument, convinced that my client was going to prevail.  My opponent said nothing.

It was quiet as the Commissioner looked down at me over his glasses and addressed me.  “Counselor,” he said, “I notice here at the bottom of this transcript that it says “Unofficial Copy”.  Do we have a hearsay problem here?”

My opponent perked up, his case revived by the person who was there to judge it, not argue it for him.  “Your honor, I OBJECT!  Hearsay!”

I looked around the courtroom.  My client did the same.  The child was not present, so I couldn’t get their testimony to authenticate it.  I was trapped.  My opponent had won.

As I packed up my folio, one of the old-timers sitting immediately behind the bar leaned forward and said “Tough Break, Kid.”
I looked at him and replied “What the hell was I supposed to say?  Gee, your honor, thanks for making my opponent’s argument for him.”?  He just chuckled and said “Sometimes, there’s nothing you can say.”

Sometimes, it doesn’t pay to get out of bed.

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