There are different types of continuation of practice agreements. As a general rule, a lawyer concludes an individual contract with another sole proprietorship, another company, a limited liability company or a professional company in the Community. Agreements can range from a simple “double coverage for one another” for vacation or other temporary absences to selling the practice in the event of long-term disability or death. One approach would be to include each client in the agreement and assign individual values that correspond to the overall assessment agreed for the practice. Payment is made to the lawyer`s heirs from the money received by the successor firm of the settlements to these clients for future services. The agreed percentage of the current collection to be paid depends on the duration of the contract. If the duration is 5 years, 20% of each amount collected is paid each year. The maximum amount to be paid for a customer is the agreed value. If the customer terminates the services of the successor company, payments for that customer will be interrupted.
Temporary disability. The agreement should require the successor company to provide employees to support the day-to-day operations of the practice. Employees would generally be lawyers and employees. However, either lawyer must be available in the successor firm to review the work of paralegals and staff and provide the necessary experience and background to make the necessary decisions. The lawyer(s) are in contact with and under the supervision of the temporarily disabled practitioner. Each of the two law firms would negotiate a compensation agreement for the support firm. The agreement would provide for the conclusion of the agreement after the expiry of the temporary impediment. The temporarily disabled practitioner would likely announce his return in advance, but the agreement would not require it. Strong continuation of practice agreements can resolve this dilemma and preserve practical value and help prevent a lawyer`s spouse or immediate heirs from facing a hasty sale or divestiture of the practice in an emergency. A continuation of practice agreement can also provide security for legal practitioners, their employees and appropriate security. The surviving spouse or heirs will not participate in future client growth once the continued practice agreement comes into effect.
Be careful when executing a note, as it sets the price of the counter and prevents payments that match cash flow. It is inflexible for customer losses. The buyer may end up paying for a customer they may not own. The predecessor firm must inform all clients of the agreement in accordance with the requirements of their state attorney and assure them that there will be no interruption of services if the practice changes hands. It is important to ensure that the surviving spouse(s) are aware of the existence of the continuance agreement and understand its provisions. In addition, the lawyer in the estate of the previous lawyer must know the terms of the contract if he has not drafted and negotiated the contract. Lawyers must invest time and effort in finding suitable successors for their law firms and in creating useful and fair continuation of practice agreements. The key – is to find the right person or company. However, investing time is a good investment, as a continuation agreement for good practice ensures that if a lawyer is not able to continue the practice, the value they have accumulated over the years will not be lost. An orderly transfer from one firm to another lawyer or law firm is a significant financial benefit to the lawyer`s family.
At the same time, the lawyer discharges his professional responsibility to his clients through the successor sorted on the hand. . . . .