On Friday, I coached a client about selling his practice. Our conversation was far-ranging. I started with several questions of my client that, in my opinion, set the stage for all further deliberations. How do these questions resonate with you? What additional questions might you ask yourself?
- Why do you want to leave your practice?
- What do you want to do in the "second season of your life?"
- Do you want to retire, or start a new adventure?
- Can you achieve the same objective without selling your practice?
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The Ohio Bar adopted a new rule of professional conduct, Rule 1.17, that allows the sale of a law practice as of February 1, 2007. (more…)
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Where courts have refused to uphold a covenant not to compete given by one lawyer to another in the sale of a law practice, one of the primary arguments against validating the covenant is that clients have a right to counsel of their own choosing. And, the argument continues, saying that a lawyer cannot practice law in a given area for a reasonable period of time restricts that right.
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The New Hampshire Bar Association Ethics Committee, in May 2007, wrote an opinion or (my term) "white paper" as part of its ethics studies on closing a law practice.
It’s a good summary of factors to consider, though certainly not complete. And, since the date of this opinion/white paper, the Supreme Court of NH has approved a new set of Rules of Professional Conduct which include Rule 1.17 explicitly permitting the sale of a law practice in NH for the first time.
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Rule 1.17 was adopted this month in New Hampshire, effective January 1, 2008. It’s rule 1.17 provides, as does the ABA Model Rule 1.17, that an entire law practice, or an area of a law practice, can be sold. (Thanks to Bruce Dorner for the
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New York’s DR 2-101 (22 NYCRR 1200.7) states: "… (b) A lawyer in private practice shall not practice under a trade name…"
If lawyers’ names must be used in the title of a firm, as seems to be the case under the new advertising rules in NY, any lawyer that would be interested in purchasing the law firm (permitted in New York) would either have to "retire" the selling lawyer (and keep the name in the firm "trade name" since the rule enables the name of a deceased or retired member of the firm to be retained) or change the firm name.
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ABA ETHICSearch just published a memorandum concerning the closing of a law practice.
In addition to mentioning our book, Selling Your Law Practice: The Profitable Exit Strategy, the author cites several articles and ethics opinions that provide a broader perspective on the topic, including the ethical responsibilities of retiring lawyers and departing lawyers
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Even immigration lawyer law firms are concerned about growing their practices by buying a practice.
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Question: When buying a law practice, why should I pay any price that is not calculated on a percentage of the revenue that actually is produced from that practice after I take charge? (more…)
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Both Tom Collins and Ed Wesemann support my contention that law firms do have goodwill! See my book, Selling Your Law Practice: The Profitable Exit Strategy. (more…)
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