Practice Coverage and Succession Planning
Succession planning: tools, documents and resources
Preparing the practice coverage and succession plan
Succession planning webinar available for viewing
"Planning ahead has one retiree sitting pretty" and "Succession planning," Spring 2011, Benchers' Bulletin
"Succession planning, it's good practice," Summer 2011, Benchers' Bulletin
Lawyers owe a professional obligation to clients to plan for interruptions in your practice, whether due to unexpected emergencies or a planned retirement. It also provides further protection from the risk of an insurance claim while you are unable to practise.
Small firm and sole practitioners in particular must ensure provisions have been made to manage or dispose of your practice.
Reasons for having a practice coverage and succession plan
- Only a practising lawyer may deal with files and trust accounts and the matter is further complicated if your practice is incorporated.
- The plans you put in place now will remove that extra burden from your loved ones during times of stress should something happen to you.
- Through a plan, you can choose the lawyer who will look after your practice, and on what financial terms.
- Planning can permit the net value of your practice to flow back to you or your estate.
What happens if you don’t have a plan
- The Law Society may have to immediately contact your loved ones to arrange for practice coverage, possibly seeking court appointment of the Law Society as custodian if necessary.
- The appointment of a custodian may create a negative perception surrounding your practice, which may negatively affect the value of your practice.
- A custodian:
- must protect the interests of your clients by dealing with urgent matters or completing work paid for and still in progress, but cannot continue to represent them;
- may protect the value of the practice, but will not maximize it.
- Custodianship fees and expenses are paid by your practice, yourself or your estate, possibly resulting in additional debt for you or your estate.