Often, my estate planning clients are engaged in a professional
practice of some sort, be it law, medicine, psychiatric care, accounting or the
like, and many are sole or principal practitioners. The customary documents most often do not
provide any specific instructions for the winding up or disposition of the professional
practice. As such, in addition to the
standard Will, Trust, Durable Power of Attorney and Health Care Proxy, it may
be wise for such a client to execute a “Professional Will” addressing the winding
up and disposition of the professional practice. Some professions have regulations addressing
file retention, client notification and other such matters, and it is important
that a qualified person be in charge of seeing the process through in full
compliance with all applicable matters.
A Professional Will differs from a personal Will, in that it is
not a legal document, but rather a detailed set of instructions for an
appointed “Professional Executor” to follow.
The Professional Executor (“PE”) generally would not be the person named
as Personal Representative or Trustee of the other documents, but rather a professional
colleague who understands the nature of the practice and the steps to be taken.
The PE should be empowered to do any or all of the following:
1. Identify all of
the clients to be contacted to inform them of the death or incapacity of the
professional. This may be done in
person, by phone, or in writing, but should be done with proper sensitivity.
2. Access all records
relating to the practice, and as referred to below.
3. Change voice mail
message, website and any other internet-based sites relating to the professional.
4. Notify any
professional liability insurance carrier of the death or incapacity of the
professional, and deal as needed with current or future coverage.
5. Refer current
client matters to other practitioners or to him/her self.
6. Return files to
clients, if they request that, or otherwise dispose of closed client files in a
responsible manner (shredding, burning) to maintain confidentiality.
7. Inform all
professional organizations of the death or incapacity, and terminate memberships.
8. Maintain all other
files in compliance with any applicable laws, rule and regulations.
9. Reconcile all financial records, pay liabilities and collect receivables.
A Professional Will should include:
1. A list of all of the clients to be contacted to inform them of
the death or incapacity of the professional, and a statement empowering the PE
to contact those clients.
2. A statement identifying where all current client files are
kept.
3. A statement
identifying where all old files are kept.
4. Identifying the
location of all billing and financial records relating to the practice,
including passwords if they are kept on a computer.
5. A statement
identifying the location of all databases of client names, addresses and phone
numbers, with passwords if applicable.
6. A list of all
email addresses, websites, and other on-line resources used by the professional
and passwords for all.
7. Location of any
keys required to unlock file
cabinets or other storage facilities.
8. Any specific
information to be provided to clients.
9. If applicable, the
name and contact information for the professional liability insurance carrier,
and any other professional organizations to which the decedent may belong.
10. Arrangements, if
any, for compensation to the PE for the work he or she does.
11. Any additional
instructions to the PE.
If you have already had an estate plan prepared, you may want to
consider adding a Professional Will to the document set. If you have no estate plan, now would be an
excellent time to put one into place, and a Professional Will may be a part of
such a plan. It behooves you to leave
proper information and instructions in the hands of a trusted person who is
qualified to attend to the difficult task of winding up a professional practice
in an appropriate manner.
