Author: marcsherman

Marc is the President and Founder of Marc D Sherman & Colleagues PC in Lincolnwood, IL. For over 38 years, Marc has represented individuals and businesses in a variety of Estate Planning, Probate, Business transactional and civil litigation matters.
Estate and Probate, Estates Planning And Probate, Trusts

Your Estate Planning Competence: The Matrix

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The Estate Planning Competence Matrix here will help you maximize your planning, or maximize your Parent’s planning if you are looking for a productive way to approach the considerations and the helpful Estate Planning materials that you should be considering.

The basic considerations and information gathering (below the line). Where you are or should begin:

THE INFORMATION ZONE

Nobody likes to do this, but taking stock is the key to success above the line on your journey to Estate Planning Competence!

Start with information gathering. You and your Attorney need to know the complete asset and property picture, as well as the current personal information and background. An Estate Plan cannot be derived in a vacuum. Well, it can, but it would likely leave unnecessary holes and fail to produce optimally effective documents for you and for your Estate Executor or Living Trust Successor Trustee.

Gather the following documents and information:

1.         Copies of insurance binders or information concerning insurance policy numbers and insurance company and rep/agent (with phone number) for policies now in force. This includes Homeowners/Auto (is there an umbrella policy?), Life (term, whole, variable; who are beneficiaries; face amount), Health and Disability Insurance.

2.         Information concerning major personal assets:

            A.        Copy of title for autos, boats and other titled vehicles;

            B.        Real Estate Properties Owned (pull copy of deed for home residence, investment properties, timeshare interests, and leasehold interests);

            C.        Account information, including all financial, stock, bank and other accounts (and estimated value); Identify if any of the accounts are jointly owned with others, or if you have given permission to other persons to sign and authorize transactions for the account;

            D.        If not included with the other account information, list 401k, Pension, Annuity, IRA, CD and similar accounts and whether beneficiaries have already been identified for those accounts;

            E.         Bonds, stocks held in “street name”;

            F.         Other significant assets (include jewelry, antiques, collections, cryptocurrency, intellectual property assets such as patents, copyrights, and options to acquire assets or business interests).

3.         Information concerning any businesses or business interests owned by you. Identify others who own an interest in the business; Is there a buy-sell agreement, shareholder agreement or operating agreement (for an LLC) controlling transfer of interests/shares during lifetime or at death?

4.         Information concerning major current liabilities, such as a recent mortgage statement, or business guaranty or lease guaranty information. Are there any personal loans from others to you or from you to others? Auto financing or auto leasing information, including a copy of a recent statement.

5.         Include copies of other documents not already identified, such as:

            A.        Copies of birth certificates, for you and your spouse or partner, and children; as well as adoption records for adopted children;

            B.        Copies of death certificates for spouse, children;

            C.        Information concerning military service and discharge;

            D.        Information concerning important memberships (are you entitled to death benefits, pension-type accounts if any, etc.?);

            E.         Copies of burial plot deed, contracts for perpetual care for you and for relatives for whom you have responsibility to oversee those issues; cremation and other plans and contracts made (if any); and

            F.         Significant Agreements and Contracts: storage/warehouse leases, USPS or UPS Store box rental agreements, Safe Deposit Box rental agreement, and employment agreement or independent contractor agreement, and others.

6.         And, if this Estate Planning Competence review is to update your previous considerations and documents that you have implemented or considered implementing, including copies of prior Last Will & Testament, Living Trust, HIPAA Authorizations, Living Will Declaration, Power of Attorney for Health Care and Power of Attorney for Property, and other documents that may have been drafted for you and signed by you.

THE IDEA ZONE

Here, before putting pen to paper for formulate the Estate Planning ideas with your Attorney, begin to identify some of the key people who will play a role in your plan – both now and after you are no longer here. This means that you will start to point to the following persons and information:

            A.        Contact information for spouse (domestic partner, significant other), children, parents and siblings;

            B.        Religious affiliation, religious leader’s name, city/state and phone contact;

            C.        Insurance agent(s);

            D.        Accountant/tax preparer(s);

            E.         Primary physician/internist/obgyn;

            F.         Business partners;

            G.        Property managers/caretakers;

            H.        Veterinarian (and identify pets); and

Make your notes for answers to the following important questions:

            Are there any health or other conditions affecting you, your spouse or significant other, or your child or parent that should be discussed (even if the condition is not now presenting itself)?

            Who will be the guardian for minor children if you are unable to care for them?

            Who will take care of an aging parent or other person that you care about?

            Who will make healthcare decisions for you if you cannot make those decisions for yourself? Have you considered at least one alternate who could act in that role for you?

            Who will make property-related decisions for you if you cannot make those decisions for yourself? Have you considered at least one alternate who could act in that role for you?

Lastly, for this pre-discussion/pre-documentation stage, have you heard about Wills, Trusts and other Estate Planning Tools that you believe you may want to explore? Have friends or family members mentioned their use of a life insurance trust, special needs trust, transfer-on-death-instrument or other mechanism? Be sure to be ready with your questions, even if you are not sure whether those items may not ultimately be for you.

You are now ready to consider those Estate Planning Competence items that are above the line:

THE GROWTH & DRAFTING ZONE

Here, you will meet with your Attorney. A call or remote Zoom video conference may be worthwhile before a first face-to-face meeting. Your Attorney can understand the information that you have gathered, can be mindful of the timing of your planning (including any outside pressures that need to be considered). And, together you and your Attorney can identify any worrisome issues (such as, perhaps, a pending or anticipated divorce, or the illness affecting a child or significant other, or the loss of home or business or employment).

Your Attorney is there to share the good and the bad. Setting expectations for what your Attorney can accomplish and when is an important part of the journey.

Your Attorney will discuss a proposal for the type of Estate Planning materials will be beneficial to accomplish your goals. You will agree on the timeline for preparation of the materials and the fees and expenses to be expected. You will, as well, identify any additional documents that are necessary or useful for the Attorney’s work for you.

Then comes the important step of reviewing the Estate Planning documents prepared for you, tweaking those documents to ensure that they are ready for signature, and arranging for and executing the documents.

OK, you are reaching an optimal level of Estate Planning Competence! You are ready to take the next step on the journey:

THE SWEET SPOT

Here, you know you have reached an optimal level of readiness and planning when you have stepped ahead to do the following:

Assemble your Estate Planning personal resource. You will be pulling together into a central location (a “hard” file or a digital file) with your important Estate Planning documents and the materials that you have gathered in order for your family to be best able to assist you in the event of an illness or injury or other event. Discuss with your Attorney the use of a cloud service account (DropBox, Box or other service shared account) where you can securely maintain your important documents and information.

Fund your Trust! If you have decided with your Attorney that a living, revocable trust is going to be part of your Estate Plan, then you will take the next steps for the funding of your trust. Your Attorney will provide for you a Certification of Trust and provide guidance for your next actions with accounts, property deeds into trust, and other important functions.

And, don’t forget that the Sweet Spot is forward-looking: You will review regularly any questions that you have, changes that may be necessary because of significant life events for you or your family members or others close to you, and review your Estate Planning documents and the people that you have selected to act in important capacities for you (usually every 12 to 18 months).

Attorney Maureen Meersman and Attorney Marc Sherman are available to discuss your own Estate Planning Competence, or to address concerns that you have with your family member or significant other who need help to focus on their own Estate Planning questions and concerns. Our Contact Information is available here: https://mshermanlaw.com/contact/

General Litigation

The Bombastic Opposing Counsel; A Burden Or A Blessing?

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Decide if you want your Attorney to be an expensive pitbull or a thoughtful advocate.

In litigation or in a transaction, you and your counsel may find that the attorney on the opposite side is less than cordial. Personalities being what they are, this is not unusual and typically not a problem for the practitioner who is used to dealing with multiple personalities. Diverse experiences, diverse cultures and a multitude of styles are the norm in the practice of law, not the exception. Creative arguments, creatively expressed, is often the hallmark of a skilled attorney.

Issues unique to the practice of law will often seep into the activities at hand. Most lawyers have an ego. This is good, as it is useful when necessary for the attorney to be a zealous advocate for the client. But it is often the case that large egos need to be fed or flattered, and sometimes the ego-driven lawyer needs to “win” every court battle and needs to win every comma, semicolon and clause of the lease or the contract.

Then there’s the fee conundrum.

When an important deal is being negotiated, or a case is being litigated in court, several concerns may arise that put a spin on the issue. The saying “Time Is Money” has a real meaning for the lawyer and client, because in many instances the attorney fee relationship is based upon an hourly fee agreement. The need for unnecessary dialogue, court appearances or document drafting (and re-drafting) that result from a troublesome opposing attorney can become, well, tiresome to the attorney and financially frustrating to the client.

Does the client expect to be billed for the back-and-forth? Or does the client expect that their attorney will take the high road and pick the battles carefully? Some clients want to battle as much as the pompous lawyer on the other side, but later do not want to pay the additional hours for the experience! Attorneys will fight to every last drop of the client’s money, if that is the client’s direction. Cents and sensibility often win out.

Is there a strategy that can accomodate all of these considerations and turn lemons into lemonade? Most times the experienced attorney can do so.

The seasoned attorney knows that if the situation is made known to the client early and often (without whining), then the tactful display of fending off the offensive lawyer can be a boone to the attorney-client relationship. The attorney can demonstrate to their client a greater familiarity with the area of law, can demonstrate their strategic use of legal tools and practical experience, and can even display the attorney’s enhanced problem-solving skills. In court cases, every attorney knows that you win some and you lose some in the continuing press for the settlement or verdict, and if the client is properly advised then the client’s expectations and own feelings will often be reasonably addressed. The result is frequently a more solid attorney-client relationship and a mutual respect for the way that the situation was handled.

Then there is the occasional time, when the bombastic opposing lawyer demonstrates in living color in the courtroom or the conference room, and perhaps even in the presence of their own client, that the lawyer’s style (or personality flaw) and the absence of a volume button has done a disservice to their client. The lawyer cannot stop. They need to have the last word. The lawyer cannot realize where their excessive argument has taken them because their personality must view every encounter as a cage match where the opponent (or Judge) needs to tap out as sign of total defeat.

The lawyer is too wound up in their own bluster to see that those with them in person or on a zoom video conference, with others present (including their own client), are rating the argument a 5 out of 10 but the lawyer’s tactics and presentation a minus 3!

Even if the Judge or others in the encounter select their words and approach to mollify the bombastic lawyer, you know and your client knows and even the opposing lawyer’s client knows that the arrogant, blustery lawyer has lost.

When I see or hear of these situations, it is in that moment that I know what was meant by a thoughtful attorney who aptly explained to me forty years ago when he said to “be careful not to snatch defeat from the jaws of victory…” 

General Litigation, Limited Representation

Is Your Lawyer Using Creative Billing Methods? We are.

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Alternative Fee Arrangements Are Useful. And We Use Them.

The typical lawyer billing model uses hourly billing for Attorney time and Law Firm Staff time devoted to the case or project. 

The Hourly Billing Model is typical.

Each hour or fraction of an hour that the Attorney or Staff spends on the client project is included in the Attorney Invoice. Usually, this is at a quarter of an hour increment or a one-tenth of an hour increment. “Billable” time includes all time spent, such as communications with the client or others, research, document preparation, time for court or other activities (including in most instances travel to/from the location of the project).

Have you discussed with your Attorney the use of a Flat Fee Billing alternative?

This method uses a value-based approach to Attorney services by fixing the Attorney fee to the type of service. For example, Marc D Sherman & Colleagues PC often provides Flat Fee Billing rates for Client projects such as: Preparation of Wills, Trusts and other Estate Planning materials, for creation of a business entity like a Limited Liability Company or other Business Corporation, for residential real estate transactions, for Deed Transfers, and for other projects.

Using Flat Fee Billing sometimes includes the out-of-pocket expenses involved with the project, like filing fees or recording fees. But the regular practice at our Law Firm is for the expenses to be invoiced separately from the fee charged to the client. Ask your Attorney what those expenses may be and how they are paid.

Contingent Fee Billing May Be Applicable In Some Circumstances.

In some cases, usually certain types of litigation like personal injury cases, the use of contingent fee billing is arranged in order to provide the client with a reasonable basis for the Attorney Fee that is related to the results of the case. In this way, the client may only be responsible, say, to pay the Attorney a fee based upon one-third of the award to the client. At our Law Firm, the nature of our work does not often include cases where Contingent Fee Billing is appropriate.

You should review contingent fee billing agreements carefully. Is the fee payable when the award is announced? Or is the payment of the fee contingent upon the recovery of the award in collection.

Hybrid Billing Arrangements May Be Worthwhile For Both Client And Attorney.

The Attorneys at Marc D Sherman & Colleagues, PC may suggest that a hybrid billing agreement is advantageous for both the Law Firm and for you.

Consider this example: You and two friends are looking to create a new LLC entity. An agreement may be made with our Law Firm for the organization of the entity for a flat fee billing rate, and then for an hourly billing rate to be applied for representation for the creation of the Operating Agreement due to extensive work among the several new LLC Members who require a detailed Member agreement for buy-sell purposes or to include other protections to be negotiated between the Members and memorialized by the Attorney.

In that example, hourly billing may also be appropriate for creation of the new LLC business policies, employment agreements, independent contractor agreements, or contract terms and conditions appropriate for the type of business.

Get it in writing, including the Attorney Retainer Deposit.

You should expect that the Attorney-Client Engagement, including the billing agreement, will be in writing. The Engagement agreement and the fee discussion should be understandable. Ask questions, so that you are sure that you understand the Law Firm expectations and your own responsibilities.

In most instances, Law Firms expect the client to deposit a retainer payment. This is an advance deposit that will be applied to the services and expenses for the client’s case or project. There are different types of retainers, so ask the Attorney to explain the reason for the retainer, where the retainer will be deposited, and how the retainer will be applied to legal services and expenses. 

And Don’t Forget That The Fee Agreement May Need To Be Modified.

It is appropriate for an attorney to modify a fee agreement under certain changed circumstances. This means that our Law Firm may reasonably suggest a change to the fee agreement in situations that are understandable: For example, if the nature of the case or project changes significantly because of outside or unexpected forces or because of the client’s directions. Or, if the client’s own circumtances change, such as a business entity organization that begins as a single-shareholder project and turns into the organization of a multiple-shareholder project.

The Attorney Fee Agreement will often anticipate changes in circumstances, such as changes in the Attorney’s hourly rates over the life of a case that may take years to complete. But even if these changes are not specifically anticipated, changes are appropriate as long as they are reasonable under the circumstances.

Check Out Limited Scope Representation or Unbundled Services.

There are times when the client’s needs are only related to certain limited elements of the legal project or case. For instance, in a small claims case, the client may want Marc Sherman to only provide certain services – like preparation or review of the Complaint to be filed, or assistance with preparation for a motion to be presented in court or for a trial that is scheduled to take place.

Sometimes the client wishes to hire Marc Sherman to only handle parts of a court case, like contested motions or pre-trial or trial aspects of the case. The Illinois Attorney Professional Rules allow Attorney Sherman to file a limited appearance in the court case, and the Attorney Fee Agreement will set out the basis for the Law Firm billing and the expenses. The Fee Agreement will also identify the limitations on Attorney Sherman’s responsibility for the elements of the case.

Next steps? Attorney Fees and Billing can be confusing for even long-standing clients. If you have questions about Attorney Fee Arrangements, alternative billing approaches or other considerations discussed here, or if you have an agreement with another Law Firm that you feel should be reviewed, reach out to Marc Sherman by phone to (847) 674-8756 or by email to msherman@mshermanlaw.com.

Estate and Probate, Estates Planning And Probate, Trusts

Advice For Mom Who Wants To Leave One Child Much Less Than Others? 

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Best Advice May Be To Remove Child From Mom’s Will And Trust

Losing a child is devastating. Losing a child because they no longer connect is even harder according to practitioners like Batya Swift Yasgur, MA who have observed the data and the anecdotal evidence in their clinical social work practices.

Heartbreak. That’s what Estate and Trust Lawyers see in the faces of Parents who have become estranged from their children. The reasons may be known or unknown. But the scars and the trauma are the same.

One Mother tells her story: Son Jerry moved away years ago. At first Jerry answered Mom’s calls and sent a card on Christmas. But that ultimately became a rare occasion. Then Jerry stopped returning messages on his answering machine. It has been years since the last letter (Mom doesn’t email). And worse yet, no interaction with Mom’s grandchildren; Jerry’s kids don’t connect either. It has been over 10 years.

Mom’s other two children, both younger than Jerry, couldn’t fathom what was going on either — Jerry had stopped reaching out to them too.

At Mom’s appointment to review her Last Will and Testament and her Living Trust that was made years earlier she said: “I don’t want to give money or my house to Jerry when I pass away.” But Mom felt bad leaving Jerry nothing.

Mom had heard that Jerry could cause problems for her two other children after she is gone and that perhaps leaving something in her Will for Jerry would placate him.

Is there a good, better, best way to handle this situation? Read On:

The Do-Nothing Approach Solves Nothing.

“Maybe I should wait,” says Mom. Sure, things could change. But since it has been more than 10  years already, is that truly going to happen? No. Life experiences tell us that Jerry may reconnect if he needs money, or maybe if he needs someone to care for HIM! 

Waiting can be a disaster. If later Mom loses the ability (or as Estate Lawyers say, the capacity) to change her Will and Trust, then the opportunity for making changes is limited or unavailable. In fact, if she waits and something happens to Mom before she can change her Will and Trust to confirm her desire that her other two children should received her bounty, the other two children will become resentful of Jerry’s undeserved windfall and disappointed with Mom for not matching her gifting to her emotional directions. There will be little chance of reconnecting Jerry and his siblings, and the nieces and nephews.

Instead, Mom should know that directing her Estate Lawyer to make her Will and Trust changes now is positive: It allows Mom to begin to accept the reality of Jerry’s actions, and to continue to make efforts to encourage Jerry to reconnect with his family. And, Mom can later make changes if the family relationship with Jerry mends.

Instead of “Do-Nothing,” Mom is encouraged to be proactive and protective.

Cutting The Will And Trust Cord May Be The Best Action.

So, Mom decides to change her Will and Trust to match her feelings and to protect her other children and to be true to her own feelings. Jerry, she still believes, should get something when she passes — she does not want to leave him nothing. What does she do?

Considering what Mom should do, says Estate Planning Attorney Maureen Meersman, requires being thoughtful of the consequences for Mom’s Estate, and understanding the law.

If Mom wants to make a gift to Jerry, no matter how small, “I would tell her to make Jerry a beneficiary of an account or life insurance policy or set up a bond in joint ownership with him.” Meersman says. “But, unless there are worthwhile reasons to do so, I would not recommend including Jerry in the Will or Trust.”

Providing for Jerry in Mom’s Trust, Meersman explains, then allows Jerry to participate in the Estate and Trust in ways that Mom could not imagine. Jerry would be entitled to receive trust documents and be able to see how the other children are treated. And Jerry would also be entitled to receive information concerning the trust assets, even if the distribution to him was nominal.

Using Meersman’s approach, at Mom’s death Jerry would receive the beneficiary gift from the asset specifically set aside by Mom. Jerry’s ability to inject himself into the Trust Administration would be restricted. And if Mom needs to make changes in the future, she can.

Separately, Meersman would confirm the terms of Mom’s pour-over Will to her Living Trust. If Trust Funding is thoughtfully accomplished then Probate Court administration is likely to be unnecessary, and Mom’s property can be distributed in the way that she wants to take place for the other children and grandchildren.

Attorney Maureen Meersman, who has extensive experience in Estate Planning and Probate matters, has just joined Marc D Sherman & Colleagues PC in a special “Of Counsel” capacity. For more information, check out our announcement: https://mshermanlaw.com/about-us/

Maureen can be reached for questions and to set up an appointment by contacting her at atty@meersmanlaw.com.

General Litigation, Real Estate, Real Estate Sales and Purchases

WIRE TRANSFER INSTRUCTIONS: PLEASE READ

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Wire Fraud is on the rise and is a very real threat. Marc D Sherman & Colleagues PC and its Of Counsel Attorneys and staff spend significant time representing residential and commercial buyers and sellers in a variety of real estate transactions. Our Firm typically does not send wire transfer instructions for external purposes, such as real estate earnest money deposits or for funding real estate closings.

If you receive an email from our office including wire transfer information, call and confirm that it is intentionally sent by us and that the information is accurate BEFORE using the instructions.

If Wire Transfer Instructions are provided to you by a third-party, such as a title company or lender, it is recommended that you (1) confirm that the email is from a legitimate, authorized source, and (2) if so, then follow the steps that are stated in the email communication in order to ensure that the communication is legitimate and to confirm the instructions are valid, or contact our office.

For further questions, you can reach one of our Attorneys or staff at the Contact Information shown in this website.