1. society

the
SOCIETY
RECORD
VOLUME 24 | NO. 1 | February 06
NOVA SCOTIA
BARRISTERS’ SOCIETY
www.nsbs. n s . c a
Retirement 101:
A How-to Guide
VISION, LEADERSHIP, EXCELLENCE - THE LEGAL PROFESSION IN NOVA SCOTIA
February 2006
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The Society Record
Eric Jorden, M.Sc., P.Eng.
Forensic Engineer
Consulting
Professional Engineer
C ontents
VOLUME 24 | NO. 1 | FEBRUARY 2006
4
From the Editor’s desk
5
The President’s View
6
Briefs
8
Succession Planning — Donnalee Moulton
11
The Low Down — Alan J. Stern, Q.C, Pat Caldwell, Q.C., Mary Meisner, Q.C.,
Tom Burchell, Q.C., and Terry Roane, Q.C.
the
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NOVA SCOTIA
BARRISTERS’
SOCIETY
14 Benefiting from Change — Ted Delehanty
18 LIANS
Pullout section Nova Scotia, Law News Vol. 30, No. 6
For your Information, Retirement Bibliography
20
Actively Retired — David Bryson, Q.C., John Cochrane, Q.C.
22
A Plan for all Seasons — Garth Bennett, Taura Publicover, Jerome Grady
26
You be the Judge — Angus MacIntyre, Q.C., and Elizabeth Whelton
28
The Big Picture
30 Summation
page 11
page 20
page 21
page XX
page 22
C ontrib u tors
Donnalee Moulton is a
professional freelance writer
and editor based out of
Halifax.
Jerome Grady is a chartered
accountant and registered
financial planner with Assante
Capital Management Ltd.
James Musgrave, Q.C., is a partner
at Cox Hanson O’Reilly Matheson.
His practice areas are corporate
and commercial and real estate
and leasing.
Garth Bennett is a financial
advisor with Dundee Private
Investors.
Angus MacIntyre, Q.C., is a
general practice lawyer with
Dartmouth’s Heritage House
Law office.
David Bryson, Q.C., is a retired
lawyer who spent 37 years at the
Halifax firm Blois Nickerson &
Bryson.
Taura Publicover is president
and senior advisor of Eagle
Vision Financial Planning.
Elizabeth Whelton practises
family and matrimonial law
at the Halifax firm, Blois,
Nickerson & Bryson.
John Cochrane, Q.C., retired
from the firm Taylor, Maclellan
Cochrane in December 2004,
after 42 years of practice.
www.nsbs.ns.ca
February 2006
W
ell, I now have a much better idea about how lawyers
feel about retirement: pretty much like everyone else
it would seem. Retirement’s one of those great unknowns for most people, and as such we felt it was an important
topic to tackle this time ‘round – hope it helps answer some or all
of those nagging worries you might have had about this topic.
And thanks again to all those who gave of their time and selves
to help us pull it together and get it out the door.
Getting it out the door brings me to our next issue, which is, of
course, our volunteer one. Please let us know about the good
work you or someone you know is doing out in the community.
Rumour has it that April’s issue is a particular favourite with our
members, so do send in those stories, as readers are obviously
interested!
Dear Editor,
I’m just a tad baffled by comments made by Justice Heather
Robertson in The Society Record of December 2005.
Ms. Justice Robertson describes the daily hub-bub at the
Spring Garden Road courthouse, including the words “...an
agressive press anxious to photograph the accused...”
I checked on the word agressive in the dictionary and here’s
what I found: “Inclined to behave in an actively hostile
fashion.” Jeepers creepers Ms Justice...really?
When I’m assigned a court case, I always thought I was there
to let the people know what their justice system was up to.
You know, making our court seem less like a Star Chamber
by helping citizens exercise their right to see justice being
done.
I admit, I’m dedicated to the principal of a free press
covering an open court system. Perhaps, I’m even
passionate about it. But hostile? Nope. Never.
Thanks,
Rob Gordon,
Journalist
The Society Record
The
President’s
Phot o by Ted Power/NSBS
View
T
his issue of the Society Record deals with preparing for retirement. For me, retirement means golf. That’s it. I don’t know
much else about it. I obviously need this issue’s insights.
What I want to talk about is something I do know: your Barristers’
Society. It is midwinter, and the time for report cards. I would like
to report on what I have found in my time thus far as President.
The Society’s functioning depends on two distinct groups of
people: you, the members, who volunteer to serve in so many
different capacities; and the Society’s staff, those persons
responsible for the day to day functioning of the Society.
Over the years I have met hundreds of volunteers, and I am
always amazed at the dedication that our lawyers give to their
responsibilities. This year is no different. Whether it be on
standing committees dealing with regulation of the profession
and protection of the public, or special task forces considering
new areas of interest and concern, the jobs they undertake require
hours of work on top of already busy schedules. Nevertheless,
these volunteers meet their obligations with enthusiasm and
understand the importance of their work: to provide the critical
policy direction and higher level decision making needed to keep
the Society vital. Over the last few years our volunteers have been
instrumental in the development of our new Legal Profession Act,
new library system, and revamped articling program. This year,
some of what they’ll be considering includes new trust account
monitoring, insuring our compensation fund to reduce risk and
cost, how to best offer continuing professional development,
and on-going issues involving Real Estate. They do so under the
watchful eye of Bar Council, which tracks the progress of topics
every meeting. I can tell you that we are meeting the goals of our
Annual Plan, a credit to our members who serve. Of course, most
of these volunteers will tell you that the experience is not just a oneway street, that they receive back every bit as much, if not more,
than they give. Volunteering with the Society is a tremendous
opportunity for professional development, to meet other lawyers in
different contexts, and to feel a part of an important organization.
As important as our volunteers are, our staff do the critical day to
day work. Led by Darrel Pink, these people put into place the policy
directives established through the committees, the Executive, and
Bar Council. They also carry out the administrative responsibilities
of the Society, including our obligations in the area of professional
responsibility, education, and insurance. There is no question that
our members sometimes wonder what it is our staff do. Indeed,
when elected, I promised to constantly ask questions and challenge
staff to do the best job possible. That has happened. I can tell
you that the staff at our Society welcomes those questions and
challenges, and all recognize that this organization must always try
to improve. As an example, I recently sat in on a day-long session
with several senior staff focusing on a better way to offer our skills
training. I was struck by the absolute enthusiasm they had when
working to develop the best education program possible for our
new lawyers. They bring that attitude to all their responsibilities.
It is this combination of vital volunteers and dedicated staff that
leads to what I have observed at a National level: in many areas,
Nova Scotia is a leader in this country among Law Societies.
So is everything perfect with your Society? No, nothing ever is,
but that is the goal. With continued strong volunteer leadership,
which stays active and always asks questions, working together
with dedicated staff, we can ensure your Society continues to
function at its current high level. Take care.
Legal Careers
Emily Lee, B.A, LL.B
Recruitment Consultant
Hailing originally from New Brunswick, Emily received her Bachelor
of Arts degree in Political Science from Dalhousie University before
obtaining her law degree from Dalhousie Law School. She articled
with McInnes Cooper’s Halifax office and was called to the Nova
Scotia bar in 2003. Shortly thereafter, Emily relocated to Toronto and
transferred to the Law Society of Upper Canada. Emily joined ZSA
Legal Recruitment as a consultant in January 2004 and now focuses
on the placement of associates and partners in law firms and inhouse positions. Part of Emily’s mandate at ZSA is the placement of
lawyers into and out of the Atlantic Canada region.
For a confidential discussion of your legal career, please contact
ZSA today. When in Halifax, Emily can be contacted at:
1969 Upper Water Street,
Purdy’s Wharf Tower II, Suite 2200
Halifax, Nova Scotia M3J 3R7
Tel: (902) 444-4711
Toll Free Fax: 1-866-368-5699
E-mail: [email protected]
zsa.ca
Emily Lee
C A N A D A’ S
L E G A L
R E C R U I T M E N T
F I R M TM
February 2006
BRIEFS
Bernd Christmas receives 2006 National
Aboriginal Achievement Award
The Society’s 2005 Presentation to the Status
of Women Committee
Mr. Bernd Christmas, a member of the
Nova Scotia Barristers’ Society, will be
receiving a 2006 National Aboriginal
Achievement Award from the National
Aboriginal Achievement Foundation
for his contribution to business and
commerce. The award recognizes
career achievements by Aboriginal
professionals in diverse occupations,
and represents the highest honour
the community bestows upon its own
achievers. Individuals of First Nations,
Inuit, and Métis ancestry who have reached a significant level
of achievement in their respective occupations are eligible for
nomination.
On Wednesday, November
23, 2005, President Ron
McDonald, Q.C., together
with Marie Paturel, the
Society’s Equity Officer,
appeared before the
Standing Committee on the
Status of Women to offer
the Society’s perspective
on whether maternity and
parental leave benefits
under the Employment
Insurance program should
be expanded to include
self-employed workers. The
Committee was interested
in the work the Society
had done on the parental
leave proposal (which
went before Council last year). The Committee then invited
the Society to provide further feedback on specific questions
they were dealing with while considering the expansion of the
EI benefits. The Society was pleased to provide input to the
committee’s deliberation on this important issue.
Mr. Christmas is the current CEO of the Membertou First
Nation. Graduating from the Osgoode Hall Law School in
Toronto in 1991, Mr. Christmas is the first Mi’kmaw to become
a lawyer in Canada. In 1995, as a result of a request by Chief
Terrance Paul from the Membertou Band Council, Bernd
Christmas returned to Nova Scotia to work for the Band.
As CEO, Mr. Christmas has worked with the Membertou
Band Council to develop extensive business links with major
companies, including Sodexho Canada, Clearwater Fine
Foods, SNC Lavalin and Lockheed Martin. He also worked
on obtaining certification by the International Standards
Organization (ISO) for Membertou, the first native community
to obtain this status.
Justice R.E. Goodfellow, MSM, CD, Q.C, to
Receive the Meritorious Service Medal
The Society offers congratulations to Nova Scotia Supreme
Court Justice Walter Goodfellow, following a recent
announcement that he will be receiving one of the country’s
top honours: The Meritorious Service Medal.
The award, which recognizes Justice Goodfellow’s dedication
and service to Canada and the Armed Forces, will be formally
presented to Justice Goodfellow by Her Excellency The
Governor General Micaelle Jean. The ceremony is currently
slated to take place on April 28, 2006 at Government House,
Rideau Hall.
The position taken by the Society in its submission can be
summarized as follows:
“The Society would support the expansion of the
EI parental benefits and the compassionate care
leave programs to cover self-employed workers. The
Society believes that if such expansion occurs, that the
participation should be voluntary, that the contribution
should reflect the limited expansion of the EI program
and that the employer contributions should be covered by
the self-employed worker. The Society does not support
an association-created plan model.”
For a copy of the Society’s submission please go to the
Important Notices section of the website (www.nsbs.ns.ca) and
click on Discussion Papers.
To read President Ron MacDonald’s address to the
committee, please go to http://www.parl.gc.ca/committee/
CommitteePublication.aspx?SourceId=137696.
The Society Record
BRIEFS
Q.C. Appointments
Call to the Bar
The Society would like to congratulate the following 13
Nova Scotia lawyers on their Q.C. designations, announced
December 22, 2005, by Justice Michael Baker:
The Nova Scotia Barristers’ Society recently welcomed the
following new members to the bar:
Martin Ward, Federal Justice Department, 1976;
Keith Evans, KMC Oiltools Canada Inc., 1980;
Jean Beeler, Weldon McInnis, 1981;
Malcolm Jeffcock, Nova Scotia Legal Aid, 1981;
Marci Lin Melvin, Nova Scotia Legal Aid, 1982;
David Coles, Boyne Clarke, 1985;
James Musgrave, Cox Hanson O’Reilly Matheson, 1985;
Edward Gores, Nova Scotia Justice Department, 1986;
Ian Holloway, University of Western Ontario, 1986;
Daniel MacRury, Public Prosecution Service, 1986;
Lynn Reierson, Reierson Schurman;
Robert Patzelt, Scotia Investments Ltd., 1988;
and Augustus (Gus) Richardson, Huestis Ritch, 1990.
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Joseph JeBailey
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November 4, 2005
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December 2, 2005
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February 2006
Succession
planning
an important tool for business –
an ethical requirement of practice
Change is the only constant in
life, and in the practice of law.
A
Law firms, he adds, also have another onus on them that makes
succession planning not just optimal but essential. Lawyers are not
just running a business, they are also part of a profession, and in
that context, have an
obligation to make sure
Donalee Moulton
Quantum Communications
that if they are not there
to handle a client’s needs,
that someone else is. This is an ethical requirement of practice.
mong the changes that can be counted on: that lawyers will leave
a firm; some will retire, some move away, and still others will
move to the bench. In the end though, the result is the same.
There is a void that must be filled, and from the firm’s perspective – and
the clients’ – that void needs to be filled effectively and seamlessly.
The obligation on lawyers to see that their clients’ needs are addressed
– even in their absence – is clear. Less clear is a firm’s obligation to
address these needs. However, good business practice and common
sense underscore the value of planning now for what may happen
tomorrow.
“As a profession, we are starting to become more sophisticated in
our thinking about this issue,” says Cheryl Hodder, a partner with
McInnes Cooper in Halifax.
Succession planning, which enables a business to survive and grow over
the long term, goes well beyond replacing Lawyer A with Lawyer B. It
is not merely a matter of having another warm body with an LLB.
“Lawyers and law firms in general do not think about succession
planning as much as clients would like them to,” she adds.
“There is always a big effort made to make sure the transition is
seamless to the client, but so many of these relationships are personal.
There’s a risk when a new lawyer takes over. It is, therefore, not just
a matter of succession planning, it is also a risk management issue,”
says Hodder.
That thought process can be effective in two ways. It will enable law
firms to provide the best possible ongoing service to their clients. It
is also another service lawyers can provide to clients who may be in
need of a succession plan themselves.
That need is significant. According to a recent survey from the
Canadian Federation of Independent Business, seven out of 10 smalland medium-sized business owners intend to exit their businesses
over the next 10 years. Only one-third of these owners are currently
planning for their future succession. That lack of a succession plan, says
Bill Downe, Deputy Chair, BMO Financial Group and CEO of BMO
Nesbitt Burns, explains why only one in three small- and medium-sized
enterprises survives the transition to a second generation, and only one
in 10 the transition to a third generation.
Law firms are not immune from this reality. “From a business point
of view there is every good reason to have a succession plan… . There
needs to be some arrangement of who follows whom,” notes Innis
Christie, a labour arbitration expert and former dean of the Dalhousie
Law School.
Bernard Pinsky, Head of the Corporate Financial Securities Group with
Clark Wilson in BC, notes that lawyers often deal in specific areas of law,
creating a niche for their expertise. There is still a need, however, to have
a broad enough depth of expertise in an area so as to be able to fill a gap
when a lawyer leaves. Pinksy’s Vancouver-based firm, which specializes
in business law, recently experienced such a transition when the head
of the litigation department left. When time allows, the transition to a
new lawyer can be put in place over a period of several weeks or months;
the problem is that time doesn’t always allow for this.
“Retirement you can plan for,” says Pinsky. “But someone walking
across the street is hard to plan for. It’s often unexpected.
Being taken by surprise though, does not mean a law firm should
be caught off guard. As Dalhousie’s Innis Christie notes, “The
unexpected should have been foreseen.
It is preparing for that element of the unknown which underlies
succession planning.
The Society Record
“It’s so much better if succession planning starts at least three, if
not five or 10 years in advance of the event,” says David Goad, a
succession-planning consultant based in California and author of a
manual prepared by the Financial Planning Association and devoted
to the issue.
BMO’s Bill Downe identifies five key questions that businesses need
to ask themselves as a first step in developing a successful succession
plan. Three of those questions are directly applicable and easily
adapted for law firms and lawyers. They are:
•
•
•
Is there someone in the firm who is not only available to
take over, but also qualified?
If so, what is the best way to prepare that lawyer to take on
this role?
What should be done to ensure that all members of the
firm, as well as all clients, are treated fairly in the process?
Downe also recommends making the succession-planning process as
objective as possible. “It’s such a difficult thing to do, but I can’t say
it often enough: the succession planning process must not be guided
by…emotions.”
One way to take the emotion out of the process is to identify (and
separate) key stakeholders from the succession process itself. In the
case of law firms, the key stakeholders would be clients of the firm,
members of the firm, and the firm itself. According to Downe, it is,
surprisingly, the business itself that usually gets the least attention in
the succession planning process, yet probably needs it the most.
Thinking big while attending to the details is essential in developing
a truly valuable succession plan. Taking the time to do it right is
another important factor. According to KPMG, the succession
planning process alone generally takes 12 to 18 months, with an
orderly transition taking as long as three to five years.
The succession planning
process must not be
guided by…emotions.
For many firms, especially larger ones, the succession planning process
is part of a larger approach to business. At McInnes Cooper, for
example, the firm has put in place a client service model that involves
the managing partner meeting with clients on a regular basis to discuss
quality of service. This relationship with the firm becomes invaluable
when an individual lawyer leaves. In the case of succession planning,
every effort is made to put a team in place to support the client. The
team is comprised of lawyers at different levels of seniority within the
firm. The result is a seamless transition, should one lawyer leave.
“It is one of the value-added services we offer,” says Hodder. That value
helps to diminish the potentially adverse impact of the unexpected.
Another reason behind the apparent reluctance to prepare for
retirement and other unexpected contingencies is a lack of a
framework. After all, lawyers know how to run their practices, but
often have no reference point from which to draw from when taking
that next step of handing it over to someone new.
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Elements of an effective succession plan include:
• On-Site Shredding
•
•
•
•
•
•
•
Preparing a communications strategy that keeps key
stakeholders in the loop and involved
Identifying expected, and likely, vacancies coming down
the pipes
Identifying critical positions within the firm
Determining what skills are needed to meet client needs
today
Determining what skills will be needed to meet client
needs five years from now
Putting a recruitment strategy in place – even if it will not
be implemented immediately
Developing evaluation criteria to determine if the
succession plan is working (this might involve, for example,
surveying clients after a member of the firm has left)
The ultimate purpose of a succession plan is not to simply replace
one qualified individual with another. It is to ensure that the firm
responds to the needs of all clients and continues to operate smoothly
and effectively. A succession plan must also be closely connected to the
firm’s strategic plan, if there is one. If not, it must be aligned with the
vision of the firm, the partners, or the sole practitioner.
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February 2006
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10 The Society Record
the
Low
down
We recently asked a cross-section of lawyers in their 50s and
60s to jot down a few thoughts on retirement: the good, the
bad and the ugly. Is there a difference between how men and
women face leaving a legal career for a life of leisure, travel and
grandchildren? You decide.
R
etire — who me? I recall that shortly after
I began to practice in the Roy Building
in 1966 a call came in from a significant
firm across the street. The message was that the
senior partner, old man “R”, had just died at his
desk. Of course, I immediately thought that this
would never be my scenario and I would retire
long before I would be considered to be old.
Here I am at age 62, almost 40 years later. I think
I am young, although several young associates in
my firm insist on calling me “Mr. Stern” (even
after I ask them to do otherwise).
I have practiced in most areas of the law and in
situations from solo practice to the 185 lawyer
firm McInnes Cooper is today.
Most days in the practice are very rewarding. I now meet the children and grandchildren
of clients who have been loyal all of these years. Mentoring young lawyers brings me great
satisfaction. Aside from the required income, there are very good reasons not to consider
retiring. What would I do at home? My experience and knowledge stand me in good stead
with my colleagues, clients and the courts. The mere thought of leaving all of this behind me
evaporates immediately when my telephone rings or I have a visitor in my office.
Alan J. Stern, Q.C., is a partner at McInnes Cooper. He has served on the Ethics and Professional Responsibility
Committee and its predecessors for many years and currently serves as the Chair of the Ethics and Professional
Issues Committee of the Canadian Bar Association.
February 2006
11
F
or the
first thirty
years of
my pratice, the
word “retirement”
scarcely existed in
my vocabulary;
now, in year thirtyfour it persists as
my number three
subsconscious
thought - right
behind “golf ” and
“diet”.
Should I? Can
I? When will I?
What will I do if I
do? Does anyone know of a good part-time legal job — preferably
between November and March?
I am beginning to have “eureka” moments. Certain truths about
retirement are fast becoming apparent.
1. The closer it gets, the less appealing it is.
2. Golf is not a game to retire to, and is most engaging as a
means of escaping the stress of work.
3. My retirement date is out of my control, and will
ultimately be determined by my long serving, long
suffering, all knowing secretary whose CPP eligibility
date unfortunately predates mine.
Maybe this sole practitioner thing was not such a great idea after all!
Pat Caldwell was admitted to the Bar in 1972 and currently practices mostly
property and probate law as a single practitioner in Yarmouth, Nova Scotia.
W
hen you
get old,
you
retire. Right?
Wrong? What is
old and what is
retire?
Some retire at 55
by force, others
by choice. Some
change the style
of their work, if
permitted. In the
legal profession, we
have traditionally
been blessed with
the opportunity of
extended service work experiences. When I think of C.R. Coughlan,
Q.C., Irving Pink, Q.C., and several of my own family, they have all
had the opportunity to work and to serve for 60, 70 or 75 years!
I
n the 1980s
I readily
dismissed
any suggestion
of retirement,
exclaiming that
“they’ll have to
wheel me outa
here!” Admittedly,
however, over the
last several years
retirement has been
looking exceedingly
attractive with all
those substantive
and procedural
changes in most of
my preferred areas
of practice! Indeed, anyone looking at my billable hours would
think I’m already retired! Indeed, some people haven’t even seen my
Daytimer and they still think I’m retired!
In all seriousness, however, and without intending to wax
philosophical here, how I now view retirement very much reflects
how I have tried to channel my energies within a greater focus/
purpose. In so doing, and although a workaholic, I have tried
(albeit not always successfully) to maintain some quality of life,
nicely balancing work with family and other interests and facets.
Ergo, and being still young (at heart, that is), I do not see voluntary
retirement, per se, in my future. Instead, health permitting, I see a
‘refinement’ of my practice — be that in the areas of practice and/or
its location. Besides, I don’t golf.
Mary E. Meisner, Q.C. has been in practice since 1979 and a sole practitioner
for the last 20 years. She enjoys a ‘fairly’ general practice, with her preferred areas
of practice being family law and residential real estate.
Those are probably the good old days in the practice of law.
Gardening, fishing, painting, and a change in pace and lifestyle
are the opportunities that “retirement” affords those who practice
in their senior years – to continue to serve their “peer” clients and
provide mentorship to the “up and comers” around them in the
practice of law. I have seen it happen successfully and hope it is not
going the way of the do-do bird!
Some firms may have mandatory retirement criteria which forces
the issue upon you, while others may take a more ad hoc approach.
The concept of retiring also raises issues like “Can I afford to retire
and yet maintain my current lifestyle? Can I change the pace and
composition of my practice while sustaining commitments to my
firm and its objectives.”
I hope to be able to practice into the foreseeable future, as working
(as long as you have your health) keeps you current and active, and
provides a worthwhile outlet for one’s energies.
Thomas Burchell is a partner with Burchells (Burchell Hayman Parish). He
practices principally in the areas of Civil Litigation, Real Estate and Probate.
12 The Society Record
R
eceiving
a request
to write
an article on
retirement is
somewhat like
receiving a long
service award
– you stop in
your tracks and
wonder whether
someone knows
something you
do not! At some
stage, however, it
is obvious that all
of us will exit the
practice of law.
Rather like the cobbler and his children’s shoes, it is my observation
that lawyers as a group tend to spend little, if any, time attending
to the planning of their own retirements. The close to complete
absence of even modest defined contribution pension plans among
private law firms across Canada arises from a culture based on a
client service tradition and, I would suggest, an outmoded view
of the respective roles of lawyers and their firms. The size and
purchasing power of the Bar now makes pension plans affordable
and easily administered. The ‘business case’ is obvious when one
reflects on the difficulty all firms are encountering recruiting and
retaining our best and brightest law school graduates.
Demographic profiles of lawyers in private practice are telling. We
know that disproportionate numbers of women have been leaving
private practice for other pursuits early in their careers. It is not
frequently realized that the phenomenon is repeated when one
reaches the other end of the practice spectrum. Although the small
numbers involved make analysis difficult, it does appear that senior
female partners across the country are leaving the practice of law
earlier than their male colleagues.
Motivations to retire are as diverse as the lawyers involved. It
strikes me, however, that a hard look at creating alternatives to
retirement is essential if firms are to retain and motivate those
who likely are at the peak of their earning and rainmaking powers.
Attention to flexible work arrangements and to creating roles which
accommodate a lawyer’s strengths were relatively unheard of until
new entrants to the profession demanded change. That same ‘worklife balance’ focus can generate a myriad of mutually beneficial
alternatives for law firms and partners of either gender who might
otherwise choose retirement. It is with a nod to that concept that I
have decided to celebrate my own 55th birthday by departing on a
part-year sabbatical in the summer of 2007!
Terry Roane is a partner in the Halifax office of the Atlantic Canada law firm
of Cox Hanson O’Reilly Matheson. For the past 20 years her practice has been
limited to labour and employment law and she is recognized as a specialist in
that field.
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Michelle LeBaron lectures, consults, and
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February 2006
13
Benefiting
from change
T
hose entering the legal profession spend many years at
university preparing for their future careers. Their past is
one of hard work grooming them for the eventual day when
they pass the bar exams and
Ted Delehanty, President enter the practice of law.
Their hopes and dreams
P.T. Delehanty & Associates Limited
are based on having a long
Employee Benefits Consultant
successful career in the legal
profession. But what happens if that career is somehow sidetracked
by death, disability or retirement?
Most employers in Canada sponsor “Group Insurance Benefit
Programs” which help to attract and retain valuable employees.
These programs typically include the following benefits:
•
•
•
•
•
•
•
•
Basic Group Life Insurance
Optional Life Insurance
Dependent Life Insurance
Short Term Disability Insurance (to a lesser degree as
employers are turning more and more to EI as a means of
ensuring that their employees have some form of income
replacement during short periods of disability)
Long Term Disability
Health
Dental
Group Pension/Group RRSP
From the above it is easily seen that the majority of employers
provide their employees with the three most important benefits
(Life Insurance, Long Term Disability Insurance & Retirement
products). In other words, they have taken steps to ensure that their
employees’ needs are met when one of the three major causes of
career derailment occur.
Can Law Firms access Group Benefit Programs
as easily as other employers?
Larger firms such as Stewart McKelvey Stirling Scales & McInnes
Cooper can and have established very attractive benefit programs
that provide superior Disability & Retirement benefits for all staff
including Lawyers, Associates and Partners. Typically, these larger
firms use the services of a professional benefit consultant in order to
ensure that their needs (benefit/financial) are met and that the right
insurance company is selected.
Mid-size firms such as Pink Breen Larkin also use the services of
a professional benefit consultant. Quite often these mid-size firms
establish a program that offers all benefits, however, only staff
participate in the Long Term Disability. Lawyers, Associates &
Partners usually opt out of the Long Term Disability as the smaller size
of these firms preclude them from being able to purchase a Disability
plan that meets their needs. Most participate in the Canadian Bar
Insurance Association Program as it offers higher amounts of and
better coverage than a mid-size firm can buy on its own.
Smaller Law firms often do not offer Group Benefit programs as
their size discourages Insurance Companies from quoting and/or
they cannot buy a disability benefit that meets their needs in terms
of plan design and cost.
Food for thought
1.Is Disability an issue?
The following statistics are general however certainly support the
fact that Disability is an issue.
14 The Society Record
•
•
•
Almost 1.8 million of those disabled in Canada are
between the ages of 14 and 64
Every year 2 million Canadians are injured
You have a nearly 1 in 3 chance of suffering a disability
before retirement
2.Where are people usually disabled (at work/not at work)?
Generally disabilities happen away from the work place. In years gone
by the majority of Long Term Disability claims were incurred by
blue-collar workers however there has been a shift toward white-collar
employees (professionals) in the last two decades. Mental Disorders
& Neoplasms have taken over as the two major causes of new
disabilities. According to statistics, the Mental Disorders category has
become the leading cause of disability in younger employees.
3.Are employees aged 55 and older typically those who
become disabled?
While the age 55 or older category still remains a large segment of
new disabilities, a tremendous shift has occurred in the last 20 years,
with the 40 – 54 age grouping becoming the largest segment of new
disabilities
4.What does a good Long Term Disability plan look like?
A good Long Term Disability plan features the following key
ingredients:
•
•
•
•
•
•
Elimination Period – 17 Weeks
Benefit duration – Age 65
Definition of Disability – 2 Year Own Occupation
Benefit Amount – 66.67% of Monthly Earnings
Maximum Benefit Amount - $10,000 per month
Non-Medical Maximum* - $10,000 per month
*Amount available without the need to supply satisfactory evidence of insurability
5.What types of Income Replacement plans are available?
The following Income Replacement vehicles are standard however
some may not apply to Lawyers
•
•
•
•
•
•
EI
CPP
Workers Compensation
Private Disability Plans
Group Disability Plans
Association Disability Plans
Most lawyers, unless employed by a large law firm and paid a
salary, do not pay into EI and as such are not eligible to receive EI
disability benefits. In addition Workers Compensation does not
cover most lawyers.
6.How much should I have in Retirement savings?
Ideally one will have put aside sufficient monies in Retirement
savings to replace 70 per cent of one’s pre-retirement income
Conflict of interest with your client?
Need an outside referral?
For a non-metropolitan alternative, consider Mac, Mac & Mac.
We can be trusted with your client.
Think you know us? Take a peek at our unconventional website.
Discover who was once a circus roustabout. Who made it to the
NCAA Final Four. And who is not yet able to leap tall buildings in
a single bound. And other more important reasons why your
client can be entrusted to Mac, Mac & Mac.
www.macmacmac.ns.ca
MacIntosh,MacDonnell & MacDonald
Aberdeen Business Centre
New Glasgow, NS B2H 5E5
Toll Free: 1 888 752 8441
February 2006
15
What have we learned from the foregoing?
•
•
•
•
•
•
Long Term Disability is arguably the most important
benefit anyone can have
You have nearly a 1 in 3 chance of suffering a disability
before retirement
Disabilities occur primarily away from the workplace
Disability can happen to anyone regardless of age or
occupation
Large Law firms can and do establish very good benefit
programs
Mid-size and Small law firms cannot easily establish a
Group Benefit plan that provides adequate Long Term
Disability coverage for their lawyers, Associates, Partners
Key elements of the
Canadian Bar Insurance
Association’s Long Term
Disability Plan
• A monthly benefit of up to $12,000 (based on an
income qualifying table that begins as low as $18,000
and goes as high as $445,000 in annual income)
• A definition of disability that is first rate – the inability
to perform one’s own occupation until age 65 (this is
far superior to the standard two-year own occupation
definition found in most Corporate/Association
programs)
• First day qualification in order to receive “Partial
Disability” benefits
What can a Small/Mid-size firm do?
Various Association-type plans are available (the Better Business
Bureau and Chamber of Commerce jump readily to mind) however
it is the Canadian Bar Insurance Association program that appears
to offer a plan that best meets your needs.
The Canadian Bar Insurance Association has been set up by Lawyers
for Lawyers. While it offers a full range of benefits, it is in the Long
Term Disability area where it truly shines.
The authorized representative in Nova Scotia for the Canadian Bar
Insurance Association is:
Mr. John S. Bardsley
Phone: 902-468-4676 or
email: [email protected]
The future is unknown
With luck we will all live well into retirement without ever having
suffered a disability and with sufficient retirement monies set
aside to see us live comfortably. But don’t count on luck. You have
worked hard to get to where you are. Protect your future against
the financially devastating effects of a serious injury or illness
by ensuring that you or your firm has established a Disability/
Retirement Savings plan that meets your needs and expectations
should your career become sidetracked.
• For new lawyers and/or lawyers under the age of 45
(who have not been declined coverage elsewhere within
the past three years because of medical conditions)
guaranteed coverage of a up to a minimum of $2,000
per month
• Amounts over $2,000 and all amounts for lawyers
age 45 and older are issued based on the insurance
company being provided with satisfactory proof of
insurability.
• For lawyers under the age of 45 a “Future Increase
Option” can be added
• A Cost of Living Adjustment (COLA) equal to the
Consumer Price Index (CPI) is included and payable
following completion of the first year of receiving
benefits
• Elimination periods as short as 30 days
• Benefit payable until age 65 or age 71 (at lawyer’s
choice). This is far better than the standard age 65termination clause found in most programs.
• If you are disabled due to an accident the benefit is
payable for your lifetime
• Rates are guaranteed renewable
• Rates are age banded (five year age bands) and are
available in Male/Female – Smoker/Non-Smoker
16 The Society Record
August 2005
19
February 2006
17
LIANS
LIANS
Wrapping Up and Winding Down
Please visit the Loss Prevention section of the LIANS website (www.lians.ca)
for the following article complete with sample precedents.
I
n Nova Scotia, there are 497 practising lawyers who were
admitted to the Bar more than twenty-five years ago. As
the baby boom generation of lawyers begins to approach
retirement, many private practitioners have questions on what
should be considered and which tasks completed, prior to and
upon retirement. The following checklist does not deal with the
sale of a practice which involves valuation and accounting issues. It does not propose to be a comprehensive list, but rather
a starting point. It is geared primarily to the sole or small firm
practitioner who will be winding up his or her practice or to
those assisting in an involuntary windup of a lawyer’s practice.
1.
Finalize as many active files as possible. Decide when you will
cease to accept new files.
2. Notify clients with active files that you are retiring from practice
and that a new lawyer needs to be retained. A new lawyer can be
recommended but the client should be made aware that he or she
can choose another lawyer to assume their file. You should inform
them about time limitations and time frames important to their
cases (see sample precedent), and provide applicable authorizations for the client’s signature (see sample precedent).
3. Check for potential conflicts before referring and transferring client files to another lawyer. If the client chooses to self-represent,
have a receipt of file signed by the client (see sample precedent).
Maintain a copy of the file.
4. For cases that have pending court dates, discoveries or other
appearances, discuss with the client and assuming lawyer how to
proceed.
5. Where applicable, ensure that a Notice of Change of Solicitor or a
Notice of Intention to Act in Person (signed by the client) is filed.
6. Advise the Prothonotary of your retirement and your contact
information.
7. Review closed files to determine whether they should continue
to be stored, destroyed, returned to the client or, with the client’s
consent, transferred to another lawyer for storage. How long a
file should be retained depends on the type of case, the client,
and the advice given, especially where your advice is ignored.
Many files should be kept indefinitely. Without a file, it is difficult
to defend an errors and omissions claim. For additional information, see the Practice Assistance Manual and its Guidelines for
File Closure, Retention & Destruction, published by the Society in
1998 (available at the Nova Scotia Barristers’ Library).
8. If you do destroy a file, keep a record of the files destroyed and
the destruction date. Protect the client confidentiality by shredding. For files transferred, maintain a record of instructions
received and where file was sent (see sample precedent).
9. Maintain your old phone number for six months or a year, or
arrange for a new phone number to be given out or a voice-mail
activated when your old phone number is called, so former clients
have some way to contact you for file information. Re-direct mail.
10. Seek instructions from corporate clients for new addresses for
their registered and records office and ensure that the notices are
filed with the Registrar of Joint Stock Companies.
11. Make satisfactory arrangements to fulfill any outstanding undertakings. Complete reporting letters.
12. Submit the application required for Change of Category to the
Society (see application).
13. Close trust accounts and file applicable audit reports.
14. Complete billings to clients.
15. Terminate lease or sublet office premises and deal with office
equipment leases.
16. Give sufficient notice to staff of your pending retirement.
17. Pay any outstanding firm liabilities.
18. If applicable, leave open a general account to satisfy any outstanding obligations or for receipt of any accounts receivable after
the closure of your practice.
This checklist has been adapted and reprinted in part with the permission of the Oregon State Bar Professional Liability Fund — all
rights reserved.
Call Deborah E. Gillis, Q.C., Risk and Practice Management
Advisor, LIANS, at 423-1300 (345) or e-mail [email protected],
for assistance or answers to questions.
18 The Society Record
•
•
as part of mail-outs which go to all members, such as your
Society membership card, or
included in correspondence which you receive from either
LIANS or the Society.
These mailings are made at the request of NS LAP.
Getting the Word Out
D
id you know... lawyers, their staff and family experiencing
stress, burnout, addiction, depression, personal and family
problems have access to information, personal and career
counselling, and support 24 hours a day / 7 days a week?
Unfortunately, all too frequently we hear from members that they are
not familiar with the services provided by their Nova Scotia Lawyers
Assistance Program. NS LAP is addressing this problem by increasing
the distribution of program information to members through
mailings, articles in the Society Record, and the creation of a web site.
This increased distribution will ensure that all members are aware
of how to access NS LAP services and that the services are provided
through:
• an experienced counselor, and
• are completely confidential.
Over the coming months, NS LAP will be distributing program
information to all members. You may receive NS LAP information
in a number of ways and from a number of sources. Information
created by NS LAP may reach you:
Including NS LAP material in a Society mailing is an economical
way to get the word out to all members. By asking the Society’s
Professional Responsibility Department and LIANS to include NS
LAP information in their mailings, we also reach members who are
experiencing the stress of a complaint or claim.
Although information about NS LAP may be
provided to you through the Society or LIANS,
there is no sharing of information from NS LAP
to these groups. All contact with NS LAP is
completely confidential.
Early assistance with small problems can prevent the development
of larger and more serious ones. NS LAP’s goal is to provide
information to members before there is a crisis or urgent need for
assistance.
You may not need the NS LAP information for yourself, but please
remember that the program services are also available for your staff
and family. Why not tuck the information away? You never know
who may be helped by contacting the program.
Detailed information on eligibility, services provided, and
confidentiality are available on the NS LAP web site at www.
NSLAP.ca
You don’t have to face this alone.
Someone is available 24 hours a day, everyday
— the NS Lawyers Assistance Program Advisor.
Completely Confidential Assistance
1-866-299-1299
Information | Counselling | Support
w w w. n s l a p . c a
February 2006
19
Actively Retired:
Photo by Ted Power/NSBS
Two retired members lend us their thoughts on life after practice
I
am now 73 years of age and have been retired from law practice
for nine years, following 37 years in the firm now called Blois
Nickerson Bryson.
I do not miss the rigours of practice
but regret losing contact with many
admirable people in the profession.
During my working years I became a property lawyer because the
firm acted for an established Building Society in Halifax. Gradually
I moved to the related areas of construction and expropriation law.
Generally I found the practice to be demanding and stressful but
remained because I was able to earn a modest income.
Retirement, in these circumstances, was always on my mind and I
am pleased to say that I prepared for it for at least 20 years by regular,
periodic investment.
Accordingly, I was able
to retire when I did.
David Bryson, Q.C.
During retirement, I have pursued my readings in preferred areas
of literature and history, have resumed piping, participate in social
curling, and go to my cottage (which I built in 1974 but never
had time to enjoy) at Caribou Island in the summer. As well, I
now have the time to return to France each year, where my wife
and myself lived for an academic year following Law School. This
prompts me to note that I have been happily married to Carol for
almost 50 years, have three pleasing children, including Colin,
(who also practices at Blois Nickerson Bryson) and seven beautiful
grandchildren.
Obviously, I do not miss the rigours of practice but regret losing
contact with many admirable people in the profession.
My advice: Do not postpone planning for retirement.
20 The Society Record
Retired member, John Cochrane, Q.C
., at home with grandsons Oliver and
A
fter 42 years of satisfying and rewarding practice, I retired on
December 31, 2004. The arrangements were pleasant and
seamless under my firm’s (Taylor, MacLellan & Cochrane)
partnership agreement. My retirement plans were unspecific and
simply entailed moving
from a work/money focus
John P. Cochrane, Q.C.
to a time/freedom mode.
My advice (as one who has already successfully crossed that bridge)
has been solicited for those approaching retirement. I don’t know
that I should be so bold as to offer questionable wisdom to the
Society Record’s readership, so instead simply offer up my reflections
on the topic. My feeling is that “the inner man” emerged, or, at the
subconscious level, an assimilation took place over a two to threeyear period [prior to retirement]. The distillation of what would be
left behind, the measure of one’s energy and commitment, health,
life expectancy, foregone pleasures, work satisfaction, ability and
willingness to change, and, finally, desire for more family time, all said
“this is the time to go”.
No other profession offers the chance to work in or touch upon
so many roles: that of trusted personal counsellor, of adviser in the
commercial world, as practitioner of the “art of persuasion”, to be
a regular user of material with a strong intellectual and academic
content, and finally, the ability to be active in the political realm. This
mix of work, combined with a vibrant partnership of friends, is not
to be found anywhere else in the work world. The absence of day to
day stimulating interaction with lawyers, staff and clients leaves a gap
in one’s joie de vivre, not easily replaced by any amount of coffee shop
chatter. And not having secretarial support is a real bummer.
Gabriel
My retirement is and will be a time of repaying my many debts:
• playing a part in the lives of my grandchildren, remembering
my own happy childhood, and assisting my previously
somewhat neglected children in the demanding world in which
they find themselves
• serving on my town’s Planning Advisory Committee —
honouring the sound municipal government I have enjoyed
• serving on church committees to hopefully strengthen the
beacon that religion provides to society
• participating in political party (blue in colour) activities
mindful of the continuing need to keep our Canadian
democracy healthy and vibrant
• continuing to serve on a Law Society committee hopefully
assisting to maintain a healthy self-governing profession from
which I received over 40 years of benefit
• participating in our health care system by serving on my
Regional Health Authority to bring legal skills and principles
and an inquiring mind to bear on the governance of one of
society’s vital and complex agencies
• outdoor work and strenuous exercise - on a regular basis - to
counteract a largely sedentary lifestyle
• reading widely to broaden my insights, understanding, and
perspective, as well as for sheer enjoyment (to overcome a
strong previous focus on professional literature)
• being more of a helpmate to my beloved wife who has carried
the heavier burden for decades
Although the law remains a compelling and honourable profession,
There Is Life Outside The Office.
February 2006
21
a plan for all seasons
D
arlene is a single 53-year-old with no dependents. She loves
her work in the Crown Prosecutors office and intends to
continue working until she is at least 61, giving her 35
years of service. At retirement, the Provincial Pension Plan provides
employees with an income equal to 2 per cent of their best five years.
For Darlene, this would equal 70 per cent of the average of the
income she receives from age 57 to age 61. She has been frugal over
the years and has always topped up her contributions levels so she has
a significant portfolio of stocks, bonds and mutual funds. The basics
of her retirement planning seem well laid out.
Darlene reminds me of a client in a similar situation. My client was
very concerned about the fact that, as she got older, she would be
alone. Married couples assume (not necessarily a good thing) that if
anything happens to them in future years, they have a built in system
of financial and personal support. Not so a single person. My client
was putting extra money away to compensate, in some way, for this
situation, but she was unhappy with the prospect of having to ‘raid’
her portfolio to pay for future nursing care if required. Darlene is
potentially in the same boat.
A new product in the insurance industry, Long Term Care, was the
financial vehicle that provided a solution for my client. Long Term
Care pays the insured a daily amount depending on what they purchase
(between $100-$300 per day) if
they become infirm and unable
Garth Bennett, CLU, CFP
to do two or more of their normal
Dundee Private Investors
daily activities such as bathing,
eating, dressing, toileting and transferring. This benefit amount is paid
for a specific period of time, for example. one year, two years, or longer.
The problem with purchasing insurance is that the older you get, the
more expensive the premium, therefore this coverage seems to be most
appealing to people in pre-retirement mode, although it is available up
to age 80. My client was especially happy with the fact that she didn’t
have to be hospitalized to claim on this coverage and, as long as she was
prepared to pay the premium, the coverage would stay in force.
Long Term Care is a complicated coverage with a lot of bells and
whistles. The companies offering this product have arranged it so that
you can pay for a number of years and have life-time coverage, or you
can have premiums that are low in the beginning and increase over
time. In addition, they have another rider, which means that your
estate will receive the premiums you have paid if you die while the
coverage is in force. Other options have been designed to suit the
situation of the client on the one hand and support the companies
marketing initiatives on the other.
22 The Society Record
Another product providing peace of mind for clients is Critical Illness
Insurance, which works a little differently than Long Term Care.
With Critical Illness Insurance, the insurance company pays a lump
sum of cash to an insured who has been diagnosed with one of up
to twenty-two different diseases, ranging from a heart attack to Lou
Gehrigs Disease, and includes the many cancers we fear today. With
this coverage the doctor gives you the bad news and 30 days later
the insurance company writes you a cheque for $50,000, $100,000,
$250,000 or more, depending on your coverage. You are then free to
spend this tax-free money in any way you wish: hiring nursing care,
paying for equipment or drugs not covered by our medical system, or
taking a trip to the U.S.
As a financial planner, my job is to assess a client’s situation, identify
strengths and weaknesses in their planning, and help them ‘plug the
holes’. For people like Darlene and my client, both single, working, and
concerned with providing themselves with a comfortable retirement,
there are many options to consider and products to help them achieve
their goals. It is, however, imperative that they spend the time to work
with their financial advisor to put the pieces together to ensure that
their financial plan fully supports them in the years to come.
Garth Bennett, CLU, CFP, is a financial advisor with Dundee Private Investors. He is also
President of NS Chapter of Advocis, Canada’s largest membership association of professional
financial advisors. He can be contacted at 902-481-2117 or at gbennett@DundeeWealth.
com
J
ohn Smith is a 50-year-old
lawyer currently working as
Eagle Vision Financial Planning Inc.
a sole practitioner outside
the city. He is married with two
children who are 15 and 13 years old. John does not currently have
any obvious plans for retirement. His income is $150,000/year and
he has two income properties which produce an annual profit. He
has $80,000 in RRSP Contribution Room.
Taura Publicover
John would like to set up a retirement plan. Since he has not been
contributing to investments outside of his income properties, he needs
to come up with a plan that addresses both catch-up scenarios and the
tax situation that will exist should he sell his income properties.
First we will review the Universal Life Strategy as it applies to
this situation:
A Universal Life Insurance Policy (UL) has two components.
The first is the life insurance which is paid out to the named
beneficiary. The second component is the tax deferred investment.
It is recommended that the Life Insurance be overfunded for the
15 years until retirement so that investments accumulate on a tax
deferred basis and also offer potential creditor protection. Some of
these contributions can come from the tax refunds which occur as
a result of the RSP contributions, and the remainder can be funded
from personal income. At the end of the fifteen years, John will be
able to obtain collateral loans from the investment side that will give
him $40,000 a year in tax-free income for twenty years.
Borrowing to invest:
Once the RRSP is maximized, Mr. Smith may want to consider
borrowing money to invest. This would allow for a sizeable amount
to be invested into the market and start compounding immediately.
The interest on the loan may be used as a tax credit to provide
more money to apply towards the Universal Life Investment. As
an example, if Mr. Smith were to invest $300,000 today via a loan,
at the end of ten years, at which point the loan is paid back, his
investment would be worth approximately $340,000 based on an
average 8% return.
Retirement:
One of the major concerns in retirement is the taxation of the
income stream. In this scenario, the income stream would be made
up of RRSP withdrawals from both Mr. Smith’s RRSPs and the
spousal RRSP, CPP and OAS. The overfunding of the UL can
be utilized in the future for income purposes through collateral
financing. The money invested as a result of the investment loan
should be placed in a tax efficient investment such as a return of
capital investment; this would allow for an additional tax deferred
income stream.
Protection:
The first thing that John needs to do is utilize his RRSP
Contribution Room. Given that he has 15 years until retirement,
John should choose conservative and growth funds. He should
start to maximize his annual contribution limits and spread his
additional available room over the next five years. This will result in
approximately $880,000 in an RRSP at the age of 65. If availability
of funds to make these sizable contributions is a problem, he should
consider an RRSP loan. Mr. Smith should consider splitting his
RRSP contributions between himself and a spousal plan. If Mrs.
Smith has RRSP contribution room, it is recommended that this be
maximized as well.
This all being said, Mr. Smith should also prepare in case of an
untimely death. The Universal Life Investment Strategy discussed
above will also provide the insurance coverage needed to replace
any income loss. Mr. Smith should also consider critical illness and
disability protection.
There are a number of other strategies which could be utilized in
conjunction with the RSPs to provide additional income that is
taxed more favourably. A thorough protection review and joint
discussions with John’s accountant would more accurately determine
the most appropriate strategy. Two options that can be considered
are an overfunded Universal Life Policy and borrowing to invest. He
should also discuss whether incorporation is a viable strategy.
Taura Publicover is President and Senior Advisor of Eagle Vision Financial Planning
Inc. working with Optifund Investments/Laurentian Financial Services. With over 10
years experience, Taura is past president of Advocis Halifax and a current member of the
Halifax Estate Planning Group.
This strategy is for illustration purposes only. It may or may not
be applicable to any one situation. The above simply highlights
a few options to consider. Based on each individual’s particular
circumstances, other options may exist. Please consult your advisor
for individual consideration.
February 2006
23
P
aul is a partner at a large National Law firm. Now that he has
crossed the half-century mark, he and his wife, Sharon, have
started discussing retirement in a different light. Questions
like “how much is enough, where will the money come from and for
how long”, have become perplexing.
The road, which brought Paul
and Sharon to their current
Assante Capital Management Ltd.
secure position, was riddled
with more than a few potholes.
When they met, they expected a dual career existence which didn’t
pan out. Sharon stayed at home to help with a learning challenged
second child. They have three children, the eldest, Patrick is a
recent university graduate, Sara completed college and is marginally
employed, and Ben may or may not start post- secondary next year.
Jerome Grady, CFP, RFP
The two now occupy a third home, which they purchased by taking
advantage of low interest rates. Golf has become a passion, so they
bought near a good PGA level course. Their housing development
is at the high end but with their income, they can afford the
$350,000 mortgage.
Yes, they are financially comfortable now. Paul earns an income in
the $150,000 to $200,000 range but recent changes respecting soft
tissue injury settlements will have a negative impact. They have
accumulated RRSPs totaling $205,000. Maximum contributions
are part of his partnership agreement, and without those his
contributions would have continued to be sporadic.
Paul and Sharon’s housing costs now average $4,000 per month.
With education costs, supporting their aging parents, and increased
travel costs, they seem to be no better off than they were 10 years ago.
Last year, the two met with Bob, a certified financial planner and
senior financial advisor. Their first meeting was an eye opener.
The planner, who initially seemed disinterested in the couple’s money,
asked the two some unusual questions. He asked about their dreams
and their consideration for educating and launching their children.
He also asked how they felt about leaving an estate for their children.
He posed the following question: “If money were not a problem
please explain how it would change your life.” Sensing their concern,
he explained that he needed to find out what was really important to
them before he could get into the actual planning. Bob explained that
goals, like retirement, were nothing more than dreams with a number
and a date – the number of dollars required and when.
After the “dream session”, he asked about Paul and Sharon’s personal
and financial history. He wanted to know how the two made
family financial decisions, and asked about their best and worse
financial experiences. Following this was an extensive questionnaire
to establish the couple’s tolerance for risk. He explained that the
markets will do what they will do – something investors ultimately
have no control over. Defining a comfort zone and keeping the two
within the parameters of that zone, no matter what happened in the
markets, was the goal.
In the second session the three got down to the ‘nitty gritty’. Assets
– what did they own? And liabilities – what did they owe? Based
on this information he was able to calculate their net worth. He
asked for copies of all their savings and investment accounts, copies
of their wills and powers of attorney, income tax assessments, and
mortgage and loan agreements. By the time they were through the
second session the two felt that they knew more about themselves
than they had before going through the exercise.
The next step in the process was the proposed plan and investment
policy proposal, the result of which shocked the couple. To keep
within the normal range of post to pre-retirement income they
discovered they would need to accumulate investment assets of $1.3
million if they expected to retire at 65 and maintain their current
lifestyle. In rough terms that meant they’d have to put away $1,000
per month to achieve their retirement objective. Their choices
were as follows: Paul could work longer or the couple could lower
their retirement lifestyle expectations. When they examined their
assumptions and their fiscal reality, they realized Bob was right. He
explained that financial planning was a process, a lifelong process,
not an event or a product.
With education costs,
supporting their aging parents,
and increased travel costs, they
seem to be no better off than
they were 10 years ago.
After Paul and Sharon accepted the proposal, Bob showed them an
in-depth analysis of their situation and how a portfolio similar to
theirs would have performed over the years; the low periods in 1974
and 1987 stood out as being poor performance ones. The long-term
result looked good to the couple; adequate to fund their goals. Bob
then explained that with good balance, the two should be satisfied
with their performance in seven out of ten years. They would not
be pleased in about three out of ten, but, as he explained, that’s the
price they’d have to pay for long-term success.
The next meeting was what Bob called the implementation
stage. New accounts were opened, Paul and Sharon approved the
transfer of their investments and made their planner the “agent of
record” for their insurance policies. They set up quarterly followup meetings, each with a theme, which would lead to a more
comprehensive plan. Sessions included investment planning, debt
management, tax planning, estate planning, and disability, income
and asset protection.
The couple is now satisfied that they’re now on track, their only
regret being that they feel they should have started the process years
before. They now feel they’re getting more than their money’s worth
in peace of mind alone.
Jerome Grady is a Chartered (CFP) and Registered Financial Planner (R.F.P.). He is a
Senior Financial Advisor and Branch Manager with Assante Capital Management Ltd.
Contact him by telephone at 902-469-7775 or [email protected]
24 The Society Record
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February 2006
25
You be
the
judge
Q:
A:
Should lawyers be forced to retire at a certain age?
The proposition that lawyers should be forced
to retire at any age is regressive thinking which I
believe would not be supported by most members
of our Bar society. A mandatory retirement age,
at first glance, appears to be an infringement on an individual’s
rights under the Canadian Human Rights Act. However, a quick
review of case law reveals that under some circumstances the policy
of mandatory retirement has been upheld under section 1 of the
act as a reasonable limit. Similarly, in Nova Scotia our human
rights legislation appears to be interpreted to allow the policy if
it is applied equally in a work place situation. My thoughts on
this subject are not focused on the validity or invalidity of such
a regulation before the courts, but rather upon the question of
whether or not we, as a law society, should implement such a
regulation.
Given my age (58), I confess I feel a more immediate vested interest
in opposing such a move, as “the age” for me is fast approaching.
Our Bar Society, in its wisdom, has never had a mandatory
retirement age. Why in this modern age would we be considering
such a move? The advances made in our society have enabled our
citizens to enjoy longer, healthier and more productive lives, and
changes in modern technology have allowed us to become a more
knowledge-based work force. I would argue that this state of affairs
reflects no need to change the status quo. The old adage comes to
mind, “if it’s not broken, don’t fix it”.
Most members of our Bar can reflect on their careers and remember
many senior lawyers well over
Angus MacIntyre, Q.C.
the age of 65 that were, and
Heritage House Law Office
continue to be in active practice.
It is my belief that these
individuals, with their vast experience, play a valuable and integral
role as mentors for younger lawyers. The names of numerous
lawyers who have fulfilled, and continue to fulfill this function,
come to mind.
It is difficult to believe that age alone would be the reason for
mandatory retirement. In referring to cases and the current
literature, it would appear other reasons for mandatory retirement
are a consideration. It could be argued that mandatory retirement
creates job opportunities, refreshes and energizes the work force,
and allows for more predictable planning for pensions, disability
and health funds. In an article in the C.D. Howe Institute’s
Backgrounder, entitled “Banning Mandatory Retirement”, the
author, Morley Gunderson writes: “Whatever the rational for
mandatory retirement, and there are many, it is clearly an intricate
part of the employment relationship, mutually agreed to by
both employers and employees who generally have considerable
individual or collective bargaining power”. He goes on to point
out that mandatory retirement should be based on permissive
contractual relationships between parties, entered into for their
mutual benefit; thereby making age, as a factor, obsolete. Our Bar
Society does not fulfill the role of employer nor is it obligated to
provide pension, disability, health or any type of benefits collectively
to its membership. In addition, we should bear in mind that we are
26 The Society Record
professionals, primarily self-employed, and as such should retain our
autonomy to determine when we should retire.
The often advertised strategy of “Freedom 55” does not appear
to reflect the view of most lawyers I know - the majority of which
are individuals who wish to continue their practice, with no
predetermined retirement age.
Whatever the reason, it is not up to our Bar to impose arbitrary
limits on our ability to practice law. I am sure our members, who
are constitutional and civil rights experts, could offer an abundance
of research to enhance and support that particular position.
A:
As an articled clerk 17 years ago, I was asked to
attend a Provincial Court appearance to “observe” a
proceeding, the outcome of which was of interest to
a client of the firm. The individuals I was observing
were being represented by a very senior lawyer, who was continuing
to “dabble” in the practice of law long, long after the age of 65.
That day at Provincial Court culminated in my fleeing the
Courthouse, with this esteemed gentleman waiving his cane at me,
hollering that I had to give him my “undertaking”. Subsequently
two phone calls came to my firm, one from the sheriff ’s office
attempting to ascertain the facts of the hallway disturbance and one
from the law firm the individual continued to be associated with,
assuring that such an activity would not occur again.
The lesson I learned was that lawyers should not practice past their
“best before” date.
Attitudes toward retirement are inextricably linked with financial
security. Many see retirement as a very positive and much
anticipated development in their lives. Those individuals usually
have financial security through a pension or personal wealth.
For many lawyers in private practice two things happen at one time
in their careers: Student loans are paid off about the same time
planning for children’s education becomes a priority. The enormity
of the task of accumulating sufficient funds to retire in the style to
which we hope to become accustomed becomes a lurking reality.
Freedom 55 becomes just another ad campaign, and the prospect of
practicing well into retirement years looms as an inescapable fact.
Some lawyers choose to practice into their senior years out of the
sheer joy of working and practicing law. There are others who
choose to do it as a necessary evil. Regardless of the motivation, the
practice of law is ultimately a service-based business, and lawyers
have a duty to be knowledgeable, skilled, capable, competent and
to keep abreast of developments in the branches of law in which we
practice. The duty does not diminish with age.
Photo by Ted Pow
er/NSBS
was middle aged. I am just
Elizabeth Whelton
“forty something”. Twenty
Blois, Nickerson & Bryson
years ago when my father
retired from the practice
of law in New Brunswick I saw him as a senior citizen. He was 64.
Mick Jagger will be 63 this year. When I am that age, will I think of
myself as merely “sixty something”.
Currently, there is no age beyond which one cannot actively
practice. Each lawyer makes an independent decision about his
or her level of practice activity as the years go by, based on his or
her own evaluation of abilities, desires and interests. Should that
evaluation be left to the individual? Should the ability to continue
in the active practice of law be like a driver’s license – yours until
you go over the curb one too many times? Can we rely on those
who surround a senior practitioner to take on the uncomfortable
and thankless task of suggesting the time has come to give up
active practice? What if the senior practitioner refuses to act on the
suggestion.
Is anyone being served if creeping incompetence is the yardstick by
which we measure the end of a person’s ability to practice? I think
of that senior lawyer so many years ago. I gather that, in his day,
he was bright, talented and well respected. An upper age bracket
for those actively practicing law would have spared that man the
indignity of having an articled clerk observe the ignoble end to his
career.
Can we, in our senior years, deliver legal services with the sharpness
to detail, continuing interest in developments and ability to “stay in
the game” that are a required part of doing the job properly? And
when do “senior years” begin? When my mother was my age she
February 2006
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28 The Society Record
the
Big picture
Where are we nationally?
We wondered what the rest of the country was up to with
respect to the important issues surrounding retirement;
what law societies were doing to help their lawyers with
the transition into retirement, be it through seminars, CLE
programs, financial planning, how to sell or wrap up a practice,
or life after practice. Here’s what we found out.
Please note: only those provinces which are actively providing, or are at least looking
at providing this service in the near future, are listed.
Identified as an issue which needs to be addressed, and will probably
be done through the use of CLE seminars.
Canadian Bar Association
In terms of CLE programming, although not included in the
association’s current 2006 schedule, they sometimes touch on
these matters in ad hoc programming. This has typically been in
conjunction with August’s annual legal conference.
The Law Society of British Columbia
Law Society of Upper Canada
The Law Society of British Columbia does not directly deliver
programs to assist members with transition to retirement, but does
provide the following two services:
LSUC has in the past held CLE programs on various topics relating
to the wind-up of a lawyer’s practice. In 2004, they presented
a teleseminar entitled “Estate Planning for Your Practice”. The
teleseminar provided information on how to plan for unexpected
retirement. Precedents for powers of attorney and will clauses
appointing special trustees to deal with the wind up of a lawyer’s
practice were included. The program also provided information on
various forms of insurance (life, disability, business interruption, etc.)
products that might be of interest to members. The organization has
also presented a live CLE program called “Buying and Selling Your
Law Practice”. While not specifically geared to retiring lawyers, the
program did contain relevant information for that group.
Interlock, a program which is funded and sponsored by the Law
Society to provide free counseling and advice to lawyers, their staff,
and families. Interlock’s services include retirement counseling.
Interlock can provide group seminars on the topic of retirement,
as requested. The following is a link to the Interlock information:
www.lawsociety.bc.ca/practice_support/personal_assistance/body_
services_interlock.html
The Lawyers Assistance Plan (LAP), which is also sponsored by
the Law Society, provides counseling, support and intervention.
Although LAP’s primary activity is related to substance abuse and
mental distress, LAP has been developing and delivering an expanding
number of small group wellness seminars intended to assist lawyers.
The LAP is not currently offering seminars on making the transition
to retirement, but it is an issue they will eventually be looking at.
Doesn’t currently offer anything, but has identified it as an issue.
The Society also has online Practice Management Guidelines, one of
which deals with closing down your practice. The guidelines provide
information and checklists to assist members who are considering
winding up their practices. LSUC will also shortly be launching
a Winding Up Your Practice Package for members. The package
will incorporate much of the information contained in the Practice
Management Guidelines, as well as provide some of the precedents
previously produced in the CLE programs. The package will also
include resource lists. None of the organization’s material specifically
focuses on life after law.
The Law Society of Saskatchewan
Nova Scotia Barristers’ Society
Don’t currently have anything for retiring lawyers but SKLESI
has talked about conducting retirement-related seminars. It’s been
Provides materials on wrapping up a practice, and has identified this
as an issue for future consideration/development.
The Law Society of Alberta
February 2006
29
Summation
involve, at some level, all of the lawyers in the organization, regardless
of their age. Studies show that sound succession and retirement
planning at the organizational level can improve the organization’s
bottom line. Sound succession planning is also a backstop against
lawyer, staff and client insecurities, which can ultimately result in
defections from the organization.
Photo by Ted Power/NSBS
Meeting the wave head on
T
he first of the baby-boomers turns 60 this year. By 2011,
almost one-fifth of this demographic will be 61 years of age or
older. And by 2018, the youngest “boomers” will be in their
mid-fifties and the oldest will be over 70. While an aging workforce
is not unique to Canada, Statistics Canada reports that what
distinguishes Canada from
the rest of the western world
James Musgrave, Q.C.
is the relatively large size of its
Cox Hanson O’Reilly Matheson
baby-boom generation. The
positions vacated by retiring boomers everywhere in the Canadian
workforce cannot possibly be filled by the significantly smaller “babybust” demographic. Like other professional communities, Canadian
lawyers are not immune from this. Our profession is greying. This
trend is about to have a profound impact on the practice of law
everywhere in Canada, including Nova Scotia.
As one of the “younger” boomers, I have more than a passing interest
in the aging face of the legal profession. We are nearing what one
author has called a “demographic cliff ”, representing “the most radical
demographic shift in history”. The combination of declining birth
rates, increased lifespans and a cascade of mass retirements accelerating
over the next thirty years mean legal organizations like mine need to
begin age and disability management now.
Most law firms and many other legal organizations have no succession
plans in place to address the gradual or sudden loss of key senior
people to disability, retirement, a call to the Bench, etc. Of those
that do have such plans, I suspect that many consider them barely
adequate or even irrelevant. Succession should be an integral part
of every legal organization’s ongoing strategic planning and should
Good strategic planning proposes to address issues like succession,
transition, management, leadership and client relationships on
a rolling basis. Succession, for example, is a process, not an event.
This is not last minute stuff. Effective transitioning with respect to
both clients and leadership positions in the organization requires
identifying backup talent from within or acquiring that talent from
outside, and then making the significant in-advance investments
of time and proper grooming necessary for the candidate to step in
when the need arises.
Disability issues go hand in hand with effective age management. We
are fortunate to be living at a time when technology offers so many
potential and affordable solutions to many disability challenges. Most
legal organizations I know are prepared to make reasonable investments
in such things as barrier-free work areas and specialized technologies
to allow their lawyers to continue practicing after accidents, illness
or other events (which would have ended many of their careers just a
generation ago). As the greying of our profession continues (over the
next couple of decades) law firms and other legal organizations will
increasingly be called upon to accommodate these kinds of challenges.
Many such challenges can be met by simple investments, such as
speech recognition software. Others will be more problematic. While
a specific disability is often beyond the scope of either the lawyer or
the organization to anticipate, the organization should acknowledge
the increased likelihood of disability issues arising at some point, and
plan now how the organization will respond at a policy level: how
many backup lawyers are being prepared at any given time, as well
as their state of readiness; what will be fair expectations of disabled
lawyers in terms of workload, billable hours and compensation
commensurate with their abilities to contribute; and what affordable
disability coverage should be in place across the organization to
smooth out the financial repercussions of a full or partial disability.
No one said any of this planning stuff was easy, and many of us would
prefer not to have the discussions that these kinds of issues raise. Ad
hoc responses, which may have worked in the past, will increasingly
be ineffective against the demographic wave headed our way. We
should instead try taking the long view by getting in front of the age
and disability management issues now and beginning dialogues in
our firms or offices. A six-month plan now, with a view to a longer,
more detailed plan in the future, is probably a good place to start.
In the immortal words of Lennon and McCartney, “We Can Work It
Out”.
30 The Society Record
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