setting up a practice: cautions and pitfalls
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Setting Up a Practice:Cautions & Pitfalls
Beverly MichaelisDee Crocker
Practice Management AdvisorsProfessional Liability Fund
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Failure to protect client funds
Inadequate accounting
Unexplained overdrafts
Trust Accounting Violations
Lead to Bar Complaints
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Missed deadlines
Failure to detect conflicts
Lost documents
Administrative Errors Cause
Malpractice Claims
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Trust Funds Deadlines Conflicts of Interest
Learn How to Manage
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Managing Your Lawyer Trust Account
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Is It the Client’s Money?
1. Retainers
2. Settlement proceeds
3. Overpayments
Use the Trust Account
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Or is it Your Money?
You’ve done the work
Billed the client – or –
The fee is earned upon receipt
Use theGeneral Account
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Keep an Audit Trail
• Each client is separate
• Track all deposits and withdrawals
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Software
http://tinyurl.com/bls7too
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Bank → Register → Ledger
Bank Balance $1000
Register Balance $1000
Client Ledgers $1000Client A $ 200
Client B $ 300
Client C $ 500
$1000
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Use Credit Cards Wisely
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Earned Upon Receipt Fees
Signed written agreement required
Describe as “earned upon receipt”
Include disclosures required by ORPC 1.5
OSB Opinion 2005-151
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Earned Upon Receipt Fees
Refund balance if work not done
Avoid “nonrefundable”
See PLF sample agreement
OSB Opinion 2005-151
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Avoid Tempation
1. No cash draws
2. Don’t pay rent from trust
3. Use caution with transfers
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Managing Deadlines
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Technology +
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Effective Office Systems
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= Successful Time Management
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Be a FilerNot a Piler
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Allow Sufficient
Lead Time
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Tickle
and Follow-up
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Software
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Software
Compare at: http://tinyurl.com/4xfsoos
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Managing Conflicts
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Even if You…1. Limit your practice to one side
2. Limit your practice to one area
3. Practice alone
4. Practice with others
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Capture Everyone
• Clients and adverse
• Related parties
• Declined clients
• Pro bono clients
• Members of your firm
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Capture Everything
SSN or TIN
DOB
123 ABC Street
FKA
Nicknames
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Run Conflict Checks
1. At first contact
2. At file opening
3. When new party enters case
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Document Your File
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More Choices
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Manage Trust Funds Manage Deadlines Manage Conflicts
Summary
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Contact Us
Dee Crocker [email protected] Michaelis [email protected]
PLF Practice Management Advisors
503-639-6911 * 800-452-1639
and confidential