I am sole owner of a law firm in Chicago with an elder law practice. I have two paralegals and two legal assistants. Although I want to continue to practice as long as I can I am in my late 60s and am beginning to think about what to do with my practice. I have recently had several discussions with another sole owner that is interested in buying my practice. Since I want to practice as long as I can I am concerned about the timing of selling my practice due to the current ethical rules. I also want to insure that the other firm would be the right fit for my clients and staff. Do you have any thoughts or suggestions?
Making the right decision concerning the "Who" is usually more important than the "What" or the "How". Take your time to do the proper due diligence regarding the other firm. Get to know the owner as well as the employees of the other firm. Ascertain practice, client, and cultural compatibility. If you both determine that a a deal might make sense – then move to the "How". Even though you have done the best due diligence you can – you won't really know about the other firm until you try working together. So before you jump – consider taking a few baby steps first. You might start with an affiliation arrangement (Of Counsel) as a Phase I pilot test for six months. Under this arrangement you can both refer work to each other as well as have the other attorney work on some of your client matters at your office. Outline the details of the relationship in an affiliation (Of Counsel) agreement. After six months review the success of the arrangement and whether it makes sense to take the next step. If it does – a Phase II step might be to enter into a more formal practice continuation/transition arrangement with the other firm. Phase III would be either the eventual sale of your practice or merger with the other firm. Taking a phased approach allows you learn more about the other firm which will increase your odds of a successful transition and buys you time before actually selling your practice if that is the direction you should go.
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John W. Olmstead, MBA, Ph.D, CMC
Posted at 08:13 AM in Mergers, Succession/Exit Strategies
Tags: Law Firm Affiliation, Law firm succession, Sale of law practice