It was an ordinary day in a long, successful career for PBA Past President Gretchen A. Mundorff, founding partner at Watson Mundorff LLP, Connellsville.
Mundorff remembers the date: Jan. 9, 2019. Coming through the front door of her home, still bundled in her winter coat, she watched as her “very healthy, fit husband,” Don, experienced a massive ischemic stroke because of atrial fibrillation of his heart, she said.
“At 59, I wasn’t thinking two wits about crafting my own succession plan and exiting my practice,” Mundorff told participants in a webinar.
But on that fateful day in January 2019, Mundorff said her life was “irrevocably altered, and it would never again be the life that I knew.”
Don’s stroke, she said, “took away all of the function of the right side of his body. It also rendered him profoundly, expressively aphasic, because it took out the entire communications system of his brain. It caused him to be dysphasic, so he no longer knew how to swallow food or liquid. And perhaps the most heart-wrenching thing that stroke did was rob my husband of his memories, including our 25 years together.”
The family’s harrowing medical emergency experience and the subsequent lengthy hospital stays — not to mention the times in intensive-care units, neurotrauma stepdown units and rehabilitation centers in Pittsburgh, far from her office in Connellsville — led Mundorff to assess what remained of her life and practice.
She said the hospital stays and rehabilitation regiments were just the “tip of the iceberg.” As a residual of the massive stroke, Don experienced the onset of brain-seizure disorders, which required more hospital and rehabilitation stays. At one point, Mundorff said, Don was either in an ICU, a stepdown neurotrauma unit or rehabilitation unit from August 2020 to the end of March 2021.
Unless hospitalization is required, she said, Don remains at home as a hospice patient and requires round-the-clock care.
Mundorff spoke to about 438 attendees in late November at a webinar, “The Retirement Discussion,” presented by the Pennsylvania Supreme Court Disciplinary Board and the PBA. The webinar was moderated by David A. Fitzsimons, principal at ADRFitz LLC, an alternative dispute resolution practice in Carlisle.
Rely on Partners
Mundorff did not know what would have happened to her clients if she couldn’t rely on her partners in her law firm or if she was in a solo or very small law firm practice.
“To say that my husband’s stroke and its aftermath wreaked havoc with my legal practice would, of course, be a gross understatement,” she said. “But I was lucky because of my firm.”
Mundorff and her partner, Charles W. Watson, founded Watson Mundorff LLP in 1989. The firm has grown to eight lawyers, “and those lawyers and partners circled the wagons for me,” she said. “Together, we took care of my clients.”
Though Mundorff is in practice today at her law firm, she “doesn’t practice in the same way as she did prior to Don’s stroke,” she said. “I can’t devote the number of hours to my practice that I once did.”
But what if Mundorff herself had suffered a stroke or some other debilitating medical emergency?
“On a daily basis, I have to tell you that I always think about what would have happened if I was the one who had that stroke,” she said. “Or if I was the one who suffered a debilitating disease process or a catastrophic-type accident.”
‘Blink of an Eye’
“We don’t know what the future holds,” said Ellen Freedman, law practice management coordinator for the PBA and a columnist for Pennsylvania Bar News. “In the blink of an eye, our life can irrevocably change. I do get those calls every week, one, two, sometimes more, and it’s very difficult.”
Freedman said she has been on her “soapbox, sounding the alarm about succession, and especially emergency succession planning, for about two decades.”
She has good reason. Pennsylvania may be ill-prepared to handle caseloads if emergency or succession plans are not created.
The commonwealth has approximately 75,000 lawyers, with nearly half between the ages of 50 and 69, according to Dionysios G. Rassias, Pennsylvania Supreme Court Disciplinary Board.
“We are an aging legal community in Pennsylvania,” said Rassias, of The Beasley Firm LLC, Philadelphia.
Rassias believes succession planning should be required to obtain or continue a legal license.
“The cold reality is, half of us are between 50 and 69,” Rassias said. “And when you (think) that there are approximately 35,000 to 38,000 that are in this age group, where something untoward or unexpected can happen at any given time, it’s kind of scary that we have taken this long to catch up with some other very proactive states who have decided to put succession planning into their attorney registrations and basically make it an attorney requirement.”
Pennsylvania firms that have no successor with clients include 17,000 lawyers, 26% of responding attorneys, according to Rassias, what he calls “a developing problem.”
Of practicing attorneys in Pennsylvania, 29,000 lawyers have named no successor.
“About 28% of the people have a successor, whether it’s an individual or a law firm,” Rassias said. “We are starting this process and a quarter of our attorney population has already done something about it, which we are very happy with.”
Having a succession plan requirement in the registration requirements will allow firms, large or small, Rassias said, to “have all of your affairs in order as it pertains to your clients, your business, yourself and your family.”
What impact has the COVID-19 pandemic brought to planning for succession?
According to a November 2020 post from the Thomas Reuters Institute Legal Practice Management, law firms have made “modest progress” in readiness assessment of succession planning.
The article notes that a majority of leaders of midsize law firms said they did not believe that their firm is prepared to deal with the retirement and succession of partners, with 61% saying they were concerned about their firm’s preparedness. Further, most firms relied on an informal succession process and handled issues as they arose, with just 37% saying they had a formal process or were going through efforts to create one. Read more at tmsnrt.rs/3JFct7o.
“Planning is as important as providing for your family, in a will or some kind of estate plan,” Rassias said.
“Even though this is going to become a reality in Pennsylvania very soon, you should know that a lot of the states that you are cross-admitted in are going to be doing this as well,” Rassias said. “It’s going to be necessary and it’s also going to come across in the other states when you are admitted.”
The Disciplinary Board will attempt to assemble a “hybrid” type of plan “that will work best for Pennsylvania, because Pennsylvania is a little bit different,” Rassias said.
That includes major metropolitan areas on each side of the state. And the rural areas can also be markedly different.
The Board, Rassias said, is “trying to balance everything and come up with a rule that’s going to be able to cover everybody without making it too hard on some people and too easy on others.
“Really, just protecting the clients is kind of where the balancing act is going to be,” he said. “It’s coming, for sure.”
It can be difficult to determine what the look of “discipline” should be for those who won’t create a succession plan.
“The Office of Disciplinary Counsel has never been able to discipline attorneys that pass away,” said Thomas J. Farrell, chief disciplinary counsel of the Pennsylvania Supreme Court Disciplinary Board. “We don’t intend to start. We don’t intend to pursue disciplinary sanctions against lawyers who may have suffered the kind of disabilities that Gretchen’s husband is going through.”
Farrell said he views Board efforts as more educational than disciplinary.
“We do intend to try to enlist help from the PBA before we get around to rolling out (the mandatory succession planning) program,” he said. “We need assistance in educating the bar about what lawyers should do to plan for their succession, including their unanticipated absence by way of accident, death or the other ways this comes about, such as conviction, incarceration or disbarment.”
Nothing Decided
The Board is only considering what the legal mandates for succession planning may be. Nothing has been decided as of press time.
“We are considering requiring that lawyers designate a successor,” Farrell said. “We’re considering making that a mandatory question on the annual registration form.”
Potential rollout date, he said, is sometime in 2023.
What needs to be done at retirement, with a succession plan in place or not?
Can an attorney simply say, “I’m done, I’m out of here” and leave the briefcase behind?
“Walking away is not an option,” said Dana C. Belella, deputy attorney registrar with the Supreme Court of Pennsylvania Disciplinary Board. “There are attorneys every year that get late fees and they get administratively suspended. By the time we are speaking to them, their excuse is they retired months ago. Unfortunately, retiring months ago and not doing something with your license doesn’t stop your requirements.”
If you retire, your license remains active until you do something about it, according to Belella.
Here are status options registrants can select:
Option 1: Continue on active status. According to Belella, this would keep an attorney’s ability to practice open, but “whether you’re going to use it or not is another question,” Belella said. It requires an annual registration fee of $225; a registrant is subject to late fees, possible as with any registration; and the registrant must complete the necessary CLE requirements.
Option 2: Assume inactive status. Inactive status requires annual registration. The fee is $100. But the registrant is also subject to late fees during annual registration, which happens at “the same time of year as the one you’ve been doing for countless years,” Belella said. With inactive status, it defers your CLE requirement automatically.
“So, you’re not able to practice, but it keeps you in a status that is pretty easy to come back from, if you are inactive less than three years,” Belella said. “It’s pretty quick and painless to come back; there’s just a form to fill out and you pay the rest of the active fee for that year. It’s pretty quick on our side once we get everything from you. If it’s more than three years, it’s not painful but it’s not necessarily quick: You would have to file a petition for reinstatement. It’s not difficult, but can be more time-consuming.”
Option 3: Retired status. Retired status and inactive status are similar, except that there are no further annual requirements once you are on retired status. Just return the appropriate form to assume retired status, she said. Reinstatement is similar to inactive status as well: in less than three years, reinstatement is “quick and painless,” Belella said. However, reinstatement is more expensive because registrants must pay back-fees for the years on retired status, because there is no annual fee for retired status. If retired status lasts more than three years, and the registrant wants to “unretire,” the status is the same as inactive: Registrants simply file a petition for reinstatement.
There are a few more options:
Emeritus status: This status option began in 2018 to offer an opportunity for retired attorneys to provide pro bono services through legal-aid organizations in Pennsylvania. There is a simple application process for Disciplinary Board purposes, Belella said. CLEs are required for this status. Most if not all of those can be obtained for free through either a legal aid organization, such as the Pennsylvania Legal Aid Network, or through the CLE pro bono pilot program. There are many options for obtaining the required CLE credits. The annual registration fee is $35 for “the calendar year,” she said, renewing in January.
Final option: Permanently resign. “While this is an option, we recommend only pursuing this after giving it much thought,” Belella said. “There is no reinstatement from this status.”
Belella noted to make any status change after much thought.
“If you would choose to permanently resign, and then wanted to come back to practice in Pennsylvania, you would have to apply for admission again, like a new attorney would,” Belella said. The forms to make this status change are not available on the Board’s website “because we want to have an opportunity to have a conversation with the person considering it, so we have a chance to review his or her file and let them know what other options they may have before going this route, since it’s such a final action.”
Belella reminded those on the webinar to “ensure you are keeping your contact information up to date with us. Call and check to see if everything’s OK.”
Preparation is Key
Preparation for a disaster is key.
“People say, well, how can I predict an emergency?” Freedman said. “Well, you can’t. But you can prepare for the things that will need to happen if an emergency occurs, and make sure you have done everything necessary for your practice to survive, or for someone to step in and take care of your practice, monetize it in terms of sale, if that’s what you want, or close it down in an orderly fashion.”
Firms should first plan to make sure employees are properly taken care of, Freedman said. She said that a loyal long-term employee may be all an attorney has to hold it together, and/or assist a surrogate, if something terrible happens.
“I am very proud that the PBA Solo and Small Firm Section and I put together a tremendous resource that makes it pretty foolproof for you to create your emergency succession plan,” she said. “We give you all the forms, the documents: We give you language for the engagement agreement.
“The most important point for you to understand in using these materials is that they are designed to document your practice,” Freedman said.
The Surrogacy/Disaster Planning Toolkit “helps you document what’s going on, so that your emergency successor knows where to find things, can get to them efficiently and that the court does not have to appoint a conservator,” she said.
“The worst thing that can happen if a solo is alive but unable to practice, is to have a conservator appointed because the solo has not planned,” Freedman said. “The conservator literally dismantles the practice in order to protect the clients. The conservator does not run or care about the business side of the practice: He or she just takes care of the active client matters.”
Those interested in learning more can contact Freedman at 800-932-0311, ext. 2228, or lawpractice@pabar.org.
“Any PBA member who is thinking about retirement who doesn’t call Ellen Freedman is making a mistake,” Fitzsimons said.
“Without a succession plan, my husband, my partners, my law firm and my clients would all have been negatively impacted because I didn’t plan,” Mundorff said.
Mundorff said at PBA, “most of our lawyers come from solo and very small practice settings across the commonwealth of Pennsylvania.
“My story and Don’s story can illustrate that a catastrophic life event that changes the shape of your legal practice doesn’t have to happen only to you, it can happen to your loved one, your spouse, your child, your mother or father, for whom you will be a primary caregiver.”
Mundorff recommends the following:
- Plan early. You are never too young to plan.
- Develop an exit strategy now.
- Don’t go it alone. Collaborate with your family, your partners, your staff, your paralegals and your clients.
- Consult an expert in law practice management.
- Seek ethics guidance regarding the rules. Call the PBA Ethics hotline at 800-932-0311, ext. 2214, or 717-238-6715.
- Ask for help if you are not sure. PBA has many resources to help you.
- Call the Pennsylvania Supreme Court Disciplinary Board to advise you as to what the license status options are and what requirements are for registration.
- Call Lawyers Concerned for Lawyers if there is some type of addiction problem to impact your succession plan.
Do it now to craft your own unique plan that fits your life and your needs.