Legal Question in Wills and Trusts in Kentucky
Starting an Estate Planning Document Preparation Company
I had previously worked for a corporation in which I solicited Living Trusts and funded these trusts for the corporation. I have now resigned and wanted to start my own corporation doing practically the same business. I have approached several attornies in this area and in other larger cities surrounding my hometown and some have told me that since I am not an attorney they cannot split attorney fees with me since I am not an attorney. Some have told me that I would be no different than a paralegal typing the document and the attorney then signing the actual trust itself. The Living Trust itself has a designated spot in the trust stating "This instrument prepared by "John Doe, P.S.C. Attorney at Law"" in which the attorney will also make personal contact with the client. I have two questions regarding this issue. Can I start this corporation in which I am not an attorney an hire an attorney on my client's behalf and pay the attorney from the corporation and still receive money for finding these clients for my attorney? If not, Is there anyway in forming a corporation and doing this and receiving money with me not being an attorney?
2 Answers from Attorneys
Starting an Estate Planning Document Preparation Company
The corporation you worked for before is probably practicing law without a license. It is true attorneys cannot split fees with non attorneys. It is also true that the attorney is hired by the client according to most state laws. The money would have to come straight to the attorney because he is responsible for the content of documents. If something goes wrong the attorney is the one who would be responsible not the corporation. There are many estate planning companies that are in operation. However most of them are owned and run by attorneys. Those that are not are liable to be hit with suits from the state bar for practicing law without a license. An attorney is accountable for the content of the documents and dispite the boiler plate in the documents each document should be tailored to the individual needs of the client. The application of the appropriate laws and precedents to each individual client is soley the responsibility of the attorney who prepares the documents.
Starting an Estate Planning Document Preparation Company
In my opinion, there are several potential problems with your proposal. You may be prosecuted or sued for practicing law without a license. The attorney to whom you send the work might be violating your state ethical rules for lawyers because (1) you could be viewed as improperly soliciting clients for him; (2) he might be improperly sharing fees with a nonlawyer; and (3) the lawyer might have a conflict of interest, in that you were paying the fee, or at least bringing in the work, which impairs the lawyer's duty of complete loyalty to the client.
Finally, living trusts are really not "cookie cutter" legal tasks. They are part of a complete estate planning process which required thoughtful consideration by a trained and experienced lawyer, and a minimum of an hour of exploring the topic between client and lawyer, even for the simplest estates. A trust is not a "product" to be sold, it is a solution to a particular legal problem. To know if it's the right solution, you have to first investigate and understand the problem.
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