Succession planning requirement

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Succession planning requirement

At its meeting on May 18, 2018, Council adopted a regulatory amendment that will require lawyers and law firms to maintain written succession plans. This obligation is now included in subregulations 4.6.1 (law firms) and 4.6.2 (sole practitioners), and subregulations 4.6.4 through 4.6.6 provide a framework for the development of a succession plan. This came about as a result of work done by the Succession Planning Working Group[1].

While these regulations do create a mandatory obligation to have a written succession plan, the specifics of any lawyer’s plan will need to be tailored to address that lawyer’s unique practice type. Over the coming months, the Society will be working with lawyers and law firms to develop the necessary templates to support the development of practice appropriate plans.

The Society will be preparing guidance materials that will be made available to the membership in support of these regulatory amendments. Currently, materials relating to the preparation of succession plans can be found on the Lawyers’ Insurance Association of Nova Scotia’s website, in the Succession Planning section of the Practice Management resources.

[1] In 2017, the Succession Planning Working Group (the Working Group) was struck to consider whether mandatory succession planning should be required for lawyers who deliver legal services to the public. Council created the Working Group because it recognized that one of the major challenges for Nova Scotia lawyers, and one of the significant regulatory risks for the Society, relates to succession planning (or the lack thereof).  Over the last several years, the Society has experienced increasing costs associated with assisting lawyers at the end of their careers who have not made adequate plans for the transition of their practices when they are no longer capable of dealing with them because of disability, incapacity or death.

The Working Group’s final report recommended that the Society should, as part of Legal Services Support, develop, maintain and promote resources to assist lawyers and law firms in preparing for succession or wind-up of practices at the end of a career. As well, Council should consider enacting a regulation that requires all law firms delivering legal services to the public to have a succession plan and to advise the Executive Director of its location.

In March 2018, Council determined that the Regulations made pursuant to the Legal Profession Act should be amended to include a requirement for lawyers and law firms to develop and maintain succession plans for all lawyers associated with the firm. Tied to this amendment will be the need for the Society to develop guidance materials and resources for lawyers to assist them with their compliance with this new regulatory obligation as part of our Legal Services Support model.