Entire Issue - National Association of Legal Assistants

DepartmentsPresident’s Message – Vicki J. Kunz, CLAS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5From the Editor – Sharon A.Werner, CLA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7Readership Survey . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .24Vote NALA – 4-page pull-out insert . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .25Breaking News . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .29Technobits – High-Tech for Everyday Tasks by V. Lee Johnson . . . . . . . . . . . . . . . . . . .37Ethics Tips – NALA/SNAP Amicus Brief AccentsNeed for Confidentiality Screening by Libby Roleson, CLAS, . . . . . . . . . . . . . . . . . . . . .38Education –Paralegal Program Director by Kathryn L. Myers . . . . . . . . . . . . . . . . . . . . . . . . . . . . .40Practice Tips –Smart Utilization Increases Profits by Carolyn Yellis, CLA . . . . . . . . . . . . . . . . . . . . . .42Communication Corner – by Virginia Koerselman, Esq. . . . . . . . . . . . . . . . . . . . . . . . . .43Professional Development – Writing for the CLA Exam by Charlsye J. Smith, CLAS . . . .44Special Contribution:The Value of Mentoring – by Diane Pevar, AAfPE President-Elect . . . . . . . . . . . . . . . . . . . .46Affiliates Column –Communication is Basic by Sharon G. Robertson, CLAS . . . . . . . . . . . . . . . . . . . . . . . .47FeaturesFACTS &FINDINGSCharitable Estate Planning & Growing Philanthropists by James C. Soft . . . . . . . . . . . 8Valuation Expertise in Estate Planning by Carl Lloyd Sheeler, CBA, AVA . . . . . . . . . . . . . 12Paralegal Trust Administrator by John Norris Stone . . . . . . . . . . . . . . . . . . . . . . . . . . . 16Qualified Tuition Programs by John A. Hartog and Thomas W. Shaver . . . . . . . . . . . . . . . 18Charting the Comparisons – Wills and Trusts Basics by Molly J. Fischer, CLA. . . . . . . 20The Federal Estate Tax Return-I by Orville W. Bloethe, Esq. . . . . . . . . . . . . . . . . . . . . 30Part Two: Conservation Easements by William M. Silberstein, Esq. & Melinda Beck, Esq. . . . . 34NALA News and InformationThe Journal for Legal Assistants / Volume XXIX Issue 5www.nala.orgNew Members . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .51NALA Affiliated Associations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .52NALA Official Roster . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .55Continuing Education CouncilSharon A. Werner, CLA, ChairCouncil MembersAnnette R. Brown, CLAGigi E. Davis, CLARhonda R. Deters, CLASMichelle Erdmann, CLAPatricia J. Gustin, CLAJulie D. Hunt, CLAHazel Lange, CLAMaryann Valerio, CLAExecutive DirectorMarge Dover, CAEFACTS & FINDINGS is the official publication ofthe National Association of Legal Assistantsdesigned to serve the needs andinterests of legal assistants nationwide.FACTS & FINDINGS is edited for the membersof the National Association of Legal Assistants.Publishing and editorial decisions are based on the editors’judgment of the writing, the timeliness of the article,and the potential interest of the readers.The views expressed in FACTS & FINDINGSare those of the individual authors and may not reflect theofficial views of the National Association of Legal Assistants.No endorsement of those views should be inferredunless specifically identified as the official policy of theNational Association of Legal Assistants.FACTS & FINDINGS© 2003NALA Corporate Office1516 South Boston, Suite 200Tulsa, Oklahoma 74119918-587-6828 Fax 918-582-6772www.nala.org e-mail: nalanet@nala.orgFACTS & FINDINGS(USPS 363-150) is published quarterlywith two issues in the first quarter.Subscription rate for nonmembers is $25 forfour issues. Annual dues include $9 for asubscription to FACTS & FINDINGS.Periodicals postage paid at Tulsa, OK.POSTMASTERSend address change to NALA Headquarters,1516 South Boston, Suite, 200Tulsa, Oklahoma 74119EditorialNational Association of Legal AssistantsProduction EditorKenneth L. FrakesGraphic Design & ProductionJohnny King DesignFACTS & FINDINGS / FEBRUARY 2003 3

PRESIDENT’SMESSAGEThe Give and Take of MentoringBy helping you, perhaps I was trying to lift my life a trifle.Heaven knows, anyone’s life can stand a little of that.—Charlotte, from E.B. White’s Charlotte’s WebDid you know that January was National MentoringMonth? Being active over the years in different mentoringrelationships, I took the time to review some of the historicalbackground of mentoring as well as my personal experienceswith this most helpful professional strategy.The original “Mentor” was from Greek mythology.According to the American Heritage Dictionary, Odysseusassigned his trusted counselor, Athena, to be the guardianand teacher of his son. Athena was also known as Mentor.Until very recently, a mentor was generally thought of as afather figure who took someone under his wing, often fordecades. These mentors did the choosing, and such relationshipswere relatively rare. The verb “mentoring” wasn’t commonlyused in the business world until the late 1970s. Today amentor is defined as “a wise and trusted counselor or teacher.”You may not have thought of yourself as a mentor, butchances are good that you have been one. It might have been atwork, in the community or at home, but it is likely that yourinspiration and guidance has helped others in some capacity.The odds are even greater that you have been a “mentee.”This noun complements “mentor” well and has become commonin business vernacular. Few professionals can claim tohave achieved success entirely on their own, and it is a mentor/menteeprocess that often deserves some of the credit.There are two types of mentoring: “natural” mentoringand “planned” mentoring. Natural mentoring occursthrough friendship, collegiality, teaching, coaching, andcounseling.Planned mentoring occurs through structuredprograms in which mentors and participants are selected andmatched through formal processes. These formal types ofmentoring programs are increasingly popular with businessorganizations as cost-effective developmental efforts.A mentor today can be anyone who goes out of the wayto help someone else achieve goals. Mentors can be older,younger, male or female. They can be available for face-tofaceconversation, or they may be effective over great distancesthrough phone calls, e-mails, and writing. The mentoringrelationship can be for a short term, or it may last foryears. It was once common for a mentor to manage thementor/mentee relationship, but mentees now are realizingthe importance of initiating and managing the relationship.I have worn both hats in my professional years. I havebeen a mentor to several people in the legal field, and tosome who were looking for the same work ethic and communityvalues as mine. I have been told that my encouragement,ideas, and advice helped them get through differentstages in their careers.Being a mentor can be a lot of work,but I have never left a mentoring relationshipwithout feeling that I was a winnertoo. My mentor/mentee relationships havestirred me to greater excitement about myown career, and I have learned new skillsand knowledge from mentees that I mightnot have found in a mentor I chose formyself. A mentee’s enthusiasm is inspiring. Vicki J. Kunz, CLASI have had many mentors, including my mother, father, andmy eighth-grade English teacher. Several attorneys I have workedfor have served as my mentors and taught me lots, not only aboutthe law and legal procedures, but how to treat clients, how tonegotiate, and (most of all) how to be a good supervisor or boss.I recently lost a very special mentor who died at the ageof 72. She was probably the best career coach I ever had. Wehad many differences and didn’t agree on everything, but shetaught me the importance of standing up for what Ibelieved. She set a wonderful example by being active in ourcommunity and showing me the importance of giving back.As I progressed in my career, her words of encouragementand accolades had special meaning. Every accomplishmentwas acknowledged with a congratulatory note: “I knew youcould do it.” When I learned she was terminally ill, I made ita point to spend time with her. We shared memories of ourrelationship, and I told her how much she had influenced me.She said that she had considered me to be a mentor toher, and that my words of encouragement and telling herthat she could do it gave her great confidence. We laughed athow neither of us realized we were each other’s mentor.Her legacy to me is the understanding that you shouldalways act like a mentor. And you should always be amentee, learning from those around you. You must be preparedto give and take in either role.More recently, I was selected to be a mentee in a pilotmentoring program with our company. The basis of my formalapplication was the opportunity for the company to use myNALA presidency as a kind of training field. I was matched upwith one of our subsidiary presidents for the yearlong program.It has been a wonderful experience, and the developmentalgoals I set are being met. I was assigned a mentorwho shares his business philosophy and what I call “Wayne’swise words of wisdom” with me. We have discussed mattersranging from conducting effective board meetings to developingskills to lead change. Even more extraordinary is thefact that he has arranged meetings for me to learn from otherswithin the company whom he felt had more to offer.The give and take of mentoring brings freshness and asense of purpose to both mentor and mentee. It is a conceptand practice that deserves celebration in a world that oftendwells too much on competitiveness.FACTS & FINDINGS / FEBRUARY 2003 5

FROMTHEEDITORPay it ForwardMarie Warfield, Margaret ParkerO’Connor, and Mary Pollak.These names may mean nothing toyou, but they mean everything to me.These women are all legal assistants andthey were my mentors at the beginningof my career. I’m not sure they knew it,but they were.They are all responsible in one wayor another for my success today. Theyinspired me, supported me, and providedme with a shoulder to lean on when Ineeded it. One of them has retired, oneno longer has the title “legal assistant”but is using her skills in a new field, andone has celebrated 30 years with the samecompany—that’s truly an inspiration.We all have stories to tell of a“Marie,” “Margaret,” or “Mary” in ourlives. While the stories are different, theyshare a common thread—someone tookthe time and trouble to share informationabout her or his career, give us guidancein making a career decision, or, perhaps,merely chatted with us about variousschools offering legal assistant programs.Whatever the guidance, big or small, itmade a difference.Have you made a difference? Haveyou made yourself available to others toanswer questions and suggest options?Whether for a high school student contemplatinga paralegal career, or for anestablished legal assistant considering sittingfor the CLA examination, yourinfluence can be vital.The role of “mentor” seems a bitintimidating, and it is not always easy.There have been times when I didn’t havemy heart in it at the start, but once Ibegan to speak with the mentee, herenthusiasm was contagious and I foundmyself absorbed in helping someone elseand feeling as though I was helpingmyself as well.It brings tomind the moviePay It Forward.If one good deedleads to another,to another, toanother … well,you get the idea. Should the opportunityarise (and you can make it arise if youwant), I hope you will grasp it and be a“Marie,” a “Margaret” or a “Mary” insomeone’s life.We all have much to share. I’ve seenthe magic of mentoring at work onNALA Net and at convention. Let’s beopen to the possibilities and eager toshare our knowledge.In keeping with this theme, NALAPresident, Vicki Kunz, offers her perspectiveand personal experience with mentoringin her column in this issue. Andthe AAfPE contribution by Diane Pevaron “The Value of Mentoring” provideshelpful insights on mentoring studentsfrom a program director’s perspective.Remember that the mentoringprocess can be as simple as passing alongyour issue of Facts & Findings to someonewho doesn’t have a subscription(what a great gift a subscription would befor a legal assistant in your life). Whileeach issue of our journal has a “focus” wetry to include something for everyone.The focus may not be on your area ofinterest (hopefully you read them anyway—theymight be your future), butthey surely would interest someone youhave come in contact with.Even the articles outside your area ofspecialty are good grist for conversationwith a coworker, friend, or new acquaintanceat a CLE seminar. Conversation isintegral to mentoring, and what a greatway to “Pay It Forward” and build a networkor a new friendship in the process.Sharon A. Werner, CLASeveral articles in this issue deal withour focus on trusts and estates, a subjectthat affects—or will affect—all of us atsome point in our lives. In fact, mymother-in-law fell recently and broke hershoulder. This unexpected calamity confrontedus with the reality of making sureher papers (will, trust, durable power ofattorney) were in order in the event ofsomething more serious in the future.Molly J. Fischer’s article compareswills and trusts and takes us through theessentials. I found myself rereading itduring my recent family crisis.The subject of conservation easements,addressed by Bill Silberstein andMelinda Beck, is continued from theNovember 2002 issue as “Part II” in thisissue. The estate taxes that can be savedby placing a conservation easement on apiece of property is amazing and is definitelysomething many of us can considerboth in our professional capacities and inour personal lives.John Norris Stone’s article on hisevolution from a probate and estate legalassistant to trust administrator details aremarkable journey that emphasizes theimportance of keeping an open mind toalternative career directions, even whenthey don’t match our original plans. I amproud that John is a personal friend, andI am sure you will share my admirationof his commitment to his work and theparalegal profession.The inspirations in my life persist. Icontinue to be inspired by our NALAleaders (past and present), by my coworkers,and by our readers. I want tothank all of you for inspiring me to be abetter legal assistant and for continuingto fuel my enthusiasm.F&FFACTS & FINDINGS / FEBRUARY 2003 7

CharitableEstatePlanningAND GROWING PHILANTHROPISTSby James C. SoftCharitable estate-planning vehicles often represent thefirst step in the “growing of a philanthropist.” Although everyone has an “itch” to give (whether they acknowledge it or not),many find it difficult to make a major gift even when theycan afford to.The uncertainties of the future make it especially difficultfor many seniors to lose the earning power of a gifted asset.The Great Depression, World War II, and the “School of HardKnocks” has shaped this senior generation’s attitude aboutsaving or spending. Their inclination is towards accumulationrather than giving.Nevertheless, according to recent Boston University studies,it is estimated that 40 to 120 trillion dollars will pass fromone generation to the next in the coming 40 years. The importanceof charitable planning tools in this context is compelling.The concepts of charitable estate planning are not confined toretired individuals, but the primary focus here is upon seniors.These tools of the trade are commonly referred to as“deferred or planned gifts,” but they may be more accuratelycharacterized as “charitable financial/estate planning vehicles.”They often solve domestic, economic, and inheritanceplanning issues, and serve to stimulate the latent philanthropic“itch.” Once that itch is properly scratched, a philanthropistis born.Charitable Gift AnnuityA popular charitable planning device for constituents oflarge well-established charities is the Charitable Gift Annuity.If the charity is too small to offer an annuity program, a donorcan frequently establish a charitable annuity for a charity ofchoice through a local community foundation.As the name implies, the donor makes a charitable gift ofmoney or property to a charity, but retains an annuity incomewhich is often partly tax free for life, and that also may continueto a survivor beneficiary. In addition to rates that rangefrom 5.8 percent at age 55 to 11.5 percent at age 90 and older,the donor is entitled to a charitable contribution deductionthat often amounts to 40 to 60 percent of the value of the assetcontributed to the charity for the annuity arrangement.The Charitable Gift Annuity is a contract (not an insuranceproduct) between the charity and the donor. All the assetsof the charity usually stand behind the performance of the contract.Most states require registration of a charity’s annuityprogram. There are certain exemption requirements for charitiesissuing annuities, and some states are more aggressive thanothers in their regulation.In times of volatile stock markets and low interest rates,Charitable Gift Annuities are a welcome gifting mechanism forseniors who want high fixed income (partly tax free) plus contributiondeductions for the “gift.” A Charitable Gift Annuityoften enables the donor to make a much larger gift because theannuitant has not forfeited the earning power of the giftedasset, and has actually enhanced cash flow through the highannuity rate and the inherent tax savings.Many charities offer annuities beginning at $5,000, butthere is no limit to the amount of a Charitable Gift Annuity.More often than not, satisfied charitable annuitants are eagerto repeat their experience because as they grow older, returnrates go up, and additional tax benefits are generated. Donorstend to grow more comfortable giving larger sums to charity,and they are on their way to becoming philanthropists.8FACTS & FINDINGS / FEBRUARY 2003

Charitable Remainder TrustsCommercial trust companies and larger charities withsophisticated back offices will often encourage theirclients/donors to consider Charitable Remainder Trusts (CRT).There are five types of Charitable Remainder Trusts: 1)Standard Charitable Remainder Unitrust (CRUT), 2) NetIncome Charitable Remainder Unitrust(NICRUT), 3) Net Income With Make Up CharitableRemainder Unitrust (NIMCRUT), 4) Flip CharitableRemainder Unitrust (FLIP), and 5) Charitable RemainderAnnuity Trust (CRAT). All have unique applications in afinancial/estate plan, but only the general concept is presentedhere.As the name implies, the charity gets the remainder (thetrust corpus) after the trust terminates. This means that duringthe trust term, someone—the income beneficiary—enjoys anincome benefit from the trust. The income beneficiary is usually,but not necessarily, the donor.The rate the trust pays to the income beneficiary is calledthe “unitrust amount” or “annuity trust amount.” This is afixed percentage of not less than five percent or more than 50percent of the net fair market value of the assets valued annually(if a unitrust) or at the time of the trust creation (if anannuity trust). Generally, a payout rate between five and ninepercent is selected in order to allow the corpus of the trust togrow. In most cases, this enhances the income stream for theincome beneficiary during the trust term and the corpus for theremainder charity when the trust has terminated. An excessivepayout rate could collapse the trust corpus during the trustterm, leaving nothing for charity.Donors with highly appreciated assets often select aCharitable Remainder Trust as a planning device to avoid capitalgains on the sale of the asset transferred to the trust. Sincethe CRT is a tax-exempt entity, assets transferred to the CRTcan be sold without incurring capital gains tax. This leaves alarger corpus within the trust and a larger income stream forthe income beneficiary.The CRT not only avoids capital gains tax within thetrust, but also generates a charitable contribution deduction forthe donor based on the present value of the future interestgiven to charity. This deduction is determined by Treasurytables and is based on the payout rate, duration of the CRT,current AFR rate, and mode of payment.Another important planning technique that addressesincome tax, capital gains tax, and estate tax issues in the contextof an inheritance for a loved one and a gift for charity isthe “wealth replacement plan.” This practice integrates theCRT with a life insurance policy.For example:A donor with low basis, highly appreciated assets such as afarm, closely held business enterprise, or securities, transfersthe asset to a CRT. At the same time, the donor buys an insurancepolicy for a like amount making an heir the owner andbeneficiary of the policy. The donor makes annual gifts fromthe income stream of the CRT to the heir for the premiumpayments on the life insurance contract.The tax savings from the charitable deduction, combinedwith the added earning power of the CRT corpus (since therewas no capital gains tax on the sale of the funding asset) oftenis sufficient to pay for the life insurance plus a generousincome for the donor. The heir ultimately inherits the proceedsfrom the life insurance contract as well, without the burdenof estate tax.There are many more applications for a CRT, which canbe mutually beneficial to donors and charities, but thisoverview demonstrates the power of the concept. This is yet afurther step toward growing a philanthropist.Charitable Lead TrustsThe Charitable Lead Trust (CLT), unlike the CRT, isa taxable entity. The flexibility of repositioning assets bythe trustee is somewhat limited with this vehicle sinceportfolio turnover could result in a taxable event to the CLTor to the grantor.Having made this distinction regarding its tax nature,however, the CLT in most other respects tends to reverse theroles of the interested parties. In other words, the charityreceives the “lead” interest (i.e., income interest) during a trustterm while a non-charitable person receives the “remainder”interest at the end of the trust term.The two types of CLTs are the Charitable Lead Unitrust(CLUT), and the Charitable Lead Annuity Trust CLAT). If theremainder interest returns to the grantor of the CLT, thegrantor trust rules apply to the transaction. If the remainderinterest passes on to other family or non-family members, thengift/estate tax issues must be considered, as well as generationskippingissues, at the time of the trust creation.Wealthy individuals use CLTs as a means of providing animmediate income stream to their favorite charity and a futureinheritance to a favored heir. The present value of the incomestream to charity is a tax-free gift while the present value of thefuture interest to the heir is a taxable gift. The duration of theCLT, however, is usually structured in such a way that any gifttax incurred is minimal. Wealthy donors downsize their estatefor gift/estate tax purposes and, in the process, make generousgifts both to charity and heirs.Philanthropists are often created in this manner becausethey learn that they can give it away twice—once to charityand once to heirs.If a donor needs a large income tax deduction (e.g.,because the business has been sold for a large profit) a CLATmay be structured so that the trust pays an income to charitycontinued on page 10FACTS & FINDINGS / FEBRUARY 2003 9

Charitable Estate Planningcontinued from page 9for a period of years and then returns to the donor at the end of the trust term. Thepresent value of the income stream to charity is an income tax deduction in the year inwhich the trust is created, thus helping offset the gain from the sale of the business.Since the grantor trust rules apply, the donor must report the trust income on personaltax returns each year. For this reason, most grantor CLTs are invested in tax-exemptinvestments during the duration of the trust.Charitable Life EstatePerhaps the simplest, but one of the most effective, charitable financial/estate planningvehicles is the Charitable Life Estate (CLE). A philanthropist can be created withoutthe charity having a development office or even knowing how to structure the gift.Here is how it works:The donor conveys ownership (a lawyer drafts the deed) in a personal residence—ahome or vacation home—or farm subject to the donor’s “life estate.” This means that thedonor reserves the right to live in the home until death. The donor also has the responsibilityto maintain the home , including insurance, and to pay the real estate taxes. A writtenagreement outlining the responsibilities of the life tenant during the life estate term isadvisable. At the death of the donor, the life interest terminates and the charity holdsclear title to the property to use or to sell.The donor, because of the irrevocability of the transfer, is entitled to a charitablecontribution deduction for the value of the property at the time of the conveyance—lessthe value of his life interest as computed by Treasury tables. In other words, the donorcan give it away and keep it too, enjoying an income tax deduction along the way.Experienced charities sometimes combine a Charitable Gift Annuity with aCharitable Life Estate arrangement. The value of the life estate is first computed toestablish the value of the charitable interest (i.e., the charity’s remainder interest in thelife estate). Once the remainder interest in the life estate is established, the charity issuesa Charitable Gift Annuity for the value of the remainder interest. This means that thedonor gets paid for living at home, enjoys an income tax deduction, and displays agenerous act of philanthropy.It has been said that philanthropy requires thought, action, and passion. Estateplanning professionals can be the key instigators in planting the thoughts, stirring thewill to action, and inciting the passion.As the fund raising and philanthropy guru Douglas Lawson has said, “The philanthropicexperience is the healthiest way to live life fully.”James C. Soft is a Certified Financial Planner and the principalof James C. Soft & Associates, Billings, MT, consultants for plannedgiving and mentoring for charities. He has more than 32 years ofexperience in charitable financial and estate planning, and has writtenmany planned giving publications and articles. He is a co-author ofBuilding Endowment Right From the Start.He is a member of the Montana Governor’s Task Force forEndowments and Philanthropy, President of the Yellowstone Boys andGirls Ranch Foundation, and is a board member of the nationalCharitable Accord which promotes positive federal tax policy.jims@yellowstonefoundation.orgIN NEED OFTRANSLATIONSERVICES?One of the nation’spremier teams ofattorneys and certifiedlanguage professionalsstands ready to helpyou translate legal andbusiness documentsfrom and into Europeanlanguages.Intermark Language ServicesThe Legal and FinancialTranslation Experts2555 Cumberland ParkwaySuite 295Atlanta, GA 30339Tel: (770) 444-3055Fax: (770) 444-3002E-mail:info@intermark-languages.comVisit us on the Web at:www.intermark-languages.comWe know thelanguage of law.10FACTS & FINDINGS / FEBRUARY 2003

ValuationExpertisein EstatePlanningby Carl Lloyd Sheeler, CBA, AVABy their very nature, those who practice law and those whoperform business valuations (BV analysts) are often very differentpersonality types. The overlap of analytical skills with the goal ofpreserving assets and minimizing tax liabilities is what makes therelationship of attorney and BV analyst fruitful for their clients.The sheer number and impact of legal and financial issueshas a myriad of implications on value. It is human nature tominimize these issues, as they can be daunting. In the absenceof empirically supported conclusions, however, “opinions” ofasset value are mere guesses that can lead to losses of thousandsor even millions of dollars for clients. A working relationshipwith a seasoned BV analyst (an appraiser) can enhance the legalteam’s advisory role in areas ranging from estate and successionplanning to estate tax litigation.Maintain an ‘Expert’ FileBusiness valuation (appraisal) is a specialized financialadvisory niche, requiring full-time involvement to stay currentin tax and legal matters. A CPA credential alone is unlikely toprovide the requisite skills and resources to render opinions ofvalue, and may pose some conflicts of interest for those whoalso prepare tax returns for the individual, business, or estate.Keeping track of true BV experts with an “Expert” filewith notations is helpful, especially when an expert has done agood job the past. A BV analyst that has a history of emphasison accounting services, as opposed to thorough estate and giftrelated valuation expertise, provides no assurance of being ableto “Teflon coat” the appraisal report to minimize the chance ofan IRS or Probate challenge.In populating an Expert file, the following attributesshould be key:• Qualifications—formal and continuing education,relevant memberships• Credibility—years of applied experience, speakingand writing• Availability—easily reached by telephone, responsiveand timely• Preparation—work product reflects thorough analysisof relevant issues• Communication, Articulation and Persuasion—easyto understand• Personal Attributes—easy to get along with and willingto suggest ideas12FACTS & FINDINGS / FEBRUARY 2003

It might be practical to have a sample work product and providea recent scenario to the expert to obtain a sense of fees chargedand timeframe to complete work. If the quoted fees tend to be relativelyconsistent, then their reasonableness can be identified.Time & MoneyGiven the finite amount of time and financial resources withwhich to provide maximum service to the client, legal counselshould have a realistic idea of the costs for expert BV services andthe time required for the desired work product. When fees arewidely divergent, keep in mind that skill and expertise are beingpurchased, not a simple commodity.Assuming access to a BV expertfile, counsel can contact a valuationexpert with at least an overview of thesituation either before or soon afterphysically meeting the client. This contactallows counsel to ask questions andexchange sufficient information for theexpert to give a fee quote and estimateof completion time. Counsel shouldprepare to discuss the “cost/benefit”repercussions of not retaining a qualifiedbusiness appraiser. Based upon theentity valued, as well as the quality andtimeliness of requested documents, aBV assignment will typically takebetween 20 to 30 working days. A“rush” may be put on the engagement,but will usually entail additional cost.Fees may vary considerably,depending upon assignment complexityand time required to completethe appraisal. A report for anundivided interest in real propertyheld in trust is likely to have a startingfee of at least $1,500. AnLP/LLC that is an asset holding company (AHC) will likelyhave a fee starting at $3,500, and an operating business willprobably have a starting fee of $5,000. It is not unusual tohave situations that result in $10,000 or more in appraisal fees.Cost FactorsEach case is unique, but a number of common factorsaffect the cost of valuation. Contentious issues tend to costmore because there is more preparation for deposition and possiblelitigation, and there are more meetings to discuss thework product in greater detail.If the business is a partial interest, more work is requiredto research and support the application of discounts and premiums.If the business is a professional practice, investigationinto the contributory value of specific individuals’ knowledgeand the ability to transfer goodwill may require more time.If the business is a manufacturer, more time will be spentresearching the machinery, equipment and inventory to determineoutput capacity, age, and condition. If there are documentsthat are delayed or not provided at all, there may be additionalresearch required to substantiate the analyst’s conclusions andassumptions. If the assignment is for gifting or estate related purposesin order to meet the standard ofa “qualified” appraisal (and lessen thechance of challenge), a more thoroughreport may be required.Hourly rates can differ considerably,depending upon education,skills, and experience of the analyst.However, industry compensationmedians indicate that an hourly rateof $175 to $250 is common. For asimplistic example of how this couldplay out, assume a quoted fee of$5,000 and an hourly rate of $200(providing for 25 billable hours). Amodest appraisal report of 20 to 30pages would probably take a day-anda-halfto complete (12 billable hours).Then the analyst needs to examinefive years of tax returns, financialstatements, general ledgers and otherfinancial documents. Additionally, realproperty leases, agreements, articles ofincorporation and corporate bylawswill be examined to see what impactthese and other legal documents mayhave on value. An analysis to determinehow the business is performing will be conducted to determinewhat is the likely proxy for future revenue and earnings.To better understand the information provided, the analystwill usually follow up with an interview with the businessowner to address areas such as market conditions, employeecompensation, and tenure. The analyst will inquire regardingitems not readily identifiable on the financial documents andquestion whether “assumptions” appear reasonable based uponindependent research.If all this took a day (eight billable hours) to complete,then five hours are left for the analyst to compare thecontinued on page 14FACTS & FINDINGS / FEBRUARY 2003 13

Valuation Expertise in Estate Planningcontinued from page 13business against comparative ratio data sources. Companiesdo not operate in a vacuum, so industry “norms” need tobe identified to determine into what “risk” category thecompany may fall.The analyst must become acquainted with the industryand market area(s) in which the subject operates, and determinewhat pressures affect competitiveness and profitability. A studyof the economic climate and its influence on risk to the businessand the entire industry is required. This may be from the“micro” level (e.g., competing restaurants on the same block), orat the “macro” level (e.g., residential construction declines dueto increased interest rates, in turn impacting construction suppliers,etc.). Sales of same or similar businesses in the privatelyheld and publicly traded markets are researched to identify suitable“comparable” data that is actually “arm’s length.”These basic valuation analysis activities and the degree ofthoroughness will be driven by the amount of information gatheredas well as the client’s desire for a solid work product versuscost control. This is a cost/benefit tradeoff the client should carefullyconsider. A savings of a few thousand dollars by scrimpingon appraisal fees could lead to missing something that easilycosts the client hundreds of thousands of dollars in value.Initial Questions & DocumentsThe very first contact with a BV expert will initiate thecost/benefit considerations to be made by the client. A highqualityBV analyst cannot reasonably provide a quote beforehaving sufficient knowledge of the entity and situation. Thefollowing information is typical of what should be conveyed toprovide a sense of difficulty and the time likely to be required:Purpose of the appraisal: . . . . . . .Estate PlanningType of Business: . . . . . . . . . . . .Steak & Seafood Restaurant. . . . . . . . . . . . . . . . . . . . . .(not a franchise)Location: . . . . . . . . . . . . . . . . . .DowntownYears in Business: . . . . . . . . . . . .More than 10 yearsAnnual Sales: . . . . . . . . . . . . . . .$900,000–$1.2 million. . . . . . . . . . . . . . . . . . . . . .over the past three yearsAvailability of Information: . . . . .Financial Statements. . . . . . . . . . . . . . . . . . . . . .and Tax ReturnsLegal Structure: . . . . . . . . . . . . . .LLCPresent Ownership: . . . . . . . . . . .Spouse owns 50 percent;. . . . . . . . . . . . . . . . . . . . . .brother owns remainder. . . . . . . . . . . . . . . . . . . . . .(Spouse works at restaurant. . . . . . . . . . . . . . . . . . . . . .50 hours/week)Time Frame for completion: . . . .Not to exceed two monthsReal Estate Owned/Leased: . . . . .Leased by “related party”After acceptance of an engagement, a list of documents,including financial and legal documents, usually will be requested.Some information may not be readily accessible, and acquiringit may produce delays in filing or gifting. The BV analystwill usually indicate in the report what items were requestedand the impact of the omission of any data on the value conclusion.Sparse data may create added substantiation burdens onthe expert, entailing more time and expense to the client. TheBV analyst may have to make certain assumptions concerningoperations and governance in order to “fill in the blanks.”Appraisal ProcessRegardless of the property held, the BV analyst’s role is tosimulate and quantify the most likely decisions made by a poolof notional investors. Obviously, most publicly traded companiesrepresent highly liquid minority interests that can bequickly bought and sold with cash changing hands in a matterof days. An investor will be concerned with the degree of riskcompared to the economic benefit and the time to receive it.These benefits may be achieved through growth (capital appreciation),income (distribution of dividends), or both.The greater the likelihood that growth and income will beachieved, the lower the risk. The lower the risk, the higher thevalue of the property and the investment expected to acquire it. Itis a simple question of how much cash can be readily and consistentlyreceived during what time frame. This is basic financial theorywhere the property owner must be aware of the market andeconomic climate for the specific and other investments in orderto determine which choices may offer less risk or higher returns.A second issue concerns the holding period and liquidity. Ifthe property held cannot be readily sold due to the impairmentof having a limited pool of buyers, then the holder of an interestin this property may not be able to achieve a “cash equivalent”value as of a specific sell date without adjusting price sufficientlyto attract a buyer. Therefore, the adjustment or “discount” forlack of marketability becomes more profound in cases where theinterest held generates little or no income, or if it is a minority(“non-controlling”) interest in which the investor has little or nocontrol over the performance or sale of the asset. This latter situationwill result in a discount for lack of control.The absence of a legal “bundle of rights” places restrictionson liquidation, sale, or transfer. This emphasizes why a 10 percentinterest is not simply worth one-tenth of the pro ratavalue of the entire property held. These concepts underpin theestablishment of trusts, tenancy-in-common, LP/LLCs andsubsequent gifts of partial interests in situations ranging fromoperating manufacturers to an LP holding marketable securitiesand income-producing real estate.Property values and applicable discounts must be well supportedthrough empirical evidence that is widely accepted and applied14FACTS & FINDINGS / FEBRUARY 2003

throughout the BV profession. Simply selecting figures with no documented supportapplicable to the uniqueness of the subject of the appraisal and its environment placesboth counsel and client at unnecessary risk of an IRS challenge and a notice of deficiency.SummaryA BV analyst is an invaluable asset to the legal team,and shares the goal of preserving the client’s wealth andsatisfying legal distribution requirements. This is done by understanding IRS RevenueRuling 59-60 and the applicable state and federal laws and statutes and applying theirsignificance in analyzing an asset, the investment risks associated with the economic,industry and market factors that influence it’s sale and purchase. The BV Analyst’sknowhow is achieved only by thorough training and application of the profession’sstandards of practice. A wisely selected BV analyst is an excellent resource investment.Carl L. Sheeler, CBA, AVA, is a managing partner ofAllison Appraisals, a business valuation and economicdamages firm with 11 offices nationwide. The firm providesvaluations for estate and gift planning; ESOPs,FLPs, and LLCs; C-to-S corporate changes; condemnation;partnership buyouts; dissenting shareholderactions, and marriage dissolutions. During his 13 yearsas a professional valuator, he has performed 350 businessappraisals of professional practices, manufacturers,retail/wholesale and distribution companies with annualsales ranging from less than $100,000 to $100 million.He has testified in federal and state courts as anexpert witness, and is a prolific writer for publicationssuch as Valuation Examiner, Valuing ProfessionalPractices, Accounting Today, Practical Accountant,Professional Accountant, Tax Strategies, Estate and Trusts, and Nation’s BusinessJournals as well as other regional and local legal and financial periodicals.csheeler@allisonappraisals.com.Professional DesignationsCBA: Certified Business AppraiserAwarded by the Institute of Business Appraisers (561) 732-3202.A 3,100 member organization formed in 1978.CVA/AVA: Certified Valuation Analyst/Accredited Valuation AnalystAwarded by the National Association of Certified Valuation Analysts(801) 486-0600. Founded in 1991, currently with about 3,500 members.ASA: Accredited Senior AppraiserAwarded by the American Society of Appraisers (800) 272-8258.A 2,000-member society formed in 1981.ABV: Accredited Business ValuatorAwarded by the American Institute of Certified Public Accountants(888) 777-7077. Formed in 1998 for CPAs.CLAAll TheBestFiling: January 15, 2003May 15, 2003October 1, 2003Exam: March 21-22, 2003July 18-19, 2003December 5-6, 2003Now celebrating its 28th anniversary, the CLA meansbusiness. Good business. Stability. Consistency.Flexibility. Growth. Commitment and dedication.A strong foundation based on 28 years of researchand technical analysis.Access to advanced credentials in specialty areas of practice onthe federal level and advanced credentials in the statelaws. Over 9,000 have received this professionalcredential...and nearly 800 have received advancedspecialty certification...An important tool in the management of one’s career...National Association of Legal Assistants1516 S. Boston, Suite 200, Tulsa, OK 74119918-587-6828 FAX 918-582-6772www.nala.org

Was This the Plan?ParalegalTrustAdministratorby John Norris StoneMy career as a legal assistant has been full of eventful twistsand turns that began innocently enough as an Accounting majorat Wayne State University 14 years ago. I had a plan: I wouldwork my way up the ranks at the Detroit Bank where I workedduring the day and finish my degree at night.Not an earth-shattering plan, but youthful optimism oftensuffices where hard details are sparse. The plan seemed to beprogressing nicely, including an interview for an accountingdepartment position at a law firm. I didn’t get the job, but theexperience still fit my plan by allowing me to hone-up myinterviewing skills. Little did I know that this law firm wouldplay a key role in the impending circumstances that were aboutto send my best-laid plans on a tangent.The unsuspected major event looming in my future thatwould shake the very foundation of all that I thought was goodand right with the world was innocuously listed in the university’scatalog of courses as “Cost Accounting.” Within the firstfive minutes of that class in my freshman semester, I realizedthat a corner office with “John N. Stone, CPA” on the doorwasn’t in the cards for me.A New PlanSo I put away my pocket protector and graph paper andthrew myself into formulating “Plan B” for my academic andcareer future. I salvaged most of my credits, switched my majorto management, and let my boss at the bank know that insteadof crunching numbers I was interested in leading the troops. Iwas gaining confidence with my new strategy when I got a callthat was to propel my plans even further down the alphabet.The call was from the human resources director at the lawfirm where I had been interviewed. Although they didn’t think Iwas the right person for that accounting position, they believed Imight fit as a second legal assistant in their estate planning/probatepractice area. Since the position required preparation of fiduciaryaccountings, we agreed that I was just the person they needed.Now 14 years and three law firms later, I am still workingin the same practice area. My accounting skills have grownthrough the years to include preparation of fiduciary, gift, andestate tax returns. The title of “Trust Administrator” is a recentpermutation in my plans.Early in 2001, our firm was considering offering fiduciaryservices to our clients. I was familiar with the concept—involvingattorneys acting as Trustee, taking custody of assets, and assistingwith matters such as investment advice, tax preparation, bill payment,and income distributions. A large portion of my duties tothat point had entailed assisting attorneys and clients with estateand trust administration, so this was familiar territory.Once the project was given the green light, I wasapproached about my interest in acting as Trust Administratorfor new client accounts. I eagerly accepted the challenge, andafter four days of training in Boston, I began polishing a newfacet in my paralegal career.Bring it OnWhile the title was nice, and Boston was great fun, I soonrealized that this new endeavor was an even bigger challengethan I anticipated. Since our firm was starting this new venturefrom scratch, I was largely responsible for creating the forms,procedures, and systems necessary to provide a seamless transitionof our client’s accounts from the previous custodian to thefirm’s new entity, Varnum Consulting LLP.This seemed a Herculean task. In addition to my regularprobate/estate planning workload, there was a whole new set ofduties, responsibilities, and pressures to deal with. My trainingin Boston provided me with a fundamental base of knowledgeand support to build upon, but one thing I didn’t have was theluxury of “incubation” time to get comfortable with this newknowledge and the position of Trust Administrator. Within amonth of my trip to Boston, new accounts began coming in,and I soon learned the true meaning of multi-tasking.16FACTS & FINDINGS / FEBRUARY 2003

One of the most important tasks hasbeen working with the attorneys in ourgroup to create a marketing plan forthe fiduciary services we now offer. Thegoal has been to create materials that areeasy to understand and relate to. As with anymarketing plan, it is important to illustrate thepractical benefits to potential consumers.An important benefit of the servicesfor existing estate planning clients is thetrust and familiarity they have withthe attorney who drafted theirestate plan. This relationshipaffords the attorney uniqueinsight to the specific needs ofthe client. With this foundationin place, the attorney and client caneasily work together to create a customset of appropriate individual services.When Overkillis GoodI also have spent considerable time creating the in-houseforms and procedures for management of client accounts. It isimportant that these documents and systems be clear, concise,and easily accessible to the attorneys and secretaries in our group.I have compiled a binder with examples of work product, how-tolists, and important phone numbers. I have requested that everyonein our group have a tool-bar menu item on their computerfor access to the same forms and information.In addition to the obvious benefits of efficiency that accruefrom this attention to detail, there are selfish motives at work aswell. As much I as love my job, an occasional day off is much easierwithout constant phone calls from work asking “what, where,how and why.” The “overkill” I have exerted on the forms and procedures—andthe call-block feature on my home phone—actuallymakes it possible to have a real day off from time to time.Under the supervision of the attorneys, I have primaryresponsibility for obtaining information necessary to open newclient accounts, facilitating the transfer of client’s assets to thoseaccounts, establishing the periodic payments made on behalf ofthe clients, and ongoing maintenance of the accounts. It is necessaryto interact with the clients and other professionals workingwith them on a regular basis.Placing trades for clients is an example of this work. Basedon the direction of the attorney, client, and/or investment advisor,I work with brokers to buy and sell trust assets. It is notmy responsibility to offer advice regarding these trades, but Ido assist with gathering information that canbe used when the attorneys areinvolved in making investmentdecisions. I also assist withpreparation of the trustaccount statements for theclients on a monthly or quarterlybasis as well as the yearendstatements necessary forpreparation of income tax returns.Joy in the JourneyAnother aspect of my role asTrust Administrator involvesworking with the attorneysbefore meeting with a potentialfiduciary services client. If themeeting is with an existing estateplanningclient, then the attorneyand I work together to review theclient’s current and future needs. Thebroad scope of the fiduciary services we offeris customized to meet the client’s lifestyle and specific requirements.Providing clients with relevant and useful informationregarding our fiduciary services is an important and rewardingpart of what I do. I have seen first-hand how time consumingand demanding it can be for a client to gather all the informationneeded for income tax returns or to pay medical andlong-term healthcare bills. Shouldering most of the primaryresponsibility of dealing with these trust administration issueson behalf of clients is truly rewarding.Working simultaneously as a trust administrator and a legalassistant was certainly never in“Plan A” for my career. Plans“B,” “C,” and “D” have alsopassed into my résumé. I canlook back now and see that plansare influenced heavily by the willingnessto seize opportunitieswhen they arise. Putting a planinto motion can lead to destinationsyou may never suspect.John N. Stone is a paralegal andTrust Administrator at the firm ofVarnum, Riddering, Schmidt &Howlette, Grand Rapids, MI.jnstone@vrsh.comFACTS & FINDINGS / FEBRUARY 2003 17

Part of Estate PlanningQualifiedTuition Programsby John A Hartog and Thomas W. ShaverQualified tuition programs (QTPs) as allowed by InternalRevenue Code §529 have been established by almost every state,and recent changes in federal tax law have made these planseven more attractive for income tax purposes. Since December31, 2001, distributions from QTP accounts for “higher educationexpenses” are exempt from federal income tax.Higher education expenses include tuition, fees, suppliesand equipment, and room and board for students who attendcollege at least half time. Many parents and grandparents areincorporating section 529 plans into their own estate planning.Navigating the significant transfer tax and probate issues thatmay arise in connection with these plans can be made easierwith some basic “mapping.”Gift TaxContributions to a QTP account qualify for the annualexclusion from gift tax ($11,000 per account beneficiary undercurrent law). IRC §529 allows a donor to accelerate five yearsof annual exclusions ($55,000) when making a gift to a QTPaccount. Accordingly, a donor could make a gift of $55,000 foreach account beneficiary in a year, and none of that amountwould be a taxable gift. If the donor dies within the succeedingfive years, however, a prorata portion of the gift is included inthe donor’s estate. The Gift Tax Return, Form 709, includes acheck-box to make this election.Federal tax law also permits a non-donor spouse to combinehis or her annual exclusion with the donor’s. A marriedcouple may take advantage of gift-splitting to fund a QTPaccount with as much as $110,000 for each account beneficiary,and none of that amount would be a taxable gift. The provisionsof the applicable state plan should also be checked forlimitations on the amount of contributions.The five-year provision is an acceleration of the annualexclusion. If the election is made, then no annual exclusion ispermitted in the succeeding four years. When a client considersfunding a QTP account, it now is even more important toask the client about prior gifting to other QTP accounts.Estate TaxAnother tax benefit of a QTP is that no portion is includedin the gross estate of any individual, including the accountowner or the account beneficiary. There are two exceptions tothis general rule:1. If, as mentioned earlier, the donor elects the five-yearacceleration for a QTP contribution and dies within that period,then the portion of the contribution allocable to the postdeathperiod is includable.2. Section 529 provides that estate tax exclusion does notapply to amounts distributed by reason of the death of theaccount beneficiary. Proposed regulations under section 529provide that the gross estate of a designated beneficiaryincludes “the value of any interest” of that beneficiary in theQTP. This regulation appears to go beyond the provisions ofthe statute.If an account beneficiary dies, investigating the followingtwo issues may resolve most estate tax inclusion issues:1. Were any amounts distributed by reason of the death ofthe beneficiary? An account owner may change the designatedbeneficiary or roll over account balances without these eventsbeing treated as a taxable distribution under section 529.2. Does the account beneficiary own sufficient assets torequire the filing of an estate tax return?Generation-Skipping TaxProposed regulations provide that contributions to a QTPaccount also qualify for the generation-skipping tax annualexclusion. Therefore, the generation-skipping exclusion shouldalso include accelerated gifts under the five-year rule.No income tax is triggered if the QTP account is distributedto another QTP account for a member of the family ofthe current designated beneficiary. A 2001 amendment to section529 now includes a first cousin as a member of the designatedbeneficiary’s family. This change was intended to give18FACTS & FINDINGS / FEBRUARY 2003

grandparents more flexibility in rolling over section 529accounts among their grandchildren.The gift and generation-skipping tax consequences ofrollovers are determined by reference to the current designatedaccount beneficiary. A rollover does not constitute a gift unlessthe new beneficiary is a generation younger than the currentbeneficiary, determined under generation skipping tax rules. Ifthe new beneficiary is two or more generations younger than thecurrent beneficiary, then a generation-skipping tax may apply.It appears that the current beneficiary may also takeadvantage of the annual exclusion and the accelerated five-yearrule with regard to any rollover that is treated as a gift.Probate IssuesIt is important to stay current with the provisions andrequirements of your local state QTP. State law may provide thatif no contingent owner is named, the account is owned by theestate of the original owner at that person’s death. A QTPaccount that becomes an asset of the estate should be listed on aprobate inventory, even though it probably would not be includedon the estate tax return of the account owner. Alternatively,state law may provide that the beneficiary becomes the owner ofthe account if no contingent owner is named.Qualified tuition program accounts may become morecommon as estate planning vehicles. Account owners may wishto designate the disposition of the account by specific bequestunder a will or under the provisions of a trust.The account owner may also have executed a power ofattorney authorizing an attorney in fact to designate a contingentowner or exercise other rights such as changing the beneficiary.Powers of attorney should be reviewed for such authorization.As a planning tool, drafters may want to include a specificreference to QTP accounts in the power of attorney.Internal Revenue Code§529 ChecklistLocal Section 529 Program• Review Disclosure Booklet• Keep current on developments• Review maximum contribution levels• Review rollover of account and change of beneficiary rules• Review designation of account owner rules• Check for mandatory distribution rules• Report nontaxable GST transfers on Form 709• Review prior year gift tax returns for election• Look for changes in beneficiary one or two generationsyoungerEstate tax• Account owner: check for five-year election on Form 709• Account beneficiary: determine if any distributions occuron death• Account beneficiary: determine if filing of Form 706requiredProbate• Account Owner: review for probate asset inclusion• Review designations of contingent account owner• Review exercises under Power of Attorney• Review will or trust for specific bequest of the accountJohn A. Hartog is a founding member of California Trust & EstateCounselors, LLP. He is a Fellow of the American College of Trust & EstateCounsel and is a California attorney. He is certified by the California StateBar’s Board of Legal Specialization as a specialist in taxation law and in estateplanning, trusts, and probate law. His practice emphasizes taxation matters,personal service enterprises, sophisticated estate planning techniques, andtrust administration and probate.He is admitted to practice before the California Supreme Court, theNinth Circuit Court of Appeals, and the United States Tax Court and theDistrict of Columbia Court of Appeals.Mr. Hartog has published extensively inthe field of taxation and estate planningand is lead consulting editor forMatthew Bender’s California Wills &Trusts, a multi-volume treatise, formsand document assembly program. He isalso the coauthor of California TrustPractice, published by Matthew Bender.Mr. Hartog earned his BA degree,cum laude, from Pomona College,his JD from Hastings College of theLaw, University of California, and aMaster of Law in Taxation from GoldenGate University.jhartog@calteclaw.comGift and Generation Skipping Tax• Check the Form 709 box for five-year electionFACTS & FINDINGS / FEBRUARY 2003 19

Charting the ComparisonsWills and Trusts Basicsby Molly J. Fischer, CLAWills and trusts are often key components in estate planningstrategies. Understanding the terms and fundamental conceptsof these instruments is helpful in keeping estate plans ontrack and compliant with the law as well as the needs andwishes of decedents, inheritors, and beneficiaries.Some basic definitions:Will—a legal document by which an individual describesproperty owned at death and designates to whom that propertyis to be distributed. A will is created during a person’s lifetimeand “speaks” at their death.The will can be a good foundation for an estate planbecause it outlines the wishes of the testator (maker of thewill). It directs the disposition of personal belongings after thetestator’s death and designates a guardian for minor children.A state court proceeding called a “probate” may be requiredto effect the transfer of the decedent’s titled assets to thebeneficiaries as designated by the will. The testator maychange or revoke the will at any time before death.Trust—a legal entity created by a settlor (grantor, ortrustor) for the benefit of designated beneficiaries under thelaws in the state of residence. A trust is either “revocable”or “irrevocable.”In a revocable trust, the settlor reserves the right toamend or cancel the trust at any time before death. An irrevocabletrust is a trust that cannot be amended and terminates asprovided in the trust document.Some types of trusts include: an inter vivos trust, also knownas a “living trust” or “family trust” (the subject of this article); a“credit shelter trust;” “Qualified Terminable Interest Property”(Q-Tip) trust; life insurance trust; charitable remainder trust; testamentarytrust (established within a will); and special needstrusts. Each trust has a specific purpose, and these are but a few.When comparing simple wills and trusts in basic estateplanning, the living trust is a customary choice. A living trustis created by a settlor and operated during the settlor’s lifetime.Almost anything can be placed in a trust—bank accounts,stocks, bonds, real estate, life insurance, and personal property.Elements of a WillI. Heading or Title.II. Exordium and Publication Clause. Identifies thetestator, state of domicile (to establish jurisdiction),age, testamentary capacity, and declares to the publicthat the document is the testator’s last will.III. General Revocatory Clause. Revokes all previous wills.IV. Provision for payment of debts and funeral expenses(optional).V. Instructions for funeral and burial (optional).VI. Appointment of Fiduciaries. Designates the personalrepresentative of the will and if the personalrepresentative shall serve with or without bond.Appoints a personal and property guardian forminors or for a person with a disability.VII. Specific testamentary gifts. Provides for thedisposition of property as the testator chooses.Legacies are gifts of money, bequests are giftsof personal property and devises are gifts ofreal property.VIII. Provision for residue of estate. The residuary clausetransfers the remaining property of an estate that hasnot been specifically given to the beneficiaries,including any additional property that may comeinto the estate after the will has been executed or afterthe testator’s death.IX. Simultaneous death clause. A clause in a will thatdetermines the distribution of property in the eventthere is no evidence as to the priority of time ofdeath of the testator and another, usually thetestator’s spouse.X. Testamentary trust clause (optional).XI. Testimonium clause in which the testator states thatthe will was freely signed and dated, and whichrequests the proper number of witnesses to do likewise.XII. Testator’s signature. The testator must sign the will inthe presence of witnesses—usually two.20FACTS & FINDINGS / FEBRUARY 2003

XIII. Attestation clause of witnesses. Witnesses state thatthey have attested the testator’s signature on the will.XIV. Witnesses’ signatures and addresses. State statutes maygovern proper wording for the attestation clause andproper procedure for witnesses’ signatures. Somestates require the witnesses’ signatures to be notarized.Elements of a TrustI. Declaration/Creation of the trust. A settlor is anindividual who intends to create the trust. To be asettlor, a person must own a transferable interest inproperty, have the right or power of disposing of aproperty interest, and have the ability to make a validcontract. The same person cannot be the settlor,trustee, and beneficiary, but the same person could bethe settlor and trustee, or the settlor and beneficiary.II. Designation or appointment of one or more trusteeswho are named to administer and manage the trust.The trustee(s) hold legal title to the trust property forthe benefit of the beneficiary. The trustee is afiduciary and, as such owes fiduciary duties to acthonestly and loyally for the sole benefit of the beneficiary.III. Create powers of the trustee. Most state statutesspecify fiduciary powers, but also permit the creatorto expand or limit those powers by inserting aprovision to that effect in the trust. The specificduties of the trustee should be clearly spelledout (Helewitz 77).IV. A legal purpose for the trust must exist. The trust’spurpose may serve the private interests of the creatorto benefit private persons, known as a private trust, ormay be established to provide charitable benefits,known as a public trust.V. There must be trust property, real or personal, thatmust be transferred to the trust. The trust cannotexist until the property has been legally transferred tothe trust. After the creation of a trust, title toproperty placed in the trust must pass to at least twopersons. The title is “split” into legal title andequitable title. The trustee receives the legal title, andthe beneficiary receives the equitable title.VI. One or more beneficiaries must be named to receivethe benefits (income and/or principal).VII. A termination point must be established. Privatetrusts terminate within a statutorily determinedperiod of time, and the trust should indicate thepoint at which the trust will end, either by particulardate or contingent event.VIII. The trust should indicate a remainder interest. Theperson or persons in whom the legal and equitabletitles will merge.IX. Signature of the creator(s). Many jurisdictions requirethe document to be signed by at least one trustee andwitnessed or notarized. If the trust is a testamentarytrust, the creating document is the will, which mustmeet statutory requirements for the execution of wills.Alternatives to a Will or TrustThere are other ways to hold title to property that avoidprobate and are transferred to the beneficiary without anyadministration or trust necessary.I. Joint tenancy with rights of survivorship.II. Community property with rights of survivorship(an alternative in community property states).III. Tenancy by the entireties—joint owners are husbandand wife (check state laws).IV. “Pay on Death” (POD) provision to bondregistration, bank accounts, savings accounts or“transfer on death” (TOD) registration for stocks,brokerage accounts and mutual funds. (See UniformTransfer On-Death Security Registration Act).V. Proceeds of a life insurance policy payable to anamed beneficiary.VI. Employment benefits contracts that contain anamed beneficiary.VII. Annuity contracts with a named beneficiary.VIII. IRA’s with a named beneficiary.See charts on Pages 22 and 23References:Hower, Dennis R. Wills, Trusts, and Estate Administrationfor the Paralegal, Minnesota: West Publishing Company, 1996.Koerselman, Virginia. CLA Review Manual, SecondEdition, New York, West Publishing, 1998.Helewitz, Jeffrey A. “A Matter of Trusts—What it takes toproperly draft a legal trust,” Legal Assistant Today, May/June2000, Volume 17, Issue 5: pp. 77–78.Molly J Fischer, CLA, works in the areas of estate planning, wills,trusts, probates, guardianships, and Medicaid planning with the Law Officesof Patricia F. Winnie, Esq., Reno, NV. She holds BS and MS degrees inDesign, Merchandising and Consumer Sciences from Colorado StateUniversity, and has an Associates Degree in Applied Science in LegalAssistant studies from Truckee Meadows Community College. She teachesEthics for paralegals at Truckee Meadows Community College and is amember of the Sierra Nevada Association of Paralegals, having served aspresident and current NALA liaison.FACTS & FINDINGS / FEBRUARY 2003 21

Charting the Comparisons: Wills and Trusts Basicscontinued from page 22Terms & DefinitionsDefinitionand/or condition Term Used in Wills Term Used in TrustsCreator of the legal document Testator / Testatrix Trustor, Grantor or SettlorFiduciary managing the “estate” Personal Representative, Trustee orExecutor, ExecutrixSuccessor TrusteeAdministrator, AdministrarixAny person to whom the decedent’s Beneficiary Beneficiaryproperty is given or distributed.Two or more persons who attest Witnesses [A trust does not requireand also sign the will, in somewitnesses. However, thestates the witnesses signaturestrustor’s signatures areare notarized.usually notarized.]Personal and real property. Estate Trust property /corpus.The form of ownership of trustEquitable Title to propertyproperty held by the trusteegiving the trustee the right tocontrol the property.A right of the party to whom it (theLegal Title to propertyequitable or beneficial title) belongsto the benefits of the trust.Comparative Advantages/Disadvantages/EffectivenessWillsUpon death, the will becomes a public document.The probate process is controlled by the court.The court insures that creditors are paid,administrative fees and costs are paid, andbeneficiaries are paid according to the will.The court’s probate process protects the fiduciaryfrom further creditors claims after the time periodfor notice has expired. All claims against the estateare forever barred. Creditors are barred from assertingclaims against the heirs.TrustsA trust is a private document. The courts do nothave any control over trust assets.However, if there is a dispute between beneficiaries andtrustees or if a trustee’s handling of the trust principle orincome is in question, the issues may be taken before theprobate court. If the court accepts jurisdiction, the trust isno longer a private document.The trustee has the fiduciary responsibility to ensure thatthe settlor’s bequests are fulfilled exactly as prescribed inthe trust document. The distribution process is controlledby the trustee, unsupervised and with no guarantee to thebeneficiaries that the trustee is following the trustinstructions exactly.The trustee and beneficiaries are liable to creditors of thetrust. Some jurisdictions provide statutes for notice tocreditors in a trust administration that serve to protect thetrustee and beneficiary from perpetual creditor claimsagainst the trust.22FACTS & FINDINGS / FEBRUARY 2003

A Living Trust can help preserve and increase an estatewhile the settlor is alive, and offers protection should thesettlor become disabled. A guardianship of an incapacitat-ed adult may be required to protect the person and tomake healthcare decisions.WillsProbate can be cumbersome, time-consuming, andexpensive. However, most states have informaladministration of small estates which do not requireprobate or have shortened the probate process thusreducing the expense of probate.The will doesn’t take effect until the testator dies.Probate and estate settlement costs may decreasethe size of the estate.Trust assets that are not properly titled in the name ofthe trust are subject to probate.The Will has no administration during thetestator’s lifetime.Durable powers of attorney for estate management andhealth can be created for the testator that are valid evenif the testator becomes disabled or incapacitated. Aguardianship of an incapacitated adult may be requiredto protect the person and to make healthcare decisions.Interpretations of wills can vary from state to state.Assets left to a spouse are subject to federal estatetax upon the surviving spouse’s death.An ancillary probate must be established by the courtto transfer or sell real property in a state other thanthe testators domicile.A professional manager of assets can be named as thepersonal representative of the testators estate,(i.e., a bank’s trust department).Federal Estate Taxes are not avoided with a will.However,in the case of a married couple leavingeverything to each other, no federal estate tax will bedue after the death of the first spouse no matter howlarge the estate.A Will contest is possible, although usuallydifficult to challenge.TrustsThe initial cost to establish the trust and any amendmentsto the trust as the laws change can be expensive. Theliving trust, because of the transfer of documents and itsoperation as a viable entity during the grantor’s lifetime,make it more expensive to draft and implement than a Will.A living trust takes effect when the grantor/settlor signsit or on a date specified by the grantor/settlor.Trust litigation may decrease the size of the estate.A Living Trust avoids probate because the property isowned by the trust, so technically there is nothing for theprobate courts to administer. Careful management of thetrust assets is required to avoid probate.The living trust is a living document and careful ongoingadministration during the lifetime of the Trust is necessary.All assets must be transferred into the trust name. Realproperty deeds must be transferred and all lien holders(mortgagees) must be informed. All bank accountsreopened in the name of the trust, all partnership andstock interest must be transferred, and each of thetransfers typically requires special documentation bythe transfer agent.Trusts are established under the laws of the state wherethe trust is written. Statutes of a community property statediffer on the division and distribution of property anddepending on if the character of the property hasremained community or separate property within the trust.Assets left to a spouse are subject to federal estate taxupon the surviving spouse’s death. A trust can offer sometax relief for the trust after the last settlor’s death, thusbenefiting heirs of the trust.A trust can make the transfer of real property in morethan one state easier.Through a trust, an arrangement for assets to beprofessionally managed by a trustee can be established.Federal Estate Taxes are not avoided with a trust.However, in the case of a married couple leavingeverything to each other, no federal estate tax will bedue after the death of the first spouse no matter howlarge the estate.It is very difficult for disgruntled heirs to challengea Living Trust.FACTS & FINDINGS / FEBRUARY 2003 23

FACTS & FINDINGSReadership SurveyOur purpose with Facts & Findings is to meet your professional information and career needs. We are reintroducing this readership survey to evaluatehow we are doing and help us enhance the journal. You may complete the questionnaire on this page (use a photocopy if you wish) and send it toNALA Headquarters—1516 S. Boston Ave., Suite 200, Tulsa, OK 74119—or go to our website at www.nala.org where clicking the mouse and typinga few strokes is all that is required.Editorial ContentThe length of articles in Facts & Findings is: Too long Too short Just rightThe writing style of the articles is: Too basic Too technical Just rightPlease indicate your interest in these Departments:Extremely Somewhat NotInterested Interested Interested InterestedPresident’s Message From the Editor Breaking News Practice Tips Education Techno Bits Ethics Tips Affiliates Column Communication Corner News & Information Indicate your interest level in articles on the following:Corporate Law Family Law Criminal Law Administrative Law Real Estate Law Finance/SEC Law Estate Plan./Probate Law Juvenile Law Elder Law Career Development Bankruptcy Technology Intellectual Property Dot.com Law Civil Litigation Paralegal Issues Constitutional Law Health Law About YouHow long have you been a legal assistant? ____ YearsWhere do you work?Products & Services Firm Non-profit Recommend purchases Corporation Free-lance Authorize purchases Government Other ________ Make purchasesCheck all of the types of articles you are mostinterested in reading: Expert-written In-depth Analysis of Current Issue Interview Practical “How-to” Case Study Other _________________________________________What is your main reason for reading Facts & Findings? Education Association NewsPlease tell us the title, or the subject, of your favoriteFacts & Findings article:________________________________________________________________________________________________________________________________________________________________________________________________Please tell us how you think Facts & Findings can bettermeet your needs:________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________Do you save Facts & Findings? Yes NoDo you pass your Facts & Findings on to others? Yes NoHow many others use your copy? ______I would like to submit an article for Facts & Findings on the following: ______________________________________________________________________________________________________________________________________________________If you are interested in submitting an article, please provide the following contact information.Name: ______________________________________________ Phone: _____________________________________________Address: ____________________________________________ E-mail: _____________________________________________City: ________________________________________________ State: ________ Zip: ___________________24FACTS & FINDINGS / FEBRUARY 2003

vote \ vōt \ vb 1 a : a formal expression of opinion or will inresponse to a proposed decision; esp: one given as an indicationof approval or disapproval of a proposal, motion, or candidatefor officeproxy \ 'präk-sē \ n 2 a : authority or power to act for anotherb : a document giving such authority 3 : a person authorized toact for anotherYour Vote is VitalThe definitions are easy to understand,and the process is straightforward once yougrasp the details. Please review the followinginformation regarding NALA electionprocedures so that you can make your voiceheard at the annual membership meetingon July 11, 2003, during our convention inSan Antonio, TX.Only active members present at themeeting, or represented by proxy, may vote.Members are the lifeblood of aprofessional association, and yourparticipation ensures that our programsremain strong and continue to meet theneeds of members.Election of OfficersOfficers elected at the annual membershipmeeting are:• First Vice President• Second Vice President• Secretary• TreasurerThese officers are elected for one-yearterms, and may serve a maximum of twoconsecutive terms. Candidates are profiledin the May issue of the NALA Newsletter.(The President of NALA is elected fora one-year term by the Board of Directorsfrom among its members during theirMarch meeting. The President-elect takesoffice in July with the new officers andboard members.)Regional DirectorsRegional Directors may serve a maximumof two consecutive two-year terms.Directors for Regions II, III, and IVwill be elected at the 2003 meeting by acount of ballots mailed to the NALASecretary. Blank ballots are sent to activemembers in the designated regions in Mayand must be received by the NALASecretary at the address noted on the ballotno later than June 11.Ballots are opened and counted theday before the annual meeting. ChosenDirectors are introduced at the meeting,and their terms begin upon adjournment.It is crucial that these ballots be sentseparately from proxy forms (see Cautionon page two).ProxiesIf you cannot attend the annual membershipmeeting in July, you may designateanother active member and an alternate torepresent you. You must file a Designationof Proxy form (in this material) with theNALA Credentials Chairman by June 11,with a copy to the NALA Secretary.It is prudent to file this form even ifyou plan to attend the meeting. Shouldunforseen circumstances keep you fromattending the election, then a designatedproxy could step in for you. Be sure thatyour designated proxy and alternate areactive members, and that they plan toattend the meeting. It is wise to send copiesof your Designation of Proxy form to yourproxy and alternate for their information.FACTS & FINDINGS / FEBRUARY 2003 25SPECIAL SECTIONNALA 2003 ELECTION 1

Instructions to ProxyholdersSend your Instructions to Proxyholderform, to be provided in the May issue ofthe NALA Newsletter, to your proxy andalternate only. This form serves a completelyseparate purpose from the othersand is intended only to tell your proxieshow to vote. Do not misdirect yourInstructions to Proxyholder to NALAHeadquarters, the Credentials Chairman,or Secretary.///// Caution /////Do not put proxy forms in the sameenvelope with ballots for regional directors.Ballots for regional directors are notopened until the day before the July 11membership meeting—a full month afterthe deadline for receipt of yourDesignation of Proxy form. Any proxyforms found in regional ballot envelopeswill be too late for your proxy to castyour vote.DeadlinesMarch 1Proposed amendments to NALA Bylaws.Submit to the NALA Secretary in careof NALA Headquarters.March 15Declaration of Candidacy forNALA OfficersApril 1Declaration of Candidacy forNALA Regional DirectorsMay 1Affiliated AssociationsAwards DesignationsJune 11Designation of Proxy formsdue to NALA SecretaryResolutions due from NALA membersor NALA affiliated associations forconsideration during the annualmembership meeting of NALA.Official NoticeCall for Declaration of CandidacyforRegional Directors— January 9, 2003—To Active Members ofRegions II, III, and IV:Regional Directors of this corporationwill be elected by mail ballots from the generalactive membership of this corporation,which shall be tallied at the annual meetingin San Antonio on July 11, 2003.In 2003, the following directors willbe elected for two-year terms:Region II:West Virginia, Virginia, Maryland,Washington, D.C., North Carolina, SouthCarolinaRegion III:Alabama, Florida, Georgia, Tennessee,MississippiRegion IV:Arkansas, Louisiana, Oklahoma, TexasActive members who wish to declarethemselves candidates for a directorship mustcomplete and submit the special Declarationof Candidacy form. If you are interested in adirectorship, you are urged to read Article IVof the Bylaws pertaining to the duties of adirector. Declaration of Candidacy forms fordirectors are available upon written requestto NALA Headquarters. The completedform must be received no later than April 1,2002 to qualify. Declarations received afterthat date will not be accepted. The declarationmust be sent to NALA Headquarters,1516 S. Boston, #200, Tulsa, OK 74119 Fax:(918) 582-6772; e-mail: nalanet@nala.org.Official NoticeCall for Declaration of CandidacyforOfficers— January 9, 2003—To active members of the NationalAssociation of Legal Assistants, Inc.:Officers of this corporation will be electedfor a one-year term at the annual meetingin San Antonio, TX on July 11, 2003.This is official notice of call for declarationof candidacy for the offices of firstvice president, second vice president, secretary,and treasurer. Active members whowish to declare themselves candidates foroffice must complete and submit the specialDeclaration of Candidacy form. Asample ballot of the candidates will be preparedand furnished to all active memberswith the annual meeting information inMay. Voting will be by active memberspresent on July 11, 2003, and active membersregistered to vote by proxy at theannual meeting.If you are interested in candidacy forany office, you are urged to read Article VIof the Bylaws pertaining to the duties of anofficer. Declarations of Candidacy forms areavailable upon written request to NALAHeadquarters. In order to qualify, the completedform must be received no later thanMarch 15, 2003. Declarations received afterthat date will not be accepted.The declaration must be sent toNALA Headquarters, 1516 S. Boston,#200, Tulsa, OK 74119 (fax: (918)582-6772; e-mail: nalanet@nala.org.All interested active membersare invited to write NALA Headquartersif there are any questions.26FACTS & FINDINGS / FEBRUARY 20032 NALA 2003 ELECTION SPECIAL SECTION

Official Notice ofAnnual MeetingTo Active Members of the NationalAssociation of Legal Assistants.Notice of Annual MeetingNotice is hereby given that the annualmeeting of the membership of theNational Association of Legal Assistants,Inc., will be held and will commence at1:30 p.m., Friday, July 11, 2003 and willcontinue from day to day thereafter untilcompleted at the Hyatt Regency Hotel,San Antonio, Texas, to elect officers(except president) for the 2003-04 fiscalyear; to tally ballots for and announce theelection of directors for regions II, III, andIV; to hear annual reports of officers andcommittee chairmen; and such other businessas may come before this meeting andproper continuance thereof.This notice is published in accordancewith the Bylaws.This meeting is called pursuant to theorder of the President and the Board ofDirectors.Linda J. Wolf, CLASSecretaryNational Associationof Legal Assistants, Inc.1516 S. Boston, #200Tulsa, OK 74119(918) 587-6828Annual Meeting Resolutions andProposed Bylaw AmendmentsBusiness may come before the NALAmembership at the Annual Meetingthrough either resolutions for the membership’sconsideration or through proposedamendments to the NALA Bylaws.With reference to the Bylaws, a membermay submit a proposed amendment bydelivering the proposed amendment inwritten form to the Secretary of theAssociation no later than March 1. Theseamendments will be considered by theBoard of Directors who shall recommendfor or against the adoption thereof.Members may also submit resolutionsfor consideration during the annual meeting.Resolutions to be considered must befiled at NALA Headquarters by June 11,2003 and may be proposed by individualmembers or members of affiliated associations.Resolutions submitted by membersare reviewed by the Board of Directors ora committee appointed by the Board. Noresolution shall be offered for adoptionwithout approval of the committee writtenthereon. If a question arises as to whethera resolution is within the scope and purposeof NALA, the committee shall adviseits opinion. Resolutions shall not exceed300 words.Designation of ProxyandAlternate Proxy(Form on back of this mailer)National Associationof Legal Assistants, Inc.Annual Meeting, July 11, 2003Instructions and General Information1. If you cannot attend the NALAAnnual Membership Meeting on July 11,2003, you may designate two NALA activemembers to cast your proxy vote during themeeting. One NALA member will serve asyour proxyholder and the second memberwill serve as your alternate proxyholder. Thealternate is a back-up to protect your votein the event your proxy must cancel at thelast minute or leave the meeting early. Anyactive member may hold your prxoy withthe exception of the NALA President.2. Be sure your named proxyholderand alternate proxyholder plan to attendthe annual meeting. If your proxyholderand/or alternate proxyholder have to leavethe annual meeting before its conclusion,another member cannot hold your proxy.No proxy or alternate proxyholder may bedesignated after June 12, 2002.3. Your Designation of Proxy andAlternate Proxy form must be sent to boththe NALA Secretary and the NALACredentials Chairman in order for yourproxy to be recorded. The form must bereceived by these officers no later thanJune 11, 2003. If your region is electing adirector this year, you will receive an envelopepre-addressed to the NALA Secretaryfor use in sending your ballot. Do notinclude your designation of proxy formwith your regional director ballot. Ballotsremain unopened until the annual meeting—toolate to file a proxy.4. Remember to instruct your proxyholders how you wish your vote to be cast.Announcement of candidates and proposedbylaw amendments will be published inthe May issue of the NALA Newsletter.FACTS & FINDINGS / FEBRUARY 2003 27SPECIAL SECTIONNALA 2003 ELECTION 3

Designation of Proxy and Alternate Proxy (Instructions on page 3 of this piece.)I, ___________________________________________________ , a NALA active member, hereby appointYOUR NAME___________________________________________________ a NALA active member to serve as myPROXY’S NAMEproxyholder at the NALA Annual Meeting in San Antonio, Texas, on July 11, 2003. In the event my named proxyholder is unable to holdmy proxy, I hereby appoint __________________________, a NALA active member, to serve as my alternate proxy at said annual meeting._____________ _____________________________________________ ___________________________________________DATE__________________________________________________________________________________________ADDRESSALTERNATE PROXY’S NAMEYOUR SIGNATURE_____________________________________________________________ __________ __________________________________________________________PRINT/TYPE YOUR NAMECITY STATE ZIPE-MAIL ADDRESSDEADLINE: June 11, 2003This is the deadline for RECEIPT of the form by the NALA Secretary.Forms postmarked June 11, 2003 will not be acknowledged unless they are in the Secretary’s possession the same day.Send this form to:And a copy to:Linda J. Wolf, CLASConnie Helmich, CLANALA SecretaryNALA Credentials ChairSidley, Austin, Brown & Wood Chesenhall, Nestrud & Julian, PA717 N. Harwood, Ste. 3400 400 W. Capitol, Ste. 2840Fax: (214) 981-3400 Fax: (501) 372-4941E-mail: lwolf@sidley.com E-mail: chelich@cwjlaw.com28FACTS & FINDINGS / FEBRUARY 20034 NALA 2003 ELECTIONSPECIAL SECTION

BREAKINGNEWS2003 Member ExchangePresentations SetA discussion of what everyone shouldknow about the basics of business organizations,and a review of the role of a paralegalin a Daubert challenge are theMember Exchange Program presentationsscheduled for NALA’s 28 th AnnualConvention July 9–12 in San Antonio.The Continuing Education Councilchooses presentations for these prestigiouspresentations each year from proposals byNALA members. Presentations are selectedon the basis of stringent criteria thatemphasize timely and fresh topics withwide appeal for paralegals.The Member Exchange program is theprincipal event capping the four-day convention.Heavy attendance is again expectedat this year’s program which is set for9:00–10:30 a.m. Saturday, July 12. Bothpresentations this year are in lecture format.The presenters and their subjects are:Cyndy T. Schroeder, legal assistantwith Powell, Goldstein, Frazer & Murphy,a general practice firm in Atlanta, GA,specializing in antitrust, products liabilityand commercial litigation. Her presentationon The Role of the Paralegal in aDaubert Challenge will offer an overviewof Daubert principles and delineate specificelements of the legal assistant’s role in aDaubert challenge. Daubert motions andhearings will also be covered, with emphasison what is expected of the paralegal inassembling evidence and assisting withwitnesses, exhibits and demonstrative aids.Ms. Schroeder is a former recipient ofthe NALA Affiliates Award, and was theArkansas Legal Assistant of the Year in 1995and 1996. She is a charter member and pastpresident of the Arkansas Association of LegalAssistants and is a member of the DebtorCreditor Bar Association as well as NALA.She has a BA in Mass Communicationsfrom Harding University, Searcy, AR, andhas worked as a radio news director and onairpersonality. She is a graduate of theSouthwestern Paralegal Institute, Houston,TX, and worked as a legal assistant at twoLittle Rock, AR, law firms before moving toGeorgia in 1998.Kelly A. LaGrave, CLAS, legal assistantin the business/tax department ofFoster, Swift, Collins & Smith law firm inLansing, MI, will make a presentation onthe basics of business that every legal assistantshould understand. The lecture willcover the various types of business organizations—soleproprietorship, general parternship,limited partnership, limited liabilitypartnership, corporation (profit and nonprofit),and limited liability companies.General information on how to formeach type of business organization will bepresented, including specifics about requiredstate and Internal Revenue Service filings.The advantages and disadvantages to eachtype of organization, including costs, liability,management, taxes, etc., will be discussedMs. LaGrave has a BA inInternational Relations from JamesMadison College, Michigan StateUniversity, and holds a CLAS inIntellectual Property. She has been withFoster, Swift, Collins & Smith in Lansingsince 1993 with experience in many areas,including business formation and termination,maintenance of business entities,mergers and acquisitions, the UniformCommercial Code, and franchise matters.She is Director of Region V for NALA,and a member of the Legal AssistantsAssociation of Michigan. She is a recipientof the Mentor Award from the State Bar ofMichigan Legal Assistants Section, and hasserved as Chair, Secretary/Treasurer, andEducation Chair of that association.F&FNew EducationalServices ManagerKrista Lower, a Tulsa meetingplanner since 1989, has been namedDirector of Educational Services atNALA Headquarters. Many memberswill be acquainted with Ms. Lower(formerly Marlin) through her workon NALA meetings with Spears Traveland formerly with Southern HillsTravel in Tulsa.Her initial responsibilities will bein the administrative side of planningthe annual convention educationprogram and in promotion of NALA’sweb-based educational offerings.Because continuing education is atop NALA priority, this new positionwas created to facilitate greaterorganization and effectiveness of alleducational programs, according toExecutive Director Marge Dover.“Krista’s experience with us over thepast 12 years gives her excellent insightinto the details that must come togetherto make our educational programs thevery best,” Ms. Dover said. “Her expertiseis proven, and we believe improvementswill be seen right away,” she said.Ms. Lower is a native of KansasCity, KS, and came to Tulsa in 1973from Enid, OK. She attended HardingUniversity, Searcy, AR, and is currentlyworking toward a degree in Educationand Business in Tulsa.F&FFACTS & FINDINGS / FEBRUARY 2003 29

A ‘Snapshot’ of the EstateThe FederalEstate Tax Return-Iby Orville W. Bloethe, Esq.This is the first article of a two-part series dealing with theintricacies of procedure and recommended courses of action when filingthe Federal Estate Tax Return.The Federal Estate Tax Return (Form 706) is essentially a“snapshot” of the deceased’s estate taken at the instant of death. Itdescribes assets and their values, sets forth all retirement plans,and designates beneficiaries. It is a comprehensive collection offacts and figures that serves as an agenda of actions to be takenby the estate and by family members.Meeting the deadline for filing this return may be the single mostimportant part of the process. Some form of checklist or calendarentry, or a combination of these reminders, should be added to regularoffice procedures to ensure meeting this deadline that falls ninemonths from the date of death. Informing the fiduciary and family ofthis critical time constraint is also advisable. It is prudent to requestnecessary material from these parties well in advance of the deadline,and to follow up with persistent reminders.If there is any doubt that the return will be filed on time,then an extension of time to file should be requested. Explain thereason for requesting additional time, and always ask for themaximum six-month extension. The attorney can file for theextension, which should always be sent by certified mail (moreabout certified mail to follow).Always attach a copy of the approval of the extension to thefirst page of Form 706 when it is filed. Similar procedures forindividual state estate tax returns may be in order.File Later, Pay NowThere is no provision for an extension of time to pay otherthan when there is an extreme hardship or the tax cannot be ascertained(Form 4768 is required). Otherwise, an extension of time tofile may be obtained—but pay now. Sell assets or borrow money ifnecessary, but pay the tax if at all possible by the due date.If cash is needed, and an estate has a trade or business constitutingmore than 35 percent of the value of the estate, thenelecting Section 6166 is a sound choice. This is a great tool whencash is short, but electing this option must be done on a returnthat is filed by deadline.With this arrangement, the portion of tax attributable to thetrade or business has no principal payments for the first fiveyears. Then there are 10 equal payments with interest on the first$1.1 million of taxable value-bearing interest at two percent, andthe balance at 45 percent of the interest payable on sums due theservice. The interest expense is not deductible for income oradministration purposes.Filing returns by certified mail—and affixing the certifiedmail receipt to the first page of Form 706—is a precaution thatcan pay huge dividends when returns slide through cracks in thebureaucracy. In an actual instance, a $47,000 late-filing penaltywas abated when a certified mail receipt was presented as proof ofthe timely filing. That receipt provided benefits far exceeding thecost of mailing all future returns by certified mail.Schedule A – Real EstateIn preparing Schedule A, a title search invariably should bedone—or the abstracts continued and subsequently examined.Neglecting to do this invites embarrassment and possible liabilityboth for the preparer and the beneficiaries. The cost of the titlesearch, or abstract continuation, is insignificant compared with thebenefits—and it assures a good night’s sleep for the preparer.When land is involved, especially if taxes must be paid, obtainan appraisal by a certified appraiser. Those who have dealt with theInternal Revenue Service know that an arbitrary figure on value istantamount to insulting the IRS. An “opinion” of value simply hasno place on Form 706. Nor should the “assessed” valuation of acounty appraiser be used, because those values are often based oncriteria that bear no relationship to fair market value.The appraisal is also fundamental for allocation purposes. Itcan be used to allocate a portion of the value of the land to tileand a portion to fence. The appraisal will set out the value added30FACTS & FINDINGS / FEBRUARY 2003

y buildings so they can be depreciated. The entire certifiedappraisal should be submitted with the return. Returns that aredocumented this way have a far greater chance of being accepted,and a certified appraisal is a wonderful document to give to familymembers to stress the value of their inheritance.Schedule B – Stocks & BondsWhen listing stocks on Schedule B, use the Committee onUniform Security Identification Procedure (CUSIP) numbers,and list the exchange on which the stocks are traded. Obtain lettersof appraisal for any unlisted stock.Use stock value as of the date of death—if death occurredwhen the exchange was open. Add the high for the day and thelow for the day and divide by two to determine the mean averageprice to be used in setting the basis.If there was no trading on the date of death, determine the meanaverage price on the last day it was traded before the date of death andon the first day it was traded after the date of death. Multiply thesemean prices by the number of days either before or after date of deathand divide by the total number of days thus used.Example—Mean price three days before death = 15Mean price two days after death = 12Therefore: (15x3) + (12x2) =13.85If there is a large block of stock, there is a discount for“blockage,” and a discount may also be available for nonmarketability.For bonds, use the closing price, and for mutual funds, usethe “redemption” price rather than the “asking” price.It is a good idea to preserve records showing how a basis isobtained. The IRS has the ability to extend values of shares anduse date-of-death values for particular stocks. They vigorouslyexercise this ability, so the challenge to preparers is to be at leastas thorough as the IRS.Schedule C – Mortgages, Notes & CashShow accrued interest from the date of last payment to dateof death. This is “income in respect of decedent” and is taxablefor both income tax purposes when received and for federal estatetax purposes when Form 706 is filed. If federal estate tax ispayable, deduction is allowed to the extent the tax was paid—topreclude double taxation.If there is an installment contract, take into account the interestrate and length of the contract, then apply a discount to achievepresent fair market value. Notes payable with low interest rates, orthose that have long maturity periods, are likewise candidates fordiscounts. Use standard discounting tables that provide the presentvalue of a dollar for any given year at the various rates, and attachthe computation to Form 706 for IRS review.For contracts of sale, show the percent of gain for ready reference.If there are “E” bonds, show the interest accrued; if “H”bonds are involved, show the interest increment in the bond. Ifthere is an installment contract, do not hesitate to take a discountsince the percent of gain will always remain the same. Again, usestandard tables to determine contract discounts.If alternate valuation is elected, and if stocks or bonds weresold between the date of death and date of alternate valuation (sixmonths later), then the sale price must be taken. If dividends aredeclared prior to death, and the price of the stock sells minus thedividend, then such dividends should be shown on Schedule B.Take care to show cash found on the person, in a desk, orelsewhere, and report the balance in the checking account afteroutstanding checks have been deducted. This attention to detailsignals the due diligence of a well-prepared return to the IRS.Schedule D – Insurance on Decedent’s LifeFor every insurance policy on a decedent’s life, a Form 712should be completed—no exceptions. If someone other than thenamed insured owns a policy, include a history of when policy ownershipchanged. The reason for this is that if there was a transferwithin three years prior to death, then the policy is brought backinto the taxable estate of the decedent. The proceeds of life insuranceshould never be used to pay federal estate taxes because this willresult in inclusion of the policy within the taxable estate.Ownership of life insurance policies by surviving children,(either initially or as soon as ownership can be determined), canafford significant estate tax savings. It is incumbent upon thechildren, however, to do what is right in this regard.The Irrevocable Life Insurance Trust is a great vehicle forestate tax savings. First establish the trust, and then buy the insurance.Be sure the trust contains a “Crummey” power, and set upthe procedures to give annual notices and properly record them. Anotice to the beneficiary/child, followed promptly by a confirmingreceipt, is a good way to assure that notice is given and received.The receipt should state that the beneficiary has received thenotice, waives withdrawal, and consents to the money beingapplied to payment of the life insurance premium.Cross-ownership of policies between husband and wife isfine, but where child beneficiaries are involved, the policy shouldspecify after one dies that “the children will be the successor ownersand beneficiaries.” Then, the proceeds of the policy on the lifeof the first spouse to die will pass to the surviving spouse, and thechildren will own the policy upon the death of the remainingparent. The insurance proceeds of the last to pass away escapesbeing taxed for federal estate tax.Where the decedent owned a policy on another person, onlythe cash value is included in the taxable estate. This might moreproperly be included in Schedule C.continued on page 32FACTS & FINDINGS / FEBRUARY 2003 31

A ‘Snapshot’ of the Estate: The Federal Estate Tax Return-Icontinued from page 31Schedule E – Jointly Owned PropertyThe “fractional share” rule applies between husband andwife. The total value is shown and half is included in the taxableestate. There is an increase in basis for “that part that was ownedby decedent, i.e., one-half of the total.”Have a certified appraisal done to document the fair market valueat date of death, and keep track of the basis of such jointly ownedproperty because half is the original purchase price (adjusted forimprovements less depreciation) and the remainder is the half-interestinherited. This mandatory rule of taking into account only half thevalue may result in not qualifying—or perhaps “just barely” qualifying—underSections 2032A, 6166 and Section 303 Stock Redemption.Disclaimer is possible and applies to the half attributable to thedecedent. That half passes by reason of the joint tenancy to the survivor.If disclaimed, then it passes as though there were no survivingspouse to receive it. Early appraisal of this possibility is advisable sothe individual has plenty of time to consider the disclaimer.For deaths before 1977 where it can be proved that onespouse furnished the consideration even though the property wasjointly owned, the law then in effect required the survivor to takethe basis of the decedent on 100 percent of the property. After1977, a step-up in basis was granted to the surviving spouse. SeeUnited States vs. Gallenstein, 92-2 U.S. Tax Ase (CCH Par.60,088), and Hahn vs. Commissioner, 21-2 Tax Court, affirming975 Fed. 2nd, 286. In these cases, the property was purchased inJuly 1955 for $38,500, and the decedent died in December 1987when the value was $3,633,652. The survivor stepped into thehusband’s basis and a full step-up in basis rather than paying taxon the difference between values at date of death less $38,500.Where farm ground is involved, a step-up in basis for theland means there is a step-up in basis of the tile, the fence, andthe farm buildings for the half interest of the decedent. These significanttax benefits are often overlooked.Schedule F – Other Miscellaneous Property...List vehicles, household goods, and itemize antiques toobtain a new basis. For the farm estate, have a reputable machinerydealer or auctioneer appraise all machinery, livestock, andequipment. Have the appraisal itemized on the auctioneer’s ormachinery dealer’s stationery, and list by groups such as “oldcows,” “heifers,” “yearlings,” “calves,” and so forth.It is crucial to make a very complete and thorough list. Thinkof it as though the surviving spouse or other inheritors are “purchasing”this property from the decedent. They are paying fullmarket price and obtain a basis equal to the full fair market value.Make detailed records for all grain, feed, and livestock, andmake a schedule of “items receiving a step-up.” Then, as suchitems are either fed to the livestock or sold to the elevator, take adeduction on Schedule F. It is like writing a check, but in thiscase the benefit accrues without the need for a check.If a partnership is involved, it is important to list the items ofpartnership property and to elect a step-up in basis for “the decedent’sinterest” in each item under Section 754 of the IRC. Thestep-up in basis applies only to the interest of the decedent. Oncemade, this election is binding, but this is seldom a detriment.Schedule G – Transfers During Decedent’s LifePrior to the 1981 Economic Recovery Tax Act (ERTA), giftsmade within three years of death were included in the taxableestate under the presumption that such gifts “were made in contemplationof death.” Since ERTA, a gift is a gift, is a gift. Inother words, once a gift is made, it is out of one’s estate.Exceptions to this rule include these:1. A gift of life insurance within three years of death—such giftis ignored unless three years have elapsed.2. A gift made that is not fully disclosed on a gift tax return.This is an issue of “disclosure” that often arises when the value isnot easily determined. For example, a closely held corporationwith an assumed discount for “minority interest,” and a furtherdiscount “because of lack of marketability,” might still be includedin the taxable estate of the decedent even if the gift is within the$11,000 annual exclusion. A lack of disclosure opens the door forIRS to bring this gift back into the taxable estate. It is crucial tofile a gift-tax return on items of uncertain value and it is wise tosupplement that return with a full disclosure as to probable value.3. The following transfers are brought back into the taxableestate of decedent:Section 2036: Where the donor reserves the use of theproperty for his lifetime. This property nowreceives a “step-up in value” to fair market valueon date of death.Section 2037: Where one has to survive the grantor andwhere there is reserved more than a fivepercent reversionary interest.Section 2038: Where the grantor reserves the right to changeenjoyment, such as power to revoke orterminate the trust, power to control andmanage the corpus and power to changebeneficiaries, such as power to appoint.4. For purposes of determining eligibility for special use valuation,(Sec. 2032A); Stock Redemption, (Sec. 303); and eligibilityfor 15-year payment of federal estate tax, (Sec. 6166), gifts madewithin the past three years are included in the taxable estate.5. A portion of the specific lifetime exemption of $30,000 maybe used for gifts made from Sept. 8, 1976 to Dec. 31, 1976. As aresult, 20 percent of the amount claimed must be taken off theunified credit of decedent. For example: A gift of $15,000 lessthe $3,000 exclusion would result in a gift of $12,000, and 2032FACTS & FINDINGS / FEBRUARY 2003

percent of that is $2,400 to be deducted from the unified credit.For deaths in 2002, a unified credit of $345,800 would bereduced by $2,400 to $343,400.Schedule I – AnnuitiesAnnuities and retirement plans are playing an increasing rolein financial planning. Annuities should be listed with value determinedby a letter from the issuing company, and both the ownerand beneficiaries should be listed. Set forth the cost basis onSchedule I for easy reference so tax consequences may be monitoredas the annuity is drawn upon.It is also wise to have beneficiaries withdraw funds from theannuity in a manner that spreads the tax burden over a period oftime. Annuities may serve well if properly purchased for a specificprogram, but they often seem to be purchased so “I don’t have topay income tax on the income.” This is faulty thinking, becausesomeone eventually has to pay the piper.Retirement plans should be carefully documented andchecked to see if the required distribution was taken in the yearof death—and, if not, to take it without delay. The distributionpasses to the designated beneficiary and not to the estate.The spouse should consider the spousal tax-free rollover sothat the tax can be further deferred and the plan will continue togrow. If a charity is named, be sure that the charity is paid outcompletely by Sept. 30 of the year following death. Then the namingof a charity will not interfere with the other beneficiaries withdrawingtheir funds over their remaining lifetimes. If not taken, then afive-year withdrawal requirement will create stiff tax consequences.A person must take out benefits by April 15 after reachingthe age of 70 years and 6 months. Take these benefits in the calendaryear when 70 years and 6 months is achieved.If a surviving spouse chooses to rollover the funds, he or shetakes out benefits in his or her own right. Benefits are calculatedanew each year, and under new rules, there is greater deferral everyyear. Upon rollover, the spouse should name the children as beneficiaries,with each as owner of a separate share.If the beneficiary is not the spouse, (i.e., a child), take thebirthday in the year following the date of death and determine payoutfrom the new tables published in Optimal Lifetime & EstatePlanning by the Greater C.R. Community Foundation (May 1,2003). These tables determine the payout in the year followingdeath, so for each subsequent year, simply reduce by one.The great deferral will make many pension holders wealthy(providing they had not worked for Enron, WorldCom, et. al.)._________________________________________________The second part of this article in the next issue will examine othervaluation considerations and review preparation of the balance of theschedules to be included on the Form 706.Orville W. Bloethe is a tax attorney with Bloethe-Van Zee Law Office, Victor,IA, working primarily in the areas of income tax and estate tax. He is co-author ofthe Iowa State Bar Tax Manual, is a member of the American College of Trustsand Estates Counsel, and speaks frequently at the Iowa State Bar Tax School.Awards Nominations DueThe rigorous selection process for recipients of NALA’s annualawards begins with formal nominations made by members. TheBoard of Directors determines final recipients, but the entireprocess depends upon initial nominations.Members are urged to submit their nominations soon so that thequalifications of various nominees may be carefully considered andcompared before selections are announced for the Awards Banquet duringthe 28th Annual Convention, July 9–12, 2003, in San Antonio, TX.Honors and awards are a meaningful way to show appreciationand admiration for peers who go the extra mile, and they alsodemonstrate standards for others who may be inspired to accomplishgreat things on behalf of the profession and NALA.All of NALA’s awards acknowledge exemplary achievements.The most prestigious of these are the Founders’ Award and thePresident’s Award.The Founders’ Award is the highest honor bestowed byNALA as an expression of appreciation by legal assistants throughoutthe country. The award recognizes extraordinary contributionsthat have affected the profession for a significant period of time.Recipients need not be members of NALA.Former Founders’ Award recipients include NALA FoundersJane Terhune, CLAS, and Dorthea Jorde, CLA; Una A. Clark, CLA,Editor of the first editions of Facts & Findings; paralegal educatorVirginia Koerselman, Esq., and Past President Kay Kasic, CLA. In2002, the Oklahoma law firm of Crowe & Dunlevy became the firstorganization, rather than an individual, to receive the award.The President’s Award is exclusively for NALA members, andrecognizes achievements of leaders in the growth and development ofthe profession. Recipients must be members of NALA for at least twoyears and have at least five years of experience as a legal assistant.Former recipients include Jimmie Murvin, CLAS, LCP, BatonRouge, LA; Lana J. Clark, CLA, Solvang, CA; Nancy Hole, CLAS,Des Moines, IA; Beverly Bolton, CLAS, Wichita, KS; and Karen B.Judd, CLA, Champaign, ILNomination forms for both these prestigious awards areavailable from NALA Headquarters, or they may be downloadedfrom the NALA Web site at www.nala.org.FACTS & FINDINGS / FEBRUARY 2003 33

Part Two: Tax BenefitsConservationEasementsby William M. Silberstein, Esq. and Melinda Beck, Esq.Part One of this series was plublished in the November,2002 issue.Conservation easements are a valuable tool for landownerswho wish to preserve their land. Congress has supported and evenpromoted this opportunity for the preservation of land by creatingvaluable federal income tax and estate tax benefits for landownerswho donate a conservation easement or sell conservation easementsthat meet certain criteria for less than market value.These federal income tax benefits include charitableincome tax deductions and estate tax exclusions and reductions.Some states also offer their own tax incentives which canbe used in conjunction with federal tax benefits to producepowerful monetary motivation for landowners to preserve theirland. Donating a conservation easement is not only a positivestep for the preservation of rapidly disappearing natural andagricultural areas, but is also a sound business decision.As explained in “Part I” in the November 2002 issue ofFacts & Findings, a conservation easement is a contract betweena landowner and a land trust or governmental entity which containspermanent restrictions on the landowner’s use or developmentof land. However, the landowner retains ownership andexclusive use and possession of the land with this arrangement.Often a conservation easement will reserve a fewresidential building sites for the landowner with theremainder of the land left in its natural or agriculturalcondition. An easement will typically prohibit surfacemining, commercial and industrial activity, and intensiveagricultural uses such as feedlots.Conservation Purposes DefinedA landowner can qualify for federal tax benefits bydonating a conservation easement to a qualifiedorganization for conservation purposes. A qualifiedorganization is a governmental entity or a 501(c)(3)charitable organization which meets certain criteria.Conservation purposes are defined in Internal RevenueCode § 170(h)(4) to include the following:• Recreation and education of the general public• Protection of the natural habitat of wildlife, fish or plants• Preservation of open space, including farmland andforestland, for the scenic enjoyment of the generalpublic or pursuant to a clearly delineated governmentalconservation policy• Preservation of historically important land or a certifiedhistoric structureIRC § 170(h) also requires that the conservationeasement be perpetual in duration, and that no surfacemining be permitted on the land. Treasury Regulation §1.170A-14 further clarifies and expands on these basicrequirements, and adds guidance regarding the valuationof a conservation easement to determine the amount ofthe charitable contribution.To quantify the charitable contribution, a landownermust obtain an appraisal of the value of the conservationeasement. This value is determined by an appraisal of thevalue of the land without the conservation easement, comparedto the value of the land after the easement has beengranted. The difference between the two is the value of theconservation easement. This approach is sometimes referredto, aptly, as the “before and after” approach. A soundappraisal is critical because it is the document most likely tobe reviewed by the Internal Revenue Service.34FACTS & FINDINGS / FEBRUARY 2003

Valuable DeductionsIf a conservation easement satisfies all Internal RevenueCode requirements, then the donating landowner has made acharitable contribution that is eligible for an income taxdeduction for the value of the conservation easement. Thisdeduction may be used to offset a taxpayer’s ordinary incomeas well as income realized from capital gains, but the deductionis generally limited to 30 percent of a landowner’s annualadjusted gross income.A donating landowner may take a deduction in the yearof the donation, but, if the full amount of the conservationcontribution cannot be utilized in this first year because ofthe 30-percent limitation, then the balance of the contribution—subjectto the 30-percent limitation—may be carriedforward to be deducted in each of the following five years oruntil the full amount has been claimed, if earlier. Because aconservation contribution is a charitable donation, theresulting deduction is subject to the other limits existing inthe Internal Revenue Code for itemized deductions.For example, assume that “Evelyn” owns a beautifulranch in the Rocky Mountains. If she sells the ranch, it willproduce a long-term capital gain. Instead, she donates a conservationeasement on the ranch to her local land trust. Theranch’s fair market value (FMV) before the easement is $2million, and the value after the easement is $1.2 million.In this scenario, Evelyn has reduced the value ofthe ranch by 40 percent and has made an $800,000conservation contribution. She has an adjusted gross income(AGI) of $150,000, and will be allowed to take a deductionof as much as 30 percent ($45,000) of her AGI in the yearshe donates the conservation easement. The remaining$755,000 of contribution can be carried forward anddeducted for the next five years subject to the 30-percentlimitation each year. Depending upon her income levelover the next five years, she may not be able to deduct theentire value of the contribution.These income tax benefits are not limited solely to individuals.A “C” corporation can also take a deduction for thevalue of a conservation easement, but the deduction is limitedto 10 percent of a corporation’s contribution base (taxableincome with certain adjustments). On the other hand, an“S” corporation can take a deduction that will pass throughto the shareholders, but the deduction will be limited to anindividual shareholder’s basis in the stock. Finally, partnershipsand limited liability companies receive benefits similarto individuals and can claim a deduction that will passthrough to owners without any basis limitation.Estate Tax BenefitsThe conveyance of a conservation easement, whetherby donation or sale, also results in estate tax benefits.The conservation easement reduces the value of the land,thereby reducing the total value of the taxable estate of adeceased landowner. Further, if a conservation easementqualifies under IRC §2031(c), up to 40 percent of thealready reduced value of the land subject to the conservationeasement can be excluded from the taxable estate up to amaximum exclusion of $500,000.IRC §2031(c) is available for the estate of a deceasedlandowner whose land is subject to a conservation easement,provided that certain requirements are met. The majorrequirements are as follows: 1) the land must have beenowned by the deceased landowner or a member of the familyfor at least three years prior to the landowner’s death, 2) theconservation easement must prohibit commercial recreationaluse of the land, and 3) the value of the conservation easementmust be equal to at least 30 percent of the value of theland without the conservation easement on the date of thedonation—or the exclusion will be reduced.Going back to the example of Evelyn’s ranch, assumethat Evelyn dies after placing the conservation easement onthe ranch. Remember: the FMV of the ranch before the conservationeasement was $2 million and $1.2 million after theconservation easement. Assuming Evelyn has no other assets,the estate tax due on the ranch without the conservation easementis approximately $435,000. The estate tax on the ranchwith the conservation easement is approximately $82,000.The conservation easement has saved Evelyn’s familyapproximately $353,000 in estate taxes. Assuming the propertyqualifies for the §2031(c) exclusion, then the state is allowed toexclude an additional $480,000 of the value of the ranch.Evelyn’s family will not owe any estate taxes on the ranch.More Benefits to ComeThese valuable estate tax benefits can also be capturedthrough the grant of a conservation easement provided forin a will. A gift made by will is considered effective as ofthe date of death, and therefore will reduce the estate taxes ofthe deceased landowner in the same manner as shown in theabove example. IRC §2031(c) also permits a conservation easementto be conveyed after a landowner’s death by the estate andstill qualify for an estate tax exclusion. There are state law issuesthat must be examined for a post-mortem easement grant.A number of states have also passed laws to provide taxbenefits for the conveyance of conservation easements.Colorado, for example, grants taxpayers who donate conservationeasements a tax credit equal to the value of the concontinuedon page 36FACTS & FINDINGS / FEBRUARY 2003 35

Part Two: Conservation Easementscontinued from page 35servation easement up to $100,000, plus 40 percent of anyamount in excess of $100,000, up to a maximum availabletax credit of $260,000. Most importantly, this state taxcredit in Colorado is in addition to any federal tax benefits.Landowners will undoubtedly continue to use conservationeasements as they see the environmental and societalvalue of preserving land for future generations. Rewardingsuch benevolent landowners with federal and state tax benefitswill increase the amount of land protected. Congress isconsidering new tax benefits for the sale of land to be preserved,providing options in conservation transactions for abroader spectrum of landowners. The efforts of Congressand state legislators together with the ingenuity of landtrusts and governmental entities in fully utilizing these taxbenefits will provide countless rewards in the future.Development of Water Projects” at the 2003 Colorado Water LawConference. She has a BA in Economics from Pomona College,CA, and a JD from the University of Denver.mbeck@irwl.comBill Silberstein is head of the Conservation Easement PracticeGroup at the Denver, CO, law firm of Isaacson, Rosenbaum,Woods & Levy. He is recognizedas a leader in land conservationlaw and has served as counselto Colorado Open lands,Colorado Cattlemen’sAgricultural Land Trust, GreatOutdoors Colorado, AspenValley Land Trust, and ColoradoCoalition of Land Trusts. He hasrepresented many landownersand other local and national landconservation organizations inpreserving tens of thousands ofacres of Colorado land. He is afrequent speaker on conservationeasements and the tax aspects of open space preservation.He holds BA and JD degrees from the University of Colorado,where he served as an intern with the National Wildlife Federationand served as case note editor for the Law Review.Melinda Beck is a member of the Isaacson, Rosenbaum,Woods & Levy Real Estate and Transactional Practice Group, thePublic Law and Policy PracticeGroup, and the ConservationPractice Group. She was formerlyan assistant county attorneywith a wide spectrum of duties,including matters pertaining toland acquisition and managementby the Douglas CountyDepartment of Open Spaceand Natural Resources.Ms. Beck did a presentationon “Land Use Litigation…”before the 1999 Rocky MountainLand Use Institute AnnualConference, and presented“Considerations Affecting the36FACTS & FINDINGS / FEBRUARY 2003

TECHNOBITSHigh-Tech for Everyday Tasksby V. Lee JohnsonWhile you’ve been busy working during the past few years,technology supporting many legal processes has been hard atwork too. Exciting and innovative automated services exist todaythat can make many of the functions performed in your dailycourse of business less routine and probably more interesting.One area in particular benefiting from advances in technologyis document coding, or indexing. Automated coding is nowcost effective for projects ranging from a single box of documentsto a warehouse full. The only possible exception mightbe a situation where the documents are mostly handwritten.A review of some basic terminology will be helpful inlooking at details regarding this technology.Imaging—conversion of paper documents to electronicformat in order to create an exact replica of a document.Coding—typically refers to collecting key informationfrom a document, either by human coders or viasoftware programs.Indexing—the process by which the important informationidentified in coding is added to a database in orderto facilitate searching for documents.Searchable database—the result of imaging, coding,and indexing from which important documents can belocated and retrieved using a search request or query.Documents can be “imaged” without being “indexed,”but the result would not be very useful since the databasewould not be searchable.There are products and services that can literally “read”document images and quickly return a fully-indexed databasecontaining full text, all the standard data fields (e.g., author,recipient, Bates® number, document type and date), plus otherfields such as additional names and pre-determined “key terms”typically too cost-prohibitive to code from the document text.Automated document coding has evolved to the pointwhere it should be seriously considered as a viable method ofquickly and inexpensively creating a database. This technologyallows legal support professionals to spend their valuabletime on more complex and challenging tasks beyond thegrasp of current technology.Clearly, computers cannot do much of the complexanalysis of which humans are capable, and perfection is notto be expected of either computers or humans. The databaseprobably will not be perfect. Some fields will be as accurateas those coded by humans, while other fields may notachieve that level of dependability.However, using technology to cheaply, effectively, and efficientlyperform routine coding allows delivery of a database ina matter of days instead of months. The ability to access anduse information early can make a critical difference in decisionsto litigate or not, and in the outcome of the litigation itself.The fact that the database can be enhanced by humancoders makes using a combination of human coding and technologya sensible approach. Having a useful database quicklycreated using automated indexing may well be more importantthan having a “perfect” database delivered too late to be useful.Revolutionary advances have also been made in searchingfor important documents. Some automated codingprocesses offer unique built-in features, including searchtools, which make them even more effective. Technologybreakthroughs actually allow computers now to “understand”a document’s meaning using discrimination processes similarto those of humans. The programs can then search a databasefor other related documents, regardless of document type.These search tools typically are easy to use and don’trequire complicated querying. They often display results inseconds with just a push of a button. This new search technologyis the perfect companion to automated indexingbecause it doesn’t rely on fielded data to provide results. It is“reading” every word of optical character recognition (OCR)text on every page of the document.The technology supporting information indexing andretrieval has been evolutionary and is gradually moving awayfrom traditional database creation and searching. The appropriateuse of technology to effectively and quickly indexinformation in a way that supports effortless searching forrelated documents has become essential for law firms thatwish to remain competitive.V. Lee Johnson is an expert inthe area of litigation documentmanagement, and is Executive VicePresident and co-founder ofSyngence, LLC, a company that providesfully-automated, Internetbaseddocument indexing and analysisspecifically designed for litigators.He is also the founder of DocIDTechnologies, Inc. and a co-founderof Docucon Legal Division.vljohnson@syngence.com.www.syngence.comFACTS & FINDINGS / FEBRUARY 2003 37

ETHICSTIPSHush, Y’all!NALA/SNAP Amicus Brief AccentsNeed for Confidentiality Screeningby Libby Roleson, CLASSteven Leibowitz, Thomas Standish andEcker & Standish, CharteredPetitionersv.The Eighth Judicial District Court of the State of Nevada,Clark County, and The Honorable William O. Voy, DistrictJudgeRespondentsAndDeena LeibowitzReal Party in InterestNALA and the Sierra Nevada Association of Paralegals(SNAP) filed an amicus curiae brief in the above case inresponse to a petition for writ of mandamus filed by thepetitioners. At issue in the petition is the lower court’sdisqualification of the Ecker & Standish law firm fromcontinuing to represent petitioner Leibowitz because the firmhired a non-lawyer who possessed confidential informationconcerning the opposing firm’s client.The lower court based its disqualification on Ciaffone v.District Court, 113 Nev. 1165, 945 P.2d 950 (1997) whichheld the rules governing disqualification of non-lawyers are thesame rules applicable to the hiring of lawyers. In so holding,the court reasoned that not subjecting non-lawyers to the samescrutiny as lawyers would grant less protection to the privilegedand confidential information held by the non-lawyers.As stated in their brief, NALA and SNAP contend thescreening of non-lawyers to protect confidences when changingjobs should be permitted. Incorporated by reference into the briefwas the amicus curiae brief submitted to the Oklahoma SupremeCourt in Hayes v. Central States Orthopedic Specialists, 2002 OK30, 51 P.3d 562 (2002) regarding non-lawyer screening issues(the Hayes brief) which was submitted by NALA, the OklahomaParalegal Association, the Central Oklahoma Association of LegalAssistants, and the Tulsa Association of Legal Assistants. InHayes, the Oklahoma Supreme Court stated:“Thus, before being disqualified for having hireda non-lawyer employee from its opponent, thehiring firm should be given the opportunity toprove the non-lawyer has not revealed client confidencesto the new employer and has been effectivelycounseled and screened from doing so.”Also discussed in the brief at 4-5, Leibowitz, et al v.District Court, et al, Supreme Court of the State of Nevada, CaseNo. 39683 (issue not yet decided) are various problems posedby the lack of non-lawyer screening, and which were notaddressed by the Ciaffone court:• Limited employment opportunities of legal assistantswould disserve clients by impeding the ability of firms toutilize the services of legal assistants, thereby increasing theoverall legal expenses to clients.• Legal assistants who tend to work on cases involvingcomplex litigation and multiple parties become extremelylimited in their mobility and may become disqualified fromworking at as many as 20 to 30 law firms in cities like Renoor Las Vegas as a result of having been briefly involved inone large case.• Legal assistants may be privy to confidential informationin far more cases than lawyers and thus be far more likely tocreate a conflict since they tend to work on many more ofthe firm’s cases than individual lawyers do.• Non-lawyers are required to work for lawyers, and,unlike a lawyer, cannot go to work for themselves, thus makingthe impact of the Ciaffone rule much more harsh onnon-lawyers than on lawyers.• Because non-lawyer employees have no independentduty of loyalty to a firm’s clients, the former client shouldhave lesser reasonable expectations with respect to theemployee’s job mobility as long as confidences are protected.• Non-lawyers who live and work in rural towns inNevada are effectively precluded from changing jobs due to38FACTS & FINDINGS / FEBRUARY 2003

the great number of conflicts which arise between the smallnumber of firms. It is virtually certain that the consequenceof such immobility will be to reduce the non-lawyer workforcein such communities and make hiring such employeesfar more difficult.According to the Ciaffone ruling, if the non-lawyer neverobtained confidential information (as defined by court rules),then disqualification is unnecessary because no ethical problemhas arisen. This view means the hiring firm must determine ifthe non-lawyer has obtained confidential information.However, the hiring firm cannot inquire as to any such information,making it impossible for the hiring firm to independentlydetermine if a conflict exists.If it is subsequently determined that the hiring firm has inits employ a non-lawyer who possesses confidential information,the client would be severely prejudiced. The disqualificationof the hiring firm at a late stage would obviously causedelays in the judicial process and most likely litigation againstthe hiring firm by the now-former client on whether or not thenon-lawyer actually possessed confidential information. Thelatter would most certainly disclose the very information forwhich protection should be sought.It is obvious the Ciaffone court did not take into accountany impractical consequences resulting from its finding. Nonlawyerscreening would protect both the hiring firm and thenon-lawyer, regardless of whether or not the employee actuallyhas confidential information. It would also reduce the unnecessaryconsequences that the lack of such screening would produce.Further, if a screening rule were not put in place, theclient would not have the right of being represented by thelawyer of choice.It is easy to see that the screening process should be inplace. I have experienced the problems faced by legal assistantsworking in rural areas and I’ve seen the difficulties movingfrom one job to another in a large metropolitan area by onewho possesses confidential information.Client confidentiality is a precious commodity in ourbusiness, as is a legal assistant’s ability to change jobs.Breaching that confidence hurts a lot of other peoplebesides yourself.So, as we say in the South, “Hush, y’all.”Libby Roleson, CLAS is a paralegal with the Memphis, TN,office of Stokes Bartholomew Evans & Petree and currently servesas NALA’s Ethics Chair.lroleson@stokesbartholomew.comF&FAre you a paralegal or new manager looking to develop your management skillsto further your career?Skills For New ManagersTopics include: How to Be a Successful Manager, Hiring &Firing, Becoming a Master Communicator, Dealing withDiscipline and Employee EvaluationsApril 26-27, 2003Washington, D.C.LAMA Members: $250(if postmarked by 3/21/03)Visit www.lamanet.org or call 404-292-2976for more information.

EDUCATIONHow Do You Get There?Paralegal Program Directorby Kathryn L. MyersSo, you think it might be time to change the focus ofyour career?Several questions probably come to mind, not the least ofwhich is: “What do I want to do while still being involved inthe paralegal field?” After much deliberation, you may comeup with the idea that being the director of a paralegal programwould be the ideal new career path. The next question,of course, is, “How do I get there from here?”Becoming a paralegal program director is not aneasy task for a practicing paralegal. Many colleges anduniversities have educational requirements such as a minimumof a master’s degree. There are usually fewer restrictionson proprietary institutions and community colleges than onfour-year colleges and universities regarding hiring minimumsbut each institution has hiring criteria. You need to knowwhat that involves.No matter what the educational requirements might be,for a practicing paralegal, your practical experience is alsoextremely important. Creating a quality resumé and a portfolioof your accomplishments is vital.The first thing, of course, is to have a resumé that makesyou stand out from the crowd. It should be tailored towardthe job you are seeking and it should be filled with actionverbs that exemplify the experience and qualities that youhave to offer a new employer.Naturally, the resumé should highlight your experience.Work history should be presented first either in reversechronological order by employer or by identifying your skillsby topic. Forget the “objective”—your potential employerknows you want a job. The resumé should be set up usingbullets instead of narrative paragraphs—no one wants to read“I have worked for the same attorney for eight years.”Conventional wisdom holds that employers take approximately37 seconds to scan a resumé. Quantify and qualify yourmaterial by using action verbs and indicating: “Managed acase load of 150 active personal injury cases.”Along with the resumé you should have a portfolio. Aportfolio is a purposeful collection of material accumulatedover time. The material documents the extent of your learning,achievement, and development. Documentation ofknowledge and skill acquisition can take a variety of formsincluding, but not limited to the following:■ Letters of support,■ Diaries■ Video and audio tapes of your work■ Pleadings, memoranda■ Projects■ Registration receipts from continuing education andconferences attended■ Proof of membership in professional organizations■ Subscriptions to legal publicationsThis professional portfolio will be representative,not comprehensive. Each artifact chosen for inclusionshould represent at least one significant aspect of you and/or your accomplishments that can be translated intoemployability.First, prepare your portfolio as a showcase of your bestwork—your highest achievements. This will involve selectingfrom artifacts in your portfolio and adding new ones.Second, do not send your portfolio when you apply for ajob, but include in your cover letter a statement concerningyour portfolio (e.g., “Throughout my career, I developed aprofessional portfolio that clearly and concisely exhibits myattributes as a paralegal. I would be pleased to share this portfoliowith you during an interview.”Third, if granted an interview, take your portfolio withyou. Be prepared to present the highlights, and practice presentingit effectively. In some instances, you might be asked topresent it at the beginning of the interview and in otherinstances you might use it as a source of evidence or enhancementof a point you make in the interview. Interviewing practicesvary widely from employer to employer. Portfolios aremost likely to be reviewed in situations where the employer isfamiliar with the abilities of a paralegal.Fourth, if the interviewer is particularly interested andwould like to examine your portfolio more closely, offer toleave it. Be sure to make explicit arrangements for retrievingit, and, of course, follow through as planned. It could be that40FACTS & FINDINGS / FEBRUARY 2003

your portfolio will create the impression that tips the scalesin your favor.Fifth, remember it is likely that some people inposition to hire are not familiar with professional portfolios,as you know them. Take time to concisely explain thatdeveloping your portfolio has been a process of reflectionand evaluation that has helped you to know yourself as aparalegal and to establish a foundation for career-longprofessional development. To some extent, presenting yourportfolio will inform the interviewer about both you andthe portfolio concept and process.Finally, keep your portfolio current. As you gain experienceand grow professionally, alter it to reflect your development.Remember that it is not only your first job applicationthat may be enhanced by a well-prepared and presented portfolio.Developing your portfolio is an excellent foundation formeeting any expectation of continuing legal education.The portfolio should contain documentation of knowledgeand skill acquisition. A good place to start the documentationis by reading the Core Competencies established by theAmerican Association for Paralegal Education (AAfPE). Thosecore competencies are divided into two areas—skill developmentand acquisition of knowledge. Within those areas arecompetencies based on skills in critical thinking, organization,general communication, interpersonal relations, legal researchand writing, and computer skills.The acquisition of knowledge should include (at least)organization and operation of the legal system, organizationand operation of law offices, litigation procedures, the paralegalprofession and ethical obligations, contracts, torts, andbusiness organizations.This knowledge and these skills are the same types ofknowledge and skills needed by paralegal program directors.That is the connection you want to emphasize.Now that you have documented your career anddemonstrated your value through experience, you shouldalso include activities that show your value to the institutionfor which you wish to work. What should you have done? Inmost cases, you are looking at taking over the duties from anexisting program director unless the institution near you isstarting a brand new program. Therefore, you should familiarizeyourself with the institution for which you want to work.Become important to that institution by doing suchthings as serving on the advisory board, providing aninternship or mentor opportunity for students, being a guestspeaker, and/or teaching a course. Doing these things alsoprovides an insight as to whether being a program directoris really what you want to do.When the job of program director opens, provide thatresumé and portfolio. Sell your strength—your experience.No one knows better than you how valuable your experienceis to paralegal students. Use that to your advantage.Once you become director, you will need to add a few itemsto your “to-do” list. You may be involved in recruiting students,marketing the program, overseeing the budget, creating newcourses, and/or hiring other faculty. Above all, it is vital to staycurrent in the field. That means continuing your education, too.The life of a program director is never stagnant. Being aprogram director is fun, challenging, and rewarding. You willopen new opportunities for yourself and you will enrich thelives of the students you touch. That sounds like a win-winsituation to me, so go for it!Kathryn L. Myers is Associate Professor and Coordinator ofParalegal Studies at Saint Mary-of-the-Woods College, Saint Maryof-the-Woods,IN. She is a past president of the AmericanAssociation for ParalegalEducation and has written a numberof articles for Facts &Findings as well as presentingeducational programs at theNALA Annual Convention.She has been involved inparalegal education since 1982when she helped create the paralegalprogram at Saint Mary-ofthe-Woodswhere she served onthe founding advisory board, wasas an adjunct instructor, and wasCoordinator of Paralegal Studies.She has been active in AAfPEsince 1989, serving in manyadministrative and leadership roles, and now serves on the nationalconference committee. She also served on the committees that createdthe model syllabi for several courses, and was a member ofthe Core Competencies committee.She is a founding member of Indiana Legal Assistants, a memberof the National Association of Legal Assistants, the Indiana ParalegalAssociation, and the National Federation of Paralegal Associationskmyers@smwc.eduF&FFACTS & FINDINGS / FEBRUARY 2003 41

PRACTICETIPSRemind the BossSmart Utilization Increases Profitsby Carolyn Yellis, CLA“Time is Money.”This axiom applies whether you work in a large law firmor organization, or pursue the challenges of the paralegal professionas a sole practitioner. As with many axioms, however,we need reminding of their wisdom from time to time. Moreto the point, we need to remind our employers that effectiveuse of paralegal services can significantly benefit profits.The things that “go without saying” often are the verythings that need to be said the most. A review of the “obvious”may help you prepare for the time when you can remind yourboss of the importance of paralegal services to the bottomline—and some of the techniques and practices you use tomake those services work more effectively and profitably.To increase profitability, it is important to consider theinput-to-output ratio of the business system and maximizeefficiency of that ratio. Proper utilization of paralegals providesstrong leverage in this ratio and can yield significant improvementsin profitability. Qualified paralegals perform tasks thatotherwise would have to be addressed by lawyers with attendanthigher billing rates. Some of the matters that legal assistantscan attend to include these:• Client Interviews• Investigation• Legal Research• Discovery• Law & Motion• Trial Preparation• Trial• Post-Trial Collection• Real Estate Transactions/Due Diligence• Formation of Corporations and Partnership Agreements• Intellectual Property Transactions• Trusts, Wills, and Probate Matters• Divorce Proceedings and Child Custody MattersTo increase the profitability of the law firm, the billingrate of the employee as compared to their salary is a crucialfactor. Some insurance companies have set rates for legal servicesand some actually have lists of tasks performed by theattorney and tasks that are performed by the paralegal thatthey will cover.A comparison in the “Comparative Rates/Costs” chartshows the profit gained if the paralegal prepares a Motion toExclude Expert Testimony.Comparative Rates/CostsParalegal -Hourly Rate= $25.00(52K a year)(Paid by Firmto Employee)Attorney -Hourly Rate -$75.00(135K a year)(Paid by Firmto Employee)Cost Per Hour for Task $65.00 $150.00Preparation Time 2.5 hours 2.5 hoursCost Billed $162.50 $375.00Cost to Firm $75.00 $187.50(for wages only)Difference Billed $212.50. But the loss of revenueto Clientby the attorney not attending thedeposition is $1,200.*Note: The attorney also needed to appear in an all-day deposition that sameday but had to reschedule because no one else could attend. The charge forthe attorney to attend the deposition is $1,200. The paralegal saved the attorneytime by preparing the motion and the attorney got to attend the depositiontherefore increasing the profit to the firm.Templates & MacrosProper utilization of software is mandatory to the profitabilityof a law firm. Whether the firm uses Microsoft Word or WordPerfect,the use of templates and macros can save hours of time—and,therefore, money. A template can store boilerplate text, customtoolbars, macros, shortcut keys, styles, and autotext entries.An easy way to create a template is to open a documentthat contains the features and content you want to reuse, thensave it as a template. A macro is a series of Word (and someother applications) commands and instructions that you grouptogether as a single command to accomplish a task automatically.Instead of manually performing a series of time-consuming,repetitive actions, you can create and run a single macro.Automation of these tasks will take an investment of time tocreate initially, but once set up, these functions will save hours oftime, adding significantly to profitability at the bottom line.42FACTS & FINDINGS / FEBRUARY 2003

Document DatabasesParalegals are masters of document control and organization.Depending upon the type of law being practiced, thelegal assistant’s choice of database applications can save hundredsand thousands of dollars. Conscientious paralegals shouldbe knowledgeable about a wide array of applications to choosefrom. To maximize the firm’s ability to make a reasonable profit,initial investment in database software is essential.Checklists & CalendarsUsing checklists to open and work cases can increase theefficiency of the office and the quality of services offered toclients. Missing an important filing date or appearance can bedisastrous to the client and the firm, so a good calendaringapplication should be at the top of every firm’s software list.Serving the client is the prime directive of the legal team,and proper utilization of paralegals on the team makes goodsense. Clients receive high quality work supervised by theirattorney at a much lower rate than if the attorney performedall the work. The firm increases profitability by freeing up theattorney to practice law, and allowing the legal assistant toexert the office expertise seldom acquired by lawyers. This is awin/win situation for the firm and the client.Carolyn Yellis, CLA, is a graduate of Southern California College ofBusiness & Law where she received her paralegal certificate. She earned herCLA in 1998, and is currently a freelance paralegal. She also serves on theAdvisory Board of Santa Ana College,and is in her first term as an advisoron the executive committee of theCalifornia State Bar’s Solo and SmallFirm Section.She currently is Board Advisor,and formerly served two terms aspresident of the California Alliance ofParalegal Associations. During herfirst term as CAPA President, shetestified before the CaliforniaAssembly, Judiciary, andAppropriations Committees in supportof AB 1761, which was ratified by the California Governor in September 2000.She remains active in educating the public and the legal community on howthe statute affects paralegals, the legal community, and the public.cyellis@aol.comF F &COMMUNICATIONCORNERAs if...by Virginia Koerselman, Esq.Have a communication question? Submit itto the Communication Corner for ananswer. Post your questions to the FACTS &FINDINGS discussion board on NALANetor send them to nalanet@nala.org.5. Vicky’s homemade pudding tasted (as if) (like) warm mud.ANSWERS:(page references are to the CLA Review Manual, 2d ed.)1. Ken and (I) (me) are charter membersof this organization.2. Neither Amelia (or) (nor) Tucker finished on time.Virginia Koerselman3. (When) (While) I tried to lose weight, I gained five pounds.4. Allen works (as if) (like) there will be no tomorrow.Use “like” to connect phrases. Page 128 . . . pudding tasted likewarm mud.4. Use “like” to connect phrases (not clauses). Page 128 . . . Alleworks as if3. Use “when” to indicate time. Page 128 . . . When I tried . . . . .2. Correlative conjunctions must match: neither/nor or either/or. Page126 Neither Amelia nor1. Use the nominative case when the pronoun is used as part of thesubject of the sentence. Page 116 . . . Ken and IFACTS & FINDINGS / FEBRUARY 2003 43

PROFESSIONALDEVELOPMENTSome TipsWriting for the CLA ExamAfter I registered for the CLA exam, I went through theusual steps to prepare: study buddy, flash cards, review manual,and mock exam, but I never stopped to think about my writingprocess (or that part of the exam requires writing). I neverstopped to think that I would be giving up my computer andwriting by hand and with a pencil for the first time in years.When the first written assignment on the exam camearound, I was sure I would be the first one out of the roombecause writing is my thing! When I got the exam, I carefully readthe question, then positioned my fingers over the test paper asthough a keyboard would appear if I held the pose long enough.How embarrassing. I looked around to see if anyone waswatching. Finally, I began to write by hand.Usually, when I write, I sit at the computer with a drinkpositioned just to the left of the keyboard. I write for a while,stop, reach for the ever-present glass, then lean back to readand revise the bit that I have written before moving on. So, inthe CLA exam, I put my pencil down, leaned to the left for mydrink and almost fell out of the desk (one of those studentnumbers without armrests to grip).At this point, I realized two things: 1) I have a writing processthat I follow every time I write that is as routine as brushing myteeth (sitting in this desk with a pencil definitely was not part ofthat routine), and 2) if I had hit the floor, I probably would havebeen the first to sustain a head injury while taking the exam. All ofthis happened before I even tried to “cut and paste.” Not pretty.Despite my early prediction that writing was my thing, I was thelast to leave the test room after the written sections of the exam.Because I have been studying theories of writing in graduateschool, my writing experience during the CLA exam intrigued me.Studies show that examinees score about the same regardless ofwhether they handwrite or type exam responses, so I could not blamemy performance on being denied a keyboard. But, I do believe writingby hand and typing are two different experiences, and being preparedto handwrite can make taking the exam a little more comfortable.Based on my experience as a CLA examinee and what Ihave learned about writing, I offer the following tips for havingan injury-free writing experience during the CLA exam:Before the ExamGet the Right Equipment—Find a brand of pencils that are“fast writers.” Nothing is worse than having a pencil that movesby Charlsye J. Smith, CLASslower than your fingers. While you need to complete the examusing a No. 2 lead (most of the exam is computer graded), pencilsdo perform differently, so spend time finding a brand you like.Train for the Exam—Before the CLA exam, train orretrain yourself to compose with a pencil. (Anyone can writewith a pencil, but composing—getting the words in the orderyou want them—takes more skill.) Practice by drafting letters toclients on paper before you type them. When you practice writingessay questions, write on paper with your pencil. Your writingprocess is physical as well as mental. Practicing writing testanswers using the computer is better than no practice, but practicingon paper allows you to experience the mental and physicalprocess you will use on the exam.Seek Feedback—Write some practice exam questions andask for feedback. The more times you practice and get feedback,the better you will get at organizing your thoughts quickly andwriting exam questions. If you do not have anyone who can providefeedback to you, go ahead and practice writing exam questions.Studies show that our writing improves through practice,whether we receive feedback or not.During the ExamAnalyze the Writing Situation—Read the instructions andfollow them. Note how long the assigned writing should beand how much time you have to write the answer.Determine the Audience and Format—Pay attention tothe audience for your document (usually identified in theinstructions) and write for that audience. Determine what kindof document you are being asked to write (e.g., letter, memorandum,report, summary, etc.). Format the document correctlyand stick to the assigned length. This is not the time to becreative or consider your work an exception.Divide and Conquer—Divide your writing time into threesegments: 1) thinking/jotting, 2) writing, and 3) proofreading.The amount of time for each segment will not be equal.You probably do this when you write on-the-job documentsas well, but the process is internalized so that you never thinkabout it. Pay attention next time you write a letter or memo fromscratch. How do you think about what you are going to write?Do you just start typing into the computer and then sort it allout? This is a fine way to compose when writing with a computer,but it may not work on a timed exam.44FACTS & FINDINGS / FEBRUARY 2003

For example: If I had an hour for the exam, I would spend10 minutes thinking/jotting, 40 minutes writing, and 10 minutesreviewing.Think & Jot—The most important things to figure outduring this phase are determining the order of your answer andthe details of it. Use this time to organize your answer. Cuttingand pasting later is impossible with a pencil. Trust me.While writing practice responses, try to figure out thetechnique that works best for you. For example, perhaps youwork best by listing key words that serve as a rough outline ofthings you want to discuss. Or, perhaps, you need some sentencesto refer back to as you write.Are you a “Revision Writer?”—If you tend to be a “revisionwriter,” a person who writes a draft and then goes backand heavily revises on the computer, you might considerspending longer on the thinking/jotting phase, and even writeout a few paragraphs on scratch paper first. In this case, duringan hour-long exam, I might spend 25 minutes thinking/jotting/draftingkey paragraphs, 25 minutes writing the completetext, and 10 minutes editing. The way you draft documents inregular life will tell you if you are this kind of writer.Write Your Answer—During the writing phase, write outyour answer completely. Make sure your answer is formattedcorrectly and follows the instructions exactly. Write legibly.Writing legibly and by hand slowed me down during the exam,so be prepared for that.Proofread Your Work—During this phase, review yourwork, including the instructions. Have you done what theinstructions ask you to do? In an on-the-job situation, thiswould be the time to revise your text by moving sentencesaround, adding or deleting information, or seeking commentson your work. During an examination, however, you only havetime to edit. Check spelling and punctuation.Each person has a different writing process. Understandingthe process that your mind followswhen you write will helpyou determine how to be an efficientwriter on the CLA exam.At the least, you should getthrough the exam injury free.Good luck!charlsye.smith@ttu.eduwww.lifeatthefirm.comF&FFACTS &FINDINGSThe Professional Journal forLegal AssistantsRush my subscription today:■ 1 year (4 issues) $25■ 2 years (8 issues) $40NameAddressCity State ZipPhone (Daytime/Business)■ Enclosed is my check number for $■ Charge to my ■ Visa ■ MasterCardName on cardCard NumberExp. DatePlease allow 30 to 60 days for delivery of first issue.Would you like to receive:NALA membership information? ■ Yes ■ NoCertified Legal Assistant Program information? ■ Yes ■ NoA listing of other NALA publications? ■ Yes ■ NoPlease mail to:NALA1516 South Boston, Suite 200Tulsa, OK 74119CONTRIBUTIONS OR GIFTS TO NALA ARE NOT DEDUCTIBLE AS CHARITABLE CONTRIBUTIONS FOR FEDERAL INCOME TAX PURPOSES, HOWEVER, PAYMENTS MAY QUALIFY AS ORDINARY AND NECESSARY BUSINESS EXPENSE.

SPECIALCONTRIBUTIONThe Value of Mentoringby Diane Pevar, JDDirector of Legal Studies, Manor College and AAfPE President-electYou have successfully completed your educational program,searched hard, and found your first job. Or, perhaps you’vebeen working as a paralegal for many years and take pride inhaving achieved economic and professional success. The furthestthing from your mind might be those who are consideringentering the paralegal profession or who are enrolled in an educationalprogram of their own.Your insights and advice, however, can help prepare futureparalegals for the realities of employment. Serving as a rolemodel can inspire by providing others with a profile of thecompetencies they will need to achieve their own success. Bychoosing to mentor—to share your knowledge and experience—youcan make a difference to those who come after you,thereby strengthening the paralegal profession.Paralegal educational programs have long recognized the valueof presenting students with role models. Dora Dye, paralegal programdirector at City College of San Francisco, established an inhousementoring program for her students in August 2000 and hasseen it grow each semester. Dye chooses mentors among her students“who have overcome challenges in life and are driven to succeedrather than those who earn the best grades in the classroom.”Some student mentors help their peers improve study skills,learn about financial aid and serve as course tutors. Others, accordingto Dye, who already have workplace experience, “connect theeducational component and the actual workplace for the mentee.”Mentors are a valuable resource once an individual completeshis/her paralegal education. The pressures involved infinding employment and successfully applying knowledge andskills as part of a legal team can be overwhelming.Carol Sullivan has chaired the Central ConnecticutParalegal Association’s Mentoring Program since its inception in1994. She describes the mentoring process as “enhancing professionalismby grooming future leaders.” She stresses that mentoringis not an internship or shadowing program, but can be asnarrow or broad as the mentor and mentee wish to make it.Most descriptions of the mentoring process refer to thementor as an advisor. The CCPA Mentoring Program (andSullivan) expands upon this definition as follows:A mentor is an advisor who shares knowledge and experienceto guide the mentee past obstacles and pitfalls…A mentor teaches vital lessons which may not be covered in aneducational program, such as how to cope with stress or how tonetwork...A mentor is a career counselor, providing practical tips onfinding that first job or transitioning laterally…A mentor is a sounding board the mentee uses to test his/herjudgments and perceptions.Although not every mentoring relationship will be the same,each party must take on certain responsibilities in order to ensuresuccess. The mentee needs to ask questions and provide the mentorwith a framework as to what he/she needs from the relationship.The mentor must believe in the mentee, encourage curiosityand questions, create a positive environment, encourage thementee’s independence, and be able to critique when necessary.What is the motivation for an established paralegal to becomea mentor? Carol Sullivan describes her own experience: “Mentoringhas given me the chance to really think about why I chose this field.It forces me to reflect on and communicate the positives and negatives,as well as gives me a sense of well being for helping someonejust starting out. Volunteering to be a mentor can make a differencein someone else’s life as well as add some perspective to your own.”Opportunities for mentoring are more plentiful than youmay think. You can mentor at work by volunteering to be availableto newly hired paralegals. You can contact your alma materand agree to be a guest speaker or lecturer, or to field questionsfrom prospective students. Write an article describing yourexperiences as a paralegal for local or national publications.As with the Central Connecticut Paralegal Association, yourlocal or state paralegal association may have a mentoring program.If it doesn’t, seize the opportunity to start one. Your insights andadvice will make a difference to those who follow in your path.Diane Pevar is Director of Legal Studies at Manor College, Jenkintown,PA, a position she assumed in 1988after designing and implementing theschool’s paralegal program. As anattorney, she practices personal injurylaw, specializing in complex catastrophicloss litigation. She has served asDirector of Associate Degree Programsfor the American Association forParalegal Education, headed AAfPE’sMentoring Program, and is currentlyits President-elect.F&F46FACTS & FINDINGS / FEBRUARY 2003

AFFILIATESCOLUMNCommunication is Basicby Sharon G. Robertson, CLASAffiliated Associations DirectorCall me crazy, but I really enjoy the wintermonths. The sky is clear, the mountains arecrisp (fancy way of saying “no haze”) and bare,and the stars are brilliant.How many times have you driven down theroad and seen something you had never noticedbefore. How often has the winter stripped theleaves away to reveal that there was a house behindall those trees? There is something about the wintermonths that overcomes the lush color of theother seasons and brings you back to the basics.One of the most elemental basics, and alsoone of the most important, is communication.Associations communicate with their membersthrough newsletters and periodicals; program brochuresadvertising upcoming educational events,scholarships, and other pro bono activities; andthrough list serves or other e-mail mass mailings.But how do associations communicatewith other associations? One of my goals is toencourage communication between the affiliates.To facilitate communication, we haveadded the Web site addresses for each of theaffiliated associations listed in the back of Facts& Findings. (Please contact NALA headquartersif you find errors in your contact information.)It is my hope that associations will use thecontact information in this list to communicatewith each other when they have questions aboutcertain issues, when they need advice on startinga new project, or when they need feedback onspecific issues. I also encourage the affiliates toutilize the conference center on NALA Net. Asalways, your regional director and the AffiliatedAssociations Director are available when youhave questions or need assistance.Another form of communication is theknowledge imparted through survey responses. The2003 Affiliates Survey is posted at the NALA Website at www.nala.org for your association to address.Many affiliates have already responded to the survey,but what a boost it would be to communicationif we were to get a 100% participation rate.Some of the information sought by thesurvey includes facts on scholarship programs,types of CLA study groups, and types of probono activities, as well as contact informationfor each affiliated association. Informationgleaned from the survey, and a compilation ofthe services and benefits offered by the affiliatedassociations will be available at the AffiliatedAssociations Meeting on July 9 at the annualNALA Convention in San Antonio.While on the subject of the 2003 AffiliatedAssociations Meeting, I am thrilled toannounce that the North Carolina ParalegalAssociation (NCPA), and the Legal Assistantsof North Texas Association (LANTA) will beparticipating in the 2003 Affiliate ExchangeProgram at the July 9 meeting.“LRP—Does Your Association Have It?” isthe title of the NCPA’s presentation, and I amtempted not to explain LRP just to pique yourinterest. However, I haven’t been able to figureout a short summary of the presentation withoutgiving it away. From this presentation, affiliatedelegates will learn about the benefits oflong-range planning, how to conduct a longrangeplanning session, and the value of periodicassessment of long-range goals, includingmeasurement of the accomplishment of thosegoals. The speakers will be Belinda T. Pruitt,CLAS and Anita Watts Wing.Kim Cantu, CLA will be making LANTA’spresentation, “Charge Up 2004!” The presentationwill put forth some new ideas on motivatingmembers and increasing participation inmeetings and activities by providing membersrewards (much like frequent flyer rewards) fortheir involvement. Along with increasing memberparticipation, the presentation addressesways to involve vendors in opportunities andsupport for association activities.With these two great programs, what morecould you ask for—how about some great fun,meeting new friends, and renewing longtimefriendships? Of course there is also networkingwith other affiliates, and acquiring new ideasfor your association.In the winter, it is good to look forward tothe warmth of July and a convention thatpromises to continue the tradition of toppingitself year after year. What do your members(and others) see about your association when allthe leaves are gone and you are back to thebasics? Come to San Antonio and share thatinformation. Remember the NALAmo!FACTS & FINDINGS / FEBRUARY 2003 47

&NEWS INFORMATIONNew MembersSept. 20, 2002 thruDec. 31, 2002ALABAMAJoanette BennettDebra D. Thomas-BrownDeSchazo Reynolds, Jr.Lisa Price SmithVictoria SmithMargaret V. StackAmy M. StoneARIZONACynthia C. LoveKevin Michael MajorMartha L. RobardsRanae M. SmithPatricia A. TenczaARKANSASMarilynn CurryRobyn M. DisneyEileen A. RossbackWal-Mart Stores, Inc.CALIFORNIASuzi K. BachanDee BeardsleyKelley A. BelillNancy CarrollVeronica M. CaylorHelen M. EatonMelisa Dawn Frick, CLASCarmelita GarciaJanet M. GellatlyCharmaine L. GrayLisa M. HeinoldPeter HodgensAna HoriganSelby JessupCassandra KincaidDiane H. LoronaMaric CollegeDebbie J. Marona, CLAJulie A. MarottaChristine MunozDeborah A. MurphyVictorialei “Nohea”NakaahikiCarol O’NeilJennifer Nicole PierceBarbara E. RogersChristina SalasGlenn ThomasLarry D. UnruhCOLORADOKaren A. ElmontMargaret R. HamiltonHelen M. HorsfieldTonia InnsPatricia D. LeHewCharles E. Roth, IIIAnne SuttonDELAWARELori WhitmerFLORIDAAngela A. AndreeSherry L. BatisMaritza C. BehneyTerri S. BlommelLinda CalixteAriane ChiclesDebra ClarkeKellie T. CrawfordTheresa A. DanielsKellie DillonMonica FiaschiEnid C. Epstein-Friedman,CLARebecca HauserMaureen JaegerAnna L. LimardoLeah M. LombardAndrea LozanoJames MacormackGustavo ManzoJean Crawford MartinMargaret McCamyFrances A. McNealNancy A. Moss, CLASPamela B. OlshanAdline M. ParkinCherylann PattersonJose R. Prieto, IIITheressa RagsdaleElizabeth ReiherAngela A. RetterbushCynthia RobbinsRenee RocheMary C. SanchezAmy E. SchultzLinda M. G. SmithCassie D. SnyderDebbie StevensManuela TomasLouise E. Thomas, CLAMichelle Douglas Wacha,CLALinda T. Wells, CLADawn WigginsGEORGIALouise JonssonSusan LachanceStephanie TullisYvette Werkheiser-BatesILLINOISDeborah L. BraddChelsey DillonPatricia M. FrankJanet L. Holdeman, CLALaretha JonesMichelle D. MalesAmelia McClellanCynthia R. MuehlbergSusan R. MurphyTiffany L. RosinskiFrederick C. StoneINDIANAMichelle P. ArdEllen M. ProctorIOWAJennifer A. HeyerCynthia R. OrtizKANSASMark CoveyKENTUCKYT. Gail DukeKarla A. MessengerDawn OstertagBrittany L. SimmonsLOUISIANALauren B. BraggElizabeth T. RiviereMARYLANDTheodora J. HowellBrieta LlewellynLaura StahlMASSACHUSETTSRebecca FrisbieAmy E. MarshallAndra SmithSarah WilliamsonMICHIGANJeffery A. FordDavid M. GottliebSusan M. McCabe, J.D.MINNESOTAVanessa DavisMISSISSIPPIChristen J. AndersonCarolyn N. AshfordShirley WilliamsMISSOURIMaryAnn HillegasDebbie LoweRebecca A. ScogginMONTANASusan A. Harding, CLAChristine ShoopmanApril A. SmithTina SunderlandNEBRASKAKaren L. Emerson, CLANEVADAKip AlmAlison T. CardwellCandace R. Jones, CLASKristine LaFastoSigna PendegraftVickie I. Perry, CLAAnne H. PotterCindy L. PulsipherWendy Lea RossAlma Vida B. Farro-SulioRobert “Jerry” SwainAngela P. WinterNEW HAMPSHIRERebecca BrooksNEW JERSEYKiomeiry CsepesChristine DeaconRebeca EscobarKaren HulmesDeborah A. KetcherickRobin A. LukacsElizabeth MontantiNEW MEXICOColecia BostwickSean O. Shannon, CLANEW YORKRafael BeaumontPamela King-BelforShanta CastilloMelissa A. ConteNatalie DennisShaheen ElElaine N. GunnMaria HaluskaShahinul Islam KhalisdarGladys LopezEric MatusewitchTheresa McKenzieBronwyn MerhigeJaye MillerDiane MorganSilvana H. MoscatoJoseph MurrayMoinuddin NaserMichael J. PryceRobin J. PurcellRicardo G. SingletonKatlynn StewartRaj K. ThakurNORTH CAROLINAHolly AdamsWilliam D. BartlettRegina A. BechtlerNyyokkia T. CannonClaudette C. J. HarrisToni KahlHeather D. KinradeSara H. NothdurftLaura A. Peres, CLARebecca SpradlingKimberly D. WhiteRuth Ann WrightNORTH DAKOTAM. Bryn EldridgeJoshua RoaldsonOHIODiane BarnumNikole M. BarrereKelly BeekmanKathryn BennettConnie BrackenElizabeth BrownValerie A. BryantNicole Wildhart-BurrJames Lee CampbellLayna M. DailDionna C. DunnMelissa E. DunnCari EgglestonKelli FergusonNikko S. FrankbonerKaren L. GossageShannon HummelSuzanne JezekLisa Ann KaufmanEda LassenLisa MillerJulie Lynn PloegerBonnie L. PrayMike RiegerCynthia RuffingLaurie A. RyanCarol SchafferParrish A. ShoupEva Shannon SimmonsDiana J. SpoerrDebra S. StouderRebecca L. WaitsOKLAHOMAAmanda AdamsDiane E. BessLorrie ClarkeCurtis E. ElliottJennifer HinnenTerri L. Holmes, CLALori LesterGideon A. LincecumLinda Merlene Goen-PharaohAlta Bush SelveyTheresa WalkerJamie S. Wilson, CLAOREGONBrian RicePENNSYLVANIAAmanda C. AultKaren M. McCabeNorthampton CommunityCollegeLynn C. RibarCatherine M. WhiteSOUTH CAROLINAPatricia McCurdyAdam Caje O’NealSOUTH DAKOTALori ClimisRichard A. JensenLisa R. Klein, CLATENNESSEEKitty L. ColemanMarjorie HainesSusan J. HumbleTerry L. ShipleyLane Owens WhiteTEXASAmie AronhaltVera BalicTerri BeimBrenda BishopRhonda J. Brashears, CLAWilliam E. BrownJudy CannonMelanie S. CooperCatina Coy48FACTS & FINDINGS / FEBRUARY 2003

&NEWS INFORMATIONJulie CunninghamStacey A. DraperMisten E. ForemanGina GutierrezElizabeth L. HallTina HallSusan HillebrandtRhonda S. Ingram, CLAKendra Steele-JacksonAshley E. LentLaWanda LewisStephen M. LockeDebbi McDaidGrace Kathleen MorrowMichelle MortonJill M. PetersonJoy PrestonSara QuintanillaMarilyn ColemanRobertsonMindy SeeleyLeslie D. StithTiffany L. Sulser, CLACharlotte WillaUTAHJulie D. VolnyVIRGINIAMarisa AlfanoMelissa A. ColeDana L. GodekJennifer HeflebowerMarie E. Kelley, CLABonita KimpRose Marie LamannaMichele M. ShanksAnn F. SwiftPatricia Van HiseApril M. WestWASHINGTONAlison ForrestMary E. Martinez-LaPointTiffany M. StephensWEST VIRGINIAPatricia D. ClarkErica L. McCordWISCONSINDera L. JohnsenWYOMINGLee Ann SchuttFOREIGNTricia Y. MottaAffiliatedAssociationsAs of Dec. 6, 2002ALABAMAAlabama Association ofLegal Assistantshttp://www.aala.netPresident:Jane D. McKinnon, CLABirmingham, ALLiaison:Jeanie C. JohnsonBirmingham, ALLegal Assistant Societyof Virginia CollegeVirginia College atBirminghamFaculty Advisor:David Champlin,Legal Dept.Birmingham, ALSamford ParalegalAssociationFaculty Advisor:Les EnnisBirmingham, ALALASKAFairbanks Associationof Legal AssistantsPresident:Deana M. WatersFairbanks, AKLiaison:Barbara A. Johnson,CLAFairbanks, AKARIZONAArizona ParalegalAssociationhttp://www.azparalegal.orgPresident:Karen L. Trumpower,CLAPhoenix, AZLiaison:Kelley S. Dalton, CLAPhoenix, AZLegal Assistants ofMetropolitan Phoenixhttp://www.geocities.com/azlampPresident:Deborah M. Nolan, CLAPhoenix, AZLiaison:Kristina JensenPhoenix, AZTucson Association ofLegal Assistantshttp://www.azstarnet.com/nonprofit/talaPresident:Deborah A. McMurrich,CLATucson, AZLiaison:Sue A. MahonTucson, AZARKANSASArkansas Association ofLegal Assistantshttp://www.aala-legal.orgPresident:Constance F. Helmich,CLALittle Rock, ARLiaison:Valerie D. NationLittle Rock, ARCALIFORNIALos Angeles ParalegalAssociationhttp://www.lapa.orgPresident:Jenifer G. GibbsLos Angeles, CALiaison:Mary L. Theroux, CLAPasadena, CAOrange County ParalegalAssociationhttp://www.ocparalegal.orgPresident:Mary Helen RichHuntington Beach, CALiaison:Marilyn Dupies,CLA, CASNewport Beach, CAPalomar CollegeParalegal Studies ClubLiaison:Cheryl MandrellPoway, CAFaculty Advisor:Angelo CorporaSan Marcos, CAParalegal Association ofSanta Clara Countyhttp://www.sccparalegal.orgPresident:Samantha SchumacherMenlo Park, CALiaison:April M. Piercey, CLAPalo Alto, CASan Joaquin Associationof Legal AssistantsPresident:Pamela L. Buchnoff,CLAFresno, CALiaison:Debbie DoddFresno, CASanta Barbara ParalegalAssociationhttp://www.sbparalegals.orgPresident:Barbara BrookeMedina, CLASanta Barbara, CALiaison:Kimberly A. MumfordSanta Barbara, CAVentura CountyAssociationof Legal AssistantsPresident:Delaina FinchOxnard, CALiaison:Geraldine Bowen, CLAThousand Oaks, CACOLORADOAssociation of LegalAssistants of ColoradoPresident:Doris Silva, CLAColorado Springs, COLegal Assistants of theWestern SlopePresident:Penny LandeisGrand Junction, COLiaison:Kirsten MillerGrand Junction, COFLORIDACentral Florida ParalegalAssociationhttp://www.cfpainc.comPresident:Anne M. Iazucco, CLANaples, FLLiaison:Wilhelmina G.Herschey, CLAOrlando, FLGainesville Associationof Legal Assistantshttp://www.afn.org/~galaPresident:Michelle SharpGainesville, FLLiaison:Kathleen R. Logan, CLAGainesville, FLNortheast FloridaParalegal Associationhttp://www.jaxla.orgPresident:Margaret C. Costa, CLAJacksonville, FLLiaison:Mary F. Greenhill, CLAJacksonville, FLNorthwest FloridaParalegal Associationhttp://www.pla-net.orgPresident:Cristi A. Malone, CLAPensacola, FLLiaison:Kristine M. Hill, CLAPensacola, FLParalegal Association ofFlorida, Inc.http://www.pafinc.orgPresident:Penny W. Bell, CLASCocoa, Palm Beach, FLLiaison:Linda Borders-DeIorio,CLAWest Palm Beach, FLSouth Florida ParalegalAssociationhttp://www.sfpa.infoPresident:Aida C. Rodriguez, CLAMiami, FLLiaison:Linda N. AndersonMiami, FLSouthwest FloridaParalegal Associationhttp://www.lasf.comPresident:Jane D. Gill, CLASarasota, FLLiaison:Susan L. Levine, CLASarasota, FLVolusia Association ofParalegalshttp://www.volusiaparalegals.comPresident:Judy Beatty Haraseth,CLADaytona Beach, FLLiaison:Maryann Valerio, CLADaytona Beach, FLFACTS & FINDINGS / FEBRUARY 2003 49

&NEWS INFORMATIONGEORGIASoutheastern Associationof Legal Assistants ofGeorgiahttp://seala.cjb.netPresident:Vicki H. Garrett, CLASavannah, GALiaison:Pamela K. Bebon, CLASavannah, GAILLINOISCentral Illinois ParalegalAssociationhttp://hometown.aol.com/cipainfo/myhomepage/club.htmlPresident:Lisa J. Craghead, CLAUrbana, ILLiaison:Deborah L. BraddUrbana, ILINDIANAIndiana Legal Assistantshttp://www.freeyellow.com/members/ilaPresident:Becky A. FehrNew Albany, INLiaison:Darlena E. Gentry, CLATerre Haute, INIOWAIowa Association ofLegal Assistantshttp://www.ialanet.orgPresident:Denise M. Brentner,CLACedar Rapids, IALiaison:Jane WigginsArmstrongWaterloo, IAKANSASHeartland Association ofLegal AssistantsPresident:Alice M. MarksKansas City, MOLiaison:Sharon ChatburnWood, CLAOverland Park, KSKansas Association ofLegal Assistantshttp://www.ink.org./public/kalaPresident:Nancy ElizabethMendenhall, CLAWichita, KSLiaison:Stephanie G. Rahm,CLAWichita, KSKENTUCKYWestern KentuckyParalegalsPresident:Julie P. Franklin, CLAMadisonville, KYLiaison:Joan Hobgod, CLAMadisonville, KYLOUISIANALouisiana StateParalegal Associationhttp://www.la-paralegals.orgPresident:Jimmie W. Murvin,CLAS, LCPBaton Rouge, LALiaison:Jan L. Melton, CLA,LCPShreveport, LANorthwest LouisianaParalegal AssociationPresident:Pamela H. East, CLA,LCPShreveport, LALiaison:Jan L. Melton, CLA,LCPShreveport, LAMICHIGANLegal AssistantsAssociation of Michiganhttp://www.laamnet.orgPresident:Marcy L. Jankovich,CLASJackson, MILiaison:Renee J. Jent, CLAAlpena, MIMISSISSIPPIMississippi Associationof Legal Assistantshttp://www.mslawyer.com/malaPresident:Zenda S. HeafnerJackson, MSLiaison:Jacqueline M. Watkins,CLASRidgeland, MSUniversity of SouthernMississippiSociety for ParalegalStudiesPresident:Trisha TriggHattiesburg, MSFaculty Advisor:Gail Lucas, CLASHattiesburg, MSMISSOURIPSI SIGMA CHI-ParalegalSociety of SpringfieldCollegeFaculty Advisor:Brian J. WilsonSpringfield, MOSt. Louis Association ofLegal AssistantsPresident:Judith A. ClarkSt. Louis, MOLiaison:Michele R. HyattSt. Louis, MOMONTANAMontana Association ofLegal Assistantshttp://www.montana.com/malaPresident:Deborah L. Ethridge,CLASMissoula, MTLiaison:Christine ShoopmanMissoula, MTNEBRASKANebraska Association ofLegal Assistantshttp://www.neala.orgPresident:Susan A. Alstadt, CLAOmaha, NELiaison:JoEllen I. Keating, CLAOmaha, NENEVADAClark CountyOrganizationof Legal Assistants, Inc.President:Crystal L. Matteson,CLASLas Vegas, NVSierra NevadaAssociation of ParalegalsPresident:Karen C. Biggs, CLASReno, NVLiaison:Molly Fischer, CLAReno, NVNEW JERSEYLegal AssistantsAssociation of NewJerseyhttp://www.geocities.com/CapitolHill/2716President:JoAnne HaffemanRutherford, NJLiaison:Kathleen Bonelli, CLARidgefield, NJNORTH CAROLINACoastal CarolinaParalegal ClubFaculty Advisor:Col. Robert E. SwitzerJacksonville, NCMetrolina ParalegalAssociationPresident:Kathleen A. MorgochCharlotte, NCLiaison:Beverly G. KingCharlotte, NCNorth Carolina ParalegalAssociation, Inc.http://www.ncparalegal.orgPresident:Theresa Ann Irvin, CLACharlotte, NCLiaison:Sherry Vaughan, CLARaleigh, NCNORTH DAKOTARed River Valley LegalAssistantsPresident:Barbara A. JustWest Fargo, NDLiaison:Evelyn P. Beauchamp,CLAFargo, NDWestern DakotaAssociationof Legal Assistantshttp://www.wdala.orgPresident:Laurie A. Guenther,CLASBismarck, NDLiaison:Kathleen A. Stradley,CLASGlyndon, MNOHIOToledo Association ofLegal Assistantshttp://www.tala.orgPresident:Evelyn D. Evans-Eck,CLASToledo, OHLiaison:Ruthanne E. Chase,CLASToledo, OHOKLAHOMACity College LegalAssociationFaculty Advisor:Jack MooreNorman, OKNortheastern StateUniversityLegal AssistantAssociationFaculty Advisor:Glenda ArkisonTahlequah, OKOklahoma ParalegalAssociationhttp://www.okparalegal.orgPresident:Kerri L. Herring, CLAEnid, OKLiaison:Lennis D. Ailey, CLAPonca City, OKTCC Student Associationof Legal AssistantsFaculty Advisor:Sherry TaylorTulsa, OKTulsa Association ofLegal Assistantshttp://www.tulsatala.orgPresident:Beverly A. Boyd, CLATulsa, OKLiaison:Cassandra O. Oliver,CLATulsa, OKOREGONPacific Northwest LegalAssistantsPresident:Jana R. Bauman, CLAPortland, ORLiaison:Dawnne L. Linenbrink,CLASEugene, ORPENNSYLVANIAKeystone Legal AssistantAssociationPresident:Cindy J. Geib, CLASMount Joy, PALiaison:Jean Marie Rice, CLASCarlisle, PASOUTH CAROLINACharleston Association ofLegal AssistantsPresident:Barbara E. Mills, CLACharleston, SC50FACTS & FINDINGS / FEBRUARY 2003

&NEWS INFORMATIONGreenville Association ofLegal AssistantsPresident:Peggy B. PayneGreenville, SCLiaison:Rebecca J. Maxson,CLASGreenville, SCTri-County ParalegalAssociationhttp://www.concentric.net/~tcpaPresident:Angela L. GrondinesSummerville, SCLiaison:Julianne GuzmanMt. Pleasant, SCSOUTH DAKOTANational AmericanUniversity Associationof Legal AssistantsPresident:Mary WitterRapid City, SDFaculty Advisor:Jennifer B. UtterRapid City, SDSouth Dakota ParalegalAssociation, Inc.http://www.sdbar.org/sdlaaPresident:Christine K. Lillo, CLASSioux Falls, SDLiaison:Sheri GrossAberdeen, SDTENNESSEEGreater MemphisParalegal Alliancehttp://www.memphisparalegals.orgPresident:Olivia C. Roleson,CLASMemphis, TNLiaison:Pamela Riddick Cobb,CLAMemphis, TNTennessee ParalegalAssociationhttp://firms.findlaw.com/TPAPresident:Diane M. Sykes, CLASCleveland, TNLiaison:Alisa Cathcart PruettKnoxville, TNTEXASCapital Area ParalegalAssociationhttp://www.capatx.orgPresident:Rhonda K.Harshbarger, CLAAustin, TXLiaison:Melissa Vargas WannAustin, TXEl Paso Association ofLegal AssistantsPresident:Carol M. SagaribayEl Paso, TXLiaison:Sharon A. Newson,CLAEl Paso, TXLegal AssistantAssociation/PermianBasinPresident:Lee Bell Ulvestad, CLAMidland, TXLiaison:Rhonda S. Ingram, CLAMidland, TXLegal Assistants of NorthTexas AssociationPresident:Kim J. Cantu, CLADallas, TXLiaison:Allen F. Mihecoby, RP,CLADallas, TXNortheast TexasAssociationof Legal Assistantshttp://www.ntala.netPresident:Barbara J. Hensley,PLS, CLALongview, TXLiaison:Kathy S. Hermes, CLALongview, TXSoutheast TexasAssociationof Legal AssistantsPresident:Katrina SterlingWaddell, CLABeaumont, TXLiaison:Kimberly Dawn Frenzel,CLABeaumont, TXTexas PanhandleAssociationof Legal AssistantsPresident:Penny ClarkAmarillo, TXLiaison:Susan Grim, CLASAmarillo, TXTyler Area Association ofLegal AssistantsPresident:Sarah ConnorTyler, TXLiaison:Lynda M. Barron, CLASTyler, TXWest Texas Associationof Legal AssistantsPresident:Kathy McDonald, CLALubbock, TXLiaison:Susan E. RullaLubbock, TXUTAHLegal AssistantsAssociation of UtahPresident:Julie L. ErikssonSalt Lake City, UTLiaison:Bonnie K. Hamp, CLASalt Lake City, UTVIRGIN ISLANDSVirgin IslandsAssociation of LegalAssistantsPresident:Eloise M. BenjaminSt. Thomas, VILiaison:Georgeann S. Peters,CLASt. Thomas, VIVIRGINIARichmond Association ofLegal Assistantshttp://geocities.com/CapitolHill/7082President:Ann KnobbeGlen Allen, VALiaison:Patricia C. Anderson,CLASRichmond, VARoanoke ValleyParalegal Association:President:Stacy S. DevlinRoanoke, VALiaison:Kathy WardRoanoke, VATidewater ParalegalAssociationPresident:Betsy H. Blank, CLAVirginia Beach, VALiaison:Faith R. Sullivan, CLAPortsmouth, VAVirginia PeninsulaParalegal AssociationPresident:Victoria Quadros, CLANewport News, VALiaison:Dennette L.Miller-Lusk, CLANewport News, VAWEST VIRGINIALegal Assistants of WestVirginia, Inc.http://www.lawv.orgPresident:Anna M. Morgan, CLAWheeling, WVLiaison:Sandra L. Morrow, CLAMartinsburg, WVWISCONSINMadison Area ParalegalAssociationhttp://www.califex.com/mapa/index.htmlPresident:Renee HammondMadison, WILiaison:Terri A. WilhelmMadison, WIWYOMINGLegal Assistants ofWyominghttp://www.lawyo.comPresident:Kathi A. Bachert, CLACasper, WYLiaison:Debra B. Jennings, CLAGillette, WYFACTS & FINDINGS / FEBRUARY 2003 51

NALAOfficial Roster2002-2003Fiscal YearAs of October 2, 2002NALA Board ofDirectorsPresidentVicki J. Kunz, CLAS,MDU Resources Group, Inc.918 E. Divide AvenueP. O. Box 5650Bismarck, ND 58506701-222-7644FAX: 701-222-7683Vicki.Kunz@mduresources.comFirst Vice PresidentDebra J. Monke, CLASState Farm InsuranceCompaniesOne State Farm Plaza, A-3Bloomington, IL 61710309-766-2912FAX: 309-766-1919Deb.Monke.GIIA@Statefarm.ComSecond Vice PresidentTita A. Brewster, CLAOppenheimer Wolff &Donnelly, LLP1400 Page Mill RoadPalo Alto, CA 94304650-320-4151FAX: 650-320-4100tbrewster@oppenheimer.comIncludes:ALASKA&NEWS INFORMATIONSecretaryLinda J. Wolf, CLASSidley Austin Brown& Wood717 N. Harwood, Ste. 3400Dallas, TX 75201214-981-3342FAX: 214-981-3400lwolf@sidley.comTreasurerKaren Greer McGee, CLASSecond Circuit Courtof Appeals430 Fannin StreetShreveport, LA 71101318-227-3703FAX: 318-227-3735kmcgee@lasccoa.state.la.usExecutiveCommittee MemberCharlsye J. Smith, CLASCivil Litigation Specialist6350 Hulen Bend Terrace,#1314Ft. Worth, TX 76132817-294-4113FAX: 817-294-8564Charlsye.Smith@ttu.eduCertifying Board ChairDawnne L. Linenbrink,CLASMuhlheim Boyd & Carroll88 East BroadwayEugene, OR 97401541-868-8005FAX: 541-868-8004linen@mbclawoffice.comChair, ContinuingEducation Council(Official Publications)Sharon A. Werner,CLA, CHAIRMasco Corporation21001 Van Born RoadTaylor, MI 48180313-792-6437FAX: 313-792-6430sharon_werner@mascohq.comAffiliated AssociationsDirectorSharon G. Robertson, CLASNorth Carolina PrisonerLegal ServicesP.O. Box 130Linville Falls, NC 28647828-765-8897FAX: 828-765-0617sharonr@hci.netChair, ProfessionalDevelopment CommitteeKarin M. Scheehle, CLASBaird, Williams & Greer340 E. Palm Lane, #150Phoenix, AZ 85004-4552602-256-9400FAX: 602-271-9308kscheehle@bwglaw.netRegion I DirectorKimberly J. Houser, CLACapital Blue Cross2500 Elmerton AvenueHarrisburg, PA 17177717-541-7331FAX: 717-526-3064Kimberly.Houser@capbluecross.comNALA REGIONSRegion II DirectorAmanda A. Folk, CLASSCANA Services, Inc.Mail Code 130Columbia, SC 29218803-217-7317FAX: 803-933-7786afolk@scana.comRegion III DirectorMelissa A. (Lisa) VanderWeide, CLASBroad & Cassel390 N. Orange Ave., Ste. 1100PO Box 4961Orlando, FL 32802-4961407-839-4200FAX: 407-650-0961mvanderw@broadandcassel.comRegion IV DirectorCassandra Oliver, CLAThe Williams CompaniesOne Williams CenterPO Box 2400, MD 41-3Tulsa, OK 74102918-573-6650FAX: 918-573-4195cassandra.oliver@williams.comRegion V DirectorKelly A. LaGrave, CLASFoster, Swift, Collins& Smith313 S. Washington Sq.Lansing, MI 48933-2193517-371-8287FAX: 517-367-7387klagrave@fosterswift.comRegion VI DirectorAnn L. Atkinson, CLAKutak Rock1650 FarnamOmaha, NE 68102402-346-6000FAX: 402-346-1148ann.atkinson@kutakrock.comRegion VII DirectorMichele D. Doyle, CLATeton County SchoolDistrict #1P.O. Box 1971Jackson, WY 83001307-733-2704FAX: 307-733-6443wdoyle@wyoming.comRegion VIII DirectorChristine E. Porter, CLAJeffrey Foote& Associates1515 SW 5th Street,Suite 808Portland, OR 97201503-228-1133FAX: 503-228-1556cporter@footelaw.comRegion IX DirectorKathleen H. Miller,CLA, CASRutan & Tucker611 Anton Blvd., #1400Costa Mesa, CA 92626714-662-4625FAX: 714-546-9035khmillerclacas@aol.comIncludes:BRAZILENGLANDONTARIOIncludes:BAHRAINGUAMHAWAIISINGAPORETAIWANNEW ZEALANDIncludes:PUERTO RICOVIRGIN ISLANDSFACTS & FINDINGS / AUGUST 2002 52