[Ed. note: This post was originally published in the Lee's Summit Journal on November 25, 2011.]

Red-light cameras have become an increasingly popular public safety tool in cities across the country. They raise revenue by giving people what amounts to a parking ticket for their car being in an intersection while the light is red. The cameras are operated by private companies that split revenues with the cities that hire them.

Red-light cameras are in a political, financial and legal fight. A Missouri state senator received a camera citation and is fighting the violation in court.  The red-light camera industry has lobbyists. Lawyers have taken on the anti-camera cause as volunteer public service.  There are anti-red-light-camera fundraisers, complete with live music and celebrities.

A St. Louis suburb was a recent hot spot for red-light-camera law.  City of Creve Coeur vs. Nottebrok, a Missouri Court of Appeals case, has told us that red-light cameras are legal in Missouri.

The case dealt with a typical red-light camera ticket. The car owner who received the ticket fought it. She argued that the city ordinance was unconstitutional. The court did not agree. Because the city wrote the ordinance as a nonmoving violation, rather than a moving violation, the car owner didn’t stand a chance. The court found the ordinance had a “substantial and rational” relationship with the city’s ability to manage the “health, safety, peace, comfort, and general welfare of the inhabitants of the municipality.”

The court noted that the ordinance did not prohibit “running a red light.” Rather, it “prohibited the presence of a vehicle in an intersection when the traffic control signal for that intersection was emitting a steady red signal for the direction of travel or orientation of the vehicle.” This distinction was crucial in lowering the city’s standard of proof and otherwise making the charge legal.

The court’s analysis of public safety was justly ample. The ordinance said that red-light cameras prevent accidents and pedestrian injuries, improve traffic flow and reduce the public cost of emergency response. While not noted in the court’s opinion, research indicates that red-light cameras actually achieve these goals.

The problem seems to be in the operation of red-light cameras. Critics claim that cities are just trying to raise revenue, that public safety is a convenient platform. A recent USA Today article talked about questionable practices by red-light camera companies, such as contractually preventing cities from lengthening yellow light times. The fact that the industry has lobbyists at all should say something about the money and influence at stake.

The car owner in Nottebrok will probably ask for review by the Missouri Supreme Court.  We don’t know whether the court will hear the case, but it is evident that red-light cameras are increasingly common and controversial. Look for them at an intersection near you.

Lastly, there is an update on a prior column about property owners at the Lake of the Ozarks who faced losing houses and other structures built on their property (Lee’s Summit Journal, Oct. 21, 2011).

The owners had all built structures within an area designated as a no-build area under Federal Energy Regulatory Commission regulations and Ameren project boundaries. The Commission has given Ameren until June 2012 to redraw its project boundaries to presumably exclude most of the affected property owners. I expect that Ameren will do this, but at this point the ball is in its court and up in the air to some extent.

In the meantime, property owners are nervous. Some have already filed suits and more are likely to come. Law and public relations are colliding in this case, just in time for election season.

[Ed. note: This post was originally published in the Lee's Summit Journal on October 21, 2011.]

In real estate, paperwork is important. A recent article in The Kansas City Star about Lake of the Ozarks property brought the lesson to light.

Thousands of lake house and condo property owners were recently told to tear down about 4,000 “non-conforming structures,” including homes, gazebos, docks and entire condo buildings. All these structures are built on the lake, below a buffer zone required by Ameren Missouri. Ameren operates the Osage Hydroelectric Project and is required to keep the buffer zone as a condition to its federal license to sell electricity.

If upheld in its current form, the order will cost people a lot of money. Affected property owners have loudly voiced their opinion. Ameren is fighting the agency ruling, to this point with no success.  Lawyers are surely scrambling on all sides. As it stands, every property owner within the area will have to take down any structure on their property that lies at or below 670 feet above sea level.

How did this happen? The scrambling lawyers will have different opinions about that, but one question will be whether the affected owners had notice of the buffer zone when they bought the property. Notice could come in lots of forms, but is usually on the public record at the local recorder of deeds office.  Every time someone transfers a right in property, it should be recorded. If it is, whatever rights are granted or reserved will be spelled out in a deed or related document.

The Recorder of Deeds for Camden County told The Star that “corners were cut (when the Lake was developed), banks weren’t asking for surveys, nobody asked about setbacks. A lot of stuff got built where it shouldn’t have, and nobody noticed.”

If you’re a property owner, that is generally not a good thing to hear.

Even if the affected property owners ultimately get to keep what they’ve built over the years, if the buffer zone was recorded before they bought their property, the burden will be on them to fight it. They’ll have to expend funds for legal counsel, title reports, accountants and possibly filing fees, and will have to endure some degree of emotional distress.

This is not a political issue anyone will want to tackle, especially with election season approaching. I expect the property owners will keep what they’ve built in the buffer zone, possibly in some negotiated different fashion, but they will have to continue to endure the stressful process of litigation.

For you, the lesson is to seriously look at contracts, title reports, deeds and other paperwork affecting your title.  Your bank and title insurance provider will look at them, but you need to as well. These will all be part of the large stack of closing documents. Get them with enough time to read and understand everything.  The lake story appears to be riddled with people and companies that didn’t read or catch important language in their real estate paperwork.

What you may see as simple boilerplate can have a heavy impact. Sloppy transactions can breed a whole host of issues in real estate. This just happens to be the latest example.

[Ed. note: This post was originally published in the Lee's Summit Journal on September 30, 2011.]

I hear a lot of great “how to work with your lawyer” questions, many times from clients. This week, it was during a meeting with a team of insurance agents.  “When should someone look at their estate plan?”  We could have talked for hours.

While similar legal tools might be used in many estate plans, the people factor behind each plan is always different.  If you consider complexities of frequent career moves, increased entrepreneurship, blended families, domestic partnerships, special needs and greater access to charitable giving, it’s easy to see how everyone’s estate plan is unique and will change throughout life. Each life turn could require you to put a plan in place or revise the one you already have.

Whether from a wealthy relative, the lottery or a career boon, if you find yourself with wealth, it’s crucial to have estate plan documents in order.  This goes for anyone, at any age, regardless of whether kids are in the picture.

Say you’re a young adult or unmarried without kids.  At this point, unless you’re caring for a friend or relative, you’re pretty free and easy.  If you don’t have much, it’s still good to have powers of attorney in place. If you have any assets at all, an estate plan is crucial to ensure those assets are managed according to your wishes.

Say you get married or remarried. Young, married couples should have the basics in place.   If you marry, it’s a good time to call your lawyer or find one for the family.  Remarriages are particularly important, as they may bring kids or estate plan documents from a prior marriage.

Say you get divorced.  Estate planning is a good way to start your new life.  It may involve revoking documents you adopted with your former spouse, and provides a good building block moving forward. If kids are in the picture, you could have important guardianship issues to address.

Say you’re a first-time parent. Kids change everything, right? Just as you schedule doctor appointments for your bundle of joy, you should talk to your lawyer about drawing up guardianship documents.

Say you have multiple kids who are still young. Having young children brings its own set of challenges, which can affect all aspects of life.  When additional kids come along, you finally get that life insurance policy, or a child reveals the extent of special needs, it’s a good time to revisit estate plan documents.

Say you become successful.  Work promotions or business transactions may bring you an asset base that needs an appropriate estate plan.  As your career progresses, especially at important milestones, have a coffee with your lawyer.

Say your kids go through adolescence.  As kids move through high school and college, interests, abilities and proclivities start to solidify.  How kids fit into your estate plan may change from the basic plan you adopted when they were babies.  This is especially true for business owners, who may – or may not – see the business’s next generation take shape in their kids.

Say your kids become financially independent. While this bullet may make you chuckle, your estate plan may change as the kids leave your the nest of gold. Guardianship issues go away and needs change for you and your kids.  You may also acquire new assets at this point, which need to be folded into your estate plan.

Say your kids have kids.  Grandchildren literally bring a new level to your estate plan.  They have their own needs and could play into tax planning strategies.  As grandkids enter the picture, it’s a good time to have a coffee with your lawyer.

If you’re a business owner or have a long history with an employer, and as you see retirement in the distance, it’s also good to look at your estate plan. There could be strategies to implement now that have important effects down the road. This is especially true if your strategy is to reduce your asset base or transfer ownership of a business.  Don’t wait until retirement for this.

When you finally retire, it’s also important to look at your estate plan. Your situation has likely changed since you last adopted estate plan documents.  For some, it’s crucial to finally adopt an estate plan at all.

Your estate plan is truly unique to you.  Keep an eye out for life developments that might impact your path.

[Ed. note: This post was originally published in the Lee's Summit Journal on September 16, 2011.]

Divorce. Breach of Contract. Default on Loan.  Suit on Account.

Getting sued is usually not a good experience. It’s adversarial, probably the last straw in a bad relationship, and will cost money, time and emotional resources.  The cynic would say that lawyers are the only ones who enjoy litigation. How you deal with a lawsuit will impact your experience with it. Litigation will never be described as fun, but you may be able to make it less bad.

When you’re served with or first see a suit, take a deep breath and read the paperwork in front of you. At that point, you’re on the clock, but you have time for a level head. Make a copy of the paperwork, get out your red pen and make notes. Are facts correct? What dates do you see? What does the suit ask for? Where is the court?  When do you have to respond to the suit?

Nothing you read is presumed to be correct, and it is most certainly biased. Remember that what you’re reading is designed to logically and coldly argue a point. A good litigator will zealously argue why you are in the wrong, without knowing or caring about your side of the story. As you read, organize your thoughts with as little emotion as possible. This won’t be easy, but it will help you manage the path ahead.

It’s good to have a go-to lawyer on your contacts list.  Your lawyer may only help with your will, trust or traffic tickets but probably knows a litigator who can go to battle for you. Your lawyer may also be able to interpret legalese, investigate procedural status or help determine what the suit is demanding. Unless your lawyer has a conflict, he or she may even talk about the substance of the matter, helping you identify key issues right away.

Line up financial resources. In many instances, your litigator will require a case advance, and often the matter can get pricey. If you don’t have a strong defense, it may make sense to gather enough to settle the matter. Either way, look at savings, a line of credit or loan options. You may not have to tap into any of these, but lawsuits deserve low expectations when money is concerned.

While you have a right to defend yourself, it can be a risky proposition. At a minimum, gather enough for a paid consultation with a litigator. Even this, though, won’t provide you the protection of having a lawyer enter his or her appearance on your behalf. Sometimes it makes sense to work with a few lawyers, as litigation touches many areas of the law. Business and bankruptcy lawyers often help with projects made necessary by litigation. If you are a business owner, make sure your business lawyer is in the loop. Assess what you have to lose and allocate resources accordingly.

As you assemble your team, remained focused on what you value. This is important, as you’ll be directing your attorney on strategy and settlement offers. If the best interest of a child is your main value, keep that in focus as the emotion of divorce takes hold. If you want to keep costs in check, manage ego as business litigation heats up. This can be especially important if you’ve retained a particularly zealous litigator.

Practice patience. Whether you experience discovery or a clogged docket, your matter will almost certainly last longer than you expect.  In most circumstances, a delay in a matter is completely normal. Your mind might be racing, but your case is not. Use delay as opportunity to tend to everyday business. Exercise.  Put money away. Stay on top of future court dates and discovery schedules, but do your best to compartmentalize spikes in stress caused by litigation.

Litigation is the dispute resolution method of last resort. It has been designed to provide all parties with a methodical avenue to present evidence that supports their points of view. Keep this in mind as litigation and emotions heat up. Define victory and play to win.

[Ed. note: This post is a rewrite of an article for Missouri Lawyers Weekly, October 24, 2005.  It has been retooled for non-lawyers, and was originally published in the Lee's Summit Journal on August 30, 2011.  As the real estate market starts to rebound, investors are looking at the Self-Directed IRA strategy once again.]

THIS POST IS FOR INFORMATION PURPOSES ONLY, AND SHOULD NOT BE USED IN PROMOTING, MARKETING OR RECOMMENDING A PARTNERSHIP OR OTHER ENTITY, INVESTMENT PLAN OR ARRANGEMENT.  THIS PUBLICATION IS NOT INTENDED FOR USE AS A MEANS OF AVOIDING PENALTIES.

“Self-directed” IRAs are a common method of investing in real estate. Sometimes marketed as “private money lending,” it’s a strategy you might be hearing more about.

With self-directed IRAs, an IRA is used to invest in real estate projects, with all common IRA benefits. Purchased assets include real property ownership rights, secured promissory notes, and ownership rights in various investment entities.

The individual retirement account is a staple of most financial plans. It has been referred to as “the tax shelter of the people” because of its great tax advantages and easy accessibility.

During the last real estate boom, self-directed IRAs gained popularity on the coasts.  Sometimes called “real estate IRAs,” self-directed IRAs were also discovered by Missouri and Kansas investors. The term “self-directed IRA” is not found in the Internal Revenue Code.  Although firmly rooted in basic IRA law, a self-directed IRA is essentially a marketing term used to describe a particular organization of an IRA’s fiduciary powers and duties.

An IRA is a trust. Under specific statutory language, an investor contributes an asset (cash) to the trust (the IRA account). The trust then “directs” its money to a particular investment, typically stocks, bonds and annuities. A stock broker typically manages the account’s investment (as a fiduciary) and serves as the IRA’s trustee. The broker exercises virtually all fiduciary power in crafting the investment.

With a self-directed IRA, you keep most of this power. While a custodial trustee holds and administers the IRA account, you direct the investment, instead of a broker. You determine which investments are appropriate for the IRA, and you tell the custodian where to invest the IRA account.

The IRS does not put many limits on the types of assets in which an IRA may invest.  While IRAs typically invest in public stocks or mutual funds, self-directed IRAs commonly invest in real estate, private business entities and commercial paper. The only investments precluded by the IRS are life insurance, collectibles and certain prohibited transactions.

Therefore, you can use IRA funds to invest in a real estate deal or a promissory note, presuming the transaction comports with IRS rules. Within that investment, any gains (or losses) accumulate with all IRA tax advantages. In fact, all traditional IRA rules apply to self-directed IRAs, including contribution limits, tax deferral or exemption rules, and required minimum distributions.

While the strategy is legal and has a track record, there are a few extremely important points. How does a self-directed IRA work? First, you determine whether a self-directed IRA is appropriate for your portfolio. Next, you or a designated representative sets up a self-directed IRA custodial account. Funds are then deposited, transferred or rolled into the new account. Once the account is funded, you direct those funds to your selected investments.  The custodial trustee disburses the funds in exchange for indicia of asset ownership, such as a deed, an LLC membership interest or a secured promissory note.

At no point in either setting up an account or funding an investment should you receive a distribution of any part of your IRA account.  Setting up a self-directed IRA simply involves the movement of funds from one IRA account to another, presuming you are not creating the self-directed IRA account with a new deposit.

Your fiduciary power and duty are important to the self-directed IRA strategy. You choose which investment is appropriate for your portfolio, and you assume responsibility for assessing risk. It is your responsibility to research, verify and analyze things like market conditions, valuations, financial projections, liquidity and legal parameters.

The law prohibits you and other “disqualified persons” from engaging in a wide variety of transactions. Disqualified people include you, any of your ancestors or lineal descendants and entities in which you hold controlling ownership or management rights.  Be mindful of any conflict of interest you might have in any investment made by your Self-Directed IRA.

Roth IRAs present another issue. While a Roth may be used as a self-directed IRA, the IRS will watch it more closely. Any transaction between your Roth and a related person (who may not even be a “disqualified person”) must be reported to the IRS. Be mindful if a Roth is involved in your real estate deal and seek professional advice if you believe you may have a conflict of interest.

If debt is involved in your deal, you may have a few other issues to consider. If your self-directed IRA borrows money, you may not personally guaranty the loan.  There is also a “debt financed income tax” that may apply to your deal. A CPA who understands this taxation is an important part of the self-directed IRA team and should be consulted at the start of the investment cycle.

Finally, note the consequences of running afoul of the law. If your self-directed IRA is not executed properly, there is a risk that the IRA will be considered “distributed” to you. Presuming you are not at an age where you may begin taking distributions from the IRA, there will be at least a 10 percent early withdrawal penalty on the amount of the account, plus income tax at your applicable rate. The IRS also places a 15 percent tax penalty on each prohibited transaction, and an additional 100 percent tax penalty on each prohibited transaction that is not corrected within the taxable period.

By using the self-directed IRA strategy, you can incorporate private investments into a perfectly legal retirement structure, and can enjoy gains on a tax-deferred or tax-free basis. You should understand the limits of the strategy, in addition to any benefits that might apply to your particular situation. It’s your job to research, verify and analyze things like market conditions, financial projections, valuation, risk, liquidity and legal parameters. This applies doubly if your IRA will have business partners. If the numbers look promising, but you need help, speak with a professional in the relevant investment’s market.

An IRA is a “personal savings plan” designed to provide for retirement. A self-directed IRA is no different. Retirement is the target with this strategy; you should maintain perspective and map the plan accordingly.

[Ed. note: This post was originally published in the Lee's Summit Journal on July 8, 2011.]

The Casey Anthony trial has come to an end, much to the disappointment of talking heads everywhere.  The not guilty verdict has caused a ripple throughout the Twitterverse.  Observers have mostly bemoaned the failure of the American justice system.  Famous legal pundit Kim Kardashian notably commented, “WHAT!!!!???!!!!  CASEY ANTHONY FOUND NOT GUILTY!!!  I am speechless!!!”  Retweeters quickly pointed out that Kardashian’s dad helped OJ Simpson escape criminal liability in what was the seminal modern made-for-TV trial.

Needless to say, the Anthony case has highlighted a sometimes massive disconnect between actual litigation and the thrilling and crystal clear soap opera many have come to expect.  How does the Anthony case relate to your legal world?

Litigation usually involves issues that are deeply important to someone. In the Anthony case, the issue happened to involve the horrible death of a child. While most cases will deal with issues that pale in comparison, they will still offer some degree of passion, emotion and potential loss or gain.  Ms. Anthony’s life and liberty were at stake here, but in many cases the issue is money, child custody or the ability to freely use one’s property.

This is in stark contrast to the plodding, often emotionless nature of litigation. Criminal and civil cases all involve a heavy dose of rigid procedure, verbose motions, dry hearings and lots and lots of down time.  Most often, a case’s excitement is manufactured outside the courtroom by either the parties themselves or third parties who have a stake in or merely an opinion on the matter.

This paradox between anticipated excitement and dull reality sometimes comes as a disappointment to people.  However, it most often produces a unique brand of prolonged stress for the parties to a case.  Hurry up and wait.  And wait, and wait and wait.

This massive pain in the neck is exacerbated by a lack of clarity that stands in sharp contrast to the simple yes or no outcomes of legal fiction.  In civil litigation, results are rarely a winner-take-all scenario.  In criminal litigation, like the Anthony and OJ cases, any lack of clarity usually benefits the defendant, much to the dismay of anyone following the trial who thought for sure the defendant did it.

The clear-as-mud phenomenon is a result of the requirement that evidence must build the case. In every case, each party will either present evidence or attempt to refute evidence in order to prove its side.  Each building block can involve its own long process of back-and-forth, with lawyers attempting to exclude some evidence, minimize other evidence or convince a judge that certain evidence must absolutely be presented.

As a client, it’s important to remember that evidence is king.  While your lawyer may at times appear to be zigging while she should be zagging, it may be that she is attempting to set the stage for the next piece of evidence or for an anticipated motion. Of course, each step takes time, which leads to frustration. In the Anthony case, each step fueled the talking head machine and surely wore down everyone involved. It often helps to remember that the process, while maddening at times, is a controlled progression.  In some countries, whatever “process” is in place can be arbitrary and overtly corrupt, with few or no evidentiary rules.  While not perfect, the American legal system at least lets your attorney (whom you have a right to retain) strategize on your behalf, build your case according to established rules of evidence and receive notice of everything happening with your case. Your lawyer can help you deal with litigation by keeping things in perspective at each step.

Most importantly, you should be realistic about your expectations, because, as noted, the outcome of your case will rarely be a black-and-white scenario. Evidence may be wholly or partially excluded, a judge may interpret a law differently than your lawyer contends, or you may catch a jury on an off day.  Sometimes, as has been speculated in the Anthony case, you or your lawyer may simply rub a jury the wrong way.

The Anthony case has certainly been a hot topic the last few years, but lots of people go through the litigation process every day.  Granted, you probably have less at stake than Ms. Anthony, but the process can be to a lesser degree confusing, frustrating and sometimes just plain insane.   Your lawyer can help you maintain perspective.  She can help you keep a healthy expectation of what might come of the matter and when.  Control what you can control, and do your best to forget about the circus that might be happening outside the courtroom or your own head. At the end of the day, you can probably rest assured that a Kardashian is not Tweeting about your case.

[Ed. note: This post was originally published in the Lee's Summit Journal on June 9, 2011.]

Last weekend gave me an opportunity to experience how a community should work.

“Smart use of development tax credits,” you ask? Maybe a swift and efficient response to a natural disaster? A savvy political deal made to address a particularly sticky issue? Nope, although I’ve seen all of these in 10 years of practicing in Lee’s Summit.

More important for this article, what does this have to do with working with your lawyer? In a minute.

Last Saturday, about 200 Rotarians from throughout Missouri gathered to celebrate a great honor for Dan Hall, member of the Lee’s Summit Sunrise Rotary Club. Dan is about to begin his service as District Governor for Rotary District 6040, which extends from Lee’s Summit and Kansas City all the way up to Kirksville.

This is a great honor, a testament to Dan’s leadership and commitment to service. It’s also a feather in the cap of our community. The last district governor from Lee’s Summit was our very own Carl Chinnery, 10 years ago. Rotary is the world’s largest service and business ethics organization, spurred by business owners and community leaders from a vast array of vocations. Dan is kind of a big deal.

As we were getting ready for Dan’s celebration (a roast for which I was master of ceremonies), everything was coming together perfectly, down to the potato-themed centerpieces that you can ask Dan about the next time you see him. I was even on time, more or less, equipped with everything on my checklist.

But I forgot the programs. Thud. And they were locked in the offices of the Lee’s Summit Journal, who graciously printed them for us.

Double thud.

Yes, to not have a program at an event like this would not have been good. And time was short. I was, all of a sudden, the one about to be roasted.

But we live in Lee’s Summit.

I called Journal publisher and friend John Beaudoin, who was enjoying the weekend with his beautiful family.  “I need to get into your office! Now!” I presumed the event would just have to start late; we were all the way in Independence. “No problem,” said John, “I’ll drive them to you.” And he did.

The event went off without a hitch and I was spared a good amount of personal stress and embarrassment. Although a joke or two went over like a lead zeppelin, it was a happy day for everyone, particularly Rotary District 6040 Governor Dan Hall.

How does this all relate to you working with your attorney? Of course, there is no legal issue involved in the story, except for the speed limit that John probably exceeded to get to Independence on time. To me, though, John’s good deed reminds us that we’re all in it together. The law simply helps us work with one another.

Whether it’s getting a will together, buying a business, navigating through litigation or developing real estate, people, with their lawyers, will create the tone of values that shapes communities like Lee’s Summit throughout the country.

The concept is most visible in community development, non-profit endeavors and job-creating partnerships, but it happens every day on projects of all sizes. People decide what values and goals are important and lawyers help make it happen.

Last weekend, someone helped make something happen for a lawyer. Thanks, John. I owe you one.

[Ed. note: This post was originally published in the Lee's Summit Journal on June 9, 2011.]

As we start to separate from the So-So Recession, a few legal trends have emerged.  As a planning and transaction attorney, I’ve seen from afar an uptick in litigation the last few years, mostly over debt. Business loans and vendor accounts first and then home purchase and refinance loans have worked their way through Missouri dockets. Many remain there.

Just this year, I’ve seen an upswing in commercial asset acquisition. People who survived the last economic cycle are looking at what they think are undervalued assets, including businesses and commercial real estate. Companies are also shedding off unproductive divisions and focusing on their bread and butter.  While the new real estate owners may take a while to figure out what to do with their new buys, the new business owners are, or will soon be, making rent payments, which is good.

I’ve also seen regular people look at their basic estate planning. Things like guardianship for the kids, non-probate transfers for the house, IRA beneficiary designations and health care powers of attorney are some of the “little things” that may have been put off during economically uncertain times.  For many post-Boomers, the time has happened to mean helping a parent transition to a new home or way of life.

In all of this, people have had a chance to revisit old paperwork. Deeds, promissory notes and vendor contracts have all been dusted off for use in litigation, estate planning or just a little legal housekeeping. This is proving to be an important exercise, especially when life or business situations have changed since documents were signed. Estate planning documents, for example, may have been signed when the kids were kids or when portfolios were inflated. Most estate planning documents were also drafted before the big 2011 estate tax revisions.

In some cases, defective or air-tight documents are making a big difference in the outcome of disputes. The latest real estate boom and bust created a plethora of faulty legal documents, especially in home buying and refinancing. Reports started coming out last year of courts creating dockets just for these cases. Enterprising attorneys have created quick niches that specialize in past home loan and refinancing procedures. Most of you know one property or another that is bogged down in litigation or is headed that way.

US Bank v. Cox is a recent Missouri case that highlights the bubble’s confusing glob of paperwork. In that case, a wife borrowed money and put up real estate as collateral. The real estate bust came. She defaulted on the note. The bank came after both her and her husband, but the couple argued that the husband wasn’t liable. For proof of its case, the bank introduced what the court found to be documents with the husband’s forged signature. Needless to say, the bank lost.

While a forged signature is pretty serious, there are a litany of other ways that paperwork can and probably was messed up during the home financing feeding frenzy. Many are finding it a good idea to look at the deed to their house, update it if necessary and then keep it in a safe place.

As we look to the second half of 2011 and beyond, we’re sure to hear differing opinions of whether we’re at the bottom of the bust, especially with an election year coming up.  Many are taking care of the little things now, taking advantage of good buying opportunities and waiting for the malarkey to fly as campaign season heats up.

[Ed. note: This post was originally published in the Lee's Summit Journal on May 27, 2011.]

When does working with a lawyer go from being a luxury to a good idea?

That’s a real question from a real client. It brings up a great point. When do you call your lawyer? You don’t want to spend money on unnecessary attorney fees, but you need to protect yourself.

There are obvious call-your-lawyer situations where it’s just what you do. Getting arrested, for example, is a situation in which most people bring in legal help. Being sued is another example. In these cases, the risk of taking care of something yourself is just too high to go without counsel. In many respects, your own tolerance for risk creates your trigger point for calling your lawyer.

Other situations may not be so stark, but give you the feeling that you should probably call your lawyer.

Sometimes it’s a suspicion that, as my client put it, you are about to be screwed. This could involve a business deal, a probate matter, an insurance settlement, a real estate deal or other similar situations. Major life transactions, like getting a will together, buying property or adopting a child also fall under the should-call category.

There are some common situations in which people handle their own legal affairs, but then call an attorney to fix problems with those matters. Signing a contract, setting up an LLC, becoming incapacitated, entering a partnership or receiving an arrest warrant are all situations in which a lawyer should have been retained earlier.  In most cases like this, it costs more to solve legal problems than it would have been to take care of the matter correctly in the first place.

It is virtually always better to talk to your lawyer sooner than later. Ideally, this would come the moment a matter starts coming together.  Some would say you should call your lawyer when you first think about whether you should talk to your lawyer. Oftentimes, your attorney will also have good insight on non-legal aspects of your matter.

This is when the issue of luxury comes into play. Do you want to spend money on something that may not materialize? If you manage the situation correctly, that question might not come up.  A quick email or a cup of coffee could facilitate thoughts from your lawyer that, while valuable, would be at no charge. The answer you take away could be “nothing needs to happen now, but let’s follow up in a month.” It could be “I’m glad you brought this up now, we need to move quickly.”

Most attorney-client dynamics can be strengthened or improved by clear communication. This should not only include honest and thorough communication about the facts of a matter, but also the issue of attorney’s fees and the general costs of the matter. Many would say the same thing about every relationship.

[Ed. note: This post was originally published in the Lee's Summit Journal on May 13, 2011.]

Do-it-yourself law has been a topic of this column before. You’re undoubtedly aware of DIY websites that offer an array of legal services.

Estate planning is a hot area for DIY law. The website www.leimbergservices.com recently covered the issue in the article, “From Zoom to Doom: The Risks of Do-It-Yourself Estate Planning” (Steve Leimberg’s Estate Planning Newsletter Issue 1808, May 4, 2011). This is a subscription-based website, but I highly recommend it for financial planners, accountants and attorneys.

“Zoom to Doom” recognizes that DIY law has proliferated proportionately with the rise of the Internet. Millions of people have used DIY websites to prepare estate planning documents in the last 10 years. The article talks about the convenience of DIY law, but also points out that there are risks in “putting legal decision making in the hands of novices.”

It stops short of disclaiming DIY websites altogether, but certainly reminds you, as this column has before, that legal decisions are serious, can have long-term impact and shouldn’t be taken lightly.

Increased use of DIY law can be traced to a convergence of factors. The rise of Internet usage, coupled with a general lack of estate planning, plus cheap DIY prices have all made DIY law a viable option to everyone, regardless of the size of the estate. DIY law has been slickly marketed as a convenient and cheap method of delivering legal services. LegalZoom alone claims to have served more than one million customers.

These websites claim to not offer legal advice. They typically have customers agree to multiple disclaimers attesting to this. However, DIY website marketing lets you know that they can help you “minimize estate taxes,” deal with guardianship issues and assist estate administrators.

Of course, the sites advise that you consult with an attorney before finalizing any document they prepare, presumably because they know they’re helping you deal with serious stuff.

“Zoom to Doom” points out a few potential problems. Document formalities, which differ from state to state, may be deficient. Conflict of interest rules may be impossible to screen if, for example, a beneficiary of an estate will also be a witness or trustee in the planning documents.

Necessary verbiage, such as self-proving affidavits, which make it unnecessary for witnesses to appear in court to affirm a will’s validity, may be incomplete or nonexistent. Changes in the law may also not be addressed as years go by after you download and execute the initial DIY documents.

Each of these pitfalls could have disastrous effects on someone’s estate. This would be the “doom” part of the article. “Zoom to Doom” sets out a few ways to fix problems that arise after DIY law is practiced, but each solution would inevitably involve retaining counsel. Yes, a will can be completed in 15 minutes for $69, but it would cost many times that to fix, undo or otherwise deal with any problems created by the online convenience.

My big take-away from “Zoom to Doom” is that the market will probably blend the good aspects of online technology with at least one thorough talk with a licensed attorney about life’s big picture.

Lawyers are already using web portals, virtual meeting technology, digital document review and cloud computing. They also continue to meet with clients, investing time learning about individuals’ values, family structure, goals and wishes.

“Zoom to Doom” appropriately ends by highlighting the fact that you, the client, are the center of any legal project. As each life is unique, your estate plan should reflect your own, organic path.

Attempting to capture this during a 15-minute, $70 computer session has the potential to miss the twists and turns your lawyer is trained to catch. While I’ve made this a message to you, the article says this squarely to the lawyers and trusted advisors out there.

Our biggest point of competitive difference against DIY law is the ability to share a coffee with a client, listen to that client’s story, effectively capture all the client’s wishes in the final estate plan and be there as the law and personal circumstances inevitably change.