Lawyer 11 90 web by Alabama State Bar Association

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Sulle 340 Birm ingham. Alabama 35242- 48 20

Te iophOl"l8 (205) 980-0009

Toll Free (800)526- 1246 FAX (20 5) 980路9009

路CHARTER M EMBER; NATI O NAL ASSOCIATIO N OF BAR路RELATED INSURANCE COMPAN IES.

T!J [?)[j'@@i]~@[j'@ [?)[j'@@]ClD©~© ~@[j' ® .FO:l.. SOLID ~O®[Q)®@i]® [?)[j'®©~~©@ Automobile Insurance Law by Davenport Cl 1989 Criminal Offenses 8. Defenses in Alabama by ChlBrkas. Chiarkas. & VB/gas

· 1982 Criminal Trial Practice 2nd Ed. by ChiarkBs 1\ 1988

Criminal Trial Practice Forms 2nd Ed. by Chiarkas Cl 1988 Divorce. Alimony & Child Custody w / Forms 2nd Ed. by M cCurley & Davis

· 1988 Evidence by Scl)foeder. Hoffman & Tiligpen Cl 1987

Equity 2nd Ed. Tilley's by

Hansford ~1985

Law of Damages 2nd Ed. by Gamble Cl 1988 Limitations of Actions & Notice Provisions by Hoff ° 1984

REV/SEDI Workmen's Compensation w / Forma 2nd Ed. by Hood. Hardy & Saad ° 1990

EXPANDEDI • Including Current Supplement. if applicable.

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THE

M HARRISON COMPANY, PUBLISHERS 311 0 c ' o...... ~ .. ~. P Olio. 1500 ' No<"o". OA 30091.1500

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317

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VOL. 5 1, NO.6

NOVEMBER 1990

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Mon j,omery aU lst Tom ConrlOI palnjed the NovemOO. covel. Con rlOr Is. well· known w.lIO:rc;ol.,..iS1. ~nd tt.c ~OYcr I",;nllnll I~ kb 'Cf-"Wlion of ~te AI~b;l",o1 Sr~~ B~' he;>Oq\I;l~~"'. followlnM complcrlon of tile addi tional 32.500 S(Jua,e f~t of consuuctlon cu"cntly UtldefWay. Con\trucrlon on rho ;Wdl tlon OOJI;tn Octobe, t ~nd the estimated comll101 lon ddte Is Sep!rmbe, 1991 . Once 38-,ln, ~II h.I! ~,~i.l! i(\n 3Ctl"ltll'$ wllllMl linde, 0'1I:l 'QQf. The ~utrent b\III\1lnll will ~n\lt .g~ «)ITl~ renov.,tlon when the !lew IIdIl,tlon Is nrllhed. with ~ final p.ole.:t cOnlpk~l()n date of J~t!ua.y 1992Ou,lnS constrVCllon. jfWcry member 01 Ikll Alawma Sw e Ba' will be asked to make a If lnlmum pll'(ise of BOO tow,,,d tk i~ p'ojo:cl, Pledlles would be p;l y"bl.;: OYI:' a Ik,CIl-Vi:~' Jl'Ilriod. I'II1sldem Alhdtton's coluFT'n In Ihll. l'SUi! Ild(h~~ the need (m Ih i! e.p.1n ~IOt\. With the conSI, VC llon of t~e now ludldal bulldlnll urodefWay across tke ~treel from tht \)ar headQuatters arod with Qu. own new 1.,~lIi l e•. J;Iwy<!" on(t ~H~ ln will h~ve a " i1r)me AW~y IF"", kome" In wllll;h 10 wOfk and nleel c!lent~. Ou, ba, commissioners again will have adequate space In whiCh to mo!el. And. la;t but no! leasl, Oncll ~H~ln we will kaye vlslto, p;lrldnM.

INSID E THI S ISSUE - - - - - - -- - -- - -- Issues in the Sale of a Small Business Under the Alabama Business CQrporation Act - by Mi chael D. Waters and Daniel B, Graves .. ".".," high, the sale of a small business Involves significant legal conside rations.

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Alabdma Siale 8M Hudqua,lers Siail P.O. Oox 671 • ~ IS Do xtl" AV'lnuc ' Monl!lOfTl~ry, AI~bam~ 36101 l20S) 269. 15 15 Executive Di.ecl(1r . R'lllinald 1. I f ~mner, CAE ,. Kellk 8 . NQ,man Dinlclo. of f·'QII.~ms fOe(utlve A!sI 5 1~nt Mafgarel 900ne Publ lc~ t,OIllo Oi'lICfof .. Ma'ga'et Mv.pI!y Adm bslons Seefeld ry, N t:llm~ ), Robbin, Membership Serylces . ,Alice JO Hllndrl~

MClE '" Commi ttee Srcrc1a'y Diane We ldon financ;I,,1 Sllcre!~ry C. I'l Skin"", laWyer H.efef,~ 1 Sectet~ry , loy MelnlnSef G.apklc Aos SUpclfVISOT ••••••• M<Ll\8ia SIUIJ Cf IOL TA Di.IICIOr •......... , , , ,. T.<w:y D.tnlel ~Kep!lonl!t . Evelyn MCCulloch

AI.b.tm~ 5l.1 tl: 8~, Cenler for I'rofenlonal Respon!lbllil y 1019 Sovlk Perry Strl.'Cl • MonljjOlTlIlry, Alabam~ 36104 12051269. 1515

Ge~r"1 Coun",1 .. RobeU W. NQrrl, Asslst<Lnt G~eral CounSl!1 ... John A, YunS, IV As!blolnl General CoonSl!1 A le~ W. I~ckson A"iM~nt G~n~.~1 Coun~ .. J. Antl>onv M<;Laln

Adminlw~tlv'l St~ll .

F.ccmM Ruth S" ld land Cheryl Rank in 8onn; ~ M31nor

V v;~n

41 56, Mont@omery, Al ] 61 01.

318

November 1990

President's Page Alabama Stale Bar Association

8M Reporter; the crealior\ of eommlUC<!s and t<l sk (orces now numbering 46 which involYe <Wer 900 ~Iurl teer lawyers <I ~ ross the front of our bellutiful hcadquancrs building on MOn!in b(lr work: Ihe est<lblishment of 15 secgomcry's [){!xter Avenue. tions dedic(lted to specialized intercsts JuSt as our pro(cssion hM alwilyS bt.~n of Iheir memberS; ilr\d one of the counIn the centerol governmental activity, so, try's most successful IOLTA proHrams, too, is our association's headquarters-a which last ~ar procesS(!(j 51 requests for part of the stale's govcrnmemal complex assistance and dealt wi th $934,000 including the Capitol, the supreme court received from tru st account s at no cost (Inc! the sMtc office buildings. to partiCip(lting members, And, just as governmental functions An area of m<ljor un<lvoid~ble growth and r~5 Jl(Insjbjli'ies h(lve grown throul!h has been the handling of I<lwyer the years, the sam.:! thing has happenr..od diScipline and other activities of the to our state bar. g~nl!ra l coun scl's office. In 1964, k"W In 1964 whcm our building wa ~ con1;0nll,l(liI1IS were filed aHainst lilWYCrs, structed the number of lawyers belongl ast year Ih~ num~r was 988. If we ilre Ing to the Alabama State Bar totalled 10 maintain our ~xj s ting system of selfdiscipline, ralher Ih(ln having the flM'Cr than 2,200. We now number over ALBRITTON 9,200, <lnd we continue to grow larger disciplining of lawyer5 taken O\ICr by every yeilf. some commi ssion outside of the profession, we must be In 1964 our building was slil1e-of-the-art <lnd justi(i"bly able to thoroughly investig<llc and dispose of these com路 II source of grea! pride to our members. Not only was il 1)laints. And the disposition must be timely, <It least <IS beautiful both ouglde arId within, bUIlt W,I $ fun cli(ln.ll, much for the bl:!nefit of the lawyers 1rM)1~ <IS for Ihe comIllainants. Additionally, the office of general counsel Issues totally adequate for current needs, and seemed large enough for marly ~arS to eOiM. MemberS and guests binding wriltl!l1 lind oral non-binding I!lhics opinions 10 enTcred a I<lrsc reccptlon room with comfonable sofas and requcsting law~rs. Thcse lotalled 117 "lid 1,100 respecchairs. A vi siting lawyer's office was availablc, as we/I as tively las\ ye<lr, while such opinion requests were r<lre 26 01 sm.lll library and conference room, where out'O('lown years <180. Also, the number of lawsuits In which the bar lawyers could conduct business, ,mc! meetings on bar is made a party continues 10 increare. buSinl:1SS could be held. Ample Slorage space exi sted and Walk into our he<ldquarter5 building today and you will our bar association was well-housed. re<:ei~ quite a different impression of our associ<ltion (rom M~ny changes caused the association's ne<.'(/s for the a visilor of 1964. If your visi! rcquires you to wait in the physical planl to Increase since 1964. With the number rt."Cl!ption room, yQI) will stand, beC.luse 50fa ~ ilnd chairs of 1i"tW'{(!rs 81"O'Wing by O\ICr 300 percenl, the number of have 8ivt!n way to additional desks for hard-v..orking STafstaff nceded 10 service their needs and admissions mat路 fers who perform Their duties over Ihe constant distractions lers has grown. The addition o( nC'N program s also has caused by their location. Nl"lt only will you hil"'" no I"lffice increased the need (or staff and fa ci lities. There Include available for mccting someorle, bUI If you rleed to use a the Lawyer Referral Service, which laSI year process<.'(/ telephone the only one lwailable may be sitting on top of the duplicating machine in the print room. If you need 11,081 reque sts OI\d ger)Craled <In eSlim<lled <Wer路$350,OOO in fees for Pllrlicipating I.. wyers; the expanded and modthe conference room for a meeting, you will hilVC to disrupt ernized Alabama Lawyer and Bar Dlrecfory; the A/JbamJ the work of Ihe IO lTA fund s director, who works ilt a small (co mln(led on IJdge 322)

320

he n(lme is I)roudly emblazoned

N(WflmOOr 1990

Executive Director's

Report HAMNER

Thanks, J.A.Y. IV

am using this November SJ禄(e 10 (,,,press my sincere appreciat on to

a colleague whose dedicilted ser路 vke to the Alabama State Bar has been Qutsr;mdlng. Johr\ A. Yung IV hI's submllled his reslgllatlon as asslst'lIlt general

counsel of the Alabama State Bar, effective December 3 1, 1990. John will have served the boll (or ten and one-half years. John's counsel to the bar has been of Inestimable value. He is possessed of a work ethic seldom seen in loday's $Otlety. He has a kt.>(lfl ilm;1 crCilrive mind; however, John's sense of right and wrong- and his disdain of the latter to any degree- has mad!" him Ideal (or the position he has so ably filiI!<!. I recall well John's rIot I nfr~u(!nt needling about perceived or reported

lohn A Yuns IV

The Alabama lilwyer

pmfcssio"al wrongdoing in Qur p'ofession long be(ore he Joined our ~l3f(. He alwnys wantoo 10 know what we were going to do nbout it and when . John's comments were never made In a \llndlc路 fconllnucd on va8e 323)

J21

~~~"~j2~~nOJ Page desk in the corner. If record s are need·

ed, they may be in One of the file drawers or

bo~e§

Ihm have spilled OV(!r In[o [he

commissioners' mccting room or they may be In 11 stori1gc room being renled In another pan of [QY,In . Do not ask for tlnil gencml cmmsel or ilny of his slaff,

because they arc working Qut of CQU;llly crowded facilities in 11 scparille building 011 Pcrry SlrC('1 And you will nOI ~ee a desperately nceded Investigator making I, possible !O handle complaintS lrwolving lawyer di scipline and the unautho-

rized pr,lctice oi law in a prompt manner, or iI ~I iltev.rid e (oardinalor for volunteer programs of legal aid to the poor, be· CilUSC there is nowhere 10 put them,

Ills 11 greill1ribulc to the abilities of our

staff tha t they arc able to perform in an Oulslolrlding rlHIMCr under' such adverSe condi tions. but conditions arc gelling even worsc alld we cannot expect sucn excellence In performance to continue for an indefinite period. Activity by o(hers to meet their needs for additional fllcHi tles (Ire (111 Mound us. The Capitol r()nQ\l;ttion hilS~n under-

w<ty for fmlr yeilrS, work hilS begun on the nlOW Judicia l Building, (lnd across the Slrett fronl uS tne Alllbama Educiltion Association is well inlo Ihe over·S4 million eMpill1slon of its he,ldQ\laners. AEA h(l$ stat!,.od with jU5tifiOlbic pride that Its nf.W fJciliti~ will be built without borrowing a dime. For severJI )'eMS W(: nave hlld a ta sk force at work on our eMpansion proj(ICl. Plilns now have been completed for a thrce-story Olddition whi ch will bring everything under one roof and leave un· fini~hed 5p.-'ce for the future. While there arc no ()xpcnsive frill s, this enlarged and rcnova ted new headquarters will be il thing of beauty and a source of renewed pride. Its cos t. Includlltg additional fu rnishings and equipment, will be al>proxim(ltely $3 112 million. With a lellp of faith in the lawyers of our STate, your board of commissioners, acting as trustees oi the AI(lb(lma St(lte Bar Foundmion, hilS ~ ppl'O\lt.od this important projec t. i'IW.Hck.'(! a contr{lct <lnd glvcn .:!pprovJI for work to begin. Suggestions have OOen1'r1ade that this project could be financed easily by (lssessing each member of the bar less than $400. These suggestions have beert

1990·91 Bar Directories LATE! The lillest €dition of Ihe Al{lbama St(l\e 8M's dire<:tory will be printed ,md maik-d to membfUS in January or Ft'!bruary of 1991 . The dlmclorles were orlglMlly scheduled to come out In December of thi s yeJr. but due to the large number of state telephone numbers being chllnged, and the many, m,my a!1orneys who have moved and nol sent the st(lle bar a change of <lddn_'Ss, it WJSdt.'Cided by the executive director and the! h.'lr dir('(tory committOO to exterld the! publlcatlort date Jnd "clcan up" the book. On a yearly basis, the stJ te bar will mJII to all firms a listin g of i1rorncys in that firm lind the ;lddress (street ,1nd mailing) 'l nd telephone number on file for that firm. It is hoped tha t thi s cffon will ensure a more accurate b.,r directory. dS wdl ,I~ membership records in general. You can help by making sure, In writing, that the st,lIe bar has your curren t. up-to-date, address, firm name and tclel)honc number, Do not <lS5ume th<llthe office man{lgcr has (lIken care of itt Othef'Nise, the Stilte bllr will not bt! held accountabli! for My mis$C!d mailings (d u~ rlotices. Cl E compl/Mee forms, Alabama Lawyers. etc.). For more information, please COnt.1Ct Alice 10 Hendrix, membership services director, Alabam(l State Bar, P.O. Box 671. Montgomery, Alabama 36 101 , phone (20S) 269- 1SIS, WATS tin-state Alabama onlyl 392-5660.

rej ected. This is a labor of love iJl1d our headquarters will be paid for OC'CilUse lawyers want to, not because they have to. When we moved Into our cu rrent building it wa s completely paid for and furnished by donations. Our buitding on Perry Street wa s bought wi th ildditional donations. While funds for this prOjet:1 can be borrowed on il long-term bilsis under 11 commitment presen tly in hilnd, we are confident that lawyers will respond once more to meet this need and make Ihe incurring of substantiJI debt service unnccessary. Our present b\Iildlng has iI w{lll beilr. Ing the names of the con tributors who made it possible. Eighty percent of them arc no longer with us, but their names are a continuing statement of their great fJith In our generation of lawyers. We C.1l1 do no less for those who will follow us. Fundraising will begin soon. Major gifts are alrc<ldy bein8 pledged to memoriJlize oUlstandinglJWyers, and aU members will be given the opportunity to do their I)ar!. This is your bar association and your building. ~lcaS(! respond when the ca ll COr'n~. You arId fu turt! grmeratlons o( lawyers surely will be proud that you did. •

NOTICE Newly Revised Third Edition of Sourcebook O!,."S(ribes Mt.odkal ilnd Legal DevelopmentJ Prentice Hall LOlW & Business has revised i1nd published the third edil iorl of Asbestos: Medical and L~ gal Aspects, which Includes updated Information 011 asbestos disease and worker health. W rinen by Barry Castleman, an environmental con· sultant, Asbestos: McdiCll/llnd Legill Aspecl olfers attorney s involved in asbesto s li ti gati on complete documentation on the evolving knowledge of asbestos h<l~iHd s, both in open literilture .md with particu!iIr ilttcntlon to the main defendants in these cases. The book covers asbestosis i1nd Cilncer, compensability of i1sbestosls ar'ld C:IIIc;er as occupational diseases, thresholds and standards used to determine safe or acceptable levels of asbestos hazards gathered from countless depositions, company records, industry consu ltants and trade associati ons. Asbes/os; Medit;al and Le8a l Aspects may be purCh.1Sed from Prentice Hall Law & Business, 270 Sylvan Aveoue, Englewood Cliffs, New Jersey 07633, ph o lu~ toll·free 1·800·223-023 1, or fax (201) 894-8666.

November 1990

Report fcOnlinucd from palJf! 321J ti~ or petty m<lnner. I knew then as now they were expreulons of genu ine can·

cern about professional conduct which demeaned the profession he honored.

I was listenioglo Ihe news while driving to Birmingham when I learned lohn had reslgnctl his former position In Ihe Anomey General's Office. I pulled off

Ihe highway in Alabaster, called lohn from (IIX1Y phone and Inqulrt'<l of his In· terest in joining ovr sUlff. He now could halle the oppommity to address those

concerns that we had previously shared. Th,,1 c(lll W,ISsome of the best money I ever spen!. John's deliberate and thoughtful man· ncr precluded an Instant acceptance; however he considered the OPIx>rtunlty only a short lime before acceptlnl!l. We

needed a fa lr-mind<!d, inlcliigenl lawyer

shoes a difficult task. I am going 10 miss my frequent. though brief, visits with John. John is not one for Srnail ialk. I will miss his thoughtful and often prodding memos, I will miss his 5eme of indignation when the profession Is dilmaged by the actions of a lawyer who violates his or her I)rofcssional oblig<ltions. I will miss his dry and somelimes cynical wit. I will miss his spirit of ooing free. l'lowever, I will miss most his goodness and his genuine caring for our profession and liS rcputallon. The Alabama Stale Bar I) better today because John Yung chose to dedicate il significant portion of his professional CMeer to milking It so. John has not told me of his fut ure plans- you do not IIsk John these things: however, I am confl· dent that whatever he does and wher· ever he chooses to do It, society wI!! be the beuer for his having done It. Thanks, John, for a Job well done, Good luck and God's speed. •

committed to thc ..,i80rOI,l$ upholdin8of the highest of ethical standards. Not long after John began work, I began receiving comments about John's being 100 vigorous, too prose<:utorial or 100 Inflex ible. Even a few suggestions were made that I should reconsider my decision with respect 10 his employment. I knew John was doi ng a task which, at times, could be both difficult and unpleasant. nOI to menlio" Ihankless, in a thoroughly professional manner. I was never more confident In my choice. I had seen a side of John Yung that far too few people know- he likes it that wayl He is a very privil!C person, bur one of the most generous ,lnd caring 1>O(1)le I know. John's gen(!rosity to IhOSi! In need and his overall interest In thi! betterment of the less fOrtunntC arc trtlitS I hl'lve witnessed fi rsthand. John's level of productivity and his work performance, not to mention Its quality, are going 10 make fill ing his

Affordable Te rm Life Ins ura nce fro m C ook & Associates

ASSISTANT GENERAL COUNSEl The Alabam~ State Bar now Is accepting appJlcilllons by leiter with resume from qUilllficd lawyers for the po~l t lo n of Assistant General COll nsel. These should be addressed to Alabama Siale Har, P.O. Hox 67 1, Montgomery, Alabama 36101 . This l>osi tion re<lUires an experienced lawyer with a strong IJrofessionill background . Salary commensura te with experience. The Alabama State Bar Is an C(lual opportunity employer.

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The Alabama lawyer

,....... . . . - ... "..~_ No_ LM

Bar Briefs Meyerson speaks at construction

contract litigation seminar Ed Mcyeoon,

I)anner In the firm of

Najj"r, Denaburg. Meyerson, btl-aut, Max, Wright 8, Schwartz. P.c., W{l S a fCiI!\lfl,."(1 speaker on the subject of "Claims and Disputes In the '90s" il t the XIV An· nual Constru ction Contract Litigation Scmlnar. The seminar, sponsored by The Florida BJr Continuing legal Education Commll-

tee and the Trial lawyers Section, was held in May in Tampa, florida, Meyerson is grilcll,Jilte of Cl,Jmberlilnd School of Law.

Huckaby and Ogle rc-cleClcd 10 board, Ame rican Judicature Society Gary C. Huckaby, an attorney with the firm of Bradley, Arant, Rose & White In Huntsville, Alilbamil and Richard F. Ogle, of the 8irmingh~m firm of Schoel, Ogle, Benton, Gentle & Centeno, vvere recently re-elecwd to tht: Amerit ;!n Jl,ldiC(lture S0ciety 80ard of Directors at the Society's annual mCf:th\g In Chicago, 80th Mtnl! life and Casua lty Vice-President Stephen

Huckaby

Middlebrook and former Nebraska Chit>/" Justice Norman Krlvosha were featured speakers at the Ineetlng. Huckaby, whoreceivcd both his bach· elor's and law degrees from the Unlver· sity of Alabama, Is a past president of the

324

Alabama State Bar and a member of the Alabamil Law Foundation's Board of 01· rectors ilnd the Alabama law Institute. He is also the state delegate to the Amer· Ican Bilr AssociaTion l'louse of Delegates and past chairperson of the Mandatory ClE Commission. In the past, HuckJby has served as a member of the executive commiul!C of the Alabama State Bar; president of the Huntsville-Madison County Bar Assocla· tlon; member of the Judicial Selection Panel for U.S. MagiSTrates; ,lI'Id ch.;li rper. son for the American Bar Association Lawyer Rclerral Md information Services and Delivery of legal Service committees, He received the AlnbOlmn State Bar Award 0' Merit in 1966.

Durward elected to board of gOvernors Gerard J. Durward of Durward & Ar· nold of Birmingham was elected in June to the Board of Governors the Amerl· Ciln Academy (If Matrimonial Lawyers at the organization's annu~1 meeting In Chicago.

Durward

Men1bcrs of the Academy are lll'N'r'Crs who concentrate In the ~rea of family court matters, divorce i1nd matrimonial

Osle

''''.

Durward Is a grClduClte of Birmingham School of ~aw.

A graduilte of the University of Ala· bama law School, Ogle is a member of the Alabama State Bar and the BirminHham Bar Associa tion, the Alabama law instilute and the American Trlallawycrs Association. He currel"ly Is seI'Vlng as president of the Birmingham Bar Assocla· tion. Ogle, w ho serves as an editori al f;onsult,lnt to Mauhew Bender ,lnd Com. pany and Ie<:tufe$ at the Alabama law In· stitute fOr COntinuing Legal Education, wa s a former national presidc!I'It of Pi K.1Ppa Alpha and president of Its Mem· orial Foundation.

UNA tru stees c iCCi Potts p resident The University of North Alaban1a BOllrd of Tru~Tees elected Robert l. Pott s as president In a special meeting in Au· gust attended by GO'I. Guy Hunt. Potts, the Interim president of UNA since January i , wa s one of tw(l finaliSts considered for the permanent poSition created by the retirement of Robert M, Guillot in late 1989. Following a vote by secret ballot, the board made a public vocal vote of unanimous support for Potts. After hi s appointment. Potts noted there are five areas that will require his immediate attention: reorganizing the administration (Ia'lleiy due to Impending

November 1990

through t969. Previously, he ha<l been iI Florence lilW firm and, during thm time, had served as the UNA a1l0rnL'Y. During 1970-71, he was a reSCom::her for a BaSion, MasSJchusclls, law nrm whl1e serving as art Instructor In law and a1lalnln8 a master of laws degree from Harvard University. Pons received his juris doctorate degree from the Uni· verslty of Alabama and his bachdor of arts, cum laude, from Southern MIsSionary Collcge. He also studied for a year al Newbold College In England. Pons also served as Alabama editor arId assistant editor of the Alabama taw Review. I-Ie later served on the C(litorial advisory board of The A/,1/.>amlll.llwyt'f. He has taugh t at BasIon University Law School, the Univer,;ity (If Alllt,lIInll and UNA. He was president of the Young Lawyers' SectiOn of the Alabama Stale Bar hI 1979-80. He has served as chairperson of the AI;IIl.1ma Board oi Bar Ex.1mlners,

a member of

Potts

retirementS and tempor;IIi1y.f1l1ed posi· lioos); maintaining good rela tionships on behalf of UNA wit' Ihe goo.<emof's office, Ihe legislalure and the Alaooma Commission on Higher EdUCiIIion; building PMI' ncrships wi th arca community colleges: dCV(!foping an <lSiV(!SSi\.1! marketing and recruiting program; 3Ild enhancing the new dC!VClopmenl e(fortlo build the endowme'" of UNA. Pons was Ihe general counsel (or Ihe Unlycrsity of AI.lbama SYSlem from 1964

NOTICE lawyers Cooperative Publishing announc es

new Bankruptcy Desk Guide l awyers Cooperative Publishing announces a com· I)/"chcosiv(! new bankruptcy ~rvice, The new Bankrupt. cy Desk Guide consiSISof four binders plus a slalules, rules and official forms pamphlet. The Uankruptcy Desk Guide is org..1ni;.:ed by topic, 110t Codo section or rule. Users do not hav() to be famlliarwllh the Code to look up Ihe Information they need. The test analYSiS, which includes detall(od proc~ural lJuidance, contains references 10 supporting cascs, statutes, rules, legislaTive hls[ory, and required (om,s..... lR Fed. Am Jur 2d, and other works In Ihe publisher's legal library an"! also cited. The Bankruptcy Forms Guide, a companion binder to [he Bankruptcy Desk Guide, provides O\ICr 800 forms for bankruptcy actions. It is sold scl><lraiely. For more information, call (7 16) 546·5530.

The Afab,lm,l law'let

laird appointed to 71h Judicial Circui t

Laird

Governor Guy Hunl al)poinloo R, 1001 Laird, Ir., to the Seventh Judicial Clteult to repl.!!;:!;!' Harold Quattlebaum, who resigned [he Judgeship earlier this year, t..11rd, 28, rt..-cel\i{.'(j his Iav.· degree from the Cumberland School of Law In 8lrm· Ingham In 1986 and his undergraduate degree from lhe Unlycrshy o( Alabama in 198~ He has been a p.1rtncr In the An· niston firm of Caldwell & laird since July 1989. Laird·s term expires In N(M!Il1ber 1992.

Bea beach bum ... in July 1991 at the Alabama State Bar Annual Meeting, Perdido Beach Hilton, Orange Beach, Alabama! m

Cooper elected ch airperson of ABA House of Delegates N, lee Cooper, a parIi'll!( In the Birm· ingham firm of Maynard, Cooper, Frier· son & Gale, P.C., has become chairper. son of th e House of Del1!8ates of the American Bar Assoclallon. Cooper wa s nominated TO the post in February 1990 and took office at the

Cooper

close of the 1990 Annual Meeting in Chicago in August. He will preside ~ r $eS slons of the HOllse of Delegates bct'v\lC(!n February 1991 and August 1992. The H()l.lse of Delegates, with 461 members, meets twice yearly to establish assocla· tiOn 1>olIclcs. Its members represent liarious ABA components, as well as sta te, local, spccla lt~· and ethnic bar associa tions. Cooper receiYed a bachelor of scienCIl degree in 1963 ilnd a law degree in 1964 from the Unillel$ity of Alabama at 8irm· ingham, wnllrll he was .... 11 editor of the Alabama L1w Review. He Is a tru stee of the Alabama Law School Foundation and of the Farrah lJlW Society of the law school. (See the May 1990 A/.100ma /..1wyer for more Information.)

Black's Law DictionclrY updal ed in new editio n from W est Publishing Black'j L1W Dlclionary, one of th e na· tion's most frequently used law books for the past 100 Yl'!ars, has been up(lmed and expanded. \Nest Publishing Compilny p(esents the "Centennial" 6th Edition of Black's L1w DiCi/onaf Y. This new "Centennial Edition" C(lntilins Oller 5,000 new or revised en trics th at reflect r(..'cent d(!ll(!lopments In the law. The last NJltion of Black's L1W Dic· tionary was published by West in 1979. Ten years of changes and new developments In the law haYe made a new, ex· panded edition necessilry. Cont"ilinoo wi thin are pronuncia tion guides, cross-references to relatl..'Cl terms,

'26

federal court rules, federal statutes, uni· (orm and model laws, ageilCY regula. tion s, and leadi ng cases. This nf]W edition GOntains I.lpdill(.'(! and expanded financial terminology, including tax and accounting termS. EKample!; of v.()rd usage, with cllations, have been added throughout to Illustrate how lIarious term s ore used or applied in various contex ts. This new 6th Edifioll will be availoble in both a Standal'd EdltlOll and il Deluxe Edition. West Publishing donates professionalism library to ABA West Publishing Comp,lIlY of 51. Paul, M innesota, has announced its Intcntlon to donate a comprehcn sive ethics and professionillism Il'IW libra!"y to Ihe Amer· ican Bar Associa tion Cen ter (or Professional Responsibility. Thi s is one of the largest corporale gifts ever received by Ihe ABA through its fu nd for Justi ce ilnd Educ.1ti on. The libr<wy will contilin ~t'S American Digest S)'Stem, the Decennial Digest, all of We st's RI..'Hional Reporters, all of the state statutc se ts published by West, USCA, q s, \Vest'S Hornbook Series, and o th er re 'ated reference rna· terlals. The "WeSt Professional Responsibilily Law Llbr.1fY" will be located in the nL"N offices for the ABA Publk and Professional Responsibility Cr()up, at the TimeJWe Building in Chicago.

Don't let your Alabama Lawyers get worn,

torn or thrown away. Order a binder (or two!) al $10.00 each from: The Alabama Lawyer

P.O. Box 4156 Montgomery, Al 36101 or call (205) 269·1515

Foundlod in 1976, the ABA Center for Professional ResponSibility d(Wlops and Interprets rul~ and guldelinM on professional conduct, prOllldlng Insight and leadership in the areas of legal ethics, professional regu!mion and discipline, client protection and prufessionalism. The ABA Fund for Justice and Educati on, the Associ ation's chari tilble .urn, supports mol'(! than 200 iow-relatoo public service and educational pmgrams to imp(()lIe the legal sys tem alld help the public.

Ameri ca n BM Association announces 1991 Law Day U.S.A. lheme The theme for Low Day U.s.A. 1991 i s~

FREEDOM HAS A NAME: THE BIll OF RIG HTS The \991 theme enCQurilges law Day progra m and event planners to foc us their efforts on commemOrll tiflgthe blcenten· ni,,1 of the Bill of Ri ghts. The purposc of Law D,lY U.S.A., celebrated annually on May 1, Is to reserve il "special day of celebration by the American people in apprecia tion of their liberties and to prOliide an occasloll for rededication to the i(!ealsof equality and justice under Iilws." Law Day U.S.A. was es tabli shed by United States Presiden ti .. 1 Procl amation in 1958 and reaffirmed by it Joint Resolution o f Congress in 1961. The American Bar AS5OCia tiQn, as the national Sponsor of Low Day U.S-A., prepare$ a detailed planning guide to assist indilliduals and organi~Mion s conduct· ing l aw Day programs. In addition, the ABA makes allailable many reasonably priced promotional and ~ ucational li n · formiltional materials, rangi ng from bu ttons and balloons 10 leaflets, brochures, booklets, SI>ccch texts ~nd mock tri al scripts. State al'ld local bar associations. II· braries, communi ty organizations, school s, churches, lilW enforcement agencies, service clubs, legal auxili aries, and scouting organiza tion s are ilmong the many groupS sponsoring L.1W Day U.S.A. programs and eYents. The ewntS range from nQ-Cost legal consultations, lllQ(:k-tdals conducted in schools, court cllf(!nlonles, I>oster ilnd eSsay con t~sts to televi sion and ra<li o call-in programs. To learn more about Law Day U.S.A" wri te for a copy of the law Day Planning

November 1990

Guide: law Day U.S.A., Ameri can Bar i\$$OClallon, 8th Floor, 750 North lake Shore DrI~, Chicago, illinoiS 60611, or telephone (312)988·6134. (The 1991 Planning Guide will be avallabl In late January.)

fo rd elected representative to National Confe rence of Special Court ludges The National Conference of Special Court Judg(.'S of the American Bar Associa tion announces tha t Judge Aubrey Ford, Jr., Macon County district judge, Tuskegee, Alabmna, was elected al the annual meeting of Ihe American Bar A~ sodatlon to serve as (tmresenlJtl YC (or the fifth district to thc execuliYC commit· tee of the National Conference of Special Court Judges, represen ting Judges In the slates of Alabama, Tennessee, Kentucky, West Virginia and MissisSil>l)i. The National Conference of Sf)(.'Clal Court Judges Is one of silc organlullons within the Judicial Mmlnistratlon Divl· slon o( the American Sar Association, and its members Indude Judgcs of a va·

rlelY of limited Jurisdiction courts, such as military courts, juvenile and family courlS, probate COUt15, distrlC!, county and municipal courts. criminal and dvll courts of s~lallz«l jurisdiction, 0100 Unill.'d States magistrates and bankrupt. cy judges, Judge Ford has served as chairperson of the Comminee on Rural Courts of the National Conference of Special Court Judges. and has been a leader in the planning of a series of natlMal Judicial conferences on the problems of rural courts,

Roberts named to SEC Birmingham n<ltive Richard y, Roberts W<lS rocenlly chosen b,' Presidenl George Bush to nil a vacancy on the Securit1<!s and EKchl'lTlge Comm ission, Roberts was a long-time lOp aide to Senator Richard Shelby, As Shelby's chief of staff arId Issues director In both the Senate and the House, he developed an Cl(pertise in SEC matters. He Is a 1973 gradu~te of Auburn Uni· versity and a 1976 gr.KIuate of the Uni-

verslty o( Alabama School of law, He also f(!Cei\o\!d a master of law degree from George W,lShlngton University In 1981. RobertS JOined Shelby's Tuscaloosa firm In 1976, aoo was hired chief of staff when Shelby was first elected to Congress in 1978, He returned to Alabama in 1983 to practice In Montgomery bul returned in 1986 to work with Shelby and direct the Senator's sIOl f(. Since April, Roberts has been with the Mobile (jrm of Miller, Hamilton, Snider, Odom &. Bridgeman.

Chief Justice announCef appellate courts current Alabama Supreme Court Chief Justice Sonny Horn sby says the supreme COutl and the state's two appeals courts entered 11 new court year on October I with cur· rent dockets. Supreme Court Justices decldl.'d 1,304 manors and wrote 703 p~rbli$hed opln. Ions during thc past year. Twenty years ago In the 1970-71 COurt yeilr, a total of 176 opinions was released. Hornsby stressed thai the work of the court, measured In the number of full written opln.

NOTICE ASSISTANT GENERAL COUNSEL The Alab,1ma State Bar now 15accr.!IJtlngapplications by leiter with resume from qUlllified lawycrs for the position of Assistant General Counsel. These should be addressed to Alabama Siale Bar, P.O. 80K 671 , Montgomery, Alabama 36 101. This position requires ;10 eKperiencecf lawyer wi th a strong professional background, S1IIary commensurate wi th eKperlence. The Alabama Slate Bar Is an CQual opportunity employer.

The Alabama L,'Iwyer

Judicia l COnferen ce of the Eleventh Circuit Each year, the clf(ult, diStrict and oonkruptCy judgt."S dIlle Eleventh Jud;cl~1 Circuit meet In conference with rr14lmbers of the bar to corr~lder the business of the COUtIS dthe circui t and 1000...ise mciln~ 01 imPfO'lirr8 1he admirriWillion 01 ju~lce In lhe cif(ult. Prevloosly, the members of the bilr who have been Invlled to auend Ihe con ference h:lVc been restricted 10 those spccifit.'<f in Addcndum No. One of the Local Rules 01 thli EICVcnth Circuit COUll 01 ApjX!als. The Judges lithe circuit h;rvc concluded thatgreat!!r lawyef partic1p.1tlon thHn thlll currently provided fOt by the local rules is desirable If Ihc confcrenc!! Is 10 accomplish t l ~ purpose of Iml)rovlng the admlnlSlratlon of Justice. To j)fovlde such parIlclp.,rlon, the Jtldges of Ihe cif(ult have decided 1h.,tthtll991 con/CfCflCe will be an open conference: Any ano'Tlcy admit· It.'<f to IIf~clice before the Courl of ApjX!als 01 the Eleventh Clrtuit or befom any 01 tht:! district coorts of the circuit may auend the con ference, The 1991 con ference will meet In Asheville, Nooh Car~ tina, May 25·27, 1991 , Any I~wyef who wishes to auend the n~ting muSt ildvise the clrcuil CKl'Cullve, Norman E. Zoller. In writing as soon IS possible; hOlt!! accommodations are limiled ~pproKlmately t,OOO rooms), lind they will be allocated on a flrsr -comc, flrsr·served basis. Zoller un be reached al Ihe U.s. Court of Appc.rls for Ihe £Ie~en lh CirculI, S6 For~ylh Sireet, Atlanta, Ceoq.tl" 30303. Phone (404) 33 1-5724.

J27

ions, has increased by 334 percent in 20 years with no Incre(lse in the number of Justices. Hornsby also sa id thai the supreme CalJrt has adopted nallonal appellate lime standard s, and that since their <IdOl>" tion eilrlier this yenr, the court has met

Judges on that court wrote, on average, 84 opinions each. The court of civil appe<lls releil sed a total of 404 opinions i1nd ended the yeilr current with its docket. The court is curren t with (Ii! Cil~S submlm:d to the Judges by the first of Sel)tember. AcIl \'C judges OIl the court a.-cragoo writing 109 opinions, each, last court term. The tOlOlI caseload on the court of civil ilppe<lls inÂˇ creased by 18 percent over the previou5

bama Law Foundation; the b(lr commission liaison to the Task Force on Bench and BOIr Relations; the Committee on the Una(JthOri;u:d Practice of Law: the Task Force on Facilities for the Alabama State Bar: and the Di sci plinary Board, Panell, of the state bar.

year. Jack5Qn J-Iomsby

the st.1ndards in 55 percent of Its cases, The nation",1 sttlndard for appellate c;:ourt$ is that every case should be decided and released within 280dilyS (rom the fllIIl8 of notice of appeal. "The Alabama SUllreme Court, in all cases since the standards wele ildopted, is averaging 293 day5:' Hornsby said. DurillS the paS! court ye(lr, the court of criminal allpeals released (I tol1l1 of 1,909 cases, 418 with f~JI1 written (lJliniOnS. The court of crimln(ll (lppeals wa s also currenl wi th its doc;:kct, havhlS decided <lnd relear.ed all cases submilled to the ludges prior to July I. The five

Jackson appointed MCLE Commi ssio n chairperson Lynn Robertson J ~ck son of Clayton, All1l):1mll, was rl.'C<'ntly appointed by Ala-bamOl Sta te Bar President H.1told Albritton to ser~ as chairperson or the Mandatory Continuing LegOlI Education Commission. Jackson is the fi rs t woman to serve as Commission chairperson. Sch(\('J1 She is a graduate of JoneS and was admi1tl..>d to the state bar In 1981. She has served as president of the Third JudiCilll Circuit Bar ASSOCiation, and as a member of the bat's Permanent Code Commission, the boord of editors of The AI.lbllmli Lawyer and the MCLE Com .. mission. Presently, she serves as 11 Im:mber of the board of bar commissioners (Third Circuit); the oo.lrd of l ru stt.'e5 of the Ala-

u.w

She is a member of the American Bar ASSOCiation, the Ameri ca!! Tria! L.lwyers Association llr"1d the Alabarlla State Bar. Jackson is city attorney for the Town of ClaytOr"!, and Is on the boOlrd of directors (or the United WOIy (or Barbour County. Her father, A.8. Robertmn, Jr., WilS a member of the board of i),1( commissioners from 1964 until his death in 1981. He also served 115 second vice-president of the state bar and chairperson of the Disci plinary Commission. Jllcksor"1 is mllrri(>d to George 1 Jackson, a pilot, Md they havcone daughter, Katherine Robertson Jackson, 17 months.

â&#x20AC;˘

Be a beach bum ... in July 1991 at the Alabama State Bar Annual Meeting, Perdido Beach Hilton, Orange Beach, Alabama! 328

November 1990

About Members, Among Firms ABOUT MEMBERS Willi am C. Daniel anrlounces th~ rclOCilliQn of his omces to Suite 502,

1990. The mailing address Is 1'.0. Brnc 3556, PhenlJ( City 36866-3556. Phone (20S) 298·2222 .

Suite 1212, Brown MimI: TQ\-'Ier, 2000 lSI A.venlJ(', N., Birmingham, Alab.lma 35203"" 110.

AMONG FIRMS

The firm of Dillard & Ftrguson annoonces Ihat Slevan K. COO(l'e' has been made a panner of tile firm . Offices lire located at 205 20th Slreet, N., Suile 331, Fr.mk Nelson 811l1ding, Birmingham, A.labama 35203 Phone (205) 251·2823.

•

AnlSouth Bank Building. PO Box 396, AnniStOn, Alabilma 36202. Phonl! (205) 236-8099.

•

lames R. Berry announCei Ihe opening of his office under the name James R. Bl'fry, with offices located ilt 1()().A S. Emmen Street, Albertville. Alabama 35950. flhone (20S) 878· 8500.

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John Mc Brayer announces the relocation of his office 10 Shelby Medical Center Bul1dlng, 644 2nd

Street, N.E., Alabaster, Alabama. The mailing address Is 1'.0. Box 1949, Atab.mer 35007. Phone (20S)

664·3838.

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I. Floyd Minor announces Ihe openin8 of his o((ice, effective Sepwmber 1, 1990. The new o(flce ad-

dress Is 458 S. lawrence Street, Montgomery, Alabilma . Phone (205)

265·6200.

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Frederick T. Enslen announces that he has whhdrawn from the firm of

Argo, Enslen, Hottow.lY & S,lbel, PC, and has relocated his office to 4145 W,lll Street, Montgomery, Alabama 36106. phone (20S) 244-7333.

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Sheree Mallin announces the open· Ing of her offices al 409 N. Court Strcct, Suite 120, Florence, Alabama 35630. Phone (205) 76().1250. She is a member of the Alabdm<l State Bar and The Florida Bar, and has an ll.M. in Tax-ltion from the Unl· ver5lty of Florid;!'

•

WJttace K. Brown, Ir" announces the opening of Ihe law Office of Kin Brown al 1323 Broad Street, Phenil( City, Alabama, ef(ccUve August 1,

The Alabama Lawyer

ford & Hunter, P.e. annOllnces Ihal Richard M. Blythe has become associaled with the fi rm, effective September 1, 1990. Offices are located at 645 W.llnUI Street, Suite 5, P.O. Box 388, Gadsden, Alabama 35902. Phone (205) 546·5432.

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Griffin, Allison, Muy &. Alvis announce Ihe change of Ihl! finn name 10 Griffin, Allison, May, Alvis & Fuhrmeisler, and thaI )aml'S W. Fuhrmeisler has become a 1l.1rtner of the firm, and Ihal Cindy 8. Sirmon ha§ become associall-d with the firm . Ofnces are loca l~ at 4516 V.11tc..""daIQ Road, Suite 1, Birmingh;lm, AlabamB 35242, and Ihe mallll\g address is P.o. Box 380275, 35238. Phone (205) 9916367.

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The firm of SlrOle & Permull, p.e. announCt!SIhe relocalion of ils offices to Ihe AmSoulh Center, Suite 1000, 200 Ctlnlon Avenue, W., Hunlsville, Alabama 35801. Phone (205) 536-171 1.

A. Danner Frazer, Ir., Edward C. Greene, WiIllJrn H. Philpot, Ir., and Michael E. Upchurch announce the forma tion of a partnership for Ihe practice of law, In the name of Fr.uer, Greene, Philpot & Upchurch, effl.'Ctlve luly I, 1990. Offices are local<.>d ut Suhe 2206, First National Bank Building, 107 St. Francis Slr(!(!l, N\oblle, Alaooma 36602. The mailing address Is P.O. Box 1686, Mobile 36633. Phone (205) 431-6020. Maynard, Cooper, Frierson & Calc, P.C. announces that e.e. Torbert, Jr., former chief justice of the Aluoomu SUI)reme Court, has become a member of the firm imd will be in Ihe firm's Monlgomery office. The firm also an· nounces Ihal lamCf L. Pricsler and lames M. Proctor, II, have become mQmbcrs of Ihe fi rm. Ofnccs are localed in Birmingham and Mont· gomery.

•

Paul C. Smilh, ,. Tkomas Burgess, Thomas Spi res and A.. Joe Peddy, formerly of Ihe firm of Smith & Taylor, announce Ihe formation of a partner· $hlp under the name of Smilh, Burgt!s$, Spires & Peddy. Assoclate5 of Ihe fi rm orc William F. Smith, II, Jim F. Oros, Jr., Michael B. Walls, Todd N. Hamilton and Frank M. Cauthen, Jr, Officl!s are located al

• •

The firm of Turner, Onderdonk & Kimbrough, P.A. announces thaI Gordon K. Howell has become a pBrlner in the firm, and Ihe Ilame of Ihe firm has bt.>ell changed to Turner, Onderdonk, Kimbrough & Howell, P.A. Offices a A:! localed in Mobile and Chatom.

•

Thon1;lS, Means & Gillis, P.e. announces Ihe n;:localion of Ihelr Montgomery office to 3121 Zelda Court, MOlllgomery, Alal),.'lma 36 t06. The mai ling address Is P.o. Drawer 5058, Montgomery 36103-5058. Phone (205) 270-1033.

•

329

lhe firnl d Miller, Hamilton, Snider annOu nc(!~ that Rk hard A. Wright and Richard Y. Roberts have become members of the firm, and Robert Bruce Rinehart and Robert G. Jackson, Jr., have become .lssociated with the firm . Offices are loe.1ted In Mobile, Montgomery nnd W,IshingtOn, D.C. & Odorn

•

The finn of lyons, Pipes & Cook announces thaI Charles L. Miller, Ir., and W, David Johnson, Jr., have become members of the firm effective Januilry 1, 1990, and William E. PritChard, 111, h(l~ bec;ome associated with the firm, eff~ct ive March 1990. Offices are located at 2 North Royal Street, Mobile, Alabama 36602. Phone (205) 432·4481.

•

Lewis & Mutin, P.c. announces Ihat Ihe name hilS been changed to Martin, Drummond & Woosk-y, P,c', and that offices continue to be located at 2020 AmSouthlHarbert Plaza, 1901 6th Avenue, N., Birmingham, Ala· il.'lma 3520]. Phone (205) 322·8000.

•

David A. Ryan ha s become associated wllh the firm of TIngle, Se~to n, My,vin, WOItson & Bates, P.c. R)"lll is a gl'ilduatf;' (If the University (If Alawma SchOOl of law, where he sefV!.'(i as a membel of the Alabama /.tlw Review and the john A. Camllbcll Moot Court Board.

•

The firm Of Parnell, Crum & Anderson, P.A. an nounces thaI Bernard B. Carr, former stilff attorney to Justice Henry B. Stegall, II, and lonathan H. Cooner have become asSOcitiled wi th the firm . Offices are located ilt 641 S. lawrence Street, 1'.0. Box 2189, Mont· gomery, Alabama 36102·2189. Phone (205) 832·4200.

•

The firm of Harris, Evan$ & Downs, Poe. ;mnounces the change of Ihe firm

lange, Simpson, Robin50n & Somervi lle announces that Neil R, Clement, D~vid W. Duke, James e. Pennington, Elwyn Berton Spence, Carey W, Spencer, arId William B. Stewart have become associated with Ihe firm at lISBirmingham omce, and that lohn R. Barran has become associated wilh the (jrm at Its Huntsville office,

!lame to HarriS, EVIlrti, Berg & Morris, Poc', with offices 10 remain at Historic 2007 Building, 2007 3rd Avenue, N., Blm\lnghrll'l1, Alabama 35203. The ((I'm also announces that R. St;m Morris hus been named a part· ncr, and that lind.l E. Winkler, Elizabeth Patterson Wall ace and Matthew J. Dougherty htlve become associated wi1h the firm.

l ega l Sl! rYi ce~ Program for Pasadena and San Gabriel·Pomona Vallt.-y announces Ihat Reginll 8, Edwards has become associated with The Handicapped and Elderly law Project located ilt 20 1 E, Mission Boulevard, Pomona, Catifornia 91 766. Phone (8 18) 308·9524, Edwards is a 1~87 admil1ee to the Alabama Stilte Bar.

J. Todd Caldwell annO\lOCes thilt G. Rod Giddens has become an associate in the firm of Caldwell & Gidden$, Offices Me localed at Suite 407, SouthTrUSt Bank, 1000 Q uir'llard Avenue, Anr\iSIOIl, Alaban\ll. The maillr\S addr(!5s Is P.O. Bo~ 2314, Anniston, Alabama 36202 . Pholll;' (205) 237· 6671.

Morrlng, Schrimsher & Riley of HuntsviUe announces that Donald lee Christian, Jr., has joined the fi rm

Berry, Abl(!5, Tatum, little & Baxter, P.c., 315 Franklin Streel, S.E., HlII\!S' ville, Alabama 35804, announces thaI

•

330

as an associate. He is a graduate of Cumberland School of law. Ofnc{'s are localed at 11 7 Cllnron Avenue, E" Huntsville, Alabama 35801. Phone (205) 534·0671.

•

Susan A. McMillan has ioined the firm as an IlSSQClate. Phone (205) 533·3740.

•

The firm of love, lovt & love announces the opening of ., branch office in Gadsden, Alabama. The offi,e is localed at 823 Forrest A~nue, Room 101-A. Phone (205) 546-6216.

•

The fi rm of Blume & Blume an· nounces that R, Shayne Roland has OOcorne associdled wilh th@ firm. Offices arc located at 2300 E. Unl· versity Boulevard, Tuscaloosa, Ala· bama 35404·4136. Phone (205) 556· 6712.

•

The (jrm of Eyster, Key, Tubb, Weaver & Roth announces th"t M. Bradley Almond has become associated with the firm. Offices are loCated at 402 E. MOulton Stret!t, P.o. Bo)( 1607, Decalur, Alabama 356011607. Phone (205) 353·6761.

•

The Law Offices of Mary Beth ManUply announces Ihat Charlotte Adams Nicholas, formerly an officer with SouthTru st Bank of Mobile, and P"trick 8. Co llin~, formerly of ColUns, Galloway &0 Smith, have become as· sociated with the firm , OffICes are l()Catoo at 209 N. Joachim Strt.!et, Mobile, Alabamil 36601. Phone {205) 433·3544.

•

Wilson & Pumroy anllounces that George D. RoblnSOI1 has becOr'lle al\ associale with the firm . The office Is located at 1431 Leigh. Ion Avenue, 1'.0. 80)( 2333, Anniston, Alabama 36202 . phone (205) 236· 4222 ,

•

The firm of Pradat & Wise announces that William B. M ~ Guire, Ir., has bf:(;ome a partner in Ihe firm . lhe firm name hilS Ix!en changt.'(ilo Pradat, McGuirt- & Wist-. Offices are located at 2902 61h Street, Tuscaloosa, Alabamll 35401. Phone (205) 345·2442.

•

November 1990

The firm of Parker & Brantley an· nounces that Mark D. Wilkenon, fornll~rly a 1)'1rtncr wi th Haskell, Slaughter " Yo ung. has !olnt.-'d the linn, and the firm name hon been changed to P.uker, Brantley & Wilkerson, P.C. The firm has m()\l('(j its offices to 1200 Bell Building. 207 Montgomery Stn:et, Montsomcry, Alal)ama 36103· 4992. Phone (205) 265·1500.

•

BeaJley, Wilson, All en, Mendel· sohn & Jemison, P.e. allnounces thm Blaine C. SINen!, former law clerk 10 Alabam.l Stlpreme Cou!"t Chid luSllctl Sonny Hornsby, has bt.'come JSSOci.l ted with the firlll, effective AuguSt I, 1990. Offices ."lte l ac;lt~.'d ,II 207 Mont· gonwry SlrCl't, 10th floor, Bell Build·

Ins. P.O. Box 4160, Montgomery, AIJ· bama 36103·4160. Phone (205) 269-2343.

•

Jackson & Taylor ;:mnounces that Robert ,. Hedge ha~ boon associall'd with the nrm as of July 1, 1990. Ilcdsc graduJtcd cum laude from Cunlber· land Law School in 1989. Offices ,lrC loc<!led dt 61 St. Joseph Street, Suite 1500, Mobi le, AI3b..lmJ. Phone (205) 433·3131 .

•

The firm 01 Ri\'t!s & !'etenan an· 110Ullces Ihm Rhonda K. Pitts and Susan SCOIl Hay<.'S h<l~ become ,ISsaclales of Ihe firm . Pitts Is J graduJte of Cumbcrl3r\d School of Law. She Is J former law clerk to the HonOfilble OSCJr W. !\dilms, Jr., of the AI"bamil Supreme Court.

t-Iayes Is il gr.lduille of Southem Methodist University Schoo of Llw. She formerly prJcticed with Ihe firm o( Zelle & Larson In Dilllas, Texa s.

•

George W. Andrews, III, fomler district attorney of Jefferson, Jnnounces the rulOCiltion of his prilctice to the ofrices of White, Dunn & Booker, 1200 First A I300ma Bank Building, BlrmlnghJm, Allibam'l 3520). Phone (205) 323·1886.

•

John Ben Banc roft has become as· socl"tt'(l wilh Ihe SmOlIi Business Ad· mlnistr'll ion ,IS iln ,lItomcy o(\vlsor In thc DISlrlct Ofnce Jl2121 8th Avenue, N . Suite 200, 6 irmlnghillll, IIlabama )520). Phone (205) 731·1728. •

NOTICE ABA publishes new book

NOTICE Noti ce of and Opporl unlty (or Comment on Proposed A mendmenls to Ihe Rulcs o( Ihe U .S. Courl of Appea ls for Ihe Eleventh Circuli Pursuant to the Judicial ImprovemenlS Jnd Access 10 Justice ACI, coolfltod al 26 U.S.C. §2071(0), nOlice Is hereby glVCrl of proposed amendmen\SIO the Rules of the U.S. COurt of Appeal s for the Eleventh Circuit, A copy of the proposed amcmdmen ts mily be obtillned without charge Jher October ' S, 1990, from the O ffice of the Clerk, U .S. Court of Appeal s for the Elcvemh Circuil, 56 Forsyth Sr., N .W ., Atlanta, Georgia 30303. Phone (404) 3)1·6167. Comment s on the proposed <lnlendments may be submitted In writing to the clerk al Ihe above address by November 30, 1990.

TIIC Alabama lAwyer

o n agricullural law The American Bar Association's Ceneral Practice Se<:tion has publl shl.'d Asricultural l ,lW: A Lawyer's Guide 10 Representing Farm CI;ents. Thi s new guidebook focuses on laws and regul ations that apply specifically to farm con cerns, and advises attorneys on procooures for representing etlenlS more efff!1:tlvely. Agricultural Law devOles a mJjor portion 10 e~plain ing Ihe laws and regulations govcrnlnglhe farmer's cont;1 CI with government agencies, particu larl~ the U.S. OepJltment of Agri c ulture. Additional chaptcr loplcs Includc organi;e:lng the (Jrm, providing specific e~amples of how eac h Slructure (sole proprietorshIp, Polrtnership, corporation) Cdn mf!et the needs of II p..lrtlcular kind of farm ; markeling the farm product, providing e~plJnatJons for the array of federal, state and local laws governing the salc and purcha§e of aSricu1tural products; obtJ Jning credit and dealing wIth bankruptcy; and usi ng and developing land, reporting on land use Issues and the (Jrmer as propeny owner. To Qrder, contJc l ABA Order Fulrtllmcnt5 15, 750 North Lake Shore Drive, Chicago, Illinois &0& 11 .

331

Consultant's Corner The following is a Royi ...'W of and comÂˇ mentary on an office aulomalion Issue that has cur re nllml>orlancc 10 the legal community, I)rcparcd by the oUice auto-

mallon consultant to the state b..,. P,IUI Bornstein, whose ... iews are nol necessarily those of the st.lle bar. This is the 161h article in our "Consul!anl'5 Corne' " series. We would like 10 hear from you, bulh in critique of the art Ide wrille" and suggestions of topies for future articles.

Business developmenl, who needs in 11 Is s.,d but true that these days everyneeds 10 be concerned with business dC'o'Clopment. Greill Scoll! He is not

one

cess of thllt required to compensa te for leakage. They typically formulate business plans, targeting key l)roSpectS, asstgnillg j)articular p<lrtners to p,lrliCular proSpcclive clients. ThL'Y often arc disappointed when, after a "decent" IntC!rval and The c)(pendlture of substantial amounts of time and money, the key panncrs return honle wil h meager results. Why'

WhC!re the growth potential is A definitive, though slightly dared, swdy of some 150 law firms nationwide with dt.'fined and implt!ml!nwd buslrless plans, rcwaloo the ralher asTounding finding Ihal 80 percenl of new business came from a firm's CX/5f11l8 client base. Prospccling for new clients Is nOI 10 be

going 10 use thaT "M' word (markellng) is hd' No, not if it bolhcB you a sre,lI

dea l, but with II virtually fb:oo (some say shrinking) dcmarKllor private sector Ieg.ll services and a conUnulng ~rsupply of law school graduates. It bch()(NCS .. tt

lawyers to think ilbout it, like it or nol.

What aboul M-growth firm sJ EYen firms with no gl1J'Wth plans n(.'(.'d to be concerned with di!\l{!loplng new business. The insur.lnce industry, to use a related example, has known (or some time that each ye.lr they lose aboul 15 percent of Iheir business book through what they call "leakage." This is the erosion of a fixed insured b.lse through 1)00pic dying. moving i1Wl'1Y Or Slml)ly choosing another provider. There 15 no precisciy mca)ure<! leakage figwe for thl! private leg.ll sector, but there mUSt be some. Suppose It is only 10 percent lost to death, relocation or change In l)rO\llders. If your (jrm is doing a million dollars a year In fee income, this suggests you must scare up at least 5100.000 in ncv. business each year just to !read w,lter.

G rowlh firms Firms with 1)I ~ns for growth surely see the need to produce rKW business in ex-

lJ2

Bornslein discouraged, bUI do not nL>gll'CI your eKisting clients. tf you want to uSC the gold mining C!X<lmple, allocate your resources 'n proportion to the expectation of strikIng a vein. There are no GenerJI MOlors Corporations sitting out in the wilderness waiting for someone TO discover them llnd offC!r to be th!'!ir general counsel. They all have

counsel. Shopping fOr nt."'" clients often involves an ethically delicale aCI of trying 10 I,'ke away 1'1 clien t from someone else. The someone else will often countcrJllack . A brawl is on .1nd you have made a professional enemy.

How to gel it So, you have dL'Cidcd to pul a substan-

tial shaft' )Qur businC!ss development effort intOyour ClClsling client base. Now what? You migh! begin ~. Insuring IhM your cllCln knows all the services your firm prO\lldes, not Just tho~ you huppcn to be providing lit the moment. Cliems arc largely lay pexmle and they often see lawyers as they see doctors: a surgiclli practice here, ilIl internal ml.'diclnc praclice over Ihere, radiologIsts somewhere else. If you have handled an adopflon for them, they might ......ell prl?SUme Ihm ls all you (Of your firm) docs. 11 you handled a real eslale IranS3ction for them, dino. Consider a modest brochure, perhaps t'M) of them, one for personal clients and one for corporate cllems. list all thl! services you offer. Some firms Include brief biogr:rphles of their I)artllers, some even a map showing Ihe location of their offlce(s), Put some in your reception area. Enclose the IlCrsonal brochure In some ol the Instruments you j)rep<lre (will s. reil l eSl<l le closings, etc.) Visit with some 01 your business eiienlS (il "howdy" calli. Ask if lhey are pleased with the work performed 10 dale and recap the olher services your nrnl o((ers. leilve a brochuftl with them . BUI where are you going 10 get the lime to m~ke,,11 these vlsl tsl Good {jucs!lon- tune in next ISSue. Summary - Recognize the need for business developmenl; - Remember where most o( the good prospeclS are (in your eMn backyard); - Make sure your clients know all you do; and - Make some cil lis on your own clienTS.

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November 1990

Request For Consulting Services Office Automation Consulting Program

SCHEDULE Of fEES. TERMS AND CONDITIONS

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REQUEST fO R CONSUlTI NG SERVICES OFfiCE AUTO MATION CONSU LTING PROG RAM

Sponsored by Alabama Stale Sar TH E FIRM

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Mall th is request for service to the Alabama State Bar fOr S(hl.>dvling. Send to the attention of Margaret Boone, execu tive assistant, Alabama State Bar, P.O. BOI( 671, Montgomery, Alabama 36101. The Aiab'lma La wyer

333

Building Alabama's Courthouses by Samul!t A. Rumo re, Jr,

The following COrllinu C$ " history of Ala路

bam,l's county courthouses-thcir ori路 gins ilnd some of Ihe people who con路

!ribuled to their growth. Th e A/ll b.1m., Lawyer plans to nm one count y's story in elleh iS$ul'! 01 Ih(' magazine. U you

have a ny pholo@ raphs o f earl y or pres-

ent courthouses. please forward them to: Samuel !t., Rumore, Jr. Misllonico & RumOr(! 1230 Brown Man( Tow<!r 8irmingh<lm, Alabtlm:t 35203

Cherokee County

The Chcrokcci were one of thc I.ugesl southern Indian tribes, and they had a lo ng history of cantilC! with Europeans.

Their lands cO\Iered Se<tions of North and South Clrolina, Tennessee, C(..'Oq:lia and Alabama . The area of present-day Cherokee Coun ty, Alabama, was occupied by Chc roke(! Ir\dlans from apIln)xima tely 13JO to May 1838, when the Ind ians WCn! forcibly moved 10 the west. The Cherokees encountered the white man as early as 1540 when Hernando de Solo e~ plofed Ihe Indi<1Il covntry in what is now Al abama. l ater. the Cherokees Cl1me into con1.1cl with English and French Vilders. As they f1'1 et rllore European s they took on more of the white man's ways, even developing their own writt en language, In the American Revolulionary War, the Cherokees sided with the English. M uch Cherokee l11no witS laid wa ste during the war as crops and c.lbins were destroyed. Alter Ihe war, the Cherokees were the Orst lribe 10 pledge allegiance 10 the nl"'N United St(lte$. H~r, by 1791 they had lost much of the r land In the Caro tl nas and TennC!sseC! by treaty with the Amerl路 ca n Government.

334

The CherQ\<ees rt'mailll'(1 fritmdly with the Amf! ric?n~ ill'ld cuntlnUed to Imlt.1Ie the white I lan's W;o/ of life, When war brokC! oul IW('(!11 frontiersmen and the Creek Indfans in AIJbam" , Ill(' Cherokees assis}Cd the American s, Cherokee~ fought ag~lns t the Creeks ,)t the Bilnle of Horseshoe Bend in 1814. HI)'IVC\ICr, when the returning whi te Indi'lIl figh t er~ ~<'Iw the beau and rlchnt'~~ of Ihe Cherokee lands, t~e '>I.'(?d ~ V"Nt' "Own for the ultimate NTrdil of TtMf!,". Alab3nl J bec,lnle a ~tolte 111 1819, A~ earl y a 1829 Ihe Slate begiln e,.-crcislng ci vil Ju bdlction over Indl;l11 Il'rriiory, In Janua of that )'eM ~ legisl;ltive acl extend civil jurisdiction of Ihe stilte over the C ek l1;1 tion. The Crecb 'lllt!re n." m from Alabama to thl,! " \i~S t in 1832. llkl!'>vi~e, an act of tht:! AI"bama Legisl,1ture in 1832 added the I;lnds tll.l1 technkilily bl.!lon8~1 to tht:> Cht.:rok~) 10 the j uri ~dl cti Cl n of SI. CI.lir COUllty. FInally, on Dc<:embf.!r 29, 1835, the Tre;ly of N ('W Echol.1 W,b ~i8nt"d be'~'l the United States G~rnmen l ;lnd cer ilin repre~elltiltives of the Cherokee 111 ians. Eight million .J(:re~ W(!rC! t ran ~ ferred by thi s document, 'Illd thc signers ilg ~d 10 m~ weSt o f Ihl! Mb ~b~l ppl Ri~r. The United St.1t l!~ Sen.lte edgerly apprCM.'<l thi ~ Ir(,,)ty whi ch Wil ~ of quc).tlO;Mblc legality, Chief John Ross, who dl~ not sign the trea ty, ;llIel11pte<1 to nu lify it, tilking hi~ ca~l' to the Unitl.>d Sta e~ Supreme COUll. The Cherokee~ ulti!TIillely l o~l tlll'ir Og~ t .mel wc ~ fo rced to move from At.luilma in 1838. More than 4.000 d ied on hI.! IOllg nlilrCh to Oklahoma. II Is an unc e!"Statement to ~i1f that th is Incident wa o lle of th e (tarkest ch,lpl efS In the history of A!i\b n101, ilnel 0 the United State. After the Trg,aly. of New Echolil wa s signed, it did not t;lke long for the legislature to organize the Cherokee territory, On Janu(lf'i 9, 1836, only " days after the treilly signing. Ihe coun tie s of Marshall , ~Kalb and Cherok~ 'M."!i'e created from

the 1ll"'NIy-acquired Indian hOLi se of ,1 Colonel designilted by the pordf'i cOLinty 5Cil t Accord ing to I it the fl~t court ill ilctu,l lly held ,1 t thc home or of Sillglcton Hughes, 011 Cowan's

The was

was

<lpproximillely eight miles fron:,;~!~\;~ The ne(cnelilnts were ,1 gang 01 not unlike loday's youth gangs,

Samucl A Rumore, Jr., i$ a graduate of the Uni versity of Notre Dame and the University of Alabama School of /.aIV, He served

founding chairperson of the

AlaiJ<lm,l Slate Bar's Famil y Law Section and ;s in practice in Birmingham with the firm of MISllolllco & Rumore, Rumore was rcccntly elected 10 serve.l$ the bar commissioner for (he 10th Cir-

cuit, place number fOUf.

No~ember 1990

the "SlIcks.H Thl.'\' were accused of the ~a8e bea ting of an old mlln. The pioneer justice system of Cherokee COUnEY put the ~Slick Brigade~ out of business. On December 22, 1836, the legislature authorized an elt.'(lion to deter· mine th e permanent sca t of justice for Chcrokl.'e CounlY. Four locations were plact..'CI in nomln~tl on: (he horrles of John Garrett, Joseph Hampton and John C. Rhea, and an area on the Coosa River known as Cedar Bluff. Cedar Bluff won the election. On June 24, 1837, the Legislature offidally dC'Sign<lled Cedar Bluff, below William Woodley's ferry, as Ihe (ounty sea t, In lhe same act dcsignilting Cedar 81uff the COUllly SCi'll, commissioners were appoin ted to lay out a IO'Nn into lots and provide for public buildings for th lJ coun· ty. A temporary courthouse wa) built where the present-day city park of CcdM Bluff 15 located. This building was a log structure. The new coon)' seat WJS clli1ed Cedar Bluff bec.. use ollhe cf;!(lilr trees Ih.. t grew on the lown she overlooking the Coosa Ri~r. Sometime between June 24, t837, when the site of Ihe counly seal was ~ctected , nnd December 23, 1837, when Ihc county seat was Incorpor.lled, the lown wa s renamed Jefferson, probably 10 honor Thomas Jefferson. Five ye;Jrs later on December 23, 1842, the Legislature renamed the town Cedar 8luff.

Cherokee County CourlhOUSe

In 18 43, .. sec tion of sou thern Cherokee County, which had been removed from the county, was reslored, This boundary change increased the population of southern Cherokee Coun· ty, and resulted In dissa ti sfaction O'ICfthe localion of the county ~eal. Mor(! 1)«)pie in the county now lived sou th of the Coos;, J.: ivcr, while CedM Bluff 'NilS north o f Ihe river. On Janu<lry 15, lB44, the Legislalure appoinlt!(J a commission to locale Ihe ex· act gcographlc center of Cherokee CounIy. It also called for an eleclion on the nrsl Monday in AI)lil 1844 for the voters to choose bet'oYCCn Cedar 81u(( and Ihe geographic cen ter of Ihe county for Ihe county seat localion. The commi ssIon selected a hUl where Centre is located loday. Needless to say, Cedar Bluff 105\ th e election to Cen tre, which Is the Old English spelling of the word "center." The Alawma Lawyer

Cherokee County Courfhouse Annex

335

(continued (rom previous page)

The promoters of the new county seat hastily el'(!(ted a frame building fOf the new courthouse. HoY.'e\ICr, the agitation concerning the Ioc . ulon of the county seat did nOl SlOp. There wa s con tinuing opposition to the complete tfilnsfer of the affairs of the COlJ\Iy 10 Centrc. On Jan· uary 27, 1846, the sale of loIS In Centre was authorized, but the ( oonty seat Issue Sl ill remained unsettled. On Februllry 22, 1848, the LegislOllure provided for the construction of iI courl· house (It Centre iIIld named the building commilll.'t!. In 1849 a brick building was conStructed . t-t ~r, the controversy continued and on February 11, 1850, a new election W.lS called for the nl'Sl Mon· day In Augu st 1850 to once again deter· mine the count y seat location. Centre

and CedJf Sluff were (he only nomlnct.'S. Centre won ag.lln, ~nd the Is~ue was (lnJlly resolved. The btick COlJ rthou~ at Centre burned May 24, 1882. A~ was svspectcd. MOit records of the prob.lte and circuit Cour1$ ~re lost. All hdlctment5, bonds and complaints were destro,oOO. Only the walls of the J3-yeJr-old building stili stood, An Interesting observation (rom Investiga tors supporting the Jrson theory w,'s that no fire had been used In the building durin8 Ihe Ilrevious day. On September 14, 1682, a cornerstone wa s laid for (I new courthouse. The fir§! brick was placed by the contractor, J.6. Patton. Th is courthouse <lIsa b~lrned 13 years later in 1895. The courthouse w~s rebul ll In 189(1, rilld a IlII"g<, bell was placed In tho

building. The 1896 courthouse W (l$ d two-story brick structure wilh a clock toYo'Cr. 1\ served Cherokee County for 40

yeo., 8y 1936, th(' people of Cherokee County Yelted for a new courthouse by iI count of 520 10 35. The CQunty receiYed a\\j~tance wi th the proJKt from the fedcfill gOV('rnment which paid 4S per· cent of the cost of the bUilding. Also, the coun ty Issued courthouse bonds fOr Ihe balance. The total cost of the Cherokee County Courthouse wa~ $80,000. The conHdctor for the I)roje<:t was the DukeStlcknry Comp;my, and the architect was Paul w. Ilofferbert. who ~ I so designed the [ tc.rwJh Courthouse. In 1952, a court· housc annex for Cherokee Cou nty w ilS con1pleted. The architect il8" in was P.l ul W. Hofferbert. •

Statewide Volunteer Lawyer Coordinator The AlabdmJ State SJr has ,I Ch,III('n8In8 t"areer opportunity for a hi ghly motivated, dcdIC,1\{-d, self·Marting .1Ilorney. Thb po~i li on will coordina te Ilro bono civil legal servicl's. Dutie<; will Indude m,lnagl ng the org.lnizatlon, recruitment and rl.'Cognition of volun teer private I.lwyer~ In thl' civil pro bono effort; coordinati ng pro bono efforts with loc.,1 bM .15)O(:1;l\ion5; serving as a resource In developing local pro hono progr,lms; .md acting as J clearinghouse for su cces~ful pro bono programs around the slate .lnd !Mtion. The perwn soutl"t mu ~ t hilve a J.D. degree from an ABA-accredltf!tIIOlw ~c hool .l nd ill least two yen rs' experience III the practice of 1.lw or other equivalent e~perien ce; bi:l self·mOl iv.lted .md ~e lf-d lrl.'Ct{>d; possess e~cellent com. munlcatlon sktu s; POSSl'SS Wontl org!.lnir.;lIional Jbilities; be willin g to undert Jk« regular ~ t " tcwi de travel; ~nd be able to wOlk with J wide vOlriety of perwnali[il:.'S ilnd grol.ps. The salarv is commcnSUf.l tc with cxperience, and an e ~c('lI e nt (ringe benefits progr.lm b provid{>d. For consideration, forward the following m ,lt eriill ~: resume and ~ar ary history, INCLUDING d (over ICllcr c>l.plain. ing backgrcund dnd interest In position, In conndence [0: Search Committee Volunteer lawyer Progr<lm

P.O, 80x 67t Montgomery, AL 36 101 DC<ldline fOf

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Issues in the Sale of a Small Business Under the Alabama Business Corporation Act by Michael D. Waters and Daniel D, CraVC!$ Business enterprises are bought and

sold eo.oery day..... lthough Irl many cases these enterprises are managed through

par1neooips or sole proprietOlshlps, they ilre typially operated through a COrpora· tion. When an enterpri se thaI is to be sold Is owned by .. corpor~tlon, the sale of the business raises a number or issues

.. ,

MichaelO. Walers

Daniel B. Craves

Is a graduale 01

is a 8,aduare of fhe

Duke UniversifY. Oxford University ,md (he UnivCrsifY of Alabama School

bJm<l and Ihe Un;· I'clsiry'j School of

of Law. He prac!ices in tile Monf80nll'ty office of MU· ler, H.1m/hon, Snider & Odom, iJnd is II member of rhe Alabama SUIte Bar and (/Iv D/wlcf of Columbia Bar.

336

Ur.ivcrsllY o( ,,4,1.1-

Law. He Wilctlces in the Mobilt' 01· fice of the firm of Mlllcr, "'am/lron,

Snider &. OdOrn, lind /5 a memlJcf of Ihe Alabanlo1 Slat e 8ilr ,llld The Florida 8ar.

under the Alabama Business Corporation Act1 The purpose of this Mlde is to set forth certain basic corpor.lte Issues that of. ten arise in sales of Alab~ma corpora· tions. This article does not discuss other problems that arc someti mes present in the sale or a business such as taK or antitrust matters or reglstr.lUon Issues UnOcr stilte and federa l securities ~tatutes.l AI50, the scope of the discussion belCM' does not Indude Issues peculiar to the sale of a public company (i.e., a corporation which is subject to roportlng requirements with the SeturlUes i1lld Exchange Commission [the "SEC'1 under either Section 12 or Section 15{d) of Ihe Securities bchange Acl of 1934'), althol.lgh many issues considered here are equally applicable to !he public c0mpany. Instedd, this Miele focuses upon the sale of corporations that are relatively closely held-i.e., corporations wilh 25 or 30 shareholders, or less. This article 15 directed primarily at the lawyer who represents the corporalion Ihat is 10 00 sold nhe "seiling corp(>ralion". It is also assumed thlll the selling corporation Is to be acquired by another Alabama corporation (the "acquiring cor· I>oration") rather than by an indivIdual, II group of Indlvldvals, or other form of business, and that the acqulrlng corporation 15 also not a pvbllc company. The discussion below Is divided into three parts. Part I svmmuilC5 various forms thallhe sale of the corporate eJ'llcrprise may take. Part II highlights some procedural requlremcnts d the Alabama Business Corporation Act in Ihe COilCex l of the sale of a corporate entcrprise. The NOI'cmbcr I ~9D

third part addres;es certain problems that are typlcally found in this oontext which, If not addressed properly, can present major obstacles to the accomplishmCflt of an effectl...e sale,

Form of the transaction

1. Merger- The SII II! of II business enterprise can take a variety of forms if the enterprise Is operated through 11 Corporation , This Is especially true If the entity acquiring the enterprise is also a corporation, The first apion is a merger,· In that situation, the selling corpora tion may merge into the acquiring corporation, I\s pM 01 that transaction, the selling cor· poratlon becomes a part of the acquir· Ing corporation, and the sell ing corpora tion ceases to exis\. All of the assets ;md lIobllitles of Ihe seiling cor· poratlon bc<:ome parI of the assets .1I1d liabilities of the acquiring corpor<ltl on,1 The acquiring corporation could also merge Into the selling corporation, with the result that the $(!'lIing corporation becomes the surviving corpora tion In the merger, Sometimes an acquisition is undertilkcn through an interim merger, The ac· quiring corporation creates a wholly O'Nned, nt.w COfl)l)ration, and the seiling corpora tion is then mefl~ed into the nt.'W or "Interim" corportl tlon. As a consequence, the corporation resulting from the merger Is owrled by Ihl! acquiring corporation, There may be reasons why the aC(luiring corpor<ltlon w.mts to operate the seiling corpora tion as a subsidiary, such as a desire to insulate the parent corpor<llion from the liabilities of the subsidiary or to maintain for public relations purpo~ the separate identity of the sci ling corpor<atlon. The interim merger provides a w;ay to accomplish those goals. 2, Consolidation- The second form that Ihe acquisition could '<Ike, the consolidation,' is simi lar 10 the merger. In a consolidation, each of the two COr1stltuellt corporations, t~ selling and the ac· quiring corporations, combine to form a new corporation altogether, The legal ef· fect of the con~ol!dat lon, howcvcr, Is essentially the same as the merger, in th(ll the corporation that resvlts from the con· solldlltlon has all of the a~5!:!IS and liabilities previously owned by the two corpora tions.'

The A/abam" Lawyer

), Sale of assels-A sale of asscts Is another method bv which a busint.'5S enterprise can be sold.' Under this method, the selling corporation sells specificilllV designated assets 10 the acquiring corporalion, Also, the acquiring corporillion may, but need not, agree to assume all or certain deSignated liabili· tics of the selling corpor.llion , In a sale of assets, the acquiring corporation chooses only those assets atld IInbilltle5 It desires to purchase and assume from the seiling corporation, For example, If the selling corporation owns tv.<O auto parts Stores and wishes to sell only one to the acquiring co/porallon, a sale of assets transaction would be a logical method by which the sale could be accomplished, While a sale of assets tran· sactlon has the possible advanti'lge of enabling the acquiring corporation to ac· quire only lhose liabilities of the seller which it wishes to acquire, in Alnbama a sale of assets which involves the sale 01 substtlntlally all of the assets of the sell· Ing corpora tion will probably be treated as a de !;tcto merger, and the acquiring corporation Is likely to be burdened with

all liabilities of the sei ling corporation regardless of any agrCi!ment to the c(mtrary,t 4. Exchange of stock-Another acquisition method, but one that seems to ha\le been used liule In Alalmma, 15 the eKchange of stock transaction,'Q Under this method, il corporalion Ciln enter into an agreement with anoth!:!r corpof'oItlon porsuant to which th!:! stock of the seiling corporation will be CltChangoo for stock, other securities, cash or other prol>@ny of the acquiring corporation. The procedures for approving an exchange of stock transaction are baSically Identical to Ihe procedures for a merger or con· solidation, which will be discussed further In part II, The eKchange or stock I)rocedure can be (01l0Wl'd to require aI/ stockholden of the seiling corporation to exchange lhelr shares In the selling Corporation for the consideration offered, The effect of this transaction, like the interim merger discussed above, v.<Ould be 10 make Ihe seiling corporation a wholly I)Nned subsidiary of the acquiring corporation,

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S, Sale of stock- The final fornlthm a sale of a business might take Is a sale of stock of the seiling corporation In a priV3te tJ(lnsaction by the selling corpor,ttion's stockholdm. In other words. the stockholderS of the selling corporation. or at least a malOllty 01 them. coold agree with the acquiring corpor'llion to sell their shares of the selUng corporation to the acquiring corporation for cash or to exchange such shares for securities or other property of the acquiring corporatiM, The terms of the sale would be negotlatoo between the shareholders of the seiling corporation and the acquiring corporation. One reason for using this alternatiYC is simplicity in that a Sille of a majority of shares of a selli ng cor· poration might be nego1iated and con· summated (Iulckly, and this generaUy can be undertaken wlthoul corl>orate actlOll by the seiling corporation or appl'CI'Val of the other shareholders who are not par· Ilcip..11ln8 In the sale. Thus, certalrl procedural req uirements which muSI be followed in the other forms noted above need not be Siltisfied In a prlv;lIely

negotiated sale of stock. " nOlher advantage 10 this method rests in the ability of the majority holders of the selling corporation's shares to sell the shares at a premium price. Often. this means that the price paid (or the maJorl. ty (or control) shares e«:ceds what would be paid for the minority shares either In a privately negotiated sale or a subsequenl merger of the selling corporation with the acquiring corporation . COUtts have made il d ear thOl, as a ge~ral rule. a premium price may be paid for con· trol imd thai the majority stockholder (or majority group) ~ no duty to di strlbutl! the premium to the minority.n As mC'ntloned In part II. h~r. there are certain dlsadvanlages 10 the acquiring corporallon If Ih ls method Is foIlOWt.'<i .

II. Procedure Except for the sale ol stock In II privately negoliated transaction, all of the form s pfl..>sented above are subiect to cerlaln speclfl€!d statutory procedures before they may be utilized. For example. In a mergC'r the boar"d of directorS of each

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constituent coq)()ration Ii requlrl>d to adopt a plan of merger, and the plan must contain prO'Jisions specified in the statute such as Ihe consideration to be received for the shares of the selling cor· poralion.n The ooard of dircctQf$ must then direct that the plan of merger be submitted to a 'o()te at a meeting 01 shareholders (which may bt either an annual or a special meetinsl. and wrillen notice of the meeting has to be giycn not It.'Ss than 20 days before Ihe meeling. II coP\' or a summary of thl,! jll;m of merger or I)tan of consolidation must be Included In or enclosed with Ihe notice of the special meetlng,1) " I the meeti ng of shareholde.... the plnn of merger is mquired 10 be apprQYC(! by the affirmilllvc ~Ie of the holders of two-thi rds of all shareSof each constiluent corl>oralion entitled 10 vote on the plan ,l. FolI(MIlng shareholder approval. articles of merger must be executed by the approl)riale corporate cfficers "nd be flll>d with the Secreta ry of State." These proc«lurt..'S are the ~1me fQr consolldalions and are substantially the S<lme for exchange of stock trar)SlIClions and sales of assets other than In the regular coorse of business. except that no filing with the Secreta ry of State is requi red following approval by the stockholders in an exchilflse 01 stock or sale of assets transaction. In all of Ihe transactions discussed in pM I, excepl the privately negotiated sale of stock. stockholders h.we the right to dissen t r• and. upon following the procedures set (orlh In Section 10-2 .....163. have the right to have Ihelr shares pur· chased for cash at the fa ir value of such shares as of 'he da te prior 10 the dale on which the shllreholder vote W3S taken lll>' I)roving the l>roposed corJX)ra te <lction. Note sl'VCral Ix>inls regarding the a~ procedures. First. In each transaclion form , excep' the sale of stock, the board of directors must tr ppr(1.'e a plan that rela tC5 to the form . I.e.• a merger, consolidation. sale of assets, or exchange of stock. Typically, that plan Is set fOrth in a written agreement which contains the terms that are required by statute to be Included In the plan and which often sets forth additional terms agl"l"l'd to by the parties, Second. the statute requires thilt Ihe plan, or a summary of the plan, be in. November '990

cludt.'d In or endosed with Ihe notice of special meetinB of the slockholders." This raises disclosure Issues 10 stockholders whi ch are outlined fu rt her In pM III. 11 is sometimes thought thm .. company which is not a I)ubllc coml>any, and therefore not 5ubject to the disclosure obligations d the SEC's proxy regulations}' with rega'tlto maUoo to Ix> 'IOted upon, need pf"Olllde a little or no disclosure to stockholders.. In the case 01 a transaction such as a merger, a sale of assels, or <In exchange of stock, howeYer, Inade(IUale disclosure can JlfoYlde a ba sis for auack by shareholders who mlJy be unhappy abou t the tr;msaction, especially the conSideration I>"lid (or shall'S of the seiling corpo/"il tion.19 These aclions are gener,llly founded upon state IllW or the antifr(lud provi sions of the fedeml securities laws.

III . Cerl ain problem areas 1. Conflicts of inte res t-Scv~.!rOlI 1)101>lems Mise in che ffilnS-lelions discussed ilboYe when aplJf"tMIl by the bo<Jrd of directors is required. For example, under Section 1()"2A-63, if i1 direttor Qi Ihe seilIng corporaTion is a director or officer of, or 15 nnancially intctCSted In, ,he acquirIng corpordtion, the tr.IOs,'lCtlon contains an Inherent conflia of interest, As a result, the conflict must be disclosed to the full board of directors which is rc(Iuired to authori:r:c the transaclion with-

out the vote of any Interested director, or the conflict of jnTerest mu51 be di$CIO!.ed to the shareholders who must apl)fO'.'(l or filtify the triinS-1Cl ion. Obl.lously, OJ conmct of Interest exists a director of the seiling corporation Is also a director or a major stockholder of the acquiring corpol"iltlon. Such conflicts of interestOlre not unusual in Silles of small boslnM~ They need nOI necessarily create problems, but If there arc minority shareholders In eIther the scillng corporation or the acquiring corporation, the proce-

Many of the (oregoh18 problems can

be ilvolded jf the sale is ul1dertaken pursuant 10 il wiv,uely negotiated sale of a majority of the shilres of Ihe corporation by Individual stockholders. tn that case, no stockholdlH meeting or other S"llutory steps arc required to be fol. 10YIed. AI the same time, however, If the acquiring corpor,)tion is unable to negotiate the purchase of 100 percent 01 the stock 01 the selling corpofiltion, the acquiring corPQfil tion, once it acquires a nlalority of the stock, will be left with minority stockholders in the selling corporation, and, thus, the acquiring COfporation and Its management will ()Y,'I) fiduciary obligations 10 those stockholders. Th,), may be a resu lt which Is unp.lllll'1blc to the OlCquiring corpor,)tlon and Its boMd of dlreclOrs. A fi ntll l)Qinl relOl te! 10 Ihe conslderOl' tlon to he Ill-lid In Ihe trom5<lction. In most cases, a business will be sold for Cilsh or stock of the acquiring corporation. A cash sale Is generaily less COIllI)le)( thOln a sale for Siock or other securities of the acquiring corpo ration. Sometimes the considera tion may be mi)(cd, I.e., part cash or pdf! stock (or other PfOl)Crty).1O If the s,lle in\'Olycs the Issuilnce of STock or securities 01 the acquiring corporJIIOn, Ihe Issuance of stock or other secufities may subject the acquiring corpor.lllonto The rt'giWaTion requirements 01 both the Securities Act of ....IOlb.lma Jnd the federal seturilie$ laws unless exemptions from regislration are 3'l3ltablc.

341

Richard Wilson & Associates Registered Professio nal Court Repo rters 17 Mildred Street

Montgo mery, Ala ba ma )6104

264-6433 duro sct forlh In Section 1()'2i\.63 should be followed carcl'ully in order to ensure !halthe IrilnsaClion is free (rom ,mack by any dlsgfumlcd stock holders. NOll', 100, Ihm Sc!ctlOIl lo.2A-63 requires that the transaction be fair and reasonable 10 the corporation rcsardll'Ss of the manner in which the transaction

is il~.11 Thus, eYeflthough the IrilOsaction receiws the al)prOYal of the disinlerl>SU.'<.I directors, or receives Ihc approval of stockholderS, if it is not fair and reasonable 10 Ihc corporation, It Is 'IOidablc because of the rela tionship gl .... Ing ri se 10 the conflict of Interest. Additional problems arise under this Sc(llon If n majority of the dirC(tors h(lVl! the prohibi ted conflict of interest. The statute, for ex.lmple, providl?S that common or Interested directors may not be coun ted In detcrmlning the presence of a quorum at a meeting of the board of directors which authorizes the lrans..'tC:tion. What If the board of directors consists of fivo members, four of whom h:M'l a conflict, but a majority of which is rc(luln.><I for a (Iuonllnll n thi s case, the In:lbi lity of the board to establish a <Iuorum for a meeting would prevent director action and would mean that the tr.msoction WO(dd be re<luired to be appr~ by the stockholders of the corporation. Stockholder approvallYould protea the transaction from anack on the basis of thc conniCI of Inte~t, but the requisite board approval 01 the transaction \YOuld be absent. This dilemma, the result of whi ch would be failure to comply with the statutory prOCNlurcs, is not addrt.'SS<.od by the Sliltutes,U AJlothcr Issue arises In the casc of stockholder approval under Section

) 4'

10-2A-63. If a connict of intercst tran saction is presented to t'lC stockholders in order for the §eCl lon to be satisfied, C.ln Interested slockholdCfS vote, or must the transaclion be JllPrOlCd only by those stockholders who hiI\C no intert-'Stin the matter to be voted ulX'n? While SeCilon 10-2A-63 specifically excludes Interested dimctors from votl Jlg In any director action On the matte!r, It con tains no si milar prohibiTion for Interested stockholders in the stockholder vote. rhus, there may be a leglslllliYe implicat'on that inte!teStcd stockholders may \/(lIe, There Is nO case law on point in Ala~ma, however, and there Is some! authority In other jUflsdlc. tion s suggC'Sting that interested stock· holders should abstain from \l()ting.n 2. Oisclosure to stockholders-Except (or the sale of stock In (I prlv.ltcly negoti111ed transaction, ellch of the transactions d iS(us~ (lbavc must be np. proved by stockholders. The statute s!>(."Cifically requires that the plan of merger Of consolidation be distributed to (or be described for) the S1ockholder;,u In addition, 015 noted alx:M.>, the conmCl of interest statute may fl!qu lre disclosure to shilreholder; of the particular conflict of In terest in quc!sUon when the shareholderS Me requlrct.l to vote on lhe tr(lnstlctlon. The obvious <luesTion here Is how much di sdoSllf(! should be presented to stockhoklers in thcsc types of transactions. While a nonpublic company is not subje<;t tl) the disclosure rcquiremenl5 of tt-e SEC's proxy regulalions, the Alablma 8usiness CO(l)()fiItion Act nonetheless requires at least some disclosure to the stockholders with respect to certain types of tran s.1Clions. ImpliCit in thJt requirement 15 Ihat the disclosure be fai r and complete, i.e" that

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I'L_

18001 749-9060

It not be misleading. While there are no cases in AI:lbamJ thm speilk to the disclosure which mUSI be made 10 stockholders of il non public comlJany, cares in other juri sdictions confirm that stock· holders must be Informed fJlrly about the matters to be voted upon at a stockholder meeting and that any disclosure giYen must contain all material inform"tion necessary to enable stockholders to make an informl,.od dl."Cision.n Some cases have suggested that rn OrdN to ensure complete disclosure to the stockholders the disclosure I)rovlsions of the SEC's proxy rules should be followcd .u Whllc cases from Olher sta tes indit;ilte that the disclosure obligations imposed upon a nonpublit; comp.lJl'( arc prob.lbly not a5 great as Ihe obligations im~ on a public company under the SEC's proxy rules", disclosing In accordance with the proxy rules, at least In substan· tial part, should help ensure that the inlo,"\alion given to stockholders is adequate and that the risks of having the transaction QV(Jrturned, Of enjoi nl!d, for lack of adequate disclosure! arc minimizt.od. 3. Disclosure of pending negoliations-A l)artlCulJlly troubling issue arises during negotiations regarding the sale of a business when there are stockholders of the selling corporJtion whQ are not privy to the negotiations. SomeTimes these stockholders C',.ocfl sell shal'l'S to the t;Qrpotatc insiders who arc aware of the ne!gotiations bUl who fJI1 to disdose Ihc negotiations to the selling stockholders. If a del1nlllVC agreement regarding the sa le of the corpo fill ion is in cxis tent;e, then any purchase of stock by corpora te insiders aWMI.! of the agJ'CCNO'Ii'Cmbcr 1990

ment from stockholders who are un· aware of the i'lgreement would viola te Rule IOb-Sllof the SEC on the basis that the dennltlvc agrccrllfMt is a material fact which should be disclosed in the si'lte or pvrchase of the stock.'i Sometimes, however, negotiiUions are merely in process, and no definitive agreement has been reached. Before the U.S. Supreme Covrt's ruUng in Basic v. Levin sonJ~ several circuits stated thtlt unless i'ln agreement in principle had been rei'lchl!d res:m;ling the purchase price to be paid for the corporation and the structure of the !r,l nsactlon. no disclosure obligmion existed to other stOCkholders.11 In Basic, however, the Supreme Court ruled thiU the mere existence of negotiations can be a material fact which must be discloSt!d to all stockholders if there Is any trading in the stock. According to the Court, whether the existence of merger negotiations Is mi'lterlal depends upon assessing the I>robability tha t the merger wi ll occur and the an· tlclP.1 tL>d magnitude of the tra nsaction to the seiling corpora tion if it in fact oc. curs.lZ

The Basic decision establishes the rule that even in the s.11e of a non public com· pany, corporate insiders (and their coun· sell must 00 sensitive to whmher any trading In the stock of the selling corporation is taking place. This Is cspccl,dly true if any persons who have access to the Inside information regarding the negotla. tion s are purchasing stock from un$u~pect ing stockholders. If that is the case, such persons, and poSsibly the cor· I>oralion itself, may be in violation of the federal securities 1<M'S on the Ih(!()ry Ihal the purchases have taken place in vloli"ltion of the ban on trading on the bi"lsis o ( mater/ai, nonpubliCinformation under Rule 101).5.)) 4. Business judgment of the board Except for privi'ltely negotiated s(lles o( stock. all of Ihc tri'lnsaction s discussed above must be hlitlally approo.-cd by the board of directors of the seiling corporation. As a resu lt. It Is the board of direc· tors of the corporation, In the first instance, thai must make a decision as \0 whether the tran sa(;lion is in the best Interest of the corporation and, thereafter,

You can 't get closer to the issues than this. At l awye" COOPCflltive Publl, hlng, we know our analyt ical lega l research system II not completo without one vital link - our field represen tatlvc •. They know whal', available, what'. affordable, and wh o" fC lIOurCllI will txr of the greatl,!st value to your practice, given your ncC(b and mi rkct. Right now, your Iocl l repl1lsentatlvc II lo~dy to help you gQt the malt from our Integrated library for Alabama practice _ fro m Al R to Am J... or uses to US lEd. If you wilnt to be In charge, tillk to a representative who'. In touch with your nct'dl. Contact your locill rep resentative directly, or call ' -800.527_04]0.

Karl;'O Runlotil t4().4) 362·81)5

1111

l;iwyer.; Cooperative Publishing In d#plh. On pol"t. In p.rsptlCtiw.

Dr t." Rooks (2OS)8 7t ·6H8

to recommend the tran$i'lction (or 5tQCkholder approval. Anytime i'I board of di· rectors o( a corporation Is re(lulrcd 10 m(lke a decision regarding wha t Is in the 00s1interest of the corpor~tion, the directors must satisfy certain flduciMY duties. These duties enCompass the duty of loyalty i'lnd the duty 1)( ( are.J " Accord· ingly, when directo~ decide whether a transaction is good for a company, if any challenge to the decision Is eYer presented, they must be able 10 demonstrate that these duties were satisfied. Another w:to{ of stating this proposition Is that the boMd of dir(oClQrS of t h~ COr· poration must act In accordance with good business judgrllerll. While there are a feow Alabam~ cases which address the business judgment rule in Alabama ?1 there arc a hOSt o( cases in Oel(lware ((IS well as in other Jurisdictions) which discuss the duty of the bo~rd of directors In a sale of busi ness con text. Those ( ases stilte what Is commonly known as the "business judgment rule." This rule provides that when a board of directors acts its decisions will be presumed to be In the best interests of the corporation and will not be disturbed by il court provid. ed that the directorS acted with due care, In good faith, and withoul self·interest.J6 These princi ples apply equally to Pllbtic and nonpubllc corporations. Accordingly, in the sille of a nonpubllc coq>oration, the board of directors must be prclhlrL'(1 to demonstrate to mi nority shareholders that irs decision sati sfied the busi ness Judgment rule. Business judgment rule Issues can arise In iI variety of situations, but two examples will suffice here. First, ,nsu me that members of the bOMd of directors o( Ihe seiling corporation wish to merge their corporation Into the aC[lulri ng corpora tion, Assume further that some of the directors of the selling corpo ration own siock or are otherwise finan cially in te~ted in the ac· quiringcorporatlon, and, therefore, have a conflict of Interest In tho tri'ln ~i1Ct ion. Finally, assume thai there arc a rlumber of other stockholders In tbe seiling cor· poration, 50 that the dlrec to ~ of Ihe sell· ing corporation owe fiduciary duties to proteclthe Interest of the minority stock. holders. In that situi'ltion, the business judgment rule requires that any decision made by the board of directors regarding the sa le of the cOfj>oratlon be free of the cl)nflict of interest.

343

i\ccordlngly, II would be typical for the nl(~m bers of the board of directors of tho selling COl'IX>r.ltlon who nre not nnanclal· Iy interested in the transaction 10 serve as a committcc 01 directors to review all rt!levant facts reS-lrdln!:! the mer!:!t!f and to apprtM! the transaction. Note that this process Is consistent wHh Section 1~2A-63 which w ts forlh the procedure that must be followed for the approval of transactions in which dlroctors have a conllict of Inter~t.J1 EYen if the terms of the transaction are cotlrely fOlif to the sell· In!:! corporation. if the decision of the

boilrd of directors to recommend the transaction is tOlinlro by a conflict o( in· terest, then, under th~ business judgment rule, a court is free to second·g\Jess the decision 01 the directors. II the court finds thill the transactioo Is not inherently (air, It can enjoin the consvmmatlon of the transaction or allow damilges to mlnori· ty stockholders who dilim that they have been damaged <1 $ a result of the tran· saction. The second example in'-'Olves a situalion in whiCh there Is no conflict of In· terest and Ihe directors <lCt entirely In

good (<lith. It merely offers the issue of whether, In ;lI>proving the transaction. the directors exercised thell duty of due care. In other words. WCre the dlrt."Ctors fully Informed .. bout the value of their corporation (and other tran saction tetms) when thl.'Y authori ted the trOlnsactionl The Delaware case 01 Smith v. !I.ln Cor/cum" although II involved a public company, presented a situaTion where the directoB 01 the selling company a~ prOYed s.l le ilt il price lhat Incloded a substantial premium OYer the prevail. Ing mOlrkel v,llue. t\Ccordlnaly, on Its face,

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the transaction Jppcarcd to be "fair:" N the same time, hOYJe\.'Cf, minority stockholders brought an action for damages <lg.1In5t the (lirettors of the coml>any on the basis that the directors could h.l\IC 01> talned a higher price. The court, in reviewing the procedures followed by the board of directors In approving the transaction, held that the directors did not exercise Iheir dulY of due care. The court nOted that the proper standard to judge director actions in this con text Is a gross negligence stan(!,lftl. It found thaI the board of directoo, In relyinl! almost exclusively on the chairman of the oo.lrd of the corporaTion to determine what the comlxmy was worth, In faili ng to obtain (In appraisal of the compllny by lin Indepen(lenl expert, ,md in failing to make their (M'n judgment as 10 the inherent worth of the company, were glQssly negligent. The dircctors were held liable to the stockholders for damages.1I Smith v. \(tn eorkum lIIustra tcs IhOtlhc business judgment rule can be harsh. It is vilillthat, when a board of directors al)proves a sale of a company, the directors kt.>ep in mind that they m<IV be required to demonstrate to a court Ihat they acted with due care In arriving at a value of the COr'l'lpany or in approving other terms. E~n in the nonpubllc company context, the board of directors must be prudent about Ihe procedures that It follows. 5. Sale of Busincss Ooctrlne-fraud In the sale of a securit y- The sale 01 a business corporation almost always generates considerations under federal am:! stale securities laws. In Ihe sale of iI closely held corporation, Ihe form cltne transaction (I.e., a merger, sale of assets, sale of slock, etc.) oftcn Is Inll>ortanl only as the mcitns of transferring the business. Prior to the Supreme Court's decision In Landreth Timber Co. v. /Anclrcth,411 SCYIlral circuits, Includ ing Ihe Eleventh Circuit, had held thaI In Ihc sale of a business, In which control of Ihe business shifted to Ihe purchaser who Inter'lded to operate the bUSiness, no sa le of a security occurred within Ihe meaning of Ihe federal securities laws even though the trans"etion witS $\fuctured as II slock sale," This rationale, known as thc sale of business doctrine, held that whal was primarily Involved WOlS a sale 01 a business, and Ihc purchaser. who Inlended to Opel'ote the business. really did nOI need the protection of the federal securiUes laws.

/.andrelh rejected Ihis doctrine.") Now, a sale of a security 15 deemed to be Involved even in the simplest of transacl ions, such as where a sole stockholder transfers 100 percent of the stock of the seiling corporation 10 the acquiring corporation which, of course, will operale and hiIYC sole control over the business. Recen tly. the Alabama Supreme Coun followed the ralionale of Landrelh am:! held Ihal the Alabama $$;uril ies laws apply to a sale of a business and the transfer of all of the Slock.H Hackney has broad Implications In Ihe sale of a nonl)ubJic company. Theantifraud provisions of Ihe Alabama Securities Act" clearly apply and will provide remedies to either the dclrauded seller or purchaser In the sale of business conlext. The Impact may

be grealer for the acquiring corporation, which may have a cause d action ag.linsl the seiling corporation (or its stock· holder$) if Ihe seiling P.1tTy fraudulently misrepresents to tnc acquiri ng corporation Information about the business beIng acquired.

Conclusion The s.lle of a business is sometimes considered to be a relaliloely simple undertaking. especially if the busmess is operated throul!h a nonpublic corporation . As can be seen, hOWl!\f(!r, Ihe sale can lake a variety of fOfms, and usually a number of corporale and securities issues must be addressed before any effcctive sa le can be accomplished. •

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II. Spt.'Culation ~is a highly subjecti~ concept which means dlf(ercnlthings to differerlt Inves totS.~ Wade, Supra, at 7. It arguably resuhed In court s substituting their ONn judgment for that of the trustee, This, along wi th the common law rule's focus upon capital preservation, has "encouragt.'<.l truStOOS 10 ill\ll!St conservaliwly to avoid losses, ~n though ... SCKalli.'d 'safe' I~tmen t; actually may Increase OYCrall portfolio risk." Id, Section 19-3-120,2(al. like ERISA and the various other stilte statutes, again omits any referen ce to SpeCuliltion or 5.1fcty of CilpitaL Wade, supra, at 15. A trustee, Instead, iJ to manage Ill\ICStments to "allain the purposes of the account," This objectllie standard contrasts with the inherently subjecti~ speculation/preservation of investment dichotomy underlyIng the common law "prudent person~ rule. W,lde, supm, CIt 12. Under the new standard, a trustee, subJect to the trust's objectives and other relev.lIlt factOfS, may sel(!(t an irM)Stn'lCfl t In ordcr to Increase capital rather than merely prese(\/(! It, While the Restatement prohibits an Il1\oeStment with a high degree of risk, eYen where the opportunity for gain ou twei ghs any ri sk, S19-3-120-Z(a} "does not require the conelusion that any lr1Vl:!stmcnt is per sc imprudent based solely on the ri sk associated with ii," Wade, supra, at 15,

The account', Overall portfolio of assets Subsection {~} repre sents another significant departure from the common law. Its second sentence permits Investment strategies consistent with modern poII(olio theory and other Investment

.. _ N _ J

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techniques that account (01" the composition of the portfolio as a whole In terms of ilS oycraU risk and return. Section 19·3-IZO.2(a) I'fovides, in pari, Ihat a truSH.>e "shall consider the role that the investmen t plays within lile <lccount's overall porlfolio of asscU:' (emphasis added)_ This mandatory dirc<:tion is similar to that of the Washington ~a tute.· The trustee also "may consider the general economic conditions, the antidpmcd Ta x consequences 0( the (nYeSt· ment, the anUdp<lted duration of the account and the needs of the bcneOdarles of the account:"G At common I,)W, while some courtSat least acknoYo'ledged the role tha t a particular Investment played wi thin a trust portfolio as a whole, sec, e.B., Chase v. PcvciJf, 383 Mass. 350, 419 N.E.Zd 1358 (1981); III rc Banko' New '!brk, 35 N.Y.2d 51Z, 323 N.E.2d 700 (1970l, these same courts emphasized that a trustee mUST focus upon the meritsof each Individual investment. For example, as the New York Court of Appeals has stated, "[IJhc fact that Ihis portfolio showed subst.mtil'l over.. 11 increase In totJl v.llue during the accounting period docs not lnsulme the trustC(! from responslbJlity from imprudence with respect to IndlvldUill in. vestments for which it would otherwise be surcharged",:' 35 N.V.2d ilt 517. The new statute, more<M!r, addresses a major criticism o( the common law "prudent perSOn" rule, that Is, the particular concept of risk Imt)lIcit in this rule. Three clements summarize this concept: (11 a focus upon the ri sk of 1055; 121 a focus upon the ri sk of a particular inYeStmcn t, rather than a focus upon the oycrail portfolio; and 13} an isolation of

the risk of loss of a particular

I~tment

(rom Its potential for gain. Note. The

Re8ulation

of Risky Inve$lmcnls, to at least one com ment~tor, Implicitl y Incorperates this concept of "risk." Wade, $Upr'l , at 7. The common law rule's focus upon risk a...oldance assumes that a trUSt beneficiary's only concern is the possibility that fu ture trust il1'o'(l5tmenTvalues will be less than cost. Id. ~ t 8. A beneficiary'S concern, more than likely, is wi,h all p0ssible future v,liucs, including the possibility that such values will exceed cost. This suggestSthat, In cvaluming an Investment, a trustee should consider the opportunity for gain, as well as the possibility of loss, In short. the common law Isolates risk from potential return even though a beneficiary, more than likely, does 1101. The tradi tional focu s upon the risk of loss resulting from a particular Investment also assumes that the risk of an enti re trust portfolio Is merely the arithmetical sum althe risks of its component Investments, Id, But "to examine the prudence of ,lny single investmenT in such a portfolio out of the context of the portfolio would be akin to examinlnS thc prudence of the placement of any stone In a gothic arch wl thoot cx.amlnlnglts relaTionship to the arch ." Klcv')n, Fiduciary

Responsibility Under ERIM's Prudent Rule, 44 I, Ta;c'n 152, 155 (1976)_A

Man

particular Investment, which at common I<JW would be "spcc:u l at l~ If considered alone, may be "prudent" v. ithin the context of the portfolio as a whole, I.e., In light 01 its potential for gain and the CHerall ri sk of the portfolio as a whole.1I Under §19.J.IZo.2(a), a trustee may design a portfolio "in such a way as 10 contain securities that will react In different manners to events which influence the markel, so that mCM!mcnt downward in one par' of the portfollo will be offset by a COrre5l)()ndlng upNard ~men t In another part 01 the portfolio." Klcvan, supra , This type of portfol io "is theoretically less vulnerable to risk than any of it5 individual components, as each investmen t is made considering its effect on the overall riskiness of the entire portfolio." Id . Sti li , nei ther the language of § 19-3-1Zo.Zla} nor ERI5;. suggests that a ttustce nlay wholly Ignore thc merits of an Individual investment. For example,

November 1990

the DcpJttmcnt of Labor regulallons in· terprCling ERISA sliII requ i~ a deICfmin,,· l ion Ihal "a parlicular ill\ft!$lmenl ... is reasonably d~l&ned ...lo fUr1her the pur· poses of the plan, taking Into consldera· tion the risk of loss and the Ol>portunlty for g.1in ....~ 29 c'F. R. §25S0A04(a)·1{b)(2). Court decisions inwpreting ERISA arc conslstent.'1 Nor should one ne(cS$<1rlly view th t! statu te's failure to mention diversific.lIlon as eliminating thi s common law requirement." A tru stee should arguably diver· sify his investments, unl~s the various factors enumerated In §19·J-120.2. e.g., generi'll economic conditions, the beneflclar1~' needs. etc., dicl:tte ~thefWl)\C. Seclion 19·]·120.2, l ike ERISA, con· templates a two-step process. Fln.t, a tru stt.>C must InvesUgate Ihe merits o( II particulllr in\lt.'Stmen t, Second, the trustee must assess how this Iwticul(lr Invest· merIt affects the IXlrtfolio 3S a whole. Unlike Iho COmmon liJW rule, thi s secti()(1 le8it!mlz~ this SKood Step as P.lrt of the decision making process. Wade, supra, at 16.

As they exist at the t ime of the investment decision Subsection (b) of too Slatute also sanc. lions the application of modern portfolio theory: "The propril2ty ol3n Investment decision is to be determined by wh;1I a fi duclary knew or should hM known til tho time of Ihe decision about the in. herem M ture and t.'Xj)eCtcd performance of the Investment, th~ olItributes of tht! ac· counl portfolio. the general (,(Onomy. and the nrods and obiectlves of the beneficiaries of the accounl as they ex· isted at Ihe time of the investment decl· ston." This subsection closely parallels the language of the Ot!laware .md Georgia Statutes. 3nd Is consistent with ERtSA.'· 5c<:t1on 19-]·120.2(11) also retillns II key aspect of the common law standard: tha t II COllrt wilt Judge <1 tru 5 t~e on Ihe basis of hi s conduct In carrying OU I his invesl· mOnt responsibllllles, rather Ih<1n on the basis of his performance or results. Courts do not dem3nd infallibility of a tru stee; instead, they measure the prudence of his actions I1t' his conduCI

at the Ilmt! an investment is made. In re Morsan GuaranlY TrUSt Co.• 89 Misc. 2d

1088, 1091,396 N.V.S.2d i8I, 784 (1977), Under the common law rule. at least In theory, a loss of an Investment did not aur~mat ic"lIy rt"Sullln liability. The com· mon taw rule, however, provided lill ie, If any. guidance as to the SCOI)e o( Carchcd and monitored each investmenl in his portfOlio, thiit he had a rdtionill basis for each decision to purchase, sell or retain 3 p.lrticular lowst· men\. he should not howe been held liable (ot a loss mt!rely because hindsight revealed thaI his decision was il mislake. Restatemen t (5c<:ond) 0( Trum §227 commem 0 (1959). Sf!(! 91$0 Sfilfke v. Uniteo SWIes 1;U51 Co" 4~ S F.Supp. 670 (S.D.N.Y. 1978) (trustee acted prudently even though a decline in the markel value of retained stock exceeded 90 per. cent O\ICr a Ihree-ycar period). The inclusiOn of this language in Ihe statute hope(ully will result in a fCncwOO enmhasis IJ')' the COUrtS upon the ex·

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tent to which a trustee takes these (,lctOrs into accounl. In the past. somc courts hiM! gi\6'l In to the temptation of secondguessing a trustce'~ h~t ment decisloo5, particularly in Urnes of economic uncertillnly. See. c.8., In rc Chamberlain'S fSIa{c. 9 NJ, Mi5(. 609. 156/1.. 42 (19311 (holding the trustt'C liable (or!\Ot foreseeIng Ihe 1929 market cra sh). Section 19-3-12o.2(b) ellmlnllle5 the common liJW focus upon losses resulting. by Implication. from "speculation;' and dearly shifts the focus to the process by which a trustee makes ;111 1nvt.'Stment.

Relianc e on the express proviSions or Ihe trust instrume n!. Subsection (c) of section 19·3-120.2 merely emphasizes thlu thc trust Instrument Itself remains thc primilry source for determining Investment oblectives and rcsl>onsibilities. Under subsection (c). "[alllY fiduciary acting UI1(lol llgcwcr, ning instrumCrtt shall not be liable to anyone whose Interests arise from such instrument for the fid uciary's good raith reliance on the eq,re5SI>ro'JiSions of such

instrument." This l;mgL/ag!.! is identical to the languagc 01 the Delaware statute, and Is consistent with the COfl'1mon taw, but differs Signific;anlly (rom ERISA,'s

IOO' Nons

,Col P..... Codl! !IiIOoIOIbI (191111. 0.1 COilf IJ, SJX1J (l9I1l.G.o CodI!""'" §5J",I " H'Q (19M': w..h. """ C. . I" 1000101'1 "-"l ,~. M.M 5I.M Anft SSOI In l19l1I 1. J,Nt Utl~ fol(l4j.xJM8I. n U.s.c tlIOolc.oMIKBI. Col I'fIIb Code tll>QolOlb! ~ ~n. 0tI Code """ ,., 11. UJOlloO' (I~ J. W..w, ''''' Nrw C./,brn; ~II_ llrull! A )I.I11IIOtt' _"...,/.,..~ .. 20 ~"'. """,", I'rob .. I. 10 .mJI'~~ "W..do'1 , ,W,

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Under the common I:IW, a t(!Stator may permit j1l1 Investment In specu lative securities. RnslOltemcrlt (Second) of TruS15 §227 comments s, n (19 59). As alway5.

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MID-STATE ATTORNEY SERVICES. INC. 32 t Cindy Lane P,O, Boll: 20394

Montgomery, Alabama 36116 (205) 288·5975 t'.O. BOI( 2St I Mu~dt S h o~l"

_ 352

A I. 3566 t

Phone 120S) 38 t ·20~0

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NQn~mbc,

1990

a testator is free to vary the otherwise ap. pliCilble investfll~flt ~iilndilrd in the draft· ing of his own inSlrument, The new statute merely reemphaslz.es this point: "The standards set forth in Ihls section may be eKpandcd, restriCted, or elim· InilK'<! by eKpress provisions in a g~rn· Ing instrument,H Ala. Code §19-3·120.2(cl (SuW. 1989).

Section 19·3-120.2'5eUmlnillion of the common law focus upon avoiding spoculatlon and preserving capital IHguably clcllates the importancc of the terms of the trust Instrument. Wade, supra , at 6. Under the common law rule, even the eKpress terms of a trUSI could be oYerridden by the prohibition on sl>cculatioo, where, "OWlfl8 to circum. stances nOI known to the settlor and not anticipated by him." the making of su!;h Investmeflt defeall.>d the trust's purpose. ReMmcment (Second) of Trus/S §227 comment w (19S9).

The rClcnlion of assels Subst.'Ction (dl of §19·3·120.2, which is slml1ar to Ihe California statute, al SQ rcwesents a shift from the common law "prudent porson" rule. At common law, a trustee must sell an Improper Invest· ment regardl~s of whether he received It at the creation of the trust or whether it w,u prudent when Initially mildc. W,lde, supra, at 4. He must continue to monitor its performance :md dispose of It if subsequent cilcumst"nces render the hlvcstmenl unsuitable in light of the trust's objectives. as well as the In~s t ment strategy emplO')llXl by Ihe trustee. There was. 01 cou rse, an exceplion to this rule: where the trust Instrument commanded the trustee to rClain an eKisting Investment, Wade, supra , at 11 Under 19-3-12a2(c), a truslee "may without liability continue to hold proper· ty received Into an account n1 Its Incep.tion ... 11 and as long as the fiduciary, in the el<ercise of good faith and of reason· able prudence. may consider Ihat reten· lion to be In the best interest of the accounl or in furtheran ce of the 80als of the governing instrument." ThiS property, significantly, "may Inciude... stock In the fidUCiary If [il is1 11 corporation ... :' This tempers the common law rule that a trustee must dispose of an "improper" assel unless the trust lnstrumenl specifies otherwise; now, a trustee may make a good faith determination that retcntion The Alabama Lawyer

serves the accounl's inlereslS or funhe~ the trust's goals. This section of Ihe statute is also con· SISIent with the ERISA. As one court has stated, "[wle have no doubt Ihat ulldet the 'prudent man' rule, which Is codified In ERISA, the tlustees here hllvc a duly within a reasonable time after ERISA loolc effect to d ispose of any pari of the trust estate which vrould be improper 10 kCCp,H MOfri5SCY II. Curran, 567 F.2d 546, 548-49 (2d Cit. 1977> ,

Thus, fiduciary actloos 0 1 In3Clioos are subject to section 19·]·120. 2 l.oven if the trust was created prior to May 16, 1989. thc dfcctive date of that )ec\ion. Concl usio n Sc<tion 19-3·120.2 repre.ents a significant departure from the common liM' "prudent person" rule. fi rst, It allows a Irustoo 10 make ,1 panlcuiar Investment In the cOnteKt of other investments, and allows a IrUSlee to aCCounl for both patentlal g.1lns ilnd losses. Second, the Sfilt· ute elim inates Ihe common law's focus on avoiding speoculatlon and preserving Ihe trusl corpus. Third, the statule, it is hoped, will result In a renewed focu s by Ihe couns on the process by which fiduciaries actually make In\ICstment decisions. Fintllly, il reaffirm5 that the key to dllllning a testator's inlent Is the trust Instrument Itself. While Ihe st"tute establishes the standard by wh ich a coun should judge a trustee'Sconduct, a tcsta· tOf Is free, as illways. to l>rovk:Ic directions 10 Ihe contrary. •

Retroactive application Finally. subse<:tion (f) of 19·3·120.2 prolIides that "this section shall apply to all fiducia ry relalionS nON existing or hereafter crealed. but ooly to the fid uciary ac· tlons or Inactions occurring after the clfeetlY<! datc hf!rcof: This Is significant bee.luse one of the otllcr malar Irust slat· utes In Alabama, the Alabama Princi pal ilild InCOllle Act, as codified ilt Ala. Code §19·3.270 el seq, (19M), is Inapplicable to trusts created prior 10 its effeclive date. Sec Englund II. FifSl NiH" 8ank 01 8irmlng/lam, 381 So. 2d 8, 10 n.l (Ala. 1980).

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wo rk softl\·( jfl'. Thl!! ~'fII'lJ·sptcific pro!{IYJIIIS(u'k IIlIIflipfl'. ciIQiCf! (/lui fill·

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62 Whn" Sl . N~ 'oIItl . NY 10043 tllOO! 221· 2w.! flA X (212, . ) 1 '111

353

Assessing the legal Needs of the Poor: Building an Agenda for the 1990s by Ke nnelh W, Ballles, Sr.

,,\1

This is Ihe third and final article In Ihe Kennelh W. Ballles, Sr.,

rec:ei~d

his un路

de'Sfadu.lte degree from Ihc University

of AI,lbama in Birmingham and his law degree from Cumberland School 01 Law, I'le Is currcmly a so le practilionel In Birmingham, Dnd is chairperson of Ihc Alabama Sum.' 8.'lr Commiuec on AC:'Cf!U !O LCglll Services.

354

three-Pilrt series of articles by members of the Alabama Stale Bar Committee on Access 10 legal Services. The first article dealt with thc leg<ll reeds survey for Ala路 bama conducted I7t Davis. PcnOeld & As-

sociates and the results of that survey 01 Ihe poor, The 5e(ord anlc!c deal! with the aspect of the survey with regards to members of the bM, Judiciary and Icgill services employees and their perception of Ihc Il'gal needs of the poor within Ihis )tiltC lmd how those needs are being met.

This article will discuss Ihe proposal of Ihls comminee to Ihe bar and board of bar commissioners-Ihe 'oblunlcer lawyer Program. The bonom line of the legal needs ~u~ was what many lawyers hiM.! been acutely aware o( for many years-the majority of the legal needs of the poor are nOI being met. It Is evident that the curfen! system does not and cannot mff!t i'Jnd handle thc growing nLJmber of legal problems fa ced by the poor segment 01 the poPLJlation. There are a number of l<!Wyers in priVil1e practice who con tribute substantial time and resources each yeOlr through various mc~ns, including organized programs sponsored by locOlI bar associations or legal Services programs, and assist the poor with legal representation. These lawyers ~ hould be recognized and applauded (or their work in this ilre" but many times they go unnoticed by the majority of us. On the othilr hOlm;l , there arc a number of lawyers who have the desIre to assist the poor with their legal problems but ft.>el lacking In kna.vledge In this ilrea, those who do nOI realize the enormous need of legal assistance to thc poor segment o( the poptJlation, and finally those who do not Cilre. In recent ye~rs, hOWCllef, a sense of professionalism has been rekindled ilnd lawyers have a desire to de\(lIe II portion of their efforts In pl'O'Jiding legal assistance to Ihe poor wi thout expectation of finan cial payment. This commi ttee w;) s charged by the bar to "review, cvalu;lIe and foster the de-. ~Iopmcnt of pro bono publico programs designed to assure access to legal services by those d ti.wns of Alab.lma who (;annQt afford thcm.H The (lrst step was the SUf\eY to assess the legal needs 01 the target group- those citizens who cannot afford legal services. The 5C(;QnQ step wIIS !O Investigilte, C'lalualc, assess and criti cally review other programs which have been implement(..od In other states to the needs and limitatIons faced I7t'

November 1990

practitioners in this stilte. The third SteP W<lS to develop a program that would meet the legal nCoeds of the l>DOr imd be a fundional and viable program through. ou t th e en tire stnte, The fourth and final step was to implemenc the progr<l m, The committee has accomplished three of the four steps OUl lined, The reo suit of Ihis work Is a program en titled the \blunteer ~r Program. The basics of this program were discussed with leaders of the bar and j udiciary In May and met with apl>rovJI and encour<lgemenl, The fo urth Jnd final step, the implementation of the progr<lm, Is now in progress. The board of bar commissioners In July adopted a resolution ra tifying the \blunteer l.aw~r Progr.lm, The search is now being conducted to select a sta te coordinator for the program , The coor. dlnator w ill work through the office of the Alabama State Bar, The lob description and ft.'qulrements of the Slate coor. dlnator are des<dbed elsewhere In this issue of the l.1wyt'r. The need for a \blunleer lawyer PrOgram has been recognized In Ihis state and across this counlry for some time, M ;'Iny States have adopted and Implemented progl1lms of similar nature to meel the needs of Ih05e persons unilble to afford a law}':r. Some slates have reviewed and discussed the possibility of a mand.1tory requirement thai each law. yer devote a portion of his or her lime to Imwlde legal assistance to the poor, 11()Y.1(.wr, no sta te has .. dopted a mandatory f(.·{wirement althis time, Two of our neighboring stJtes, MiSSissippi and Georgia, have a volunteer program presenllyoperating. The \bluntC!er ~r Progrilm devel01X,>d and designed for Alabama will build upon Ihe loelll programs now in place In the urban afCas and utilize this groundwork 10 eKpand to those areas of the Slate not CO'lCred under the current programs. The \blur'lleer ~r Program will utilize a sl<lte coordinator to oYerseE' this pragr.;am throughou t the sta te. The coordinator will issist the local bilr associa tions with the development of n(....... vol unteer programs, volunleer rt.o. cruitmcnt and training for the yolunleers, and provide technical assistance and 5UPI>Drt. The program will entail a number of different avenues to create an .;area of in· terest for the lawyer while providing

The Alabama I.awyer

much needed legal assistance to the poor, Some poSSibilities include areas of specIal need or special client issues, specialty panels of l>artlcular interests of the lawyers, providing specialized tr:linIns to l;}Wyers outside their normal scope of practice, providing " <lIning seminars In conjunction with CLE programs for credit, and providing mentor panels of experlene«l lawyers ....ho v.uuld assist volunteers with particu lar problems or questions, The program will all(M' a lawyer to obtain valuable experience In un· filmili;1r ilfeas of the law whi le prO'.'ldlng th e traIni ng and support not mllable elsewhere. The lawyer can benefit as much or more from the program as the client. There are unlimiled possibilities and potential for this progr.1m through the kf'lOWledgc, dedication arId resources of the lawyers In Ihis Slale, The success of the Volunl(.'er Law~r Program wi ll depend upon Ihe law~rs of the state. The success of Ihls program will depend on the attrtudes. the profesdesires and the concerted sionalism, e((ons of each law~r who Is a member

tnc

of the Alabama State Bar. The efforts in other states h~ met with Vlrled success. The success has been due to a IMge degree to the percen tage of plll1lclpation of the volunteering members of those Stat<! bm associations. The complete success of the Volunteer Lawyer Program in Alabama will be accomplished only when each member of the state b.1r is also a member of this program, As preo viously sta ted, the solu tion ~ seek to this unmet need of the legal needs of the poor must hilve the support of all segments of the bar to be successful. There must be a cooperative effort by each lawyer to enable this program to be a success and provide legal assistance 10 those who need il most. The challenge ahead for the program ilnd for each lawyer In this Slate Is to retu rn to being a professlon~1 In the Irue Sense of the word and volunteer to become a p;1rt of Ihis wortho,' progrJm, If each lawyer dt!VOtes a small portion of his or her time to Ihis effort, the resu lts will be overwhelming and the rCWilrds great. •

At Union Bank, Trust Is Our Middle Name. Offering Soli d T rust Ser vice Since 1901 H~nry A. I.('~lIt,

I'rC8Ident / Ch!~f "x~Ullve Ornerf Hobert 1\. Kttly, ~:x~l iv(l Vk't IIre!I;d~,\t Jan)t~ G Hnwthurnr.Jr" Senior Vic."t l'rtsidenl·Tru!il1

• UNION BANK & TRUST COMPANY 60 COMM ERCESTltEt::T / MQNTGOMEkY, Ai.AlIAMA I 2M-240-Z265 I MEMIl IlMm lc

l55

Pass the Torch by Marga ret

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The Consrirvti(m of Ihe United Stales

of America was drafted between May 14

imd $cptember 17, 1787. and became 01> era lh~ In 1789. II Is the oldest wlillen constitution nov.' in effect. The drafters of the Constitu tion were st'!cklng \0 crcale a gO\lernmcnt \0 prolcct us from foreign enemies, 10 fos ter our gene",l lM;!lfllfe and I;ommcrdill develop. men! and to pfI..'Scrvc pt.!ace Int<!rnally. A 101 of chili,lren feci they arc or\ the

outside when it comes \0 ou r system of law and govern ment. If we Me ilble \0

educate young students In law and gO'o'ernment ill an early <lgc ilnd Ihl.')'

356

become aCli..-e,

I ~biding ci li7.1.'n~,

then

wc have positively aflCcted 12 percent of our present I>opuiation, who will 00 100 pcrcenl of our populmlon tomorrow. Fur· thermore, studies indlcJte IJw-related OOuC.Jl ion h.Js been (l strong faclol In juvenile delinquency reduction. A5 an aT· torney, you hllVl! the opportunity to pass the torch by educati ng young people within your community. A liIW·mlatoo !WuC~ t iOrl aSSl)ClatlOn i~ 3 formalized network of educational, legal, I" w enforcement and community leaders promoting public knwlcdge and undefslirnding of the liIW ,1nd civic re-

sl>onsibilities through the schools ,1nd communllies. The ABA, Alaban'lll Stale Bar, Alabama's Administrative Office of Courts, Cumberland School of l,.1w, and Jan Loomis (former leacher In the Jeffer. son County school system) have been in· strumentalln gell ing the I)roject off the ground and moving fOIW,lf(1 in Alabama. A nonllrofi! i;Qrporalion, the Alabama Center for Law and Civic Education, Inc. has been crea tl.>d wi th an office locatl.>d in Cumbcriarld School of Law for pur· t>oses of promoting law-related educa· tion. The executive director, Jan loomis, with the help of the st,1le bar and memo bers, has received funding of $40,000 from 10l.TA and $50,000 from the state legislature, Through the Alaooma Departmerlt of EdUCOltiun 1990-91 budget. In addition, b&ause our stale nw has a LRE Center. which will be part olthe Nmlonal Trahllng and Dissemination Program as 3 dcvelol>ment state, It will receive $39,000 in Omce of Juvenlle Justice & Delinquency Prevention (undi ng from the U.S. Department of Justice over the nl,lxt fiVf;l yeaf$ to S(ll ull programs in jUVf;lnile delinquency prt.'VClltion. The follO'whlg am the oblC(t j~ of lawrelated education to which the Task force Committee and the Center are committed; (I) Ways to build underscandlng of our legal system ilnd the fou ndati ons ,1nd principles of our democratic; form of government: (21 W"'YS to dl,.'VC1op legal ~urviv<ll skill s and provide pfilcticaJ, upd al~ law-related information 10 the publlc; (3) WilyS to enh'lI\ce commllmerH5 to Justice and civic respon slbflitles, by deterring criminal and an tisocial behavior; (<I ) Ways to develop ski ll ~ in logicClI Clnd analytical thinking, medi~ lion and decision-milking; Jnd (5) W¥ 10 help people function more effectively In their community. Law-re. lated education projects presently being sponsored arc:

L Bar-SChOOl Partnership Program The Task Force Cominiltcc Orl Citizen· ship Education of the Alabama St,lle Bar in 1989-90 Implemented a Bar·School Paitnership Program in pilot areasBirmingham, Mobile ilnd Opelika. The IxIr le!lder'S in these areaS(or 1990-91 arc: Michael Edwards, Birmingham; David

November I ~~O

Peeler, Mobile; alld J.mu.'s Cox, Opelika. The Honorilble Willter Bridges, chalrper. son of the TilSk Force Committee on Cllilenshlp Education, and mcmbe~ (Ire closely vvorking with the director to further expalld the progrilm. In the filII of 1989, workshops were held in Opelika, Mobile and Birmingham . API)roxlmatcly 50 lawyers and 50 teachers volullleerNlto become part of this effort to explore w¥ in which tCacM and I~rs could work together 10 iml>rove you th educatloll In the law. L,lst year consisted of dilssroom viSi ts by attorneys; field trips to the courthouse, prisons and law firms; legal research; enaCtment of nlock trials in the classrooms; debates on legill issvcs; and schaolwide assemblies. Over 2,000 elementary, middle .llld high school stvdents were reached by the Jl(ogr.1m.

II . lRE survey of the slale bar In order to compile information on law-related aCl lvllics within the state, avoid needless dUI)lIc;'ttion of efforts in this area, and have a centralized center with re50vrce materials on topics, \IOlun· t ~rs, org,miz;l1iorls ;'tnd societies cantrlbuling to these objectives, a survey is needed to Identify aI/ law-related edu~ tion activities. The information rcceilo«! (rom the Survey will be complied by the Center and Issul..'CI in direc,ory (arm as the Alilbama Law-Rclated Education Review. In ilddition, thl' Inform <Jtlon witt become pOlrt of a dllta base for ongoing activities. programs, referrills, rderences, and statisticill anlllvses of objecti-..es and goals accomplished or 10 be accomplished within the commuilities.

III. Bicentennial Competition on the Constitution and Bill of Rights During the I)ast t~rell years, i.11IeIlSI SO allorneys haYe either served as judges, advisors or coaches to learns competing at the di strict, state .lnd national ICYels on their knowledge of the U.S. Constitution dnd 8ill of Rights. The comjl(! tition continues for at least two more years. It is directed by Dr. David Sink of the L.nlYersily o( Alllbllma In Sirminghllm and coordin<l ted by lin Individual In each U.S. Congressional District. \IVorkshops were held in August to Instruct teachers how to usc Ihe We Ihe People text and \0 recruit teachcrs for the competitions.

IV. OJlDP Project The Center's grant 01 $39,000 from the U,S, Department 0' Justice wlll activate this progrilm within the communities. During the first year, we will select communities throughout the state in which to establish advisory (Quneils. Their job will be 10 define problems and explore strategies and 1>oIIey changes which CQuid have an Impact upon the problenls juvenile delinquency In their respective communities. The Center will assist by providing tr<lining and resources fOf thi s projl'Ct.

V, Drug educa tion progra ms The Ccnter will be admi nistering (aUf different niltional LRE drug education progrJms. They are:

nUSINESS VALUATIONS employcc IloCk ownrnhip pl&IIJ .equ is il ioJU/lli vCIIi IUru llOCkholder dilP.ICI divorces · ch.vitabl, , illl utales • Inlan,iblc &nell

Contact: Mit chell Kaye, CFA, ASA 800 88B·KA YB (5293)

Member Amcricnn Society of Appraisers PaSt President·Atlanta Chapter The Institute of Ch3t\eted Financial An:llYilS

(1) lawyer/Doctor Education TeJm

(sponsorl..-'d by the ASA and AMA):

•

by the ConstitutioNI RightS Fovndation);

Court Testimony and I.R.S. Experience

(2) The Drug Question (sponsored

Law Substance Abuse Prevention Supplements (sponsored by NICEL); .111d

(3) Street

(4) Drugs In the School (sponsored by

the Center for Clyic Edocation).

Is your

VI. Educational videos on law and civic educallon The Center for Communication and EduCJtionOlI Te(hnology has offered to I)roduce videos for the sttl te bar lind the Ccoter at one-tenth of '''c USUJI cost, This makes more Ilffordabl~ the creation oi videos. The video will be 'What does a lawyer dol" Thi s education tool wIll assist teachers and lawyers In the presen· tatlon of material 10 the students in a more adv.lllCcd form . Please !llke 11 fe'oY minutes to complete 'he survey (pages 358·)59) and (lrop il In the ffiJIl . This survey wll1grClltly assist your stille bilr lind the Center In estlll>IIshlng and Implementing projectS to make Alab.lma 11 beuer place to live. LRE awareness and training workshops arc Ilvallablc to ilnyQne. To hold a work· shop In yQVf all!a, contact Jiln Loomis, Executive Director, AIJbama Centet for L..lW and CIvic Educ;ltion, Inc" Cumber· land School o( Law, 800 li'tkeshore Drive. Birmingham, Allloomll 35229, or call (205' 870-2433.

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357

ALABAMA STATE BAR LAW-RELATED EDUCAT ION SURVEY Name: ________________________________________________________________ Company/Firm: _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ ___

AddreSS: _____________________________________________________________ CIl' _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ Z;p _ _ _ _ _ _ _ __

Telepnone: _____________________________________ Areas of legal expertise:

lRE activities o r progr3ms In which you have pMlic ipaled : _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __

In which lRE. activities or programs would you be interestoo In participating? (Check your areas of Inll.:" :St.) Program

Descriptio n

Bar-School P,utncrship

SeNt! as legal resource lX!f'SOn 10 a teacher

Bicentennial ComlX!lition on the U .S. Con-

)udtlc a local, Siale or nalianal compclilion andlor cooch a competing le,lm

sIilUlion and Bill of Righ ts (high school level)

Serve as a community advisor \0 IIssess OIJDP Projec l on Juvenile Delinquency Prcycntlon (U.S. Dept. of Justi ce)

needs and offer strategies rcg."\rding luvenlle delinquency

SeNe as a resource person \0 explain drug laws

Drug Education

Educational videos on law and (lyfc Education

Serve ilS iln advisor Write scripts Personally appel\r on videos (Sample topic: " What does a lawyer dol")

Teaching Law to the Public

If asked to speak 10 a group of young people or adults, on which l!lw路related topics would you be wi lling to speakl (Che<;k the area$.) Constitutional Law Mediation/Dispute Resolution School Law Domestic Law State Criminal Code Consumer Law Others (Specify): Juvenile Justice System Mock Trial Legal Research {bilsk } Iconllnued on next PllgeJ

358

November 1990

(survey cominued from previous page) Check [he grade level(s) to whom you would prefer to speak: Elcnlen lilry (K路S) _ _ Middle (6-S)

H igh School (9- t 2) Adult

What does the general public need to know about the law and/or governmcntl

Other Comments:

Complete

and mail to:

The Alab.1ma Center for law & Civle Education Cumberland School of La .... 800 Lakeshore Drive Birmingham, Alabama 35229

Time & Money Nothing is more important to your practice The Al abama Stille 6.u provides services and products 10 save you time and money. Mcml.'JeKhip wrvices are available to you at lillie or no co~l. Thl'~' services arc provided fOr yOu as a member. If you are interestcc! in savi ng time and morley. call AS6 10 obtain further inforrniltion concerning any of the membership services listed: Car rentill dl Kount~

I,eglslative newsletter

CLE seminar schedules

LEX tS

FAX Sl!rvice

'>ro/essiona1 iournal

Ethics opinions

Report s of Alabam,1 Supreme Court decisions

Group hospital, disability and li fe Insurilnce

Sections (t <l different urea' of practi ce)

L~w office consulting serviC('

Sub~ta nce abuse a ~si5'ance

ldw~r

Trowel programs

referral

ASH. Alabama State Bar. (205) 269-1 5 15

The Alabama Lawyer

359

legislative Wrap-up by Roberl L. McCurley, Jr.

I' Alab;'lma Uniform Condominium Act of 1991 In 1964 AI<lbtlmll ~nllctcd our fi rst Corldomlnlum Act with 1't..'Vlsions In 1974. The Legislature enacted a !lCW Con· dominium sta tule, Act No. 90-551, whi ch Is p.1ucmed after [he draft of the Uniform Condominium Act proposed I7y the National Conference of Commissioners on Uniform Stilte UlwS. Thi s bill W(lS sponsored by Representati\lf;l Jim Campbell and Senamr Ryan deGraffenried. It is the result of WQrk begun in 1982 I7y a drafting com minee of the in· stiTuTC chaired first by Albert Tully and Then E.B. Peebles. both of Mobile. Prof~sor Gerald Gibbons of the Uniwrsity of Altlbtlma School of lAw s~rvcd as chief draftsman. Thi s new Act governs condominiums crea ted after Jan· wIry 1, 1991. This new law is prospective and its appli. carion Is limited to those cond ominiums with more th an fou r units. As to existing condominiums, the "old" law remains ~pplicable. Hovvever, ilmendmenlSto existing con. dominiums must conform to the "new" law. The following important new provi sions concern the "Crf;!ation of condomini ums'; "plats and plans'; "manage. ment" and ·condominium l)urchasers". C realion of c ondominiums When all the units arc substantiall y comp leted as evl· denced I7y an independent regi stered engineer or regis· tered architect, the declaration may be filed with the judge of probate. The proba te office will keep 011 file in il "CO il' dominium Book" a copY of the declaration of condomi n· ium, all drilwin8s, amendments, certificate of cOnll)lc tl on (lr Icrmintl tion or o rher like anl(mdmcnts. rhe dL'Chl rtltion must con tain: the name of the condomlnum whi ch " l USt Include the word "condominium"; Icgal dcscrlptlon of the real estate; number of units; description of the boundaries of each unit ond limited commOrl areas; and 0 description of development rights reserved to be exercised at different times or under certain conditions. "ny restrictions on the use, OCCUI).(lncy or le<lr Ing <lnc! the s<lles price mUST be indlcatcd, as well as any C<lSt!ments. If th e dcclar,' 11 [ reserves allY units this reSCr\l.ltion must b~ made knov·m. Other mailers, such as the \IOtlng ri ghts, sales office, association officers and board, also must be shown.

360

rials and plans rials and plans are a part of the declaration. Each plan must show : (1) the name and a survey or i! gener,,1 schemillic map of the entire condominium; (2) thl: loe,lIion

and dimens ions of all real estate nol subject to development rights; (3) a leg.ll {!cscriptiOn of any prOI~rty subjl!Ct to development rights; {4) encroachments; (5) easements; (6) localiol' and dimensions of vertical and horizontal unit

ooulldari(>S;

(7) distance Ix-I~n

non-contlguous p.lrcels;

(8) location and dimension of limited common elements;

and 1911mprovcmcnts; any contemplated Improvements must be labeled "MUST BE BUILT" or "N EED NOT BE

BUILT". Management

The uilil owners associalloll must be Incorpor.lle<! and may have the foUO'Nlng powers: (1) adopll1ilavvs and regu· lations; (2l adopt budgets <lnd co!le<:t assessmen ts; (3) hire agents and employees; (4) Institute and defend litigation; (5) make contracts; (6) regulate and maintain the common areas; (7) milke improvements; (S) CQnvt'y real and l)er5(ln<l1 p rope rty ; (9) make leases; (10) impose fees and charges; .:lnd (In h..'Vy fine~. The develol~r must !Crminate con trol alter 7S percent of the units are sold, or two years after the units are cea sed 10 be sold . There are then provi sions for unit owners to be on the board.

Robelt L McCurl6)i, J~. Is /fle dlroctor 01 /1'16 Alaooma L.8w

Instllule 81 the

Unive~lly

Alabama. He received his undergraduato and law degrees Irom the Unil'Orslt)(

financing av.lilable, warr.lIl ties, any restrictions on sale or lease, Insurance CO\l(!rilge, wning, ilnd any SI)(!Clal provi. slons such as units being used as " \lme shares The purchaser has seven days to rescind after Signing a mnrraCI and retei .... Ing an offering statement when the condominium is (or residen tial pur~ On the reolale of 11 condomInIum, the unit oymer and assocl;Jtion must furr"!l sh Ihe prospective buyer t ertilin Informmlon upon reque st (If the purchaser. An offer· ing stat~enr is not sencratly required . The entire Condom nlum Act GIn now be found in the 1990 Cumulative Supplcmenc, IS 3S·8i\.1 th rough ]5·&\·417. Any furt her Information concemlng <lny LilW Institu te project m<lY be obtalr'led by wri t InS: Alabama L.1W Institute P. 0. Bo~ 1425 Tuscaloosa, Alabama ]5486

The assodiltion is responsible for setUng a budget and keeping up the eomman areas, and must hold a meeting at least once a year. To enforce the assocla· tlon's assessment the assoclillion has a lien on the units from the time the assessment becomes due.

•

Condominium purchasers PurchaS£!rS of 11l.'W units must be glwr"! an offering statement to apprise them of the condominium. This offering statement must descl lbe the condominium and number of units, and include a copy of the declaration, plats and plans, as well as other re<:orded convenants and res trictions. Furthermore, the offering st.1tement muSt inclvde a copy of the bylilWSand any associntion rules, ~ current bn l,lI1cc sheet, a statement of the I)rojeeted common expenses. CMpcnse assessment (or the particular unit, any services which the owner must separately pay, closing COSlS, liens and mortgages.

"'j'OJ

WE SAVE YOUR TIM E . ..

ameli L E G A L R esearch With

•

Now legal reSc;lrch 1I ~~islUn ce is u~uiluble when you nccd it. withuut Ihe !l ece~~hy or lidding a full ' l ime ll,..ociutc or clcr~ .

lIeee~s

to the Stute Law Librll!)' :md Wc"tnw. we fu sl and efficlcm !>Cr ~ice. For dClldlinc wurk. we can dcli~c r inform:llion to YOll ~in eommOl1 carrier. Fcderull!xprc~s. or FAX. pro~ ide

Fnrll cll l..cgul Rc.)Corch C'xumine~ the i~sue, thoruUijhly through qLlality re~:Irc h . brief writing and lInuly~i,.

Our I"Jle, are 53:1 ,00 per hour. wilh minimum.

three hour

For Research Assista nce contoc!: Sarah Kathryn Farne ll 112 Moore Building Montgomery, AL 36104 Call (20S) 277-7937

The Alabama Lawyer

Don't let your Alabama Lawyers,

get worn, torn or thrown away. Order a binder (or two) at $10.00 each from: The Alabama Lawyer

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or call (205) 269-1515

NOTICE The Supreme Courl Conference on Constitutional Law The Duke Universi ty Cil l1adian Studies Center an· nounces a cOl1ference on United States/Canlldlan Con· 5111utlonal law to be held AI)ril 4·6, 1991 . Thl~ event will bring IOgethc, praClitlonerS ilnd senior schol[HS from Canada and the Unltoo States, and will fea ture Supreme Court Chief Justice Antonio lamar of Canada and SUI)reme Court Chief Justice William Rchn<luist of the Unirl,.'CI Still(."S, CI S well as eight other JustiCes from the two coun tries, ilnd retired Canadian Chief Justice Bdan Dickson. Thl! focu s o( the conference will be the compara tive examination of ConSIitutional Issues In both countries. Panel tOpics will include: federali sm, amending the COrl~tltu tion , f[(.-edom of cMprfSslon and dimensions of equality. The conference is being organized by "Joint Cilna· dl"nIU.S. committee reprcscnUng Duke UnlY(!rs1ty, the facuity of law of Ollawa University. the faculty of lilw of the University of British Columbia, and the Supreme Courts of both Canada and the United Stales. For more information, contact the Duke UnlverslIf Canadian Siudies Center (9 t 9) 684-4260.

'61

Opinions of the General Counsel by Alex W. Jackson, assistanl general counsel

QUESTION , ':-\ difficuh situation has developed with our client for which we sought guidance (rom Ihe Qmce of Generill Counsel.

"Our client

WoIS

Involved in an automobile accident {not

his (.11.111) I" Jefferson County. He was drilling a vehicle insured by State FMm and owned by his siSler. He was hil by tin AUSI.1IC Insured and sought represen tation during thc nrs! week of June 1988. 'Ale were in constant conlJC! with our dlent and helped him 10 secure Important rehabilitation trcilImen!. "On April 12, 1989, we submlUed a prc-lItig;ulon demand to Allstatc, logClhcr with COnl l)lcle documenHuion of Ol.lf client's InJurl~ and dan13gcs up 10 that poin1. Aboul the same lime, our client \/Isited me in the office In Ihc presence of SC!\ICfaI Other cmplO'f'l.'E'S, He complained of coostant pilin lu\d was constantl y wondering 'if it was all worth it: I was con· cerned that he was suicidal and that his actlorl would faU If not flied so we filed a lilWSuit around the middle of April

1989. "We negotiated back and (orth with AlIst"te (lnd, fin"l!y, around the first or s~or'd week In December 1989, Allstate i\ijr(.'Cd to pay the policy Hmlts of $20,000. We h(ld our dient CXt.'Cutt: a pro tJnlO release of the Allslate defendant, reservins rights asalnst any other c()I,'Crage or defendant. 'J\fu~r the case was settled and the release exocuted, we received a leller from the physician treating our client indlcat· Ing that, in his opinion, ourclie", was unable to manage his own affaIrs and linances. When w(! h(ld settled the case and discussed the disbursement with him, he had requested thaI we pay all of his medical expenses. \rVe represented him on a 40 percent con tingency con tract. Oul of his $ 12.000 share, we were reimbursed ca~ cxperlses In the amount of $247.25, paid medical liens in Ihe amount of $3,930.15, (lnd had S7,822.60 remaining to pay 10 our cllenl. "During this time we were trying 10 make arrangements for him to be ildmitted to a trauma unit for treatment of his chronic pain syndrome. We were hllYlng some difficulty get· tlng him (ldmitted to ttl<! program, 50 there was no disburse-ment of the monl.'y. I had several conversations with the people al the t-ospital aboul him. When I discussed the money that v.."C were holding for him, I told him on several occasions that II 'looked like il would only be a fLOW thousand dollars, If that much: I had felt that the hospiTal ....-ould charge him whatever money he hold, so we did not reveal Ihe amount of Ihe proceeds for fear that the Irauma unit's charges would dissipate the entire amounl.

362

NAs IJlks progressed with them, becJuse of his fragile sitUJ' tion and his poor financial siluation, it looked J5 though \Qciltional Rehabllitalion would pay for his progrJrn ~nd Ihat all of his funds would be preserved . In (act, t believe that he hM recei~ considerable Ire.Hment al the TrJuma Progr.lrn with· Out having to pay anything. 'When it became app.uent thaI he was going to be able to receive the tre.ltrncn t wilhout spending his own money, I be<:.lme very uncomfOrtable with our holding his money in !rUSt. I colllL'(! him orl sCV('rJI occasions to tell him the exact amount W1l were holding and that the mone-,' was available, but we .......ere corlcerned about his .. bilily to manage his finances. I contacted an attorney friend of mine and 1!X1'1"ined the siTuation and asked if he would mcct with the cllenl and me 10 discuss the possibility 01 handling the client's funds as his court-appointed conservator. The client cancelled several appointments we had made fOf him to meel with Ihe attorney. Finally, two or thrce months ago. he did meet with Ihe attorney and m~ and agreed Ihat it was a good idea for the attorm..')' 10 petiTion Ihe court, with Ihe client's approval, to be appointed by the courllO consefYC his funds. Thai has not hapl>cned to dale and the attorney has since indicated thnt he docs not W.ln t 10 be involved In Ihe case n a,ly way. "We called you because the "ttornl.'Y had beer' contacted by the cllem and told that he was mad at us because we would not give him his money. He had n(!V{!r requesled his money from us but had specifically requested thaI we kcep it so it would be available for admission 10 lakeshore. You suggested that we write a letter 10 you detailinglne case and that we contact Ihe client about hiIVing a member of his family pelition the COurt to assist him with his affairs. "The client c.,lIed two or three days ago and I explained to him everything that we had done and what ollr concerns life. He, as always. was vcry frustr.lll>d about his ml'dical con· ditlon, (lnd resisted milking iI declslorl of n.ly kind . At one point In the convcrsation, he Silid that he did nOltruSt nnyone, but later In the COnYCrsation said that he trusted me. At one point in Ihe conversation, h@asked If we could just kcep his money until ne needed It. I explained Ihat we dId nOI feel comfortable with tnat and felt that someone in his family should be appointed 10 help him with his finances. I suggested that Inc moSI responsible person in his family w..s probably his sister and requesled that she would be a good choice. He s.lld that he did nOllrust his sister and would not trust anyone In his filmlly te) be In control of his money. "During the lasl scvcral weeks an uninsured motorlSI claim has ~n setti<!d (with the client's knowledge and consent}

November 1990

against State Farm Insurance Camp.lny lor policy limits of 520,000 and a consent judgment was entered In Federal District Coun. Obviously, there are additional monies (close to $12,000) Pa't' able immediately to the client. "So, we ha\IC a client who is due to be paid almo~ t 520,000 from our t ru~1 account, bu t who is unable, according 10 physicians, to h;lIldlc his own aff/drS and who Is unwilling for any family member to manage his affall'5. 1M! arc uncomfortable with this situation. Knowing what we know about 1'1 s condition, we feel I! would be wrong to disburse the money 10 him, bUI we also do not feel com/onilble talking to his family behind his back, since he is our clien t. "Please consider Ihis as a request for formal guidance in til is malter. If yOu hallC any questions or would like to soo any documents, please contaci me Immediately. Thlmk you (or your cooperaII0n.N

ANSWER : You and your firm haYe complied with the various 1)l'OYisioos of Canon 9 concerningthe deposh of client funds in insured dt'poshol)' trust accounts. You h<ro<e also com III led with the pr'OYlslons thereof SO'>'ern lns nollOcatlon 10 the client of the (ecelpt of the funds. You now have on deIlOSil, or expect soon to receive, neMly 520,000 In funds belonging to thilt client, and you now believe th .. t clienl, bilsed upon an opinion expressed i:1t' ooe of the dlent's trea ting physiclans. to be unable to manage his own aff,}l~ and finances. Your personal observation of the client has also led you 10 h;we concerns regarding the competence o( the client and his ability to deal effectively with such a sum of mOIll..'Y. Under the present CcxJe of Pro(esslollal Responsibility it is concel .... nble that this informiltiQn ~gilrding the

competence of your elien! might be coosldered as a confidenCe! Or secret of the dieot, the disclosure 01 which would be embarrassing ~ detrimental to the clienl. By this dcflnition, disclosure eX such COnfidential Or secret in'ormation Is prohibited absent consen fof the client or the existence of other conditions as deIIncill(,'(1 In Discl l>lInary Rule 4-IOHCl. On the o th(!r hand disbursment of sfJch a large sum of money to an In· coml>ctent dlent, or one reasonably beliC'\led to be incompeten t, could l't.'Sultln waste or misapplication of the corpus and deny the client dle benefit of the nloncy. Under the AI(lbam.1 Rules of Professiona l Conduct proposed to the Supreme Court of AldbAma and to be promulgated In January 1991, the supreme court recogniz(!s that II lawyer m(lY, on occasion, best scrvt) II client by taking action that, on fl~t blush, might nppear to be i1dverse to the client. Spcciflcally, Proposed Rule 1.14, "CIiCnt Under a Di$ability,H provides as follows: "(a) When adient's (lbility to make adequately considered decisions in connection with the tep~entalion Is impaired, whether because of minority, mental disability or for some other reason, the lawyer shall , as fM as reasonably possible, maintain a normal client-lawyer relationship wi th the client. "(b) A lawyer may seck the apllOlntment of a guardiiln or !<Ike other protcctlve action with respect to (I client, only when the I~r reasonably beliC\1.'S th"t the client cannot adequately (lct In the client's own imerest:' The Comment to Rule 1.14 pt'(Nides in perllnent part that: " If a legal represen talillC has not bt.~n appo1rlted, tha lawyer should sec \0 such an al)jJOlnlment where il would SCM the clien t'S best interests. Thus, If a dlsl'Ibll'd client has substantial prOI>crty that

COHDAT CORPORATION ANNOUNCES ITS SOFTWARe IN5rALW/ON AND SUPPORT DIVISION WE WILL INSTALL WORDPERFECT. LOTUS 12.J. E1C. ON A PER HOUR FEE &\SIS. we WILL ALSO INSTALL COMPUTER CABLING FOR SMALL OR LARGE NE~RI<S. SUCH AS IBM roKENRING FOR MORE INFORMATION CALL (205) 623·1905 FOR A BUSINESS OR HOME INsrA~LEO OVOTE

The Afabama Lawver

should be sold for the cllen(s benclil, effooi~ (Ornplelion of the transaction ordinarily requires apPOintment 0( a legal rCpresentati~. In miJny circumstances, however, appointment of a legal representative may be expensive or traumalic (or the client. Evaluation of these consideriltions is il maner o( jlfofessional judgment on the lawyer's part:' The Comment goes on 10 provide ilS follows: " Rules of procedure In litigation generally pra.-idc Ihill minors or persons suf(erlng mental disabrlity shall be represented by a guardiiln or I1Cl<t friend if they do no! h;wc a gcneralguilrdi.ln. HoYIeYCr, disclosure of Ihe cllenl'S disability can adversely affect the clIent'S interests. For cK..1mple, raising the <Iucstlon of dis.lbility could, in some ci rcumstances, leild to procL'l.>dings (or Involuntuy COmmitment. The law~r's position In such caS(!!; is an unavoidably difficult one. The lawyer may seck guidance (rom an appropriate djagnostlcian.~ Accord ingly, and In rt!<:ognl tion of the impending changes in the ethical rules that would have Substanllal lmpact upon this panicular fa(1si tuiltion, it Is our opinion that If you arc reasonilbly convinced thai the client is oj>CfJtlng under a disability, and that the d!sabJllty Is of $u(h a m)turt! and to such an exten t as to materially Impede ilnd or endanger his ability to make dL-'C lslons In reference to the sum of money involved, then you may seek 10 have a guardiiln or curalor appointed to protect the interests of lhe client. tn effect, 'NO adol>! the view exl)rCSSt.od in Rule 1.14 that a lawyer may seek th~ appointment of a guardIan or take other protecl i~ action with rCSfX'(t to a client when the lawyer rea sonably belleYCS that the client cannot ildC<luately ilCt in his own Intcrests. (RO-9Q-67j •

HENDERSON PRIVATE INVESTIGATIONS MATRIMONIAU DOM ES ' IC SUR VEILLAN C,

CONFID ~ NTlA ~

- DI SC REET

LIc eN s eD _BONDeD PO DC>o "lll\ 1311111

filII.","".", ,

Young Lawyers' Section ven though I know that c3ch of YOI) CilSCrly i1w;lits my "'tides in The A/abamiJ Lawyer and rhe wOrds of w Sl;IOm thlJll lmpllrt, I w,mt to change the formal for this article altd expand the con tent s. I think we need mOr<! stat(!wldc communlc.1!1ol'l

" R<1lph Waldo Emerson once wrOte: 'The hi gh prize of life, the crowning fortune of a m<ln, is to be b¢rn ..... ith iI biils 10 some pursuit whi ch finds him In employment and h<lpplness.'

about what each of the local bar asso-

" M<1king the most of our professionallife is a 80(lllh"t il lll(lwycrs share. BUI compelence and excellence In our chosen field will not bring the hapl)i ness ano ~rsonal ~ ti sfact lon that Emerson described. That h<lpplncss call be achieved by getting Involved, whether by running for I)ubllc office, using your lrial skill s to represent an indigent l>erson, contributing your legal skill s [(I d nan-Ilrofil orgiinizOition or particrpating In bar assa-. ciali(ln governMents.

cia tions is doing. I ilm not sure that

the Birmin gham Young Lawyers know what the Montgomery or Mobil!;! YOLIng Lilwyers arc doing. ,md vice versa. I think one of my responsibili ties is '0 open IhecQmmunlcation and Information lines \0 let everyone know on a stat ewide level what is happeni ng at the local level s. My goal is \0 use lhls SpJCC In the /,ilwyer for communica tion of local

news, as well as sTJlewide events. I welcome any thoughts Of comments you milY h~ve iI$ to Ihe bes t Wily to achieve thi s. The bar admissions ceremony wa s held Tuesday, October 23, 1990, and was a great success. I especially thank Rebecc.1 B,yan for her hMd work In planning that ceremony. As always, she did a great job ilnd thin gs went rC<llly smoothly. I wel come all the new admittecs ;md wi sh them th e best (If lUCk in their I,rilctice. In dosing, I leave you with portions of an arlicle written by Judy Perry MMl lnez, president of the Ameri carl Bar Associ ation Young lawyers, which I think captures the spirit of the Young lawyers and chaJlenges us to act upon that Spirit:

364

"Getting invo lved means returnin g somCth ing to so(:iety. It means contributing what for each of us Is a scarce comrnodhy- tiMe-ln r"C[urn for the privilege that society has affordcd us to jXIrtlcipate In Its system of justice. '·There are 8,760 hours in a year, <lnd I know of no lime sh(!(!t in existence on whi ch one could log all of those hours as billable. Ead l of us must use some of those hours, whether it be 50, 100 or more, toward uti11;';ing our t(llents to help others.

"Each of us can find a niche, iI wny to contribute withOut drainIng neroed energy from our professional and personal life. M.1ny community and bar associa tion projects require only a few hours a month for sl.lccesslui completi on. Indeed, th e orgilnlzcd bilr is especlilily Sensi tive [0 profenional demands placed on young lawyers, and fashions many PfOjectS to requ ire minimal t ime com· mltment ..•. ·'By taking pride In our profession, by tryinM to make it just a lillie ooller for Ihose r,tany who will follow, we will gain a great personal smisfaclion. Everyone's contribution, no matter how small. will make a difference. And, most important, that difference will be felt not only by the organizilti(ln or j:ll!r$on y(lu serve, but also by you." -Judy Perry MartineZ

• Novl'Jmber 1990

Recent Decisions by lohn M, Milling. Jr" and Wilbur C. Silberm<ln

Recent Decisions of the Supreme Court of Alabama

Adminislr.ltivc lilw .. . Administr,] ti \lc remed ies do not have to be ex hausted prior to filing dec!d ratory judgment In circuit court Alilbam.1 Cellulllr Service, Inc., el al. v. Sizemo/"C, 24 ABR 2876 Oune 22, 1990). Alabama Cellular Services flied a complaint for a declaratory ludgment and Injunctive relief in the circuit court under the Declaratory Judgments Act. It sought iI dedllriltion as to whether It W,]$ a "public utility" and, therefore, subJeclto certClin taxes and th~ Alabam,] Public Service Commission. ACS's circuit coul1 action WilS dismissed, the trlill coul1 holdlngthm §41·22-1I, Alii. Code (1975) require ACS to exhllllSt Its administrillive remedies under the AdminlSlr,]tlve Procedure Act (A I¥.), §41-22-1, C( seq., Alii, Cocic (I97S), ACS appealed ilnd Ihe $upreme court r~rsed . The APA was ildoptoo In 1981 01$ "a minimum procedural code for Ihe operation of all Siale agencies when they lake action aficcting Ihe rights and dulies of Ihe public': Thus, Ihe APA 5eeks to milke the process of fC\Iicw of stilte agency actions fairer lind more

The Alabama lawyer

emden!, not 10 alrer substanlive rlglllS of a person affecled by a rule. The supreme court ootcd thai although the genesis of §42·1·10 11 from Ihe Tennessee Code, the Alabama Code, unlike the Tennessee Code, doc'S not expressly require thill il complaint be flied with the agency belore a declarillory judgment mil)' be filed , The supreme COurt ftwsoncd that the ilbscnce of that provision indicales thtll the Alabama ll!g'slature did not intend 10 make an agency oc'Ciar<1tory ruling a prerequisite to seeking a declaratory judgment In the circuit court. The supreme court also nOI(.>d that the RL'Vised Modd State Admlnlstratl~ Proct..du~ Al:t {1961) included no requirement that the administr.lti~

rem(.>dies be exhausted beforl"! an af· fected Pill1y could pursue a declaralOry judgment action ,

Civil procedure, • , doctrine of inconsistent positions e)j plained Porler v. Jolly, 24 "OR 2354 (May 18, 1990), Porter and JolI)' lived together for ~r two years ilnd had a dl spule about money, Porter sued for divorce alleging a common I""" mar· rlage and attached an affid<.lYil 10 her complaint which Stalf.'d thaI Jolly had mls'lPproprlilied her money. Service WilS never perfccted nnd I'(lrtcr dismissed the complaInt. Subst.'quently Porter executed another document Slating that the finilncial problems

lohn M , Milling.

Ir.• IS iI member of

Wilbur C. Silber·

11m firm of 1·liII, Hili. Carler, Franco, Cole & Black In

mlln, of the Birm-

Mon/gomery. Nc

is a grClduale of 5J}Tins Hill Col/cgc and Ihe Unlvcrslly of Alabama School of Law, Milling covers Ihe civil pottion of tilL' df.'Cis/ons.

ingham firm of

Cordon , Silber· man, WissJns &Childs, atfended 5<lmford University and Ihe Universily of Alabama and earncd his law dtJgrce from the Uni· verSil y'S School of lJIw.

365

were resolved alld that the parties in· tended to marl)l A month later Jolly flied 3 declaratory Judgment action seeking a COUrl determinatiOll thm no common liM' marriage existed And Porter countcr· daimed contending that Jolly h(ld t(lken OYer $100.000 from her. The trial court determined that there was no common law marriage and that Porter's counterdalm was Improper because their priOl' divorce action wa~ dismissed based on her statement thaI Jolly 0INCd her nothing. The court rull.'CI Porter could nOt t",ke such inconslster\l posl. tion s. Porter appealed and the supreme cou rt ~rsed . The sup«!me court staled that while Alabama recogni zes the "dOCCrine 01 in· consistent position that doctrine has '" number of limitations: A number of limitAtions upOn, or qualifications of, the rul c against assuming inconsistent poSitions In judicial prOCeedings, have been laid do...,,". Thus, the (ollowlng have been enumerated as essentials to the establishment 01 an estoppel under the rule that a position I3ken in an e"rlier ac· tion estops the one taking such position from assuming an Inconsistent positiOll in 11 later al.1ion: (1 ) the inconsisten! position fi rst asserted must l\3Yl! bt!en successfully maintained; (2) a judgment must have been rendered; (3) the posit ons must be d early in· consistent; (4) the parties i!nd questions must be the Si!me; (S) the party claiming esloppcl must have been misled ,lIld hilYe changed his position; alld (6) it must appear unjust to one party to perrnit the other to change. Thus, a pany may nOt assen the defense of Judicial estoppel or a prior in· consistent position unless It is demon· stra ted that the party against whom the cstoppel is sought to be iml>o$ed actually procured ;udsmentln his f;r,or as a ~ult of the incoosistent position taken by him in the prior proceeding. In this case, the prior divorce aCl lon did not go to judgment. H

Executors and administrators, . . re lalion back as it relates 10 143-2-22(.1) /-Ioly/reld .... Moales, 24 ABR 1729 Uune IS, 1990). Downs. a resident of Chilton County, WitS fatall y Injured in NoYCmber 198'; in Chilton County by

366

Mo.l tes. Cren shaw, an IU lnols resident, was appointed adm inistratrix of the deceased'S estate. In September 1987, Crenshaw filed a wrongful death action in Ihe o:;lr( uit Courl agilinst Moate$. Mo.l\(!S moved for summary ju<.igm(!nt contend ing that Crenshaw was disqualified under §43-2-22(a), AI.lbama Code (1975), to serve as admlnistr;:rtrb; because she Wil S not an Alabama resident. Mootes also ch.ll1enged CrcnshllW's letters of adminiSlration In the probate court and the probate court revoked the lellel'5 and appointcxl'-Iolyfield. The cir· cuit court enterNI sun'mary Judgment In f;r,or of Moates findin g that Crenshaw's 31>1)()lntment was null and void because she Wil S a noo-resl dent and further findIng that since the appointment wa$ null and \IOid, Holyfield'$ recent appointment and lImended action could not relate back i»;au$e thl!r'C was nothing 10 relate back 10. Holylleld appealed and the su· preme COurt reverSed. In a case 01 first impression in Ala· bama, the supreme court was asked to determine whether !he acts of an administratrix who is "duly appointed" are void or voidable where the aclminl Stratril!; i$ a non-resident and disqualified by 143·2·2 2(a). The supreme court noted thaltne probate court of Chilton County clearly had subject maliC( jurir;diction to Issue the leiters. It is also clear that when the fact of residence does not exist, the grant of lettel'5 is not void, but merely voidilble. A$ a generul rula when a court that hilS jurisdiction aver a case renders an erl'OflC()Us judgment, Ihat Judgment is not void, but voidable upon a direct at. tack or on appeal. There 15 nothing jurisdictional about §43·2·22. Violation of that statute is simply incorrect ilppl1cation of the law, subject only to il dir~t attack andlor appeal. Insurartce ••• an L&S Roofing applied Shelby Steel Fabrlca fors, Inc. .... Unifed St.1lcs FidelilYand GU8ranty Ins. Co., 24 ABR 2362 (May 18, 1990). Shelby Steel , a steel fabri C<ltor, w,lS sued in 1984 because the steel support structure it fabricat(.'(1 Cr)lIal)Sed. USF&G Insurf!<! Shelby Steel under a COml)rehen slve general liability policy. Shelby Steel noti fied USF& G of !he suit and USF& G hired a law firm to defelld. In March 1984 USF& C sent Shelby Steel a form

non-Wollver agreeml'nt. Shelby Steel's at· torney also received a cop( 01 USF&C's leller to the defense firm stating th",t the d(!fen se was under ,) nOrl-w<liver agreemen!. From March 1985 to June 1987, USF& Child exclusive COntrol of the defen se and never consulted In anyway with Shelby Steel. Twenty-nine months ilfter undertaking the del'ense, USF& G sent Shelby Steel a reservation of righ ts leller that denied CoYCrage based on policy exclusions. The denial ol ~rage was based on filctSalleged in the com· plaint. Shelby Sleel flied a declaratory ludgment action and the trial court ruled in f;r,or ol USF& G. The supreme court rC'VCrscd. Applying the I..&S RooIinS case, the supreme court Slated thai USF& C must rll ect Its "enhanced obligation of good fJlth" In order to deny c<.werilge pursuant to a reservation of rIgh ts. ThIs obligation Includes keeping the imured ilpprised 01 the Slatus of the case. Since USf& C failed to meet the obligation, il must in. demnify Shelby Steel from any liability In the underlying aclion . If an insurer intends to defend a case ptJl5uantto a nonwillver agreement or a roserv,lIlon of rights, then that insurer not only must pfOYide nOTice to its Insured of that fact, but also musl k(.'ep its Imured informed 01 the Status of the case. Since Shelby Steel's personal attomey was also notified of the no-walver, the supreme COUI1 determined that the form non-waiver was ef· fectlve. Torts . .. j)!iychialrisl generally not liable for paliertt's allack on third party MOIlon v. Dr. Prcscou, 24 A8R 2613 Oune 1, 1990). Prescott, a psychiiltrist in private practice, admitted Hunter to Jackson l'lospltal following an altercation with another patient at a medical health treatment fildlity. Hunter rt.'ceived treat· ment and w:.s released by Dr. Prescott. The following day, I-Iunter assaulted Mor. ton. Morton filed suit against Dr. PrescOtt alleging thaI he had negligently discharged a patient who ;l5511\,It(.'(I him. Morton's claim was dismissed and he appeals. The supreme court affirmed . In Donahoo .... SUltc, 479 5o.2d 1188 (Ala. 1985), the COUI1 held that In order to establish liabil ity on the IliIrt 01 s~ate officials, a plalntif( must ple,ld and prOYe that the officials knew or should have November 1990

known that an agressor mlghl be a danger to .. specific pef5On. The sUI)reme court reasoned that IIhhough Donohoo concerned an aCllon against stme officials, ils ration ale is equillly applicable to Ih ls CiJSC. Hunter made no specific threat of harm 10 Ihe victim or 10 any idenlifiable group of which Ihe victim mlghl have been a member. Unless a palIent milke!; specific Ihrems, 100 possibility that he may In (act Injure another Is vague, speculntlve and iI matter of conjec1ure. Once speciOc threats arc ver· ballzed, then the possibility o( harm to third persons become foresC!Cable and the psychlarrlst's dUlY arises.

Torts ••• D ra m Shop Ac t discussed The Bootli, Inc. v. Miles, 24 ABR 2790 (June 22, 1990). Miles was Injured when the car he was driving collided wilh Gilmer. Gilmer hi\d been to The Booth, a bar. ~rill witnesses testified Ihal Gilmer appeared inloxlcated while In The Booth. Miles sued Gilmer and The Booth under §6-5-71, Ala. Code (1975). Miles lesliOed nc Incurrf!(! ilpproximately in medical expenses, that his car waS damilged, and that he wa5 not able to work. Prior to trial, Miles cnten.'(/ Into a pro f.1n10 settlement with Gilmer for S15,000. The case was tried as 10 The Booth arld the jury relUrned a verdict for zero compensa tory damages and S65,000 punitive dilmilges. Booth 011)I>cals, and the supreme court affirmed. Booth argued that the Wlrdlct Is Incon· slstent ~(luS(! punillve damages cannot stand when the jury found no campen· satory damages. The supreme courl noted that §6-5-71 stille5 that the defendant is liable "for all damages aClually sustained, as well as exemplnry dnmilges." Therefore, Ihat st;l.tute states that a plaintiff may collect for aU damages SuSf.1incd, not all damage5 necessarily awarded by a jury. The evidence in this CilSC would sUPI)Q11 an award of compensatory damages. Therefore, In a dram shop action, when Ihere 15 sufficlcnt evidence of actual d(lmage or Injury 10 supparl an award of compensatolY damages, the SUI)reme court does nOI require a specific IJWJrc/ of IIClunl damnge5 in order to support an award of punitive damages.

sumo

The Alabama Lawyer

Secured creditors as Ii;lble under CERClA Although not a bankruptcy case as such, the (allowing is Important to secured crf!(!itors in b..lnkruptcy cases. In U. S. II. Fleet ('actors, 901 F.2d t550 (ltth Clr. 1990), the 1I1h C.C.A. stated that a secured creditor could become liable under CERCL!. (pollution controllegisliltlon) if It participated in financial management. However, the court $I(lted that there was no definiTion under Ihe statute which defined "I)ilrticlpmed in the management :' The court held that the secured lender may be liable should there be an inference that such leoder had the control If 11 desired to affect decisions regarding dlsJXlsal of hilznrdous wastes. Thus, accord ng to the holding. the nlere ability or potential 10 become involved in pollution control could milke Inc secured lender liable the same il5 iln owner.

Trust fund l axes-possible p referentia l payment Begller, TruSlfW v. IRS, 52 U.s.L.W. 4764 110 S. Ct. 225B, U.s. Supreme Court {lwle 2t, t990}. In this case, Ihe trustee claimed a preference existed In p;lymcnt to the U.S. of a trust fund tax obligation from the general account of the debtOr. The debtor had not segregated the tax money as required under the law, and, therefore, Ihe fund s had not been in any trust account. Nevertheless, Justice Marshall determined tha t segregalion was not essential- th;!t the paymenllllClf was tantamount to establishment of a trust fund, (lnd that as the fund s did not belong to the estate but to the IRS, there was no preference. JUStice Scalia, in concurring but not agreeing with the reasoning, said thilt when a check was made to Ihe IRS, this, of i t~lf, Identifies the IlOrliOI1 of the asset which became the \rust fund. He held there 10 be no prel'erence as the Identification caused a relation back to the l ime of withholding, which lime was longer than lhe preference I>crlod.

State exemption laws in conflict wi th ERI SA In re Starkey. BKY D. Colo 20 B.CO. m8, 7I13i90. This Chapter 13 C(lS(! should be of Interest to lawyers rCI>resentlng debtors who (lnder the recent Alab.lma legislation will claim ERISA, 401K, qualified pension plans as exempt from the bankruptcy estate. The Starkey court stilted th1l1 the excmption W,lS valid, as B,lIlkruptcy Code §522(b)(2) permits 11 state to Opt out from the f(.'der;lll;tW ;and successfully claim the exemption even in the face of ERISA 129 USC IOS6(dl(2)J providing that the benefit Is 1'101 exempt In bankrUI)tcy. Similarly, In re Vickers, W.O. Mo. 71519020 B.c.D. 1168, held that the exemption of benefits of (I pension plan 5Uj>erseded the ERISA provision as it was legislation which came about by reason of a specific section of the Bankrvp!cy Code. lIk(MIi se in VlriJf v. BhlUuclla, 20 B.c.D. 947, an Arizona OOnkrUI)tcy Judge held that ERISA does nOI supersede the state exemplion STatute on a relirement plan proYlded that the plan is est(lblished and maintillned by the debtor with the debtor's own resources and InlO thosc of the debtor's employer or by an employL'C organization.

Discharge of criminal reslitulion obligalions Pcnr'lsylvania Dep;lrtment of Public ~lfiJrc v. D.1\1()/lpOrt, 110 S. Ct. 2126, 1990. The U.S. Supreme Court held that criminal restitution obligations arc defined in §tOI(\) of the BankrupfCY Code (IS debts and thllt In a Chapter J3 bank. ruptcy case, such obligations are dischargeable. In this C.1SC the debtor was found guilty of wclfilre frilud and ordered to repay the amount to the welfare departMent. However, before completing payments, debtor me<! a Chapter J3 proceeding. The bankruptcy court Stlid this was a debt which was dischargcalJlc. rhe district court reversed, but the Third Circuit said il wa$ dischargeable. The U.S. Supreme Court then affirmed The Third Circuit, two judges dissenllng. The district court had held that there w.lS no right 10 payment but that this W<lS il restitution obligation rcqulrtod for punishment and rehabilitation. The Supreme Court, In conSlruing Bankwplcy Code §IOJ(4)(AI, Solid that this came within that section. The Supreme Coun did make a point in slating that in Chilpler 7, as previously set forth In ~lIy v. Robinson, 479 U.s. 36.50, reslitutlon obligations as con-

Recent Ba nkruptcy Cases

ditions of probatiOn are nondlschargCo able. The Court sald II was not reversing itself as there wa s a distinct difference between what was dischargeable in a Chapter " Clls(! ~nd in 11 Chapler 13 case.

Application of federal taxes Uniled S liUOj v. Energy Resources Company; IIIC., 110 S.(t. 2139, May 29, 1990. The U.S. Supreme Court held that In a ChJpler 11 case, the plan may pro-

vidC! for dirC!cllon o(payments to the IRS In order that the portion of Ihe debtor's lax which emJnatesfrom a trust fund be Pilid first As is genera ll y known, If prln. (ipals of a C(lrporalion fall 10 sec Ihm trust fund laxC!s, i.e. , withholding taxes, are not p<lld, the IRS Is allowed \0 assess agJlns\ Ihe principals a penalty e<tual to the lImOllnt of Ihe lax. Therefore, II is beneficial 10 such prin. cipal s, if under a 1)lan, first payments of

laxes be made 10 apply 10 such trust fund. In 1In elght-tQ-(lne d~i~ion, Ihe Court held that if it is necessary for a succf!!osful r(>()rganlzatlon to do so, the BJnkruplcy Court has the authority to make the IRS accept the plan tax payments as trust fund J>t1yments; this is so even if it means lt11l1 after the debtOf pays Ihe truSt fund paymentS1\ is unable \0 pay the f£!. mainder of ta xes, thus leaving Ihe United SIIIteS tit risk. •

Riding the Circuits Tuscaloosa County Bar Association The following are the officers (or the 1990-91 term of the Tusca loosa County Bar Association: President;

J. Douglas M cElvy, Tusca loosa

Vice-president! President-cicCI: Wilbor J. Hust, Jr. , Tuscaloosa

SecretaryfTreasurer: Dan Gibson, Tuscaloosa

The 28 members of The Dale Coum y Bar AssociaTioll elecled th eir officers (or 1990·91: David Robinson, tre.1 surer; DalC!VilIe; Crorgc Trawick, SC('rel<!ry, AritOIl; Neville Rccsf}, vICc-prf!sidefl{, Daleville; and Bill Filmore, president., OXilfk.

366

November 1990

Malpractice Prevention 17-Point Checklist by Victor 8. Levit

Victor B. Levi, Is resident partner 01 the San Fr;lOc/SCO office of the Bargcr & \'\bIen law firm willI offices 11150 in Los Angeles, San Dies<> and NI..'Wporr Broch. /-Ic Is coauthor o(legal Malpral;lice, 2nd (\.-\t'u Publishing 1981). I. Do nor promise Of 1)(CdiCI any specific oUlcOme or dollar rccovcry. 2. Before performing imy services explain to your client the amount of r("eS or the baSIS (or computing them. Any fee conllact between attorney

and clienl arranged aflcr representa-

lion has begun may be challengcO by the client.

3. MainlJln detailed and coml)lele lime records fo r all services rcnd(!(e(!, In. duding hours arId (i1..>s<:rlpllons of ser· "ices. When approl)ria'e, bill ~ur client periodically ;mel explain Ihe basis for your chaf'KCS. 4. Do nOI /gnore your dienl. Inform the client by periodic status rcporls. If there arc iong periods of del<ty ex· plain the rca'IQn (or Inactivity. Send COI)ies of p leadings and sclf-exp lan. atory leuers and return telephone calls. 5. Keep your cHen t advised 01 any serious problems that have developed. Do not minimize ri sks thm may be involved in the Icglll proceed-

Thf! A/,lbama Lawyer

jngs. Where there are alternative strategies 01' oplions that Involve risks. inform your clicnt tt> give you recom· mendatlons and let tho client choose which of the strilregles should be allO'oYCd. 6. Take 0() material action that may I)f(}o judice your client without express consent. Do 110t sl!ttlc the case. Do nOt agree to judgnlent and do not release or dismiss Ihe party without your client's consent In .'ny oI tht.'Se situations. 7. Avoid representing I"vlles with canfIIctlnglnterests, including both l>arties to a dh.()rcl!'. Disclose any prior representation that may appellr to af· k'Ct the q uality or e(tenl of represcnIillion. Disclose any pcrsonal or adverse interest you may have in the matter being represented. 8. PrescM! the client', confidence. 9. Oevelol} a S)'litcm Ih::ll will fe<luire compll;m ce: with all deadlines, Sloltutory limitations, law and motion matters, trial setting dates and other dates thm must be remembered. 10. Confirm all oral Instructions or Impor· tant conve~ tions with your client I:1t letter. 11. Do not talk down to your dient. Your general attitude and rapport with your cllem arc vital.

12. Do not overstate the strength of your case.

13. Do not associalC! o ther counsel or refer 10 a Spcclil liSI w ithout your clien t's consent. 14. 00 not undertake rep~ntiltlon in matters beyond your (!)(perience or ability without securing asslslilnce or associa ting other co unsel. 15. 00 not critid7C your client'S (ormer lawyer without being fully apprised of all material (acts. 16. 00 nOl rCV('lIl that you ca rry malprac tice Insurance. R(,ltain ;III your policies, primary and excess, especlal1y those written on an occur· rence basis. 17. Do nOt nttempI to defend your own n)alpractice claims.

Compliments of AHorneys Insurance M ul lin! of Ala bama, 1I1C. 22 Inverness Cen ter Parkway Suite 340 Blrminghnm, AI(lbama 35242·4820 Telephone (205)980-0009 Toll-free (800)526·1 2~6

FAX (205)980-9009 ·Ch(lrter Member: National Association of Bar-Related Insur,wee Cos.

36'

- Senate Judiciary CommitteeNOTICE The SCJ'l<1!e Judlcl.wy Commi ttee Mlop1(.,(j a comrnlllcc resolution in August rcgimllng membership In clubs thai engage in discrimination . The resol ut ion ~'a tes tha t It Is illtl ppropriiue fOf persons who may be nominated in \h~ fUlure 10 the federal ludiciiuy or 10 poStSin the DCpJ flrncm of Justice to belong to discrimi natory clubs where business Is conduelt'd, unless such persons are aCllvcly cnSilsed in bona fide effOrtS to eliminate Ihe discrimin;lIory pr,lC11ces. The resolution takes ef(~1 on January 1, 1991 . The committee unanimously adopted this resolution because of Its concern 111", member1hip in such clubs con路 flicts wi th the appearance of ImlJartlality required of those who serve on Ihc ((!(Icfal bench or in Ihe Justice Department. The resolu tion Indicates tha t membership In diKrimlna tory clubs will con si der In evaluating nominees.

be an Imrll;)rt(lnl faCtOr fOr Senators to

Committee Resolutio n Expressl"lg lhe sense of Ihe Commi ttee on Ihe ludiclary conct>lnlng membership in clubs Ihal eng.1ge in d iscrimln,lllon. Resolved by Ihe Commiflec on the Jud,ciary, Th.ll Il ls Ihe sen se of the Committl."C on Ihe Judiciary of Ihe Scn~le th.ll(1) dulJs where business is conducled that by policy or practice intentionally diSCrIminate on the basis of ,",CC, color, religion, sex, d isability or national origin operille to exclude persons, Including women and minorilles, from business lind professional oppoftunll ies; (2) In recenl ye<l r~, Jwarcncss has grown lhat such dlscrimln(l1lon Is Invidious and that membership In such discriminatory clubs may be viewed as il t.lcl t endorsemen t of th e d lscrlmln(l1o ry prilchces: (3) mL'I'Tloorshij> In such discrim inatory cluln conflicts wi th the appear;lIlce of Impill1iilliTY requited of persons who may serve In posi tions in Ihe Federal Judiciary 0. the DclhlrTment of Jusl ice: (4) it is Inapl>ropriattl for persons who may be nominated in the future to serve in the Federal judiciary or the DcpartmCflI of Justice to belong to such d lscrlm lnJtory clubs, unless such persons are actiyely engaged in bona fide e((otts to eliminate the diK rlminal ory practices; (5) such memberShip is iln Impon.1l1t f;lClor which Senators shou ld cOllsidt!r In evaluating such persom, In conjunction with o ther factors whi ch may reflect upon their fj tnc~s and ability; (61 so as to promote a consistent policy on this issue in thc legislative branch as well, any St:nator belonging to such iI club should resign his or her membership in light of this resolulion; (71 1o be considered a club where business is condu(!TOO, a club must have one of the following characterisl ics(AI club members bling bu siness clients or professioral associa tes to the club for conferences, nlt"(!llngs, meats, or use of the facilities; (B) club members or their employers deduct dues, fees or p1lyments as business expenses on !ilX returns; (C) the club Is one where contilCTS yalu;lble for bu sIness purposes, employment ;Hld pro(esslonal adyancement Me (ormed; o r (0 ) me club receives pilyml'!nlS from non路members (0( meals or services provid(.'resumt.>d to be clubs where business is conducted; (8) paragral)h s (I) Through (7) do nOI apl>l y to fr<ltemJI, SOrOral, religious or ethnic heritilge or8<lnizations; (9) this resolutIon shall take effect January 1, 1991 ; i1nd ( 10) The Ch.. lrman of the Committee o n the Judiciary of the Sena te is requested to transmit a copy of this r~lu t lon to the President and the Attorney General of the United St.. tes and all members of the Sc!n;ite, for such use as Ihey ducm appfoprlmc In considering futurtl nomln .. t lon~ 10 Ihe Federal bench and thl! Dl!pilftmcnt of Justice. Adol>ted by the Commi ttee o n the Judldary of the Sena te on Augu st 2, 1990.

370

Novcm/lcr 1990

Alabama State Bar Proposed Workers' Compensation law Section Survey A ta sk force 'las been commissioned to survey the m@moor$hipofthe Alabama Stme Bar 10 determine whct1cr Iherl'! Is sufficient inl!lres! to form a Workers' Compensation Law Section. Thi s scction') focu s would be four.fold: (a) OuvelopJ1'lCnt of a network of c)(pcdcnccd i1HOrncys for the shar ing of information and identifica tion of knowledgeablc allorncys throughout the state; Ib} Presen tation of a periodic newsletter dealing with workers' compenS.l1lon law topics of speclal lnlcr<.'st to AlabJma allorneys; Ie) Presentation of an annual seminar, posSibly in conjunction with Ihe state bar convention; and

(d) LegislatiYe efforlS and O'Y'erslght as the need arises. AllornL'YS who might be interested In jolninglh!! Alabama Stale Bar VVorkers' Compensation Law Section would be those who have an inlerest in workers' compenS.1Ilon cascs aoo who rf!prc5enl either the injured employee or the employerllnsurarlce comilany. The IInnulll dues for membership in thi s section would prob.lbly range from $10 to $20, depending on the number of members alld the level of activi ty of the secllon, If you Me Intcrested in becoming a charter member of this 5(.'(tlol1, please Il1dlc;ltc on the survey form below and return it to Keith B. Norman at the st.1te bar headquarters In Montgomery by NQ'I(!mbcr 30, 1990.

I would be interested in joining the proposed IM>rkcrs' Compensation 1......... Section of the Alabam<l Stolte Bar.

(N;Jmc)

(Firm)

(MaUing addmss, City, Slate, ZIP)

Areas of special interest (mark with an " X"

-===

_ _ _ Employee/lnjured Party

Employerllnsur<ln ce Coml>any O ther (please describe)

Please return by December 7, 1990, to Keith B. N{)rmllll, Director of Programs, AI{lb{lma Stille Bar, P,O, Box 671, MontÂˇ gomery, Alabal'l1il 36101. â&#x20AC;˘

The A/.lb.lma Lilwycr

371

Law Clerk Update The (allOY/ing is a list of the st;lff i1t1orncys and law clerks who will be working for thc federal and state Judges In the Montgomery orca during 1990·91 follO'M'd by,) list of the judges' law clerks In the Fifteenth Judicial Circuli and the district cOurl ~.

UN ITEO STATES COURT OF APPEALS FOR THE

CI('rk'~

Offic,c:

Judge Johnson:

"Ruth Todd e h,lUin

)udgl' Godbold:

+John Dobbs

"D,wid VJrlll

"Michael 5<:hec1er "OiIVid Lyle

ALABAMA COURT OF CIVil APPEALS Judge Ingram:

"Bill Ki ng Judge Thompson: "Barry Fisher 'Chris Herren ' Ruth Williilmson Judge Dubina : 'Linda Smith ' Pcter Fruin Judge V,lmer: 'Rhon E. Jones "Dahon Smith MilgiWilt(' CarroU: "Beatric(' Olivcr ' Michele 1(C(!d Milgl Slrate Coody: 'Arne Anderson 'Mark ChaWn

Judge

Ru~'>CII:

+Wayne Bills 'Sleve Burford

Judge Wright & Judge Brildlcy:

Justice Jones: Justice Almon: Justice Shore;! Justice Adams: Ju~tice

Houston:

+itJy Vilughiln ' SuSdn Gunncll~ ' David Sawyer +Ann Wilson +John jones ' Michelle Denton +G~rgc Dent +Charlcs Pullen ' Pcrryn Gazilway +Belle Stoddard 'SIan GlaSSCOJ( #Belinda Barnett +Teresa Norman 'Monte Hartin

'Will Ch'l!"bc~ +Bari Millcr ' jdY Hinton

Justice Srca8~1I: Justice Kennedy:

372

+AJice Kracke +Bcrnard Carr ' Wendy Runyan +Landis Sexton +EVitnS Crow ' CourhlL'Y Loftin

Mu s~~ fer

"Julie Wil son

"Jeff I'armer

ALABAMA COURT OF CRIMINAL APPEALS judge Taylor: Judge Tyson:

+Beth Kellum 'Mary Stuart TrOUI> 'Carol Surratt +Susan Copeland

'Sandra GUin Judgl' Bowen : P,'I1N~O ll :

Judge McMIII.1n :

'Pam Mable JU5tict' M,lddox:

+Charloll!;'

+Mlch..n~1 Silb<!rman

SUPREME COURY OF ALABAMA H om~by:

.. leah Snell

+Dcbor,lh 5<lnders

Judge

+Lindy Julian Be.lle

-Susan Harris

Judge Robenson:

UNITED STATES DISTR ICT COURT FOR THE MIDOlE DISTRICT OF ALABAMA Judge ! lobbl: ' William Brooks

+Kerry Caston

+Celeste Silbel

ELEVENTH CIRCU IT

'Lilla Cousins +Mary Lil ()w(>ns 'Kelly watson ' j{Ilbt!rt W,mJ +jennifer GilrrNt 'Creg HOI>klrls 'Dee Miles +Anne Bowncs 'Amy Jon('~ 'ChriS Ad.er

FIFTEENYH JUDICIAL CIRCU IT Judge Judge Judge Judge Judge

Thoma ~:

Gordon:

Phcll>\: Price: Montiel :

' Eric Ponder ' Donna KnOtb 'Cole Portis ' Brend,) Clark ' Karen Chambli~s

DOMESTIC Judge Bailey. referee Judge D,wl s: ,o.M. Strickland Judge Dorrough: ·K.athy Brown

DISTRICT COURY Judge Bright. Judge Gr('('nh,1W & Judge MlJIer: 'Phyllls Brantll'Y

.... Staff AttOrnt'Y • Law Clerk It Administra tive Assistant

- Balilf

November 1990

Memorials I W,'\( I"

I) \ \

I[) 11011111111>. "'R .

I have knOWn Fr,lnk D. Hollifield, Sr., since the 1950$. He W,l $ born December 13, 1906, and died July 31, 1990. After :utcl'ldillg How;Jrd Collcge, Frank graduated from the Birmlnshilnl School of L.1W in 193). Frilll!.: was admiUed to the b;Jr in 1935, and was a member of the bar for over 50 years.

Schuyler Allen Bake r-8Irmingh.lm Admitted: 1948

Oied: May 19, 1990 Murray All en Ballies-Culhmul

Admim.od: 1945 Died: May 7, 1990

He practiced law in the Birmingham area before serving as ~n allorney for the \klerans Administration. He worked in this cal><lcily for ma~ years. He pract!coo law In MOnlgomcry in his own law fi rm (i lotlifieid & Hotlifield> unlil 1988. Fl'ilrlk had many O!h", In ! erest ~, Inclueling attaining Competen! ToaMmaSl\!r in the Montgomery Toastmaster Club ' 1])4. He made many Interesting speeches dealing with law and social

Thom;lยง Burk, Huie-Blrmlngham Admitted: 1938 Died: August 25, 1990 John Bascomb P.l rktY, Jr.-Hunlw ille Admitted: 1948 Died: February 4, 1990

He rbe rt Carey Wdlkcr, Ir.-Hun tsv ille Admitted: 1956 Oied: August 28, 1990

Walter C. Phill ip5-Atlanla, Ceorgia MOlltled: 1942 Died: August 30, 1990

EWC!II Nt.'Y Clark- Des!i n, Florid:! ,4,dmittcd: 1946

Wayland Henry Riggins-Huntsville Admitted: 1962 Died: April 28, 1990

Died: June 12, 1990

Fra nk Dayld Ho llifie ld- Mo ntgo mery AdmiUoo: 1933 Died: July 31, 1990

justice, and also did some eM:cllent readIngs from Poor Richard's Almanac and !he works of Elbert Hubbard. He enioved his association with the Montgomery Civi tan Club, and looked forward to his meetings each Friday. l ie was a filmily man, ilnd enloyed his children and grandchildren. He had been milrr/t.>d OI.1!r SO ~ars. Frilnk will be missed bv h s family, his church, his many, many friends, and his associ;ues. Fl'ilnk wen! to church each Sunday and attended his Sunday Bible 5(hool class. He Wil5 a student of the raw and on the side of the little tran or downtrodden one. Frank W.lS very good at investigalions. He would find the facts, truth or person. N. one time, he called hlm!.elf ~Blrd Dog" Hollifield, His manner made one tru~t hi~ honesty and Integrity. l! was II ioy 10 be around Frank as he WilS II lolly miln and easy to I(lik 10. Ha wa s good company and always InterestIng. The world Is a bener place for Fl'ilnk Holllfield's having liYCd in it. โ ข

- Joe B. Cai n, Jr. Admitted to l he bar In 1935

Robert Clarence WilliamsAlexander City Mml Ued: 1927 Died: May 12, 1990

Please Help Us ... We have no wily of krlowrng when one of our mcmbel"'hip r~ dccca~ed unl('~~ W(,.HI.' noldled. Do not wai t fo r someone else to do It; jf you know of Ihe dei1 1h 01 ol1e of our members, pll',l,r let u~ know. Memorial inforlll.ltion must be in wril ing with llilnlC-. re turn addre~~ and lclcphon(' /lllmbcr.

37J

Disciplinary Report Suspensions • Effecti~ June 1, 1990, Birmingham I~r ~rnon Wade LeMay hils been suspended from the practice of law for noncompliance with the Milrldatory Continuing legal Education Rul~. lelf No. 90-2411 • Effective Augu St 1, 1990. Sylacilugil lawyer Michael

Wayne Landers h(ls been suspended from the practice of law for noncompliance with the M,md<l'ory Continuing Legal Edu(ill ion Rules. [elf No. 90-52) • O n AuguSt 16, 1990, the Supreme Court ordered Ih'\1

Mobile aUorney Miljor E. Madison, Jr., be suspended from the practice of law for a lX!rlod of two years, effective retroactively to December 28, 1988. Madison was found gultty of wUlfully ncglcctlnglcg.11 maners cnlrusted 10 him; of (aHing to seek the lawful objectives of his clients: of failing to carry out a con·

Iract of employment entered Into for his professional services; of prejudicing and dilmaging his clients during the course of Ihe professlona relation ship; and of engilging in conduct thill i1vver;ely reflected 00 his fi tness to practice law. IASB Nos. 88·592, 88-79a &- 88·689J • Effective September 1, 1990, TU~OIloos:. lawyer Hugh Don W.-aldrop \Nas suspended from the practice of law for non· compliance with the Mandatory Continuing legal Education Rules, IClE No. 9().461 • In an order dared August 2, 1990, the Supreme Court of Alabama suspended Rich.ud l . T.1ylor from the practice of law in the State of Alab..lma for a period of ten days, said suspension to become effecti ve September I ), 1990. This susl)Cn ~ion was based on the Disciplinary Soard of the Alabama State Bar finding Taylor gulUy of certain violations of Ihe Code of Pro(es~ional Respon5ibility. IAS8 No, 88·5871 • Effective September 7, 1990, Mobile lawyer Sidney Moxey Harrell has been suspended from the l)rilClice of law (or noncompliance with the Client Securit y Fund Rule. [ClE No. 9().46] Public Censure • On September 21, 1990, attoflll_'Y Thomas McAllister Scnmll'S o( Anniston was publicly censured for violating Disciplinary Rules 6·10IW, 7·101tt\)(11 and 7·101{A)(2), Semmes was hired by an individual to file for a hearing and/or recon· sldefOlUon on a social securityldisabil ity claim. The client was

informed by Semmes' office Ihatlhe hearing request had been filed, when, In f.-act, It wa s later discoYCred Ihal no such request had been processed properly by Semmes' office. Semmes therefore was found to have willfully neglected il legal mailer entrusted to him, to have failed to seek the lawful objecliYeS of his client, and to have failed 10 carry out a con tract of employment entered into for his prOfeSSional scrvlces, IASB No. 89·3061

Private Reprimands • On July 18, 1990, an Alabama lawyer recei..w a private reprimand for viola tions of Discipllmuy Rules 7·101(A}(l) ilnd (21. The Disciplinary Commission delermlned thai the lawyer had failed 10 seek the lawful objl'dives of his cli~r\t and failed to carry Oul a contract of eml)loyment by nOI pursuing appellate relief in a worker's coml)ensatlon case and by assuring the client that all av.)lIable remedIes had been souSht. [ASB No. 86-477]

• On September 21, 1990, a lawyer wa s privately reprimar'lded (or willfully neglecting a legal maner entrusted to him, falling to seek the lawful objectives of his dient, and failing to carry out a contract of employment enlered into for his setvices. The lawyer accepllod a retainer to represenl Ihc client in pursuing a mortgage fon."Closure. Due 10 Ihe dilatory man· ner in which the lawyer handlltd the foreclosure, Ihe property In question wa s vandalized and the client lost ren tal income on the prol)(!rly. IASB No. 86-6741 • Or\ September 21, 1990, an Alabama lawyer received a private reprimand for violation of Olsclplinilry Rule 7·101(A)(3), The DiScil)lInory Commission determined that the lawyer had engaged In represenl ing differing interests to the detriment of a client in a criminal case when he refused to caU a former client as a witness to provi de testimony to al1ack il search warrant. The Commission found Ihallhe former clien t hilt! aCll"CI as a confidential informant against the prescnt clienl and that the atlorney, knowing orthat, did not Inlorm the present client of the possible eKculpatory testimony uvallable from Ihe former client and did not seek to call the former client as a witness. The Disciplinary Commi ssion def:med thi$ to be a breach of the Code and delermined that a priv~te reprimand should be given. [ASB No. 89·625(A)] •

November J 990

.-. .)<_._ ......... _ . . ' __ , ..... --...... _. _....... ........ ..... -...- ..... ...._."'---" __.....,.....---_ .....-

-Classified Notices ,. .__ . . -,. . .<_. . __ . . _,,"'_... .. _ _ _ ." ... _

(-,

.. It _

'00" ... _ _

...... ut ... _ _

"'-~ ,-

"",'''' _ _ _ H

FOR SALE FOR SALE: U,S, Supreme Court Reports (Publ isher: L<lwyer's Coopcr,1 tlve) S1,000; Alabama 1..1W Reports 3d & 4th

(Publisher: lawyer's Cooperat ive) $1,800; Proof of Filets 1st, 2d, 3d (Publisher: L.lwyer's COOperJllve) $1,300; Handling R.>dcr,,1 Est,11e & Gift Taxes (publisher: l..1Wyer'S Cooper'l1ive) $100; Defense d Drunk Driving (pub-

lisher: Manhew-Bender) $250. All sets are comple te and up-to-date. Contact

Brogden & QualilebilUm, P.O. Drilwer 906, Ozark, Alilbama 36361, or phone (20S) 774·5171,

FOR SALE OR TRADE: Condo on the

beach at Fort Walton Beach, Florida· one bedroom, one bath- completely furnished, Current mortgage is $56,000 with payment of $66B per month plus maintenance fee of 591 per month . Third ncor with balcony looking down on beach. No equity reql,Jired and closing cmts are negotiable. Unit is ~ry desirable rentalllnd must be seen to fully apweciate. Call (904) 863·2784 or (904) 24J.9303 01' write 80b AY'!I'S, 184 Eglin P,ukway, NE, Suite 7, fort Wdhon Beach, Florida 32548. FOR SALE: Law office and eql,Jlpment. 2,3()().s(IUare fOOl law office with com· puters, Pf'inter, COI)ier, phones, books & FAX. Sole practitioner elccted judge ef· ft.OC1ive J<IIlUilry 1991. Phone (205) 593·2222 or write P.O. Bot 752, BOlll, Alabama 35957. FOR SALE: S.M! 50 percent on your law books. Call Nat onal law Resource, America's largest LlW book dealer. Huge Inventories. low prices. Excellent (Iual· ity. Your sali sf,l Clion absolutely gUilmn· wed. Also, call America's largest law book dealer when you want to sell yeor ullneeded books. Call for your free, noobligation quotes, (800) 279-771)9. Na· tionill liIw Resource. FOR SALE: TC Ml!mo Decisions, Vols. t·56; US Board of Tax Appeals, Vols. The Alabama Law)'ef

1-47; Tax Court, Yois. 1-91; American Federal Tax RepQrts, \loIs. 1·52; AFTR 2d, Vels 1·61. Contact Amy Ham m at (205) 322·0534. FOR SALE: Southern Reporter, Vois. \·200; Southern Reporte r Second, \obIs. 1-201; complcte Coq)US Juris; and Cor· pus Juris Secundum through 1975. All books In eKCeUer'lt condition . Contact Kilrl Tyree, 115 Hickory Hills Court, florence, Alabam.1 35630. Phone (205) 764·9682 or 764·3030. fOR SALE : Alabama Reporter, Vels. 439·557 Southctn Reporter 2nd Series ()9 books). Contact L Shattuck at 1212 Rumson Drive, Birmingham, Alab.1ma 35226 or call (205) 877-7792. FOR SALE: Alabama Digest wilh 1990 pocket l>arts; Alabama Practice and Forms Vols. \.6. Conlilcl 8ill Whit!;', P.O. Drawer 9, Scottsboro, Alabama 35768. Phone (205) 259·1711 .

POSITIONS OFFERED ATTORNEY JOBS; National and Fed· croll legill Employment Report: highly regarded monthly delJlled listing of hundreds of anomey ~nd l{1Worelated Jobs with U.s. government, other pubJidprlvatC employers In Washington, D.c., throughout U.s. and abroad . 5l2- l months; $55-6 months. Fed· croll Reports, 1010 Vermont Avenue, NW, , 408·AB, Washington, D.C. 20005, I'hone (202)393-3311 . VlsalMC.

SERVICES EXAMINATION OF QUESTIONED Documents: Hilndwriting. tY!X"Nr1ting and related examinmlons. Irllcrrlatiunlll· Iy court·qualificd expert witness. DIp. lomatc, American 80<lrd of Forer'lslc Document Examiners. Member: Amer. ican Society of Questioned Document Examiners, thc international Associil' lion for Identification, the British Foren· sic Science Society and thc Natlt'lnal Association of Criminal Defcnse lawyers. Retired Chief Doc;unenl Examiner,

USA Cl Laboratories. Hans Mayer Gid· lon, 218 Merrymont Drive, Augusta, Georgia 30907. Phone (404) 860·4267. WRONGFU L DEATH/PERSONAL IN· JURY: Ellpert actuaries will testify to value 01 lost future earnin8~ in wrungful dCillh and personal Injury c.lSes. Fel· lows of Society of Actuaries. E~pcrlence In court. Can assist In deslgr of Struc· tured 5eltlement. Call David Godof· sky-C& B Co nsulti ng Group, a Corroon & Black company, 1927 lSI Avenue, N" Birmingham, Alabama 35203. Phone (20S) 323-7000, LEGAL RESEARCH HELP: Experieoced attorney, member of Alabama State Bar sInce 1977. Access to state law library. 'M?stlaw ilVilihlble. Prompt deadline reatches. we do UCC·1 scarches. S35/hour. Sarah Kathryn hmell, 112 Moore Building. Montgomery, AI ... • b.lma 36 104. Call (205) 277-7937. No rcprescntJlion Is ma~ about the qual. ilY of thc IC8<11 services 10 be ~rfo'mcd or the eJlpcflise of tlu'! l{JwYt." perform· ;n8 such services. MEDlCAUOENTALMALPRACTICE EX· PERTS: Our experts 5uccessfu Iy testify In Alabama . Gratis preview of you r medical records. Health Care Auditors, Inc., P.O. Box 22007, 51, Pcte rsburg. Florid.l33742 . Phone (813) 579·8054, For Stilt Svs: FAX: 573-1333. CERTIFIED FORENSIC DOCUMENT EXAMINER : B.S., M.S., graduate of universityoOOscd resident school In doc· ument Cl!<lminarlon. Published nat/in· tcrnat. 5eventcen years' trIal CJCpcricncl! in state ilnd federal courts of ArDbama . FOfllcry, alterations and document ,1U' thcnticity examinations In nOfKrimlnal mailers. American Academy of forensic Sciences, American Board of Foren· sic Documerll EK.aminers, Amclican Society of QuestionQ(1 ElIiImlners. Lamar Miller, P.O. BOll 55405, Hirm· Inllham, Alab-l m" 35255. Phone (205) 986-4158. 375

Classified Notices DIVORCE CASES·PENSION EXPERT: Pension ilCtlJMy will determine p resent

v,llue of "ccrued pension rights. Stan· dill'd fee for wrillen vaJuO,I tiOn. In-COllrl 1es1imony for hourly fee. Call David Godofsky-C & 6 Consulting G ro up, a Corroon & Black compMy, 1972 151 Avenue, N ., Birmingham, Alabama 35203. Phone (205) 323-7000,

A'·

TRAFFIC ENG INEER : Consultant/Expert \rVl!ness. Gr,lduatc, registered, professional engineer. Forty years'

MACHINERY & EQUIPMENT

experience, Highwi!y and city design,

placement cost for capi tal, refinancing.

traffic control d(,..... ices, city zoning.

bilnkruptcy, insurance, etc, Wri te fo r

Write or call for resume, fees. Jilek W. C hllll1bliss, 421 Hl!lIchursl Drive, M ontgomery, Alahama 36 109. phone (205) 272-2353.

(ree brochu re. Phillip D. Brya nt, P.O. Drawer 966, Oxford, Mississippi

PRAISER ; Tv.(!nty-fl'-<!

~a~'

ClIpericnce,

Liquidation, fair market va lue and rc-

38655·0966. phone (G OI) 234·6204.

•

NOTICE Form 8300, Report of Cash Payments over $10,000 Received in a Trade or Business As a rewlt of the Tax Reform Act of 1984, a person receiving more than S10,000 cash (to Include foreign currency) in a trade or business is required to file Form 8300. " Report of Cash Payments over S10,000 Received in a Trade or Business," wi th the Intern,,1 ReVenlle Service, Multiple transactions between ,1 payer ,md a reci l>ient involving cash transactions wilhin a 24-hour period muSI be reportl>d. For example, if jill individual 1Iuends iln auCtion ilnd purchases an item for $9,000 cash and Iliter purChilS~5 another Item for $1 ,300, 11 Form 8300 must be fi loo reilOri ing $10,300 received in th e " trade or business." Also, if cash in excess of $10,000 is r<!CeivlX! in a series 01 conncctlX! transactions beyond a 24-hour period, a Form 8300 is required, If a perso!l pays $5,000 cash for all au tOn"lObl le Md subsequently makes cash payme!lts, the iI!llounts must be ~88re8ated, and once the llaymen ts exceed $10,000 In cash within one year, Form 8300 must be filed . Forms 8300 Dre due within 15 days after the d"Ie of the tr<msa ction , Additi onally, by Janumy 3 1, the recipient of the cash musl furnish to each payer a statement totalling the amounts received from the payer during the preceding calendar year. The Forms 6300 must be filed with the Internal Revenue Service at the fo llowing address: Interna l Revenue Service Data Center P.O. Bo< 3262 1 Attn: RCP Detroit, Michigiln 462 32 For relums due after 1986, and before 1990, there is a $50 fall ure-to-flle penalty IlOilO exceed $100,000 forwill{ul neglecl.lntentional di sregard was $ 100 per failure to file with no limita tion. Effective January 1, 1990, the inten· ti onill dis!egMd penal ty was increD5(..'{i to 10 percent of the ilggregate amoun t of ilems required to be relXlrtcd. Willful failure to file may subject a taxpayer to a criminal fine of $25,000 ($ 100,000 for corpora tions) and five years' imprisonment. Willful fal sificalion of Form 8300 is a felony with a fi ne o f $1 00,000 ($500,000 for corpar.llions) and three years' imprisonment. Th e Sinningham District r~cen ' ly complctl'il 131 Form 8300 compliance checks and fou rld a 60 percent noncompli ance rate. Cash tra!lsactions o f about 52 million were Identified which had not been reportlX! on Forms 8300, as required. The Internal Revenue Service will step up en forcement of the IRC Section 6050 I provisions. Suspicious transactions Illay be rel>orled to the Internal Revenue Service, CriminallnvC5ligation Division at (205) 73 1-0976.

376

Novemtrer 1990

THANKS TO STRONG WE'VE KEPT OUR BALANCE'FOR NEARLY HALF ACENTURY. MISSISSIPPI VALLEY TITLE INSURANCE CQMPANY CONSOLIDATED BAUNCE SHEET Mur'Ch}l, 1990 ASSETS

CASII AND INVESTED ASSh1-S Cuh Demand Deposits Till'll! Dt.'tlOSi1S . .. . .. _....... Ilonds, ~1 Bmoni'J.:'IIcmt (mukct, $4.~~S,292),

2<).249 2AlO,94~ 4,~07.637

Stocks Prdl'Tro, at lUlllmarkt1, S98':~60} .

Common, at markt't (COSt, $214.6381 ..... MonPb'l: loom ........... .

InVesl!llCm incomedlle WId accrued , , ... Total cash arxl im't'Slro :lS,WU 01'J-1~:R ASSETS AOO'JIlfIlj ~ lId prt'nillrn~ n.uinblc . , Re-~I CSM("

buildings, furniture and l'quipmrot. at

cost, less at'I:umulatl'd depn'Cialion of 16%.630 . Title plants and records .... ' , ..... , " Im'e'ltnltllt in nffiliatt-d COIoral'lil"A ..

SUIldry .. ,

" " , " " "" " , ....... .

'[iIIal odrl':AS.o;et$ T()(lll~'lll .

....•••.••

104.457 713.Q.11 2301.273

167.295 8,226.897

, ....•...... p~yabk:I(l~rfili;ttl<drompiiny ' ... " ..... " ... ACCOlInt~ I)IIYoIbIc ....• , . . .. , .••....... ". r\lorc:s pOiyWlc •....••• "., .........•••....

.oJ5tm,,,, "".Pdt.,

1"" , p" ••/tll/ Ill .....,,..,... AI,

Gordon W. Skellon I'... p,.WtOl

I'~".'n. V,...

Vance \II, Smith

J.M. Sdl~rj

M.",pIJoJ. TN

&""1'" Ln p,."J,o/

•.oJ1:"',.,..

Wali~m T. Ulakely

I'...

""<>it ..

Patricia Ihile)' Bl'l)Wn

v... "",1M.,

}o Tlldlock vn /'Ir,oitll/ Dorlllid P. Wrddick Viro /'<r,w",

,III ........... oliN

V.. I'Hllo1tOl

~hrilyn

1'0,.

VkoPw ,U... MN

Mabcline Mnyulle

381.891

~h.""'f'<I/tr.

v.... "",.Jtll/

Na!h~n Cole

8.. """ .. MS

1.065.926

W3.643 240.228 2.99111168

I'", /;,., ... 01 MS

r~.,<IO,

11. Williford

PkJ.".,

Ddl Crmlj1Il.:!1

c../ro/Ir.

Carolyn flrceman V... /Ioo,W.oI

SI1.22~,065

5 3.739, 133 '1.228

111M2 28,322 rt.3H

Deferred il'lOOfll(' rliJ/CS .•........•...........

(12.477)

Sundry ............... , , .. " .... ,', .. . Tocwl liabilities , •• ,' SHARE! IOLDERS' EQUITY Common srock. III 5raroo \'al~oI SI.5W pet shart, AU1horil,OO 1.600 shares: issuetl322.6 ~h~~ . . I'aid·in ClIpiCal • , •••••••• , •••••• , ••••..•••. UnkllJil.td ,Ilain on irll'tstmcrtcs ....•• , , .. RctaillCd earnings , ... , , •.•. I.ess rrea.mry Stock, at OOSI. J9.' shures •... , Toc~l ~harehokk:r1' equity .. '

722,259 4.644,470

equity .....

""'''-

j. Monon Mnlrick

E. [A'OO SlIIKk.'B

Richaru 1\. Cccchcnini

lIABlLI11ES Fees aflliraxC5 ' . . . . .

"'fI)

806.480

LIABILITIES AND SHAREHOLDERS' EQUITY Claim~ .

OFFICERS ROII'll!1 H. Taj'lor. Sr. OUn ..... John T. <A!.,'lar

DIRECTORS Dudley n, BridgfOl'th. Jr.

Donnie D. Rilly

iI/M",

A!iUr",~

Sootl.wro .. oilS R ich~rd

A. Cecdk.1tini

1'oo,0it1l/ 6 COO T~"

/./Olooto 0. <!/.I/,... W14

to/,._,..,..,AlN

John T. Cossar

",,"Frank R.

Chom .... 6 CEO T•• u ...... COIjIOtOl.\lo

Airon 1'1. Hul'lt')' ~.098

4.308.812 267.762

l.m.877 !93,9~t\1 6.~80,59'

SII.22H)65

D...

MHJi.!"I'f"O/IIqo j(~ oju.,

M,A. i.t'wis, Jr. All ....'

I toward I.. McMillan. Jr.

""".

0./»<11 G... ... ,' Nou.-J 110 ..

J. Monon Mal rick "~_ht

l'h 1'00,.1.11/

.,.Js.m",.)

c.tI;.o.,.tots J.II1. Sellari

r;..o,l". Vito . ",/7;"', •• "

i><t,,,,,.,

Charles H. Sewell P,.,.IIII/

Or/'OJilGw,. ...yM... ~ (M/I

William R, Sltl'lCr

CJ,.,n_. 6CEO QIJ R.p!r

~II.

/.,,,,,,,,,,...1 CPt/l

Rowun II. TlIylor, Sr.

0...._. 6 CEO A.C. ZUCrIt'tl

""'"",w 6 C1O 00 R.,.bbt 1""."_I c..~ ~II.

OIc...HI

Bobby t. c;o...illflron William C Sml1h. Jr.

I I ir--'

J~lI!>tn. Jr. U. S. Curt of /\ppl!~lt.. 11th CIrcuIt P. O. Box J5 HDflt9UMtry M. 36101

Hon. Fr4lnk K.