JANUARY 1988

THE ARKANSAS , January 1988

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January 1988

Vol. 22, No. 1 OFFICERS John F. Stroud. Jf.. President Philip E. Dixon. President-Elect Sandra Wilson Cherry. Sec.-Treasurer Vincent W. Foster. Jr.. Council Chair

ARKANSAS

La

SPECIAL FEATURES

2 5 8

Wm. A. Martin, Executive Director Judith Gray. Assistant Executive Director EXECUTIVE COUNCIL Madison P. Aydelott. 1II H. Murray Claycomb John D. Eldridge. 1II Donald K. Harp Ronald D. Harrison Robert L. Jones. 1II R. Gary Nutter Robert G. Serio Bobby E. Shepherd James M. Simpson. Jf. Carolyn B. Witherspoon Robert R. Wright. 1II

Has the Color Barrier Fallen.? by Phyllis Harden Carter

11

Phase I: Automating the Law Office. by Charles A. Morgan

15

Up Against the WaIL

by Chris Barrier

EDITOR Ruth M. Williams, Director of Communications The Arkansas Lawyer (USPS 546-040) is published quarterly by the Arkansas Bar Association, 400 West Markham,

Little Rock. Arkansas 72201. Second class postage paid at Little Rock. Arkansas. In all counts. POSTMASTER: send address changes to Arkansas Bar Association. 400 West Markham. Little Rock. Arkansas 72201. Subscription price to non-members of the Arkansas Bar Association $15.00 per year and to members $10.00 per year included in annual dues. Any opinion expressed herein is that of the author, and not necessarily that of the Arkansas Bar Association or The Arkansas Lawyer.

Contributions to The Arkansas Lawyer are welcome and should be sent in two copies to the Arkansas Bar Center. 400 West Markham, Little Rock, Arkansas 72201.

All inqUiries regarding advertising should be sent to The Arkansas Lawyer at the above address.

Point of ViewlLetters Law. Literature & Laughter

23

26

The Developing Law: Sales of a Remainder Interest. by George N. Plastiras and Philip Miron

30

Disciplinary Actions

32 34

In Memoriam

36 38

Judicial Department Report

39

Young Lawyers' Update

41

In-House News

EX-OFFICIO John F. Stroud. Jf. Philip E. Dixon Richard F. Hatfield Sandra Wilson Cherry Vincent W. Foster. Jr. Michael H. Crawford

REGULAR FEATURES The President's Report

Arkansas IOLTA Program Executive Director's Page

ON THE COVER: Okay, close your eyes. Now, tell us what you've got on the walls in your law office.

If you're lucky, maybe a couple of the prints that go with the duck stamps, and some drawings by your kids. In "Up Against the Wall," Chris Barrier. of Little Rock. a member of the Mitchell, Williams, Selig and Tucker law firm, explains thaI it doesn't have to be that way. There is a way for you to see what is available from more than 300 artists living and working here in Arkansas. You can get some advice thrown in for the price of the art and also find out something about the artist simply by registering with the Arkansas Artists Registry.

January 19S5/Arkansas Lawyerll

THE PRESIDENT'S REPORT

Mandatory CLE

AReality cessful. it will be continued every year and expanded to include a similar consortium on the fayetteville campus.

By John f. Stroud, Jr. Thanks to the Arkansas Supreme Court, mandatory continuing legal education has finally become a reality in Arkansas. We join 28 other states, including all the states contiguous to Arkansas, that have to date adopted similar programs. The Arkansas Bar Association first initiated a study of the subject in May 1983. This study culminated in approval by the Executive Council on April 27, 1985, of a petition to the Supreme Court for adoption of proposed "Rules for Mandatory Continuing Legal Education:' My special thanks to W. Russell Meeks, ill, who, as chair of the special Mandatory Continuing Legal Education Committee, dralted the original petition in 1986 and our supplemental petition in 1987. The Per Curiam order of the Arkansas Supreme Court dated November 23, 1987, approved mandatory CLE without elaboration but as soon as the court administra-

tor has been employed, we should see a supplemental order with more specifics. With the advent of mandatory CLE, you will soon see more programs covering a diverse range of topics presented by the Arkansas Institute for Continuing Legal Education and the Arkansas Bar Association and I predict it will not be long until the general level of competency of all practicing attorneys in Arkansas will he noticeably improved.

IOLTA

The Interest on Lawyers' Trust Accounts program (I0LTA) is alive and well thanks to the efforts of its executive director, Susanne K. Roberts, and the many attorneys throughout the state who have assisted with her recruitment efforts. Due to sufficient new additions of participating attorneys and financial institutions. approximately $120,000 will be available during 1988 for scholar21Arkansas LawyerlJanuary 1988

ships, legal services for the indigent or other worthy objectives to be determined by the Arkansas IOLTA foundation's Board of Directors. I urge any of you who have not signed up to come aboard SO that interest from your trust accowIt can be used for law-related public efforts in Arkansas which improve our legal system.

INTERVIEWING CONSORTIUM

The Law School Liaison Committee, co-chaired by Joe B. Reed and J. Bruce Cross, has planned an Interviewing Consortium to bring law students and attorneys together in Little Rock during the Mid-Year Meeting of AICLE and the Association on Thursday, January 21. at the Excelsior Hotel. Twenty-one law firms have expressed an interest in interviewing on that date for summer law clerks. Hopefully there will be strong participation from law students at both the Little Rock and fayetteville campuses. This will be a wonderful opportunity for both students and attorneys to consolidate their interviews to a single day and save time and travel for all concerned. If the program is suc-

LONG-RANGE PLANNING Although we had a planning retreat in the spring of 1987 to discuss professionalism in Arkansas, the Association has not had a generaL long-range planning retreat in nearly four years. These retreats had been held annually at the Red Apple Inn. Retreats every year are probably too frequent. but certainly after four years we are due to pursue long-range planning with full vigor. Robert L. Jones, III, is the chair of an excellent committee that has planned a retreat at DeGray Lodge on April 22, 1988, where we can develop a five-year plan for the Arkansas Bar Association. Most of the major programs undertaken by the Association in recent years. such as mandatory CLE, IOLTA. the Client Security fund and legal specialization, have gained fruition at similar retreats. I am confident that new, meaningful objectives will emerge from this meeting. I urge you to attend if you are one of the persons invited to participate in the retreat.

0

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ARKANSAS CODE OF 1987 ANNillATED Official Edition t midnight. December 31. 1987. the Arkansas Code of 1987 Annobecomes the official code of laws for Arkansas. replacing the Arkansas Statutes of 1947. f...- In 1984 The Arkansas General Assembly. through its Code Revision Commission. contracted with The Michie Company for a recodification of the general and permanent law of Arkansas. Working in cooperation with the Commission. The Michie Company devoted its editorial and technological resources to this project. f...-

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By Vincent W. Foster, Jr. On June 9, 1987, Governor Bill Clinton appointed a 19-member Code of Ethics Commission to develop a comprehensive code of ethics for public officials and employees. By the meeting of the House of Delegates in Fayetteville on October 24, 1987, the Commission was only in the early drafting stages of a proposed ethics code.

The House adopted a general policy concerning ethics legislation and acknowledged it would be necessary for the Association's Legislative Oversight Committee to deal with this matter as it developed since the House would not meet again until January.

On October 26, the Committee met to consider drafts by subcommittees of the Commission.

On October 28, Association President John F. Stroud, Jr., President Elect Philip E. Dixon and Vincent W. Foster, Jr., chair of the Legislative Oversight Committee, appeared at a public hearing of the Commission to present the general policy statement of the House which was adopted four days earlier. In addition, President Stroud identified two specific areas of concern: I) proposed restrictions on the practice of legislatorllawyers and members of their firms before government agencies and, 2) provisions which would require legislator/lawyers and public officials to make disclosures which might violate the Rules of Professional Conduct related to confidentiality.

On November 13, the Commission issued a draft of the proposed Ethics Code and on November 21. the Committee met and developed comments on specific proposals.

President Stroud, President Elect Dixon and Foster appeared at a public hearing of the Commission on November 23, accomponied by state Senator Wayne Dowd of Texarkana, and presented these comments. Dowd, an attorney, testified concerning his personal view of the practical effect of some of the proposed prohibitions.

COMMENTS BY ARKANSAS BAR ASSOCIATION ON DRAFT CODE OF ETHICS BILL "The Arkansas Bar Association supports the concept of legislation

POINT OF VIEWILETTERS

PROPOSED CODE OF ETHICS

NO PROFESSIONALS IN GOVERNMENT? which more broadly addresses ethics in state government than previous legislative enactments, and commends the Governor's Code of Ethics Commission for the time and effort they have devoted to this project. The Association has previously supplied the Commission with a general statement of policy on the proposed code. We believe the state has a legitimate need to attract qualified professionals for service in government as well as to maintain high ethical standards, and we are concerned that the proposed code unnecessarily discourages professionals from participating in government.

The Association requests the Commission to consider the following four specific concerns about the proposals in the draft code which were released by the Commission to the public on November 13, 1987: "I. Chapter V, section HI), in effect prohibits lawyers who are state legislators and all other attorneys in a firm with a legislator/ lawyer from 'appearing' before any state agency for compensation, except judicial proceedings and the Arkansas Workers' Compensation Commission. The provision has a corresponding prohibition against attorneys in a firm with a lawyer who serves on the quorum court appearing before county agencies and a prohibition against attorneys in a firm with a lawyer who serves on the city council or board appearing before municipal agencies.

"Because our state and local governments rely upon part-time legislators who receive modest or no compensation, their abilities to

earn a living from their primary vo-

cation should not be unnecessarily restricted. We believe that the citizens of Arkansas are well served by having appropriate representation of attorneys among the members of the law-making branches of state and local government. In the 76th General Assembly, there are 14 senators and 17 representatives whose primary vocation is the practice of law.

Twenty-five of these legislator! lawyers practice in firms with other attorneys. The proposal would prevent not only these legislators but also any attorney in a law firm with them from representing any client with a dispute under the jurisdiction of any state agency. This prohibition is not limited to adjudicatory proceedings and could include representation involving, for example, a tax refund claim before the Revenue Division of the Department of Finance and Administration;' a license application with the Department of Health; a corporate filing with the secretary of state; an industry seeking approval of industrial revenue bonds before the Arkansas Industrial Development Department; a claimant before the Employment Security Division; and a consumer complainant before the Insurance Department or the Securities Department or the Consumer

State Sen. Wayne Dowd of Texarkana told the Code of Ethics Commission in November that the restrictions on lawyerllegislators in the proposed ethics code would "chW lawyers from wanting to be legislators." Sen. Dowd, a lawyer for nearly 23 years, appeared before the Commission with Arkansas Bar Association President John F. Stroud, Jr., of Texarkana, and President Elect Philip E. Dixon and Vincent W. Foster, Jr., chair of the Legislative

Oversight Committee, both of Little Rock.

Protection Division of the Office of Attorney General. We are concerned that the partners and associate attorneys of legislator/ lawyers and of potential candidates for the legislature shall determine that this broad restriction upon their practice is simply too great a price to pay for association with a legislator, in addition to the time and financial sacrifice that many legislators must already make to fulfill their legislative duties.

"It has been suggested at a public hearing of the Commission that this proposed absolute prohibition is necessary not only to eliminate attempts by legislators to improperly influence public servants, but also to eliminate even the appearance of impropriety. The Arkansas Model Rules of Professional Conduct. adopted by the Arkansas Supreme Court to govern lawyers in Arkansas, provide expressly that it is professional misconduct for a lawyer to state or imply an ability to influence improperly a government agency or official. (Rule 8,4(e),) Violations of this and other professional standards by attorneys are currently punishable upon complaint to the Arkansas Supreme Court 6/Arkansas LawyerlJanuary 1988

Committee on Professional Conduct. Under other provisions of the draft ethics code, a legislator who attempts to use his official position to secure anything of material value that would not ordinarily accrue to him in the performance of his official duties is guilty of a violation - a class A misdemeanor.

(Section l(j) of Chapter V,) In lieu of an absolute ban upon representation before governmental agencies, we suggest this proposed prohibition be expanded to encompass attorneys associated with a legislator/lawyer who attempt to use the official position of the legislator/lawyer to influence the conduct of a public servant.

This specific prohibition would appear to be a reasonable and adequate protection against the abuse which is the concern of the Commission when balanced against the likely side effect of an absolute ban - the elimination from public service 0\ those wellqualified attorneys who would never attempt to abuse their position as a legislator.

"2. Chapter V, section 1(h), requires a public servant. other than a state legislator, who is required to take any action or make any decision in the discharge of his offi-

cial duties that may cause financial benefit to him or 'a business with which he is associated: to prepare and file a written statement describing the matter 'and the nature of the potential conflict.'

Section 1(i) places a similar requirement upon a state legislator.

Our concern arises from the vagueness of: (1) what is meant by the 'business with which he is associated: and (2) the term 'the nature of the potential conflict.'

"Does this 'business' include a professional association? Does 'benefit to a business with which he is associated' include a benefit to a client of the public servant's law firm? Does this benefit include potential sharing of fees which another attorney in the firm may earn from prospective business with an existing client as a result of the enactment?

'We have no quarrel with a requirement that a legislator who is a member of a profession disclose that he or his firm has a client or clients with an interest in the passage, defeat or amendment of a particular bill if the legislator, through the professional association, may receive a financial benefit. We are concerned, however, that a requirement of a more specific disclosure of 'the nature of the potential conflict' may cause the legislator/lawyer to violate Rule 1.6 of the Rules of Professional Conduct governing the conduct of all attorneys who practice law in the state of Arkansas. This rule provides that with certain exceptions not applicable to this issue, a 'lawyer shall not reveal information relating to representation of a client unless the client consents after consultation, except for disclosures that are impliedly authorized in order to carry out the representation.' The Code of Professional Conduct of the American Institute of Certified Public Accountants similarly provides that with certain exceptions not applicable to this issue, a 'member shall not disclose any confidential information obtained in the course of a

professional engagement except with the consent of a client.' (Rule 301.)

"We recommend that section 1(h)( 1) and 1(i)(1) be amended to clarify that these requirements shall not obligate the public servant and the state legislator to vio-

late a code of ethics or professional responsibility with which he must comply in the practice of his profession.

"It has been suggested at a meeting of the Ethics Commission that a violation of this professional standard can be avoided by advance consent by the client to a disclosure. First, this presupposes that at the lime of the engagement or before substantial services have been performed by a legislator/lawyer or by attorneys in the some firm, they know in advance of all legislation which may be proposed. An attorney in a firm with a legislatornawyer could be substantially involved in a representation of a client on a matter requiring confidentiality well in advance of a legislative session or before a bill has been introduced which would be beneficial or detrimental to the interest of that client and thus to the compensation of the attorney, Secondly. if only legislatornawyers and attorneys in their firms are required to obtain waivers of confidentiality before their engagement on matters which possibly could be the subject of legislation, they will be prejudiced in the marketplace and thereby be further discouraged from public service.

"Finally. if the client will not consent to the disclosure. the legislatornawyer is in the untenable position of the firm withdrawing midstream from representation of the client, violating the Rules of Professional Conduct, resigning from the legislature or facing criminal sanctions under this proposed code.

"3. Chapter V, section l(I), prohibits a public servant other than a legislator from seeking employment with a business which is regulated or subject to control by a governmental body which he serves. This would require the public servant to resign before making any job application. Section l(c) prohibits not only a former public servant but also his employer from providing assistance or appearing in connection with a specific matter in which the former public servant personally and substantially participated during the public employment. This prohibition applies for a period of one year following the termination of public service of the public ser-

van!.

'We concur with the comments of James Hamilton who testified before the Commission on October 28, 1987, that these restrictions are too onerous and 'could greatly hinder the ability of a public servant to find private employment, particularly one who has had wide-ranging government experience and has been responsible for many matters.' We are convinced that these restrictions would cause well-qualified professionals lawyers. accountants, engineers - to avoid public service.

"Rule 1.11 of the Rules of Professional Conduct restricts the representation by a former government employee concerning a matter in which he participated personally and substantially and the prohibition is not limited to one year. This Rule does not apply to other lawyers in a firm with the former government employee, however, if the disqualified lawyer is screened from participation and written notice is given to the appropriate government agency. We believe the codification in the proposed ethics code of Rule 1.11 will amply protect the public interest in preventing a lawyer or other professional from exploiting public office for the advantage of a private client without unnecessarily hindering his ability to obtain private employment after public service.

H

The Commission subsequently voted: • to adopt the Association's recommendations concerning successive government and private employment; • to delete the requirement that

legislatorllawyers disclose the

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January 1988/Arkansas Lawyern

LAW. LITERATURE & LAUGHTER

Words, it seems, are often created in unforeseeable ways, This is so even in the world of law and politics. For instance, law enforcement personnel the world over know what it means to "do Miranda" or be "Mirandized." Lawyers and law students speak ever so casually

about "Brandeis briefs."

Last fall. in conjunction with the Senate hearings on Reagan's Supreme Court nominee, a senator suggested that "Bork" become a word, meaning to defame by innuendo. CBS newsman Charles Ozgood had some fun with this concept.

These source allusions are intended to keep me from being "Bidened" (excoriated for casual plagiarism), for I have run across a decision that cries out to have part of its style become a legitimate word.

In Fuddruckers. Inc. v. Doc's B.R. Others. Inc.. 826 F. 2d Adv. Sh. 837 (9th Cir. Aug. 24, 1987), the Court recognized that decor of premises and method of business may constitute protectable "trade dress" under the Lanham Act. Traveled readers will recognize Fuddruckers as a chain of trendy hamburger places entrenched in southwestern Yuppiedom. Based on what Doc's was alleged to have done, I hereby propose for the English language the verb "to Fuddrucker," meaning to copy an establishment's trade dress with intent to profit.

This proposal will undoubtedly evoke many useful derivations gerunds, participles, adjectives, etc. Given the legal origin, this line of words will crop up first and most frequently in court documents and, of course, the news media.

Plaintiffs' attorneys will plead generally that their clients were a/Arkansas Lawyer/January 1988

By Vic Fleming Fuddruckered, that a defendant committed the offense (unknown at common law) of Fuddruckering. In response to interrogatories, they will particularize the details of the alleged Fuddruckerization. They will seek cease and desist orders to compel an offending party to deFuddruckerate all premises in question.

A repeat offender will be called a Fuddruck kind of guy. Newspapers will report that he reFuddruckered.

An organized movement to stop offenders will be called anti-Fuddruckers. Folks who feel Fuddruckering should be legalized will unite as counter-Fuddruckers.

As society comes to embrace the concept, offenders will flee public scrutiny. There will be Underground Fuddruckerdom, full of clandestine Fuddruckerites. Mothers Against Fuddruckers will hold periodic news conferences to denounce offenders. Those vowing to go straight will join Fuddruckers Anonymous.

Medical science will get involved, announcing various disorders and treatments: Fuddruckerism - the irresistible urge to make money by copying another's trade dress; bi-polar Fuddruck syndrome - tendency to copy others' trade dress without realizing it; and Fuddruckaphobia - irrational fear of being Fuddruckered.

Fuddrucker therapy fads will be the rage of the nation in the '90s.

Many will make millions from paperbacks, such as "How to Stop Fuddruckering without Really Trying," "Three Easy Steps to a Fuddruck-free Family Life," "The Anti-Fuddrucker's Guide to Weight Loss During Menopause" and "Real Fuddruckers Don't Eat Steakburgers."

Sometime in the early 2000s, probably under a Republican president, a special Fuddrucker Commission will be appointed to study the problems associated with interplanetary Fuddruckery. This Commission will firmly entrench Fuddruckering in the annals of the bureaucracy, rising to become a cabinet level department by the end of the 22nd Century.

Then again, maybe not.

0 Copyright Š 1987 by Vic Fleming

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"There is not going to be in this firm a permanent underclass of minority attorneys who are perpetual associates. I just don't see that as a realistic progression or experience

that this firm is going to have, There is no sense in a dead end where you just park and stay:' Allan Gates Mitchell Law Firm

T •

o be on the cutting edge of changing the racial makeup of major law firms in Arkansas is no small task, but Wendell Griffen, Cynthia Davis and Jerry Malone are up to the challenge. They are among the first black attorneys to be hired by three of the largest and most prestigious firms in Arkansas and they are young, bright and eager to prove their professional worth.

• Wendell L. Griffen, a native of Delight. graduated from the University of Arkansas School of Law, Fayetteville in 1979. Before attending law school he served as an officer in the United States Army. A former chair of the state Workers' Compensation Commission, he's now a partner in the firm of Wright, Lindsey and Jennings in Little Rock.

• Cynthia J. Davis calls Hot Springs home. She received her law degree from the University of Arkansas at Little Rock School of Law in 1985, where she was a Rockefeller Scholar. Davis was the first black to clerk for the Mitchell Law Firm in LitJanuary 1988/Arkansas Lawyer/ll

Wendell Griffen "I've got to balance â&#x20AC;˘ two things - my abilities as a lawyer and my personhood as a black person."

l2lArkansas Lawyer/January 1988

tle Rock and was offered an associate's position there before graduation. She now works in the firm's general litigation division. â&#x20AC;˘ Jerry L. Malone, the son of a sharecropper and a native of Earle, is a 1985 graduate of the UALR School of Law, where he ranked fifth in his class. He was also a Rockefeller Scholar and was managing editor of the UALR Law Journal during his third year. Malone was the first black to clerk for the Friday, Eldredge and Clark law firm in Little Rock, where he is now an associate member.

These individuals are proof that Arkansas law firms are lowering the color barrier, despite a waning civil rights' movement and dying public support for affirmative action goals or quotas.

Malone describes the Friday firm's philosophy this way: "If a person can be profitable, I think the color of his skin should not make a difference when giving that person an opportunity as long as that person can do what the others do. The Friday firm has the idea that it wants to be full service. To do that you have to have people who are diversified in their views. To have people who are all alike - of one persuasion - is going to limit you in your outlook and in your perspective on things. Bringing in people with different backgrounds will help the firm to be full service."

Griffen, Davis and Malone battle a small and narrow view held by some in the black community that a black attorney working in a predominantly white firm is a turncoat.

"At one time, I took that kind of reaction very painfully and personally. I've come to conclude that those folks live with a disability that I cannot cure," Griffen said. On the reverse side, he finds a lot of acceptance and pride. "A lot of black lawyers are just proud that one of us is showing the whole legal world that we are as good as anybody else:' he said.

Davis and Malone share similar experiences and try to avoid wearing two hats. "I try to make the person that I am fit into both worlds. I am not ashamed that I am black and I don't try to tum into a grey person or a white person," Davis said. In Malone's words: ''You don't have to give up your blackness."

Griffen adds: "I have to be honest.

intellectually and socially, with myself. I am a partner in one of the biggest law firms in the state. The majority of my partners have cultural backgrounds that are functionally and fundamentally different from mine. They may be tolerant of. receptive to and sensitive about the social and cullural issues that I relate to as a black person, but they don't have to be. I live with it. They are not options for me to contemplate And I live with those issues as a member of this law firm, recognizing that those issues cannot dictate my life. I've got to balance those two things - my abilities as a lawyer and my personhood as a black person."

Allan Gates, of Little Rock, a white attorney and a senior partner in the Mitchell Law Firm, believes Griffen, Davis and Malone represent a trend in hiring in Arkansas law firms which will grow.

'1 think there is no doubt that you will see more minority attorneys in Uttle Rock firms. I think ultimately you will see them everywhere." he said. He explained that it's mainly a function of numbers - a firm in Little Rock with 50 attorneys is going to hire more people faster than firms in other cities and towns with 15 attorneys on staff. "Qualified black law graduates are going to be attracted to the larger cities for larger salaries and for what they perceive is a greater opportunity at acceptance and advancement." he said.

Gates also sees partnerships by blacks in white law firms as a growing reality.

"There is not going to be in this firm a permanent underclass of minority attorneys who are perpetual associates. I just don't see that as a realistic progression or experience that this firm is going to have. There is no sense in a dead end where you just park and stay," Gates said.

William Clark, of Little Rock, a white attorney and senior partner in the Friday firm, agrees. 'We haven't had too many experiences where we failed to make an associate a partner." he said.

According to Bruce Cross, of Little Rock, a white partner in the House, Wallace and Jewell law firm, partnerships are also a reality for black associates in the House firm. "I know a few years ago, the same question was being asked of us about female attorneys. Partner-

ships for black attorneys and for women are a reality as far as I am concerned and as far as every shareholder I know is concerned:' Cross, who heads the firm's Recruitment Committee, said.

Being a trendsetter requires a realistic approach, said Griffen. He was made a partner in the Wright.

Lindsey and Jennings firm in December 1983, four and one-half years after he joined the firm. "First of all, you must realize that you are going to be a part of some social pioneering and when you're pioneering, you're going to have to clear some underbrush," Griffen said.

Clark points to an event which occurred about six months ago. One of the Friday firm's clients took Malone and another of the firm's young attorneys to lunch. The client's top management was there and complimented Malone and the other attorney very highly and presented them with a gift. it was extremely gratifying to see that sort of thing," Clark said. "Personally, I have never had any misgivings about the feelings of a client with respect to a black lawyer. Perhaps there are some but none have come to my attention. I don't believe it makes any difference whether you're white or black because the ordinary person in seeking counsel is looking for the best person they can find under the circumstances. U Jerry Malone has built that reputation and they're sent to him, they won't care whether he's black or white," he said.

The color barrier hasn't completely fallen in Arkansas law firms.

However, the recognition by the bar that it should be removed and an honest attempt on the part of some law firms to do just that are making great strides toward its elimination.

"The barrier will not fall of its own weight. It will have to be removed

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by some of the same folks who have been holding it up:' Griffen said. He believes that aggressive recruitment of black lawyers and law students will aid in the removal of the color barrier.

"My complaint about black lawyers and white lawyers in Arkansas is that we basically orbit each other," he said. Griffen said that attendance by black lawyers at the Arkansas Bar Association's annual meeting is minimal at best and that most of the local bar associations do not aggressively recruit black members. Griffen adds that removing the color barrier will take a cooperative effort. "U Wright. Lindsey and Jennings had not wanted to integrate this law firm, I would not sit here. On the other hand, if I had not persevered and applied myself, I would not sit here. So, there has to be a combined effort on the part of black law graduates and the white firms if there is to be a change. Without it, there will not be a change. It's just that simple:' he said.

With competent attorneys like Griffen, Davis and Malone in the legal marketplace, the major law firms in the state will have many chances to employ black attorneys.

By doing so, the law firms will profit and the nation will see that Arkansas' law firms are aggressively lowering the color barrier to make the state "a land of opportunity" for all its lawyers.

0

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Cynthia Davis try to make the • person that I am fit into both worlds."

"I

Editor's Note: This is the third article in a threepart series on black lawyers in Arkansas by Phyllis Harden Carter.

Carter is a former assistant city attorney for the city of Little Rock and received a law degree from MarshallWythe School of Law. College of William and Mary. in Williamsburg.

Virginia, in 1975. She is admitted to the Arkansas and Virginia bars.

/

/ Jerry Malone

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lanuary 19881Arkansas Lawyerll3

Phase I

Automating the Law Office Responses to a recent survey of Arkansas Bar Association members reflect a desire for articles in The Arkansas Lawyer related to automating the law oUice.

This article. in keeping with that desire. is a short primer on ways to increase the productivity of the lawyer: what is out there. what can be done and why it needs to be done. While this article concerns only computers and software. a second article...Automating the Law Office: Phase 2:' will review other areas of technology.

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n these tough times. those lawyers who can provide a client with a better work product and who can provide it quicker and with less out-of-pocket cost than others are going to be the survivors. Numerous sturlies by the American Bar Association and various state bar associations with regard to the size and productivity of the "average lawyer" indicate that most

lawyers in the United States today practice in small firms. with 70 percent practicing in firms of five or fewer lawyers. Until recently. word processing was considered relatively expensive and a cost they simply could not afford or justify. With techno· logical advances and the reduced cost of obtaining such equipment. lawyers are beginning to understand the tremendous potential of "computerization,"

BUYING THE EQUIPMENT Word processing Five years ago, the cost of a single dedicated word processing system ranged from $12,000 to $20.000. Today that same function can be performed by a $2,000 micro-computer. Word

By

processing programs are usually the easiest to learn and the first most lawyers purchase in order to increase their productivity. Word processing can create a document quickly, correct mistakes, replace old phrases with new and delete. copy and move blocks of text. It can also oUer many advantages over typing, including: • Higher quality: The time spent on re-typing can be devoted to thinking and clarification. The result is a better final product for the client.

• Faster revision: Because only the new material is typed and the computer and printer reproduce the rest. the entire revised document can be printed faster than most people can type a few pages.

Charles A.

• Better looking final copies: Because the printer does the re-typing, margins can be changed, ti ties can be added here and there and layouts can be fixed while retaining a fresh. well·formatted and professional looking document.

Forms and clauses which are commonly used by lawyers can be saved on computer disks where minor revisions to names, dates, etc., are easily made.

Also. phrases and clauses can be pulled out and inserted into individual documents without needing to be re-typed.

Word processing programs are available to quickly check the spelling, grammar and punctuation of a document. Some programs even prompt an attorney with questions or options which expedite the production of documents and pleadings. Word processing also makes work more interesting and the people using it more productive, especially secretaries and administrative assistants who are relieved of a lot of "grunt" typing.

Accounting/time and billing software Studies by the American Bar Association's Economics of Law Practice Section indicate that after word processing, the next most frequently used software program is a "time and billing package."

Increasingly. sophisticated clients want more information when billed for services. including which lawyer performed the service. how much time was involved and what the billing

Morgan

rates were for the lawyers. associates or paralegals furnishing the service.

The time and billing software programs offer not only the ability to generate statements. but. just as importantly. the ability to review on a monthly. quarterly or annual basis a great deal of management information. For example. the information that is "typed" for billing purposes can be integrated into a general ledger program. without the need for re-keying the information. and used to prepare monthly profit and loss statements.

Reports can also be generated which will indicate the most productive areas of practice. This type of management information is important and will become increasingly more impor.:', tant for those lawyers who intend to practice profitably.

To assist lawyers in evaluating the various software programs available. the Economics of Law Practice Section has established the Lawyer's Technical Advisory Committee (LTAC). The evaluations of various software products can be obtained from LTAC for a nominal charge. saving attorneys thousands of dollars in time and in products which don't deliver as promised. LTAC users are cautioned to confirm that the version of the software they are considering purchasing is the same version which was tested and approved by LTAC.

• Faster access: The information needed. can quickly be found without looking through every record.

• Easier to update: Current information can be added. old information deleted and mistakes corrected without having to shuJfle records.

• Offers quicker sorting: A database can be arranged in any manner, It can be alphabetized by last name or sorted numerically. i.e.. for finding adverse parties listed alphabetically between November 23. 1986. and January 17. 1987.

• Flexibility: The information can be displayed in any format.

A database lets the user easily pick

Database programs A database program or application is one that helps organize. update and report on whatever information might ordinarily be kept in lists or on file cards. Compared to a shoe box lull of index cards or to slips of paper. a database program offers these advantages:

and choose information on each record and allows that information to be printed quickly and easily. Databases can be used by attorneys for docket control. library and resource files, mailing lists. mailing labels. client list maintenance. work product retrieval. litigation support and for hundreds of other uses.

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Integrated software A recent study indicates that the average computer user can successfully use and master three different computer programs. The computer user whose knowledge is above average or advanced and who is willing to devote a substantial amount of time to learning can master five programs successfully. Software developers. appreciative of these limitations. are developing programs that have multifunctions combined database. spreadsheet, word processing and communications programs - to permit the user to move information from one application to the other without having to re-key or re-type it.

One alternative to purchasing integra1ed (multifunction) software is to :',' ~ :.~~~ "., purchase a program that allows the user to import .. and export data in a number of standard formats, By having programs that input or print out data in one of these formats. the information from a database program or a spreadsheet program can be used in a totally unrelated word processing program without needing to re-key the data. '

Communications There are a number of commercially available databases which offer a wealth 01 information by merely dialing a telephone number and reaching some remote computer. The cost of using these external databases can be as high as $150 per hour or as little as $6 per hour. depending on the type 01 inlormation sought. To tap into these databases you need a computer, a communications software program and a modem, A modem is nothing more than a piece of equipment that connects one computer via telephone with another computer. converting the signals to a

Lawyers who can provide a client with a better work product and who can provide it quicker and with less out-ol-pocket cost than others are going to be the survivors.

I6IArkansas Lawyer/january 1986

form that can be received and transmitted by a telephone line. The industry standard is the modem manufactured by Hayes. Any modem purchased should be Hayes compatible and should operate at a minimum of 1200 baud - bits - per second. Newer modems coming on the market can transfer data at twice that rate but they cost about SO percent more. Also. many remote databases will not yet accept this speed.

J. Harris Morgan. a solo practitioner in Greenville.

Texas. has been very active in encouraging lawyers to practice economically.

Harris has often stated that the modem has given him the ability to research and compete with the largest law firms anywhere in the country. The ability to do this research requires a certain expertise that can only be obtained through actual. "hands-on" experience.

When buying a communications program. make sure it can be adjusted to the communications speed and the protocols - format - in which the data will be sent. Different computers use dillerent formats or protocols to send and receive data. A communications program can adjust the speed or the way in which the da1a is transferred.

Spreadsheet programs The next type of software to be considered is a spreadsheet program.

Think of a spreadsheet as a large electronic worksheet that can have as many as 250 columns and as many as 10.0CJ0 rows of facts. numbers, names, fractions or any label or value to be sorted. computed or identified.

Spreadsheets permit the user to work with extremely complex numbers or fractions and will automatically calculate the totals in the columns and/or rows specified. Here are a few of the advantages of the electronic version of a spreadsheet: â&#x20AC;˘ Easy correction and update: There is no need to use up V2 mile of cal-

culator tape to get the wrong answer. Changing or adding numbers and fonnulas is simply a matter of re-keying the changes or additions and letting the program take care of the rest. â&#x20AC;˘ Try the "what if" approach: Because the spreadsheet can do in a

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matter of seconds what would normally take hours to do by hand. people have begun to come up with "what if" figures. Experimenting with formulas and numbers can result in a whole new range of possibilities.

Electronic spreadsheets can be used for budgeting. forecasting. amortization schedules, present value analysis and hundreds of other applications where calculations must be quick and accurate. Spreadsheets are especially helpful for the preparation of amortizations that aren't "in the book." The spreadsheet for an amortization schedule can be changed so that the payment amount and the interest rate can be altered periodically throughout the schedule.

Utility programs After using a computer long enough to understand its potential and its limitations. the user will develop a need for some companion programs that are called utilities. The utility programs enable the user to transfer files

and disks and make duplicate and back-up copies. II something happens to the primary source of information and a back-up copy has been made. the information itself has not been lost.

Utilities can also be used to restore files from disks that have been damaged so that the files can be used again.

Utility programs allow the user to change the format from one operating system to another - IBM to Macintosh. Macintosh to Apple. Apple DOS to ProDos. CPM to Pascal. To avoid going through the mechanics of converting forms or data. there are commercial services that will convert this data for a fee. This cost can be expensive. but it is still generally cheaper than the expense of re-typing the data. Remember. labor is the largest single cost of operating your office.

WHAT'S OUT THERE? Electronic mail Electronic mail is the ability to transfer electronic messages. documents. letters, international cables. etc., from one office to another anywhere in the world by telephone. Transfer by electronic mail is analogous to a FAX machine except that it bas the ability to capture the informa1ion in a form that can be used instantly by a word processing program without needing to be re-typed.

One electronic mail service is ABANet. which is operated and sponsored by the American Bar Association. In addition to combining electronic mail transfer between lawyers and their clients, ABANet also provides airline schedules, news. wires, securities' market information, Lawmart (on-line legal forms), commercial newsletters. court reporting services. etc.

Legal research services There are three legal research services available - Westlaw, Lexis and Verilex - whereby case law and in

Five years ago. the cost of a single dedicated word processing system ranged from $12.000 to $20.000. Today that same function can be performed by a $2.000 micro¡computer.

January 1988/Arkansas Lawyerl17

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some cases statutes can actually be researched in any jurisdiction located within the U.S. There are hundreds 01 other commercial databases that are also available to subscribers.

Other prognm...

There are programs on the market

that will take care 01 graphics presentations. plating. printing. drawing and preparing exhibits lor trial. Although all offices may not require these capabilities. if needed. these programs can expand the ability to produce stunningly professional exhibits and graphics presentations.

THE FUTURE TECHNOLOGY Where are we headed in the next five

years? It is especially important that the solo practitioner or the small law office keep an eye on personal computer trends. It is the small firm or solo practitioner

that derives -

or should

be deriving -

a greater proportionate benefit from micro-computerization.

Look for storage capacity to continue increasing at reduced costs. The S.24" floppy disk will gradually be phased out in lavor 01 the new 3.S" disk. The

present 3.S" disks have 300 to 500 percent more storage capacity than the

S.25" disks that were standard in the industry just two years ago. And. new technology will permit the 3.S" disk to store almost S.ooo.ooo bits (five megabytes) 01 information by 1990. In addition. hard disk drives that held live megabytes of information and cost $1500 three years ago are being re-

placed by drives that hold 20 megabytes and cost less than $800. Within three years. 50 megabytes 01 storage will be available for less than $1000.

The newest storage device of the fu-

ture is the Optical disk (CD-ROM disk).

By the year 2000. a law lirm's entire library will be able to be contained on 10 to IS CD-ROM disks. "Pocket parts" will be a thing of the past. Book dealers will just mail an entirely new set of books on a Single disle.

WHY COMPUTERIZE? There are many reasons to computerize a law office and most of them are

economic. Some of the more common reasons to consider computerizing various functions include: • Increased productivity

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• Increased profitability • Improved accuracy in document production • More responsive client service

• Improved client relations • Less expensive services to clients • Increased ability to deal with competition • Provision of peak load services • Better control of overtime costs

• Better decision-making A lot of reasons are often given as to why an office should not automate.

Lawyers as a group are the most likely to offer the following "untruths" re-

garding computerization: • The equipment is too complicated. [ won't be able to understand it. This may have been true a few years

ago. but most equipment and software have been simplified.. even to the point that a lawyer can use it.

• We are doing okay now. so why change? Increased competition will demand that we are able to produce more work with the same or fewer people or that we produce it at lower cost.

• The equipment is too expensive

It is especially importantthalthe solo practitioner or the small law office keep an eye on personal computer trends. It is the small firm or solo practitioner that derives - or should be deriving - a greater proportionate benefit from micro-computerization.

I8IArkansas Lawyer/January 1988

~. ~. . '

and we can't afford it. Salaries, not equipment. are an office's largest single expense. The truth is that we cannot afford not to automate our offices.

• We are too small to use that equipment. It is in the smaller offices that we realize the greatest potential for cost savings. The small law firm or solo practitioner does not have the benefit of sharing or spreading many overhead costs over several professionals. Accordingly, they must be able to maximize their time and their productivity.

In June 19B6, the American Bar Association's Economics of Law Practice Section, in conjunction with the State Bca of Texas, hosted the second annual INDEX: LEGAL, AUTOMATING THE LAW PRACTICE seminar in Dallas, Texas, at lnfomart. (The third annual seminar will be held there in January 1988. For more information, contact the ABA's Economics of Law Practice Section or the State Bar of Texas.) The concluding speaker was J. Harris Morgan. He reminded all participants that: Technology is not a goal. Technology is a tool to be used to reach a goal.

Studies by the American Bar Association reflect that in the last 20 years attorneys have experienced a 200 percent increase in costs and expenses in running their offices, but have only been able to achieve a 50 percent increase in profitability/productivity. If we are going to continue to stay competitive, we must be productive. To be productive, we must work faster and more accurately while not pricing ourselves out of the market. We can no longer wait to implement this technol· ogy.

Lawyers must understand that there will always be something newer, faster, cheaper or better in the market. but waiting for the technology to evolve only places us farther and farther behind. We cannot worry about the newest state of the art device when we haven't even begun to understand or implement the technology that has been available for the last five years.

We must begin today if we are going to remain competent. competitive and productive.

As J. Harris Morgan repeatedly says, "Begin - and the rest is easy!

0

Editor's Note: Charles A. Morgan, of Texarkana, is chair of the Arkansas Bar Association's Economics of Law Practice Section and is a member of the Smith, Stroud, McClerkin, Dunn & Nutter law firm. A native of Evansville, Indiana, Morgan received his undergraduate and J.D. degrees from Baylor University. His concentrated areas of practice include oil and gas, real estate, commercial and corporate law. Our thanks to Beverly Brock, the Smith and Stroud firm's office manager, for her assistance in preparing this article.

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President P,O, Box 3064 Opelika. AL 36803 (205) 749-1544

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20/Arkansas Lawyer/January 1988

THE ELECTRIC COOPERATIVES OF ARKANSAS

AMAJOR SOURCE OF ENERGY IN ARKANSAS' DEVELOPMENT. "For a half-century your electric cooperatives have played a major role in the development of Arkansas.

"That role has never been more active or important than today.

With significant power Carl S. Whillock President, Arkansas capacity in coal and Electric Cooperative hydro generating plants, Corporation the cooperatives offer tremendous incentives to new or expanding business and industry.

"Arkansas' work ethic, natural beauty, Mid-America location and excellent water and highway transportation make our state more attractive than ever.

"Today the 62% of the Arkansas land area served by the electric cooperatives can attract major industry due to long-term power supply rates. Rural electric power creates jobs and keeps families together.

Now and in the future.

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"By working together we pledge to make the next 50 years the greatest in our history.

We know the power of cooperation. Because a cooperative is what we are."

aecc Arkansas Electric Cooperative Corporation

P.O. Box 9469/ Little Rock. Arkansas 72219

Developing Arkansas' Resources

January 1988/Arkansas Lawyer/21

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, Owen Hunt.

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221Arkansas Lawyernanuary 1988

Compliments 01 Arkansas ArtislS Registry

"UP AGAINST THE WALL"

By Chris Barrier kay, close your eyes, Now, tell us what you've got on the walls in your law office (besides your license and the calendar from the abstract company), If you're lucky, maybe a couple of the prints that go with the duck stamps, and some mawings by your kids.

If you're unlucky and have a decorator (or fumiture store) for a client, maybe some pictures of guys in red coats on horseback talking about foxes.

If you're real unlucky, and those kids have become teenagers, maybe you had to frame that Beastie Boys poster they gave you last Christmas.

O

Chic ain't cheap ...

Or maybe your decorator client (the one who picked those uncomfortable chairs) also spent a lot of your money and bought some original art, stuff you don't understand or even like, but which goes with the

carpet.

It doesn't have to be that way.

(Those kids are another issue entirely.)

Specifically, there is a way for you to see what is available from more than 300 artists living and working here in Arkansas. You can get some advice thrown in for the price of the art (which is generally George Chambers.

Mamoushka & Perot #2

ComplimenlS of A,tolLlO. Arlisls Registry

lanuary 19S5/Arkansas Lawyer/23

pretty reasonable) and also find out something about the artist.

In the process, you will also get some good feelings about the level of competence and sophistication achieved by our own Arkansas artists, from highly realistic landscapes to cutting edge constructions.

Get yourself registered, , , The three-year-old Arkansas Artists Registry is housed in the Fine Arts Building at the University of Arkansas at Little Rock and has two bosic functions: l) to maintain an archival record of the work of Arkansas artists; and 2) to promote the sale of the work of those artists.

The Registry is funded by grants; commissions on art sold through the Registry; fees for specialized services (such as advice on choosing and hanging art); in-kind donations of materials and services; and Corporate Collectors Circle dues. This last category means that, for an annual fee, CCC members get a discount on art purchased through the RegislIy and other special services.

Two law firms belong to the CCC. Although native crafts certainly have their place, that is not the Registry's focus. Its member artists have studied all over the country and abroad, and a number are actually better known (and sold) in major metropolitan markets than in Arkansas.

From Sheridan to Madison Avenue, ..

For example, Metropolitan Life Insurance Company exhibited a collection of works by Arkansas artists in its Madison Avenue headquarters last summer. The show, which was put together at Met Life's request by Townsend Wolfe, executive director of the Arkansas Arts Center, was well-received, not as quaint folk art. but as serious, sophisticated contemporary works.

As Wolfe aptly observed on the occasion of that exhibit, "regional art" does not necessarily mean art with an identifiable geographic cast or look, but merely art produced by artists working in a particular 241Arkansas Lawyernanuary 1988

region. They live and work in Arkansas because they want to. The Registry regards them as a natural resource, to be valued and promoted within our own borders.

Likewise, there are not watercolors of daisies and pencil drawings of old farms. It isn't possible to describe what the works of 300 artists actually are, but an example is useful: A major Little Rock financial institution hired a big name national architectural firm to design its headquarters. But. the monumental artwork they commissioned for their lobby was by an Arkansas artist. a work fully as sophisticated as the building.

The Registry sponsors art shows statewide. The Small Works on Paper Exhibit will tour the state beginning in January at Arkansas State University in Jonesboro. Other locations include Batesville, Russellville, Fayetteville, Pine Bluff, Conway and Little Rock. Watch your newspaper for your local times and location.

Central Arkansas had The AARt Show on November 9-30 at Worthen Bank. If you missed that, the 12 pieces selected as Best of Show will be on display at the Little Rock Airport in January.

The regislIy is exploring cooperative arrangements with art galleries in the state, so that slides of works

by Registry artists can be obtained through local galleries and the works discussed with the gallery owner.

What art galleries, you say? Are there any, outside Little Rock and maybe Eureka Springs? Of course, there are. Just last fall, a gallery in Sheridan (population less than 4,OCXl) put on a show with works by several dozen of the state's most prominent artists, most of whom were RegislIy artists (and several of whom were also in the Met Life exhibit).

Slide into art , , , Anyone interested in working through the Registry to buy original Arkansas art can drop by its office and look through its slides, with the

help of a staff person.

Given some advance notice as to what sorts of art you are interested in, the staff can focus your slideviewing time on just those sorts such as landscapes, watercolors, abstract works, etchings or ceramics -

or even on artists jn

your area.

(By the way, the artists aren't all in Little Rock or Eureka Springs either.

The art departments of virtually all of our colleges have important artists on their faculties.)

The staff also will help with arrangements for you to see the works themselves, possibly even in your own office. But. you are never

obligated or pressured to buy anything. And you know the asking price of each piece at the time you see the slides. lf there is enough interest, the Registry plans to bring slides and some works to the Arkansas Bar Association's Annual Meeting in June.

Next time you're scheduled to be in Little Rock and have a little extra time, plan on dropping by the Registry, on the north end of UALR's campus. Call Jayme Tull or Judy Hayes at the RegislIy (569-3288) ahead of time and they will send you a brochure on the Registry and have some slides ready for you. (They also usually have some original works on hand as well.)

And if you're interested in having the same opportunity at the Annual Meeting, give them a call, or drop them a line at: The Arkansas Artists Registry UALR College of Fine Arts 2801 S. University Avenue Little Rock, AR 72204 You might even want to bring that decorator along with you . . .

0

Editor's Note: Chris Barrier, of Little Rock, is a member of the Mitchell, Williams, Selig and Tucker law firm. He serves on the Executive Committee of the Arkansas Bar Association's Financial Institutions Law Section and is a frequent contributor of both art and features to The Arkansas Lawyer.

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jrH.,0~ ~~ January 19881Arkansas Lawyer125

mE DEVELOPING LAW

Sales of a Remainder Interest Split the fee, help a friend and save a client

By George N. Plastiras and Philip Miron The minute Bob hung up the phone, he knew something wasn't quite right.

It wasn't like Frank to invite him to dinner, making it clear that it was Frank who would pick up the tab.

Frank hadn't offered to do that since Bob tutored him through income tax in law school.

When Bob saw him at the table, he definitely knew something was bothering him.

Bob: "Is the practice of law getting to you?"

Frank: "Yeah, you might say that. In fact, you don't know how close to the truth you cae."

Bob: "Maybe I could take a few clients off your hands?"

Frank: "I wish I had them to spare, you know ..."

Bob: "Please, Frank. What's the problem?"

Frank: "It's a long story," Bob: 'Tve got all night and the meter stopped at 5:00 this evening."

Frank: "Bob, do you remember the Jones estate?"

Bob: "Isn't that the one in which I advised you to set up the credit shelter trust and transfer jointly held property into Mrs, Jones' name only?

Didn't Mr, Jones pass away a few years ago? And, didn't he have a couple of children who were giving you a rough time?"

26/Arkansas Lawyer/January 1988

Jones' estate, but on Mrs.

Frank: "Yeah, that's the one."

Bob: "Why? What's the matter?

With the unified credit and marital deduction, Mr, Jones' estate should have paid no estate tax and passed $600,000 tax-free to the children," Frank: ..It's not Mr. Jones that's the problem. We've already filed the estate return and closed the estate, It's Mrs. Jones and her children who are giving me the headache, In fact, the whole family seems pretty dissatisfied. Oh, we saved taxes on Mr.

Jones' death, her estate will pay Uncle Sam his share," Bob: "Remember the unified credit? You should save another $600,000, Together you've sheltered $1.200,000. What is the problem?"

Frank: "That's not much consolation on a $5,000,000 estate. [ figure if we're lucky we might pay $2,000,000 in estate tax and that's with no asset appreciation! I can't even make gifts fast enough to keep the estate from doubling in 12 years! The family is considering changing lawyers. After all I've done!

Can you imagine?"

Bob: 'What kind of prop" erty is in the estate?"

Frank: "Bonds and real estate, mostly."

Bob: "Income producing or unproductive land?"

Frank: "Both."

Bob: 'Tve got an idea. Let's split the fee!"

Frank: "Bob, I don't think you understand, There will be no fee if I can't come up with a plan," Bob: "What? No, no, Frank. I'm talking about dividing the property into two bundles of interest; a lile estate and a remainder interest.

You remember those concepts from the property course, don't you? Mrs.

Jones could sell the remainder interest to the children or to a trust for their benefit."

Frank: "Sounds like future interests to me. Bob, don't you remember I almost had to repeat our property course because of future interests?"

Bob: "Don't worry. Except for a few potential tax problems, it's simple.

I'm going to help you."

Frank: 'Tm listening."

Bob: "You see, Section 2036 of the Internal Revenue Code provides that transfers with retained life estates are not included in the gross estate where there is a bona fide sale for full and adequate consideration received for the property interest transferred. This means that Mrs. Jones could sell a remainder interest in either the bonds or real estate to her children while keeping the right to income for her life. Since her life interest is extinguished at her death, it will not be included in her estate. The result is that Mrs. Jones has eliminated the value of her life estate from her taxable estate.

How do you value a life estate?

First. you must get an appraisal of the property. Then, there are actuarial tables in the Treasury Regulations. Section 20.2031-10. which show the value of a life estate and remainder interest based on the age of the transferor-seller. Use the factor outlined in the IRS table and multiply it times the fair market value of the property. This should give you the selling price of the remainder interest.

Is this legal?

U you mean does the IRS recognize this valuation concept, the answer is apparently "yes." The IRS has issued several private letter rulings on this very issue approving the valuation method. (PLR 7806001; PLR 7837003; PLR 8041098; PLR 8145012).

What if Mrs. Jones is not expected to live for the entire average life expectancy?

Currently, the IRS tables are based on the life expectancy of the average person, with a return on investment of approximately 10 percen t. It would not seem fair to equate the remainder interest of a person with terminal cancer with a healthy person of the same age; nor

"The remainder sale has many advantages, among them possible reduction of estate taxes , , " possible income tax write-offs, .. and the transfer of property outside of probate." would it appear to be proper to compare income producing property with non-income producing assets.

The federal courts are sometimes reluctant to make these distinctions, but these factors certainly should be considered in valuing the remainder interest.

Unless Mrs. Jones' death is clearly imminent. I would suggest using the IRS actuarial tables (Rev. Rul. 80-80. 1980-1 C.B. 194). Also, in valuing non-income producing property, I would make it clear in the purchase agreement that the life tenant has the right to sell the property and reinvest the proceeds in income

producing assets.

You can see the beauty of selling a remainder interest in unproductive real estate because there is no income during the life of the seller.

Since there is no estate build up, there is no need to worry about appreciation.

Before selling the remainder interest of any asset [ would recommend that we project the annual income to the life tenant less anticipated expenditures and gifts. It may be that Mrs. Jones would not be better off in selling the remainder interest. It simply depends on the asset and the amount of income necessary for her to live comfortably and not feel beholding to her children for her support. Keep in mind, though, that if Mrs. Jones dies before her life expectancy, you have probably

saved estate taxes in any event.

You said that the life tenant and remainderman could agree to certain terms?

That's right. There are several ways the terms could be structured.

First. Mrs. Jones could sell a legal remainder interest without any agreement. which means that she would be subject to the common law decisions concerning the rights of the parties. For example, in Arkansas a life tenant has a duty to pay taxes on the property (Henderson v.

Ellis, 10 Ark. App. 276. 665 S.W. 2nd 289 (1984); Magness v. Harris. 80 Ark. 583. 98 S,W. 362 (1906)).

Where money or its equivalent is bequeathed for life, only interest or income can be consumed by the life tenant unless there are contrary words of authorization in the will (Chambers v. Williams, 199 Ark. 40.

132 S.W. 2nd 654 (1939)), Also, an owner of a life estate in personalty that cannot be worn au t or consumed by use such as money, notes and accounts may not convert the funds to their own use but must preserve the personalty for the remainderman (Dillen v. Fancher, 193 Ark. 715. 102 S.W. 2nd 87 (1937)).

Depreciation will be allowed to the life tenant if he is a legal-life tenant.

If a trust is used, the allocation specified in the trust agreement will govern, or if the agreement is silent. all of the depreciation will be al路 lowed to the income beneficiary (lRC 搂 167(h)), I would recommend that the rights of the parties be spelled out at the time of purchase. You could negotiate such things as allocations of depreciation, the right of the life tenant to sell the property and reinvest the proceeds or who will pay for maintenance and other expenses of the property. The terms are limited only by your imagination. But remember, if you are too creative, you may be promoting val uation problems.

Another alternate way to structure the sale would be to transfer the property in trust whereby a trustee makes all of the management decisions. This would be a good idea if the life tenant is incompetent or unwilling to handle such matters. A variation of this technique would be to transfer the property to a revocable trust which could be revoked by either the life tenant or reJanuary 19881Arkansas Lawyer/27

mainderman. In the event of revocation. the property would simply become a legal interest.

With respect to valuing the remainder interest. I must warn you that there is some movement in the federal courts toward requiring the purchaser of a remainder interest to pay the full fair market value of the property without discounting it for the seller's life estate (Gradow. 87-1 USTC ยง 13. 711. 1987 P-H 148. 511 (CIs Ct. 1987)). You should be aware of this problem and closely monitor all future cases.

What if the purchaser can't afford the remainder interest? I'm not sure that Mrs. Jones' children could produce the amount of money necessary to implement this plan.

That is one of the major drawbacks to a remainder sale. If the children have their own independent wealth. there is no problem. but 99 percent of the time this is not the

case.

There are several ways of financing a purchase. First. you could exchange a promissory note for the remainder interest. The note must have an adequate stated interest and. as with all sales. must be bona fide. Don't even think aOOut monkeying around with the interest or payment or you'll destroy the whole deal. You may even consider a OOlloon note after a term of years with interest payable during the term. Another way would be to sell the remainder interest in exchange for a private annuity. However. this is not considered a good option because the remainder interest transferred is not income producing. If you really want to be aggressive. try a seIf-cancelling note. That is where the note cancels itself at the death of the seller and is not includible in the seller's estate. It's very tricky. however.

Does that mean any other type of promissory note could be includible in the life tenant's estate?

Yes. but remember that unless it is a balloon note. the principal balance will be decreasing and. hopefully. as payments of principal are made the life tenant may be making additional annual gifts or taking trips around the world to prevent asset accumulation.

28/Arkansas Lawyerl)anuary 1988

"One negative point to the remainder sale is that the remainderman does not receive a stepped up basis in the property on the death of the life tenant./I Mrs. Jones' children would be furious over a plan which recommends spending after the annual gifts.

An estate tax rate of 55 percent is a great incentive to spend.

What about gifting the money to the children to purchase the remainder interest?

There is a danger is tying gifts to remainder interest purchases. Ever

hear of the step-transaction doctrine? The IRS can collapse a series of gifts and the purchase into one transaction: a sale without adequate consideration is the same as a gift. i.e.. you have just jeopardized your remainder interest sale since it is not a bona fide sale for full and adequate consideration in money or money's worth.

If there is no other way to finance the purchase of the remainder interest. I would recommend that your client make a gift and wait at least one year before allowing the children to purchase the remainder interest. It is called the "old and cold money rule."

If you really want to get fancy. gift $600.000 to Mrs. Jones' children. then wait at least a year wld make a joint purchase of property. i.e .. Mrs. Jones purchases the life estate and her children purchase the remainder interest.

What's the benefit of this?

The benefit is an additional income tax benefit to Mrs. Jones who

will be able to amortize the cost of her life estate. even if the property is nondepreciable. In other words. she could purchase any investment type asset. such as stocks or buildings. and amortize the cost.

There apparently is a distinction between carving out a life estate from an existing asset and purchasing a life estate (Manufacturer's Hanover Trust vs. Commissioner of Internal Revenue. 431 F.2d 664 (1970)).

Speaking of income tax. what are the income tax consequences of a re-

mainder interest sale?

In general. the seller of a remainder interest recognizes gain or loss by subtracting the proceeds of sale from his or her OOsis. Under the income tax regulations. the seller's basis must be allocated between the remainder interest and the life estate. Presumably the same Treasury tables which are used to value the interest may be used to allocate OOsis.

If the property is sold subsequent to the sale of the remainder interest. the life tenant and the remainderman will recognize gain to the extent of the difference between their respective sales price according to the Treasury tables mentioned aOOve and their adjusted basis.

Where the life tenant has the pawer of sale over OOth interests (the remainder and life estate) and the proceeds must be accounted for and preserved for the remainderman. the gain on the remainderman's interest will be taxed as if it were held in trust (Rev. Rul. 61-102.

1961-1 C.B. 245).

Under other circumstances. the income tax consequence to the remainderman can also get very

complicated.

What about the income tax consequences on the death of the life tenant?

The law appears to be unsettled in this regard. An argument can be made that upan the death of the life tenant the receipt of the property by the remainderman results in the recognition of taxable income (Guthrie v. Cornmr. 42 BTA 696 (1940): Jones v. Commr. 40 TC 249 (1963) remanded for further proceedings.

330 F.2d 302 (3rd Cir.. 1964) on remand. T.C.M. 1966-136).

One negative point to the remain-

der sale is that the remainderman does not receive a stepped up basis in the property on the death 01 the life tenant. This potential income tax cost should be estimated in determining the total potential savings in the use of a remainder sale.

Consider particularly bands. The children could pay a substantial income tax when they mature. Since they have purchased only a remainder interest, the children's basis will be very low.

In summary. let's just agree that the remainder sale has many advantages. among them possible reduction of estate taxes by eliminating all or part 01 the transleror's estate. thereby freezing appreciation 01 the translerred asset; possible income tax write-offs to the lile tenant for amortization/depreciation; and the transfer of the property outside of probate. There are still. however, unsettled issues and potential risks.

Waiter. two 01 the biggest steaks in the house. please! And, set him up a tab since "we split the fee. helped a friend and saved a client."

0

"There are, however, unsettled issues and potential risks in remainder sales."

Editor's Note: George N. Plastiras and Philip Miron are members of the Plastiras Law Firm in Little Rock. Plastiras is the immediate past-chair of the Arkansas Bar Association's Economics of Law Practice Section. He is a board certified tax specialist. a fellow in the American College of Probate Counsel and a former president of the Central Arkansas Estate Council.

Miron is a certified public accountant and holds membership in the American Institute of Certified Public Accountants and the Arkansas State Society of Certified Public Accountants.

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January 1988lArkansas Lawyerl29

DISCIPLINARY ACTIONS September to October The Arkansas Supreme Court Committee on Professional Conduct from September to October 1987. issued three letters of reprimand and six letters of caution. It suspended for one year the law license of Bob Scott of North Little Rock and accepted the surrenders of license from former federal Judge Harry E. Claiborne of Las Vegas. a native of McRae. who was impeached and removed from office in October 1986 after being convicted of income tax evasion. and Jeptha A. Evans of Booneville. The Committee took no action of a disciplinary nature on 80 informal complaints against attorneys and voted "no action warranted" on six formal complaints. In other business, Sam Sexton. of Fort Smith, in September appealed to the Arkansas Supreme Court the suspension of his law license by the Committee on August 29, 1987. The action of the Committee was stayed pending the appeal.

The stay will terminate at the end of 30 days if an appeal is not perfected.

BOB SCOTT Suspension of License Bob Scott. of North Little Rock. had his license suspended for one year on September 2, 1987. by the Committee on Professional Conduct for violation of Rule 8.4 of the Model Rules of Professional Conduct involving misconduct. Scott was hired to handle post-conviction relief for the complainant. He received a $500 partial retainer on September 10.

1984. to represent the complainant and an additional $2.(xx) on September 21. 1984. and $2.500 on June 5.

1985. The complainant said Scott did no work on his behaU and accepted an additional $2.500 six months after the statute of limitations had run.

HARRY E. CLAIBORNE Surrender of License Former federal Judge Harry E. 3D/Arkansas Lawyernanuary 1988

Claiborne of Las Vegas. formerly of McRae. voluntarily surrendered his license to the Committee on Professional Conduct in October. Judge Claiborne was impeached and removed from office in October 1986 after being convicted of income tax evasion. The conviction on income tax evasion constitutes a violation of Rule 8.4 of the Model Rules of Professional Conduct involving misconduct. The state Attorney General's Office. on behalf of the Committee. filed a lawsuit in circuit court on December 31. 1986. to disbca Judge Claiborne.

JEPTHA A. EVANS Surrender of License Jeptha A. Evans. of Booneville, voluntarily surrendered his license to the Committee on Professional Conduct in October. Evans stated in his petition for surrender that due to his advancing age and related health problems, he could not adequately continue in the practice of law. Evans received a letter of reprimand from the Committee last year for violation of Rule 1.8 of the Model Rules of Professional Conduct concerning conflict of interest.

GERALD W. CARLYLE Letter of Reprimand Gerald W. Carlyle, of Newport. was issued a letter of reprimand by the Committee on Professional Conduct in September for violation of Rules 1.3. 1.4 and 8.4 of the Model Rules of Professional Conduct involving diligence. communication and misconduct. Carlyle was hired in September 1984 and paid $I(XX) to pursue a judgment against a corporation and stockholder and to dissolve the corporation. Part of his fee was to hire co-counsel in Pulaski County. The complainants said cocounsel was never obtained. but Carlyle filed suit on their behalf in Pulaski County Chancery Court in October 1984. After much delay. the

matter was non-suited and refiled in Pulaski County Circuit Court in February 1986. By that time, the corporation was closed and all assets had been auctioned off. After a hearing date was set, the complainants went to the Pulaski County Courthouse to meet Carlyle and finalize and file the settlement documents. but Carlyle did not appear. He said he would handle the matter at a later time. In March 1987. the complainants picked up their file and hired another attorney.

They learned that in November 1986. a judge had signed an "agreed order" which dismissed the individual defendant from the suit and awarded a $15,000 judgment against the corporation. The complainants said this violated express instructions to Carlyle.

RONALD D. HEUER Two Letters of Reprimand Ronald D. Heller. of Little Rock. was issued a letter of reprimand by the Committee on Professional Conduct in September and October for violations of Rules 1.3 and 3.2 of the Model Rules of Professional Conduct involving diligence and expediting litigation.

He was reprimanded by the Committee in September as the result of a Per Curiam order of the Arkansas Supreme Court granting a "motion for rule" on the Supreme Court clerk.

Heller said it was his fault that the record was not timely tendered for the appellant. The matter was submitted to the Committee by the Supreme Court and processed as a formal complaint. The complaint was received by Heller on July 2.

1987. and. despite assurances from him that a response would be submitted. no response was received.

He was reprimanded in October as the result of another Per Curiam order from the Supreme Court. The Court said Heller had represented an appellant to appeal his criminal convictions. Heller tendered the record to the clerk for filing more than

seven months alter the expiration date and the clerk refused to file the record. Several months later, Heller filed a Rule 37 petition in trial court alleging ineffective assistance of trial counsel. On October 21. 1985, in a hearing before the trial court, Heller said he liled a "motion for rule on the clerk." On the basis of that representation, the trial court set an appeal bond and the appellant was released pending appeal. Nearly eight months later, the state moved for revocation of the appeal bond alleging that no "motion for rule" had been filed. At a hearing, Heller conceded he had never filed the motion.

The bond was revoked and Heller was found in contempt of court. The complaint was sent to Heller on May 12, 1987, and he did not respond.

PHIL BARTON Two Letters of Caution Phil Barton, of DeQueen, was issued two lellers of caution by the Committee on Professional Conduct in September for violations of Rules 1.3 and 3.2 of the Model Rules of Professional Conduct involving diligence and expediting litigation.

In a Per Curiam order dated July 29, 1987, the Arkansas Court of Appeals denied Barton's "motion to file a belated brief" in two cases. In one case, the Court of Appeals said Barton had failed to lile an appellant's brief which was due on May 2, 1987. In a letter to the Arkansas Supreme Court clerk on June 8, 1987, Barton said he would tender the brief in this case no later than June 15, 1987. The brief was tendered on June 16, 1987, and was found to be out of compliance with Rule 9(d) of the Rules of the Arkansas Supreme Court and Court of Appeals. His motion to file the belated brief was denied.

In another case, the Court of Appeals said that an appellant's brief was filed on December 26, 1986, but was later determined not to be in compliance with Rule 9(d) of the Supreme Court and Court of Appeals. Barton was directed to lile a substituted appellant's brief in compliance with Rule 9(d) by April 3, 1987, but failed to do so. He told the Court in a letter dated June 8, 1987, that he would tender the brief no later than June 15, 1987. The brief was tendered on June 16, 1987, along with a "motion to file a belated

brief." An inspection of the brief revealed that it was not in compliance with Rule 9(d) and his motion was denied.

STEPHEN CHOATE Letter of Caution Stephen Choate, of Heber Springs, was issued a letter of caution by the Committee on Professional Conduct in September for violation of Rule 1.12 of the Model Rules of Professional Conduct involving the requirements of former judges. The complainant stated that she was the plaintiff in a lawsuit filed against Greers Ferry and heard by Choate in his capacity as circuit judge. The defendant, the city of Greers Ferry, was represented by City Attorney Darrell Graves.

The complainant said that when Choate left the bench, he resumed practice in the same law firm in which Graves practiced. She said that at city council meetings, Choate made reference to work being done for the city by "his firm."

She said further that Choate succeeded Graves as city attorney. The complainant said that she had obtained financial records which show that the legal fee for the preparation of the Greers Ferry brief in the case she filed was paid to Choate with an indication "for O'Brien (the complainant) procedure case." She said that while sitting as judge, Choate participated in the case, assisted in the preparation of the Greers Ferry brief and shared in the fee.

LINDSEY

Jâ&#x20AC;˘ FAIRLEY

Letter of Caution Lindsey J. Fairley, of West Memphis, a part-time federal magistrate, was issued a leller of caution by the Committee on Professional Conduct in September for violation of Rules 1.7 and 1.9 of the Model Rules of ProfessiOnal Conduct involving conflict of interest. A title insurance company said that under an agency can tract with

them, Fairley searched real estate title records and issued commitments for title insurance and title insurance policies. In this capacity, Fairley issued three owners' policies of title insurance. The policies insured against a mortgage held by the Equitable Assurance Society.

He later liled suit to foreclose and named the insureds as defendants.

DANIEL

J. KROHA

Letter of Caution Daniel J. Kroha, of Little Rock, was issued a letter of caution by the Committee on Professional Conduct in September for violation of Rules 1.3 and 1.4 of the Model Rules of Professional Conduct involving diligence and communication.

Kroha represented the complainant in a divorce. He gave the complainant numerous excuses over a 16month period as to why the case had not come to trial. The complainant said she attempted to contact Kroha numerous times, leaving messages on his answering machine, but the calls were not returned. Kroha also failed to appear at a scheduled court .hearing.

GENE O'DANIEL Letter of Caution Gene ODaniel. of Little Rock, was issued a letter of caution by the Committee on Professional Conduct in September for violation of Rules 1.3 and 1.4 of the Model Rules of Professional Conduct involving diligence and communication.

O'Daniel was paid $60.20 to file and service a lawsuit for the complainant. The check was endorsed and cashed by O'Daniel. The complainant did not hear from O'Daniel for several months and contacted him near the end of March 1987. She said O'Daniel told her he'd been unable to file suit for her because of a health problem, but assured her the statute had not run. The complainant had no further contact with O'Daniel.

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IN MEMORIAM

Timothy D. Brewer Timothy D. Brewer, aged 30, of Little Rock, died Tuesday, November 10, 1987.

Brewer had been a partner in the House, Wallace and Jewell law firm since September and was a member of the firm's corporate law section.

He joined the firm in 1985 after working three years as in-house counsel for Southwestern Bell Telephone Company.

Brewer received his juris doctorate in 1982 from the University of AIkansas at Little Rock School of Law, was survey editor of the UALR Law Journal and a member of the Journal's Review Committee. He received a bachelor's degree in arts from the University of Central Arkansas at Conway in 1979 and was named outstanding general business administration graduate.

He was treasurer of the Board of Directors of the Pulaski County Chapter of the American Red Cross and chair of the Red Cross Blood Services Committee. He had also done volunteer work for the United Way of Pulaski County and the AIkansas Arthritis Foundation, heading and organizing several of the 321Arkansas Lawyer/January 1988

Foundation's benefits.

Brewer was an "outstanding member" of the Phi Delta Phi law fraternity and a member of the ethics committee of the University of AIkansas for Medical Sciences.

Brewer was born at Lebanon, Tenn., the son of Elwyn and Madene Sowell Brewer, who now reside in Enola (Faulkner County). He was a graduate of Enola High School.

He was a member of the AIkansas Bar Association since 1981 and had served on its AIkansas Statute Revision, Anti-Trust and Trade Regulations, State and Federal Securities and Public Information Committees.

Brewer was a member of Trinity United Methodist Church. He was a member of the Church's finance committee and president of the Good News Sunday School class.

Survivors are his wife, Stacy Sells Brewer of Little Rock; a daughter, Allyson Elizabeth Brewer of Little Rock; his parents, Elwyn and Madene Sowell Brewer of Enola; two brothers, Gary Brewer of Enola and Doyne Brewer of Greenbrier; and a grandmother, Ethel Brewer of Conway.

A scholarship fund has been established for his infant daughter, Allyson Elizabeth. Contributions to the scholarship fund should be directed to the trust department of First Commercial Bank. Checks should be made payable to the Allyson Elizabeth Brewer Scholarship Fund. For more information concerning the fund, contact the House, Wallace and Jewell firm, 3800 Capitol Towers, Little Rock. AR 72201, or phone 375-9151.

Jack Daily Jack Daily, age 75, of Fort Smith, died Sunday, October 18, 1987.

Daily was a graduate of the University of Arkansas and attended Stanford University and the University of Michigan.

He was a 33-year member of the

Arkansas Bar Association and a member of the Sebastian County Bar Association and the American Bar Association.

Daily was a past president of the Noon Civic Club and a member of Kappa Sigma Fraternity.

He was a member of S1. Bartholomew's Episcopal Church.

Survivors are his wife, Isabelle Daily of Fort Smith; two sons, Thomas A. Daily of Fort Smith and Harry Pete Daily of Englewood, Colo.; a sister, Jane Tennant of Fort Smith; and seven grandchildren.

William H. Drew. Sr. William H. Drew, Sr., age 67, of Lake Village, died Sunday, November 8, 1987.

Drew, a retired AImy Reserve major, was a Mason and a World War II Navy veteran.

He was a 35-year member of the AIkansas Bar Association and was a former member of its Continuing Legal Education and Professional Ethics and Grievances Committees.

Drew was also a member of the American Bar Association and the American Legion.

Drew was an Episcopalian.

Survivors are his wife, Mary Kosearas Drew of Lake Village; two sons, William Howard Drew, Jr., and George Stuart Drew of Lake Village; a daughter, Katharyn Christine Drew of Pine Bluff; a brother, Stuart Drew of Jackson, Miss.; a sister, Katharyn Lott of Hot Springs; and five grandchildren.

Thomas D. Wynne. Jr. Thomas D. Wynne, Jr., age 71, of Fordyce, died Tuesday, September 29, 1987.

Wynne was the senior partner in the Wynne, Wynne and Wynne law firm.

He had been a practicing attorney in Fordyce since 1953. He was a for-

mer mayor of Fordyce and a former municipal judge and deputy prosecuting attorney.

Born December 30. 1915. he was the son of the late Thomas Duncan Wynne. Sr.. and Agnes Gill Wynne.

Wynne was a graduate of the University of Arkansas. where he received his law and undergraduate degrees. He was also a graduate of Fordyce High School.

Wynne was a veteran of World War II and was awarded the U.S. Air Force Silver Star. two Distinguished Flying Crosses. six Air Medals and a Purple Heart.

He was past president of the Fordyce Chamber of Commerce. past vice president of the Arkansas Municipal League. former state liaison officer from Arkansas to the U.S. Air Force Academy and a former member of the Fordyce Rotary Club.

He was a 34-year member of the Arkansas Bar Association.

Wynne was a past member of the board of directors of the Arkansas State Golf Association and was among the top golfers in the state in his youth. He was a longtime football official and was a lifetime member of the Arkansas Football Officials Association.

He was a member of the First United Methodist Church. past chair of its Board of Trustees and a member of its Administrative Board.

Survivors are his wife. Margaret West Wynne of Fordyce; three sons.

Tom Duncan Wynne III and Robin French Wynne of Fordyce and Teny Frank Wynne of Pine Bluff; one daughter. Mary West Wynne Roark of Fordyce; four brothers. Hal Gill Wynne of Arlington. Va .. Robert Douglas Wynne of New Orleans.

La.. and Dr. George French Wynne of Warren; two sisters. Annette Wynne Shipman of Scottsdale. As.. and Agnes Wynne Phillips of Little Rock; and eight grandchildren.

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Arkansas IOLTA Program

Funds Increasing "Geometrically"

By Susanne Roberts

state. Second, to ease many lawyers' minds, the degree of difficulty in joining IOLTA is minimal. All you bave to do is sign the form, send it to the Foundation's office and post in your office the required notice to clients about your participation in the program. We recruit the bonks and they convert the accounts and send in the interest. Third, there is still some confusion over the required method to notify clients. You simply post a notice which we provide.

Lawyers occasionally ask questions concerning whicb funds should be deposited in the client trust account and whicb funds should be invested for a particular client. Three factors should be con-

The Arkansas IOLTA Foundation, Inc., continues its enrollment of attorneys and financial institutions in the Interest on Lawyers' Trust Accounts (I0LTA) program. I want to thank you for your cordial reception during my visits to law offices throughout the state. It's truly been a pleasure to visit with those of you on the "front lines."

Some issues concerning IOLTA are repeatedly raised. First. many of you, though well intentioned, have been putting off signing our enrollment form and sending it in. If you've received the form but baven't yet signed up, please do so. It's dillicult to call on every lawyer in the

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sidered when depositing or investing client funds - I) the amount of interest the funds will earn while deposited; 2) the cost of establishing and administering separate tax reporting procedures; and 3) the nature of the transaction. In determining the practical questions of what are "nominal in amount" or "ex-

pected to be held for a short period of time," the following informational table provides some guidance.

The table assumes that $50 is a reasonable estimate of the minimum amount of interest that a trust account for an individual client must generate to be practical in light of the costs involved in earning or accounting for such income: Number of Days Required 10 Generate $SO of Principal Interest at Sif4 Percent Deposil Compounded Dally $ 500 6S4 1,000 2,000 5,000 10,000 20,000 30,000

335 196 68 34 17 9

Grants to be Announced in April The funds collected by the Foundation have been increasing almost geometrically since we started.

From January to October 1987, we collected $113,231.25. Currently, we are collecting about $150,000 per year in interest income from trust accounts. We are now receiving applications for grants which will be approved this spring. The closing date for these applications is February I, 1988. The grant recipients will be announced on April I, 1988.

IOLTA

ATTORNEY HONOR ROLL Guly 16. 1987 to October 15. 1987)

ARKADELPHIA Steve DeMott Wright. Chaney & Berry

Bill D. Etter Martha P. Gilpatrick Michael R. Gott Hugh W. Harrison Howard & Howard McDaniel & Wells Rees Law Firm Seay & Bristow

CAMDEN

Edwin Keaton David McMahen ELDORADO

James B. Bennett Ronald L. Griggs Law Offices Landers & Shepherd Denver L. Thornton

LAKE CITY Woodruff & Huckaby LITTLEROCK Barber. McCaskill. Amsler. Jones & Hale Kathryn P. Eisenkramer Laser, Sharp & Mayes Madden. Huddle & Johnson Robert McHenry

FAYETTEVILLE Raymond C. Smith FORTSMITH Orville C. Clift HOPE Graves & Graves

NORTH LITTLE ROCK Ed Phillips Wood Law Firm

HOT SPRINGS Frances M. Finley Byron Cole Rhodes

PINEBLUFF Dickey Law Firm

JONESBORO Anthony W. Bartels Warren E. Dupwe

TEXARKANA KarHon H. Kemp. Jr.

IOLTA

FINANCIAL INSTITUTION HONOR ROLL Guly 16, 1987 to October 15, 1987)

Financial institutions denoted by a double asterisk have expressly waived all charges for IOLTA accounts. and institutions denoted by a single asterisk have to date remitted interest to the Foundation without deducting a fee.

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JUDICIAL DEPARTMENT REPORT

Judicial Productivity Is Improving

By R. Christopher Thomas In recent years, this department has encouraged the acquisition and use of computers to aid our circuit, chancery and probate judges in the management of their dockets. In addition, many judges have obtained the support of case coordinators, and other court related personnel. such as law clerks. Further. there appears to be an increased interest in the subject of docket management among the various jurisdictions. Therefore. it seems appropriate to investigate whether these developments have had any measurable impact upon the processing of cases.

Although the fundamental purpose of our data acquisition effort is to provide case management information for individual judges, other benefits accrue from this rather substantial collection of data. One such benefit is the compilation of statewide information on the status of the court system in general. For example, statistics provided by this department are utilized by the Judicial Reapportionment Board in their analysis of requests for additional judges. On a more general note. our data can, from time to time, tell us about the overall health of our judicial system.

One basic measure of activity within the judicial branch is the disposition rate, which is a comparison of the number of cases terminated to the number of cases filed. This indicator tells whether existing judicial resources are coping with cases as they are filed. Three years ago, in fiscal year 1983-84. the disposition rate was 92"10. In our most recent fiscal year. 1986-87, this disposition rate had improved markedly to 97%. Thus. last fiscal year, for 36/Arkansas Lawyer/January 1988

every 100 cases filed, 97 cases were brought to a conclusion.

A composite picture of performance within the judicial branch can be obtained by reviewing three other indicators. The quantity of litigation can be shown from the number of filings. The ability of the judicial system to adjudicate those filings may be measured by the number of terminations. Finally. the "backlog" can be shown by the number of active cases pending at the end of a given fiscal year.

Tbe line chart which appears on this page provides the opportunity to observe our recent experience in each of these areas.

Not surprisingly. filings have continued to increase. yet that rate of increase has been somewhat suppressed in recent years. Terminations over the period have also increased. However. the rate of increase has not quite been sufficient to absorb the increased rate of filings. yet the gap is closing. Conse-

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quently, the number of cases pending has continued to increase, yet at a slightly lower rate of increase.

Two modest conclusions may be drawn from the analysis. First, our general jurisdiction courts, for the present. are almost managing the inventory of new cases with which they are burdened each year. Second, while the disposition rate remains high, each year sees a small number of cases added to the "pending end" measure. However,

the addition to the "backlog" has been proportionately less each of the last two years. The result is a continuing, almost imperceptible, upward movement in the number of cases which our courts are unable to handle each year.

There are a number of factors that may serve to arrest the creeping increase in "backlog" and perhaps reverse the trend. First, five addi· tional judges will take the bench in the near future. Second, it is reason-

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Third, at least insofar as circuit court is concerned, the transfer of some civil litigation to municipal courts will have a beneficial effect.

Fourth, interest remains high in obtaining adequate support resources for our general jurisdiction judges and state funding for that support will continue to be sought.

For the present, the court system isn't losing any appreciable ground in the never. ending battle with increased filings, yet it isn't gaining any ground either. Perhaps the recent developments outlined above will favorably affect that stalemate.

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EXECUTIVE DIRECTOR'S PAGE

Meetings...

Meetings.

II

By William A. Martin

court decisions, family. criminal and real estate law. taxation. ethics. the new Corporation System and the new Ar-

"To maintain the requisite knowledge and slrill, a lawyer should engage in continuing study and educa-

kansas Code. In addition, the traditional reception 01 the Arkansas Law Center, the Arkansas Bar Founda1ion dinner and meetings of Association commit-

tion."

tees and the House of Delega1es provide

Comment, Rule 1.1.

Model Rules of Professional Conduct "Another bar association meeting!" Does that announcement create happy images and eager anticipation or do you think, 'Tm not interested and won't go?" I believe those of you not attending bar association meetings are missing something good - something both educational and fun.

In our serious moments, we know law grows and changes so fast that, at best. we can only keep up with a small part. We need to know not only what the law is, but what it is likely to be the next time an appellate court rules on an issue. Continuing legal education programs provide additional sources of inlormation to draw from in our effort to meet ethical requirements. And with the coming of mandatory CLE, we have a specific, measurable obligation to attend educational programs.

business and social activities for everyone.

• The Natural Resources Law Institute

on February 2S to 27, 1988, brings lawyers and landmen together in Hot Springs for programs on oil and gas and a day at

Oaklown Park.

• The dynamic Irving Younger. nationally recognized for his speeches on

litigation tactics, will speak March 11.

1988, on jury selection and discovery at a

seminar sponsored by AlCLE. • The always important Federal Practice Inslilute on March 10. 1988, will leature the insights 01 federal judges and lawyers on successlully handling feder-

zeal and are opposed by other lawyers representing their clients' interests with equal zeal. To limit conflicts to the courtroom and the negotiating table, lawyers need the neutral ground provided by organized social functions and bar asso-

The burden of handling other peoples' problems and the time restraints that go with the practice of law create stress that cries out for relief. Bar association meetings, with their non-adversarial settings, provide a welcome change of pace - a mini vacation - while making productive use of the lawyer's time.

Whether it's a local bar association luncheon, dinner or social hour or the American Bar Association's annual meeting, lawyers benefit tremendously from attending meet· ings with other lawyers. Our Arkan· sas Bar Association and Arkansas Institute for Continuing Legal Education (AICLE) meetings and programs provide wonderful opportunities for learning and renewing and reinforcing friendships with other lawyers and their families.

Some of our upcoming attractions include: • The Mid-Year Meeting on January 22 and 23, 1988, featuring "Racehorse"

ciation meetings.

Haynes and presentations on Arkansas

to encourage cordial relations among lawyers:' Article I. Arkansas Bar Association Constitution Lawyers represent clients with

38/Arkonsas LawyerlJanuary 1988

al cases.

• The Workers' Compensation Law In-

stitute on April IS. 1988, a1tracts many insurance and labor representatives with whom lawyers work in handling cases for injured workers and their employers.

• The popular Tax Awareness Semi-

nar on May 6. 1988. helps keep the lawyer who is not a tax expert up-to-date on how

tax changes oifecl the practice of low.

• The Arkansas Bar Associa1ion's Annual Meeting on June 8-11. 1988, in Hot Springs, will be held in conjunction with the Arkansas Judicial Council. Your Ic>cal courts should be closed and their judges present at this joint meeting.

Highlights include the introduction of the newly revised Arkansas Form Book. the ever popular Gridiron presentation

by the Pulaski County Bar Associa1ion. a dinner/dance with lillie Joe and the BK's and receptions, sports events. law

school alumni luncheons and numerous meetings 01 our committees and affili· ated organizations.

Take a look at these meetings and CLE offerings. If you haven't been attending, give us a try. You'll like what you discover!

D

YOUNG LAWYERS' UPDATE

"Leadership"

By Michael H. Crawford

Webster's Dictionary defines "lead" in part as: "I. To guide; 2. To be ahead; 3. To make the beginning play; 4. The winning position; 5. A margin of advantage." All too often we confuse the word "leadership" with such words as "president:' "chairman" or "boss." These words refer to people who. though often leaders, seldom provide the true strength of leadership. It is the members of the organization who provide "the winning position" or "a margin of advantage."

The Young Lawyers' Section, despite its numerous successful projects. has failed miserably at leadership. Although one in three readers of this article (more than 1.500 lawyers) are members of the YLS. most are simply unaware of the benefits of membership. We shamefully boast only a handful (approximately two dozen, at best) of members who participate in the Section. Our leadership is lacking.

The first step in taking the lead is to recognize the path. The path to the "winning position" necessarily includes contributions to the profession of law. The true leaders are those who recognize the value of team play. When the few join the many, suddenly they find unlimited opportunities, like the opportunity to help the poor and disadvantaged through pro bono representation and the chance to meet other experienced attorneys. Increasing job satisfaction and sharing good times with fellow attorneys through the YLS are but a few of the membership benefits.

As young lawyers. we are the future leaders of the law profession.

Find out what the YLS can offer you by calling or writing me concerning

those committees and projects which need your help. Be informed!

Be a leader!

The YLS is pleased to take the lead by providing: • The Trial Practice Seminar on March 25 and 26, 1988. at the Hot Springs Sheraton. The seminar offers sessions on Friday and Saturday and afternoon excitement at Oaklawn Park. A bulfet lunch in the Arkansas Room at Oaklawn Park will be held Friday. Seating in the terrace, which offers a great view of the finish line, is reserved. Call the Arkansas Bar Association at 375-4605 or 800-482-9406 to register.

Space is limited.

• The Statute of Limitations Handbook is currently being updated by the YLS to premiere at the Association's annual meeting in June. Contact Joseph Calhoun at 376-3800 to offer your assistance.

• The HighSchool Mock Trial

Competition co-sponsored by the YLS will begin in April. This year's topic is AIDS discrimination in the workplace. Coaches, judges and organizers are needed. Call Susanne Roberts at 37&-180 I to offer your assistance or call your local high school to encourage their participation in the competition.

• The Young Lawyers' Newsletter is being organized by Edward Boyce. Your assistance is needed to contribute helpful articles and humorous stories. Send your ideas to him at P.O. Box 948, Newport. AR 72112 or call 523-5242.

• The Practice Skills Course will provide bosic nuts and bolts information about law practice. Greg Jones, in collaboration with the Arkansas Institute for Continuing Legal Education (AlCLE), is planning a training course which will be provided free to all speakers. If you'd like to volunteer to organize the program or speak at the seminar, call Greg at 371-0808.

• District representatives of YLS will undertake this year to locate and activate young lawyers throughout Arkansas as part of a Leadership Outreach effort. If you're ready to become involved or just want to meet some successful young lawyers, give your district representative a call. The representatives are: Northwest - Robert Ridgeway. Jr..

321-1931 Northeast - Chris Paul. 932-6694 Central - Greg Jones. 371-0808 Southern - Michael Dennis. 534-5532 Won't you become involved in the YLS and become a leader? A wise man once said, "There go the people. I must hurry and catch up with them for I am their leader:' It is time for you to catch up with the Young Lawyers' Section.

0 January 198a/Arkansas Lawyer/39

AFTER THE DECLARATION OF INDEPENDENCE OUR FOUNDING FATHERS WROTE SOMETHING EVEN MORE IMPORTANl: Ten years after the signing of the Declaration of Independence our founding fathers created what historians have called the greatest single document struck off by the hand and mind of man.

Our founding fathers created the Constitution of the United States.

For the first time in history. power was granted by the people to the govemment. and not by the government to the people.

The freedom unleashed by the Constitution allowed Americans to develop their talents and abilities to the fullest. And attain what is now known the world over as the American Dream.

As we commemorate the Bicentennial of the Constitution, there is no better way for you as an American to reaffirm the principles for which our country stands than to learn more about the Constitution.

The words we live by.

THE CONSTITUTION The words we live by

To learn more about the Constitution write: Constitution, Washington. D.C. 20599. The Commission on the Bicentennial of The: U.S. Constitution.

40/Arkansas Lawyer/January 1988

.

~

IN-HOUSE NEWS LAW SCHOOLS, A.I. C.L.E. AND HOUSE OF DELEGATES

UNIVERSITY OF ARKANSAS SCHOOL OF LAW, FAYETTEVILLE

By J.

w.

Looney

Lonnie Beard has an article in the Agricultural Law Update entitled "Consequences of Electing to Make the Uniform Capitalization Rules Inapplicable to Cattle Held for Breeding and Dairy Purposes.

Janet Flaccus article "Taxes, Farmers and Bankruptcy and the 1986 Tax Changes: Much has Changed, But Much Remains the Same" appeared in the Nebraska Law Review. Flaccus served as co-chair for the "Fundamentals of Bankruptcy" seminars sponsored by AICLE in Fayetteville and Little Rock; spoke at the program on "Special Bank Problems: Setoffs, PostPetition Credit and Lender Liability" and spoke at the 1987 Heartland Labor and Employment Law Institute on "Recent Employment Law Developments in Arkansas and Oklahoma."

Rob Leflar's article "Compensation for Work Related Illness in Arkansas" has been accepted for publication in

the Arkansas

Law

Review.

Wylie Davis chaired the Multistate Bar Exam Committee on Contracts at its fall meeting in Niagara Falls. N.Y. He was a special lecturer for the University of Arkansas Museum Series.

His lecture "Birth and Growth of the United States" was in observance of the Bicentennial of the U.S. Constitution.

Robert A. Lenar continues a full teaching load with the law school in torts and conflicts.

Bob Laurence's article "Abuse of Discretion in the Denial of Sua Sponte Motions to Dismiss Under II U.S.C. ยง 707(b): In re Love, Poetic Justice and the Other Blackbird" appears in the Annual Survey of BankruptcyLaw. Mary Beth Matthews served as co-chair of the Fall Legal Institute Program on "Organizing

and Advising Arkansas Businesses.

Lou Lindsey was one of 3S law librarians selected to participate in a research conference

sponsored by Mead Data Central on "Effective Teaching of Legal Research in an Online Environment."

Charles Carnes and Warren E. Banks had an article entitled "Share Valuation - A Chance for Financial Literacy" published in the California Western Law Re-

view. The article has been selected for re-

immigration law's effect

printing in the Corporate Practice Commentator which is edited by Professor F. Hodge O'Neal. a leading scholar on corporate law.

Rod Smolla's "A Little South of the Law" appears in the October 1987 Southern Magazine.

Smolla chaired a panel

NEW LIBRARIAN HIRED Marcia Baker, formerly of the University of Texas Law Library, has joined the staff of the Young Law Library as assistant librarian in charge of circulation!

discussion on the consti-

reference.

tutional aspects of the crises at Central High at a symposium in Fayetteville.

Ray Guzman has been appointed to the Governor's Commission on Probation, Parole and Sentencing.

John Watkins spoke to the City Attorneys Association in Hot Springs on recent developments in Freedom of Information; to the Arkansas Municipal League annual meeting in Fort Smith on 1987 FOIA amendments; to the Sixth District Trial Practice Seminar in Little Rock on recent changes in Arkansas rules of civil procedure; and to the Media Law Seminar in Little Rock on confidential sources.

Jake Looney spoke at the National Institute on Cooperative Education in St. Louis on cooperative director liability; served as education leader for a legal study tour of the Soviet Union; spoke at the annual meeting of the American Embryo Transfer Association in Orlando; and spoke to the Arkansas Horticultural Association annual meeting in Fort Smith on the new

on agriculture.

STUDENT ACTMTIES Jere Diersing, who graduated last May, won second prize in the Nathan Burkan Memorial Competition for an essay entitled "The Use of the Defense of 'Unclean Hands' to Copyright Infringement Action."

Karen Callahan was awarded special recognition for her entry in the Eighth Circuit essay competition on papers related to the Bicentennial of the U.S. Constitution.

Lucy A. Wiggins, who completed the LL.M. degree last May, has an article in the Journal of Agricultural Cooperative on "Cooperatives, Securities Violations, and Advisor Liabilities; A Case Study."

ABA-LSD membership at the U of A School of Law, Fayetteville leads the circuit with membership in excess of 94 percent.

MEMORIAL TO JOHN A. BUNCH During the remodeling and expansion project. the Law School had a grill built in the courtJanuary 19BB/Arkansas Lawyer/41

yard. The grill may be used by student groups.

The Christian Legal Society will shortly place a plaque on the grill, dedicating it to the memory of John A. Bunch, Class of 1985.

Before graduating from Elkins High SchooL Bunch set a national high school record, which still stands, for rushing 608 yards in a single game. He played football at Dartmouth before transferring to and graduating from Arkansas. It was while working in banking that cancer was first diag-

UNIVERSITY OF

ARKANSAS

AT UITLE ROCK SCHOOL OF LAW

nosed. He entered law

school in September 1982. Despite his illness, which had resulted in the amputation of a hand, he was an active member of the cookout crew, when the Christian Legal Society initiated its cookouts that semester. Despite several operations, he persevered and completed his degree requirements. On his death in November 1984, he was survived by his wife, Aleta, and his six month old son, Joel.

Grant Hall of the Northwest Arkansas Times wrote: "He was a

record-setting athlete, but he will be remembered more for the inspiring way he lived his life in the face of a prolonged series of physical setbacks. He fought to the end." Wally Hall of the Arkansas Democrat wrote: "He left this earth without a complaint, only a prayer to God for his blessings." His courage, his commitment and his compassion provided an example and a model to the Law School 0 community.

421Arkansas Lawyerl/anuary 1988

By Paula Casey Lawrence M. Friedman, the Marion Rice Kirkwood Professor of Law at Stanford University, delivered a lecture, "The American Constitution: A Double Life," on October L 1987. The lecture was the sixteenth in a series sponsored by the Ben J. Altheimer Foundation.

The Law School hosted a lecture by Thomas F. Eagleton on October 30. Eagleton, the Democratic nominee for vice

president in 1972, discussed the United States Constitution in the final lecture of a series called "The Future of the American Constitution."

Dean Lawrence H. Averill attended a meeting in Philadelphia as a member of the Consultive Group of the Restatement on the Law Governing Lawyers.

Professor Eugene Mullins gave a presentation to the Conference of State Prosecutors on the 1987 Arkansas Code on October 22 in North Little Rock.

Visiting Professor Griffin J. Stockley discussed small claims procedures with the Central Arkansas Municipal Clerks Association at a meeting on October 30 in Little Rock.

On October 2, Professors Philip Oliver and John DiPippa debated

the nomination of Judge Robert Bark to the U.S. Supreme Court. The debate, sponsored by the Agora Forum, was held at the University of Cen-

of Admissions, and Casey attended the annual meeting of the Southwest Association of Prelaw Advisors in New Orleans, Louisi-

tral Arkansas.

ana, in September.

Professor Oliver's article "Time to Retire Life Tenure" was published in the Wall Street Journal on September 18.

Professor Robert R. Wright was a delegate to the United States/ China Joint Session on Trade, Investment and Economic Law at Beijing, People's Republic of China, in August 1987. American lawyers met jointly with their Chinese counterparts to discuss changes in the law which would promote trade between the two countries. Attorney General Edwin Meese chaired the United States delegation and the Chinese Minister of Justice chaired the Chinese delegation.

Professor Wright also attended the Fall Council and Officers Meeting of the Section of General Practice of the American Bar Association in Palm Springs, California, in October. He is chair of the Arkansas Form Book Editorial Board.

Associate Dean Scott Stafford attended a Site

Professor Frances Fendler was co-chair of the Arkansas Institute for Continuing Legal Education's (AICLE) Fall Legal Institute in Fort Smith in October. Professor Glenn Pasvogel was co-chair and speaker for "Fundamentals of Bankruptcy" seminars sponsored by AICLE and held in Little Rock and Fayetteville in September.

Professor John Pagan gave a talk to the Little Rock Civitan Club about the role of the quorum court in county govern-

Evaluation Orientation

Workshop sponsored by the American Bar Association at the Indiana University-Purdue University at the Indianapolis Conference Center in September.

Associate Dean Paula Casey participated in a workshop for the development of professional skills courses sponsored by the American Bar Association at the Universi ty of New Mexico School of Law in Albuquerque in October.

Jean Probasco, director

ment.

STUDENT NEWS William Cash, Jon Taylor, Tricia Eables and Jana Brown attended a joint meeting of the Eighth and Tenth Circuits of the American Bar Association/Law Student Division in Kansas City in September.

Patti Leuken, governor of the Tenth Circuit for 1987-88, also attended.

Eables received an ABA! LSD Certificate of Merit.

Cash and Taylor attended the American Bar Association's Annual Meeting in San Francisco in August as voting delegates for the Law School. A resolution sponsored by Law School students dealing with alternative testing dates for law students was approved by the ABAILSD assembly.

Mariam Miller Hopkins and Frank Arey competed in a regional moot court competition

at the University of Tulsa.

0

A.I.e.L.E. NEWS

By Rae Jean McCall During the past year, the Arkansas Institute for Continuing Legal Education offered more than 30 seminars and teleconferences for Arkansas attorneys, The active involvement of board members, program committee mem-

bers and faculty in providing input on future programming is invaluable, However, the "unsung" heroes are those attorneys who calL write or personally mention to AlCLE staff their requests for future programs and their suggestions for improving our CLE efforts.

This is definitely a year 01 growth for AlCLE. With mandatory CLE and increased legal specialization on the horizon, AlCLE is expanding the type and kind of CLE offerings to benefit a broader cross-section of the bar. The first step was the development of a framework for planning. A comprehensive curriculum approach to program planning was initiated during the past year. This plan establishes a network of practice area advisory committees to identify potential seminars based upon types of legal tasks customarily performed and the levels of competence required to carry them out.

The goal is to provide courses enabling the practitioner to "acquire" new skills, techniques and knowledge and to make it possible for a lawyer to maintain and improve existing skills, techniques and knowledge.

Next, five practice area advisory commit-

tees were appointed to plan program selection and content, identify and recruit faculty, monitor course quality and plan the cycle of courses in the practice

area. The initial advisory committees and their respective chairs are: Family LawlDomestic Relations - N. Dale Price, Little Rock Estate Planning/ Probate - William D. Haught. Little Rock Commercial Law/ Bankruptcy - Richard L. Ramsay, Pine Bluff Taxation - Byron Eiseman, Little Rock Litigation - David H. Blair, Batesville Comments and suggestions about potential CLE programs in these areas may be directed to the respective chair or to the AlCLE staff.

In addition to practice area advisory committees, the AlCLE Board of Directors annually elects a program committee with the primary responsibility of planning a master calendar of CLE program offerings. This year's committee, chaired by David M. "Mac" Glover of Malvern, consists of Assistant Dean David Malone of the University of Arkansas School of Law, Fayetteville; Professor D. Fenton Adams of the UALR School of Law; J. Thomas Ray of Little Rock; and David R. Matthews of Lowell.

Kudos for Previous Programs Special thanks are due the program chairs for their efforts in planning and organizing 1987 CLE programs.

Rosalind R. McClanahan of Pine Bluff and

Gregory T. Jones of Little Rock did an outstanding job in planning the "Bridging-the-Gap" 1987 Practice Skills Course.

Professors Glenn Pasvogel of the UALR School of Law and Janet Flaccus of U of A School of Law, Fayetteville organized the Fundamentals of Bankruptcy Program. Attended by more than 180 persons, this program was a tremendous success. The Fall Legal Institute, "Organizing and Advising Arkansas Businesses. was chaired by Mary Beth Matthews, assistant professor at the U of A School of Law, Fayetteville, and Frances Fendler, assistant professor at the UALR School of Law. This program was well-received by those in attendance.

Preview of Upcoming Programs • Hosted by AICLE, the 1988 Mid·Year Meet· ing of the Arkansas Bar Association will feature "Recent Developments in the Law." The fea· tured speaker will be Richard L. "Racehorse" Haynes, a noted trial lawyer from Houston, Texas. In addition to an in·depth analysis of recen t decisions in substantive areas, there will be a overview of the new Arkansas Corpora. tion System and the 1987 Arkansas Code. The meeting will be held in the Ballroom of the Excelsior Hotel on January 22, 1988. Make plans now to attend!

• March II is the date to save for a CLE experi· ence like no other. Irv· ing Younger will present "Jury Selection" and "Discovery" in two halfday seminars at the Lit· tIe Rock Holiday Inn West. Irving Younger is

the most dynamic and entertaining CLE lectur· er in the country. His unique perspective as a former

prosecutor.

judge, law professor and active litigator coupled with his excep· tional talent as a speaker - insures that this program will be informative and valuable to your practice.

D

ARKANSAS BAR

ASSOCIATION HOUSE OF DELEGATES MEETING October 24, 1987 The Arkansas Bar Association's House of Delegates met on October 24, 1987, at the Fay· etteville Hilton. Presi· dent John F. Stroud, Jr.. presided.

Sandra Wilson Cher· ry, the Association's secretary-treasurer. cer-

tified Bryan J. Reis as the new delegate from District 23. He fills the term of Michael H. Crawford who was elected chair of the Young Lawyers' Section.

The House approved the minutes of its June 13, 1987, meeting as presented and an un· audited financial statement dated Sep· tember 30, 1987.

MEMBERSHIP REPORT Philip E. Dixon, chair of the Membership Committee, reported that the Association's member-

ship has increased by 78 members. The House approved the new memo bers and applications for reinstatements and January 1988/Arkansas Lawyer/43

retired status. Dixon urged each delegate to contact at least six delinquent members.

LEGISLATION Martha Miller, the Association's lobbyist, outlined the efforts of the Code of Ethics Commission to create a code of ethics and moved that the House adopt a legislative policy on ethics reform. The motion was seconded and passed.

Vincent W. Foster, Jr., chair of both the Executive Council and the Legislative Oversight Committee, addressed the provisions of a proposed bylaws change concerning the Legislation Committee and the Legislative Oversight Committee and moved for its adoption. The motion was seconded and passed.

JUDICIAL COMPENSATION

AMENDMENT President Stroud reported on behalf of Dennis L. Shackleford, chair of the Judicial Compensation and Disability Committee. Petitions are to be circulated in each Bar District to obtain signatures in order to place the Judicial Compensation Amendment on the November 1988 ballot as an initiated act. Copies of the petition are available at the Arkansas Bar Center.

expected by Thanksgiving.

Dr. Rae Jean McCall. executive director of the Arkansas Institute for Continuing Legal Education (AICLE), presented AICLE路s annual report for 1986-87.

Susanne Roberts, executive director of the Arkansas IOLTA Foundation, Inc., reported on the continuing growth of IOLTA and the recruitment of attorneys for participation in the program.

President Stroud reported on behalf of the Corporation System Editorial Board that the Arkansas Corporation System is expected by the Mid-Year Meeting in January. He also reported that the Debtor/ Creditor System is expected by April.

Robert L. Jones. III. chair of the Long-Range Planning Committee. reported that the LongRange Planning Conference will be held on April 22, 1988, at DeGray Lodge.

Samuel A. Perroni, reporting for the Resolutions Committee, moved for the passage of Resolution 87-2 calling for at least a 24month delay in the effective date of the Federal Sentencing Guidelines which are scheduled to go into effect on November I, 1987. The motion was seconded and passed.

John Gill. chair of the Bicentennial Committee, reviewed the many events

OTHER BUSINESS W. Russell Meeks, m. chair of the Mandatory CLE Committee, reported that the Arkansas Supreme Court has been repetitioned on mandatory CLE. A decision is

44/Arkansas Lawyer/january 1988

which were or-

ganized in Arkansas by the Committee to celebrate the Bicentennial of the U.S. Constitution. including the signing of a replica of the Constitution by Vice-President George Bush at the Pulaski County Courthouse. President Stroud

praised the work of Gill and his committee.

Executive Director William A. Martin reported on behalf of the Committee on Incorporation. He presented the following resolution: The Association. its officers, committees and staff, shall proceed with plans to incorporate the Association effective July I. 1988. The president is authorized to expand the committee studying incorporation to add expertise as he deems appropriate. The committee shall report to the House of Delegates at its January 1988 meeting so that the House can make a final determination whether to go forward with incorporation.

It was moved that the resolution be adopted.

The motion was passed.

President Stroud reported on behalf of Herschel H. Friday, chair of the Model Rules of Professional Conduct Committee, and presented a "Petition for Amendment of the Model Rules." Charles L. Carpenter, Jr., moved that the House approve the petition. The motion was seconded and passed.

Ralph M. Cloar, Jr., chair of the Group insurance Committee, moved that the Association continue to sponsor the CNA professional liability policy offered throug h Rather. Beyer and Harper. The motion was seconded and passed.

Martin presented the following resolution: The executive director and a committee to be appointed by the president are authorized to explore providing LEXIS

Group Membership Services to members of the Arkansas Bar Association. If the commi ttee and the executive director determine the terms of the proposed agreement are fair and reasonable and the offering of LEXIS is beneficial to Association members. the executive director is authorized to enter into a LEXIS Membership Group Agreement with Mead Data Central.

The resolution was seconded and passed.

HOUSE TO MEET JANUARY 23 President Stroud reported that the next meeting of the House will be January 23. 1988.

He requested approval of committees appointed since June I. 1987, including the Form Book Editorial Board. LongRange Planning Committee. Model Rules of Professional Conduct Committee and Statute Revision Committee. It

was moved and seconded that these committees be ratified. The motion passed.

President Stroud also announced that Judge William Webster, director of the Central intelligence Agency, will be the featured speaker at the annual meeting in June.

There being no other business. the meeting was adjourned.

0

Respectfully submitted, Sandra Wilson Cherry Secretary-Treasurer

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ARKANSAS CORPORATION SYSTEM

The 1988 ARKANSAS CORPORATION LAW SYSTEM is

A CONVENIENT NECESSITY

a convenient and affordable necessity for any lawyer in Arkansas who will need to form a corporation after January 1. 1988.

This System presents the practicing attomey with the forms and information needed to quickly and efficiently comply with the new law mandated by Act 959 of 1987.

BY: Mark W. Nichols H. Lawrence Yancey EDITORIAL BOARD: Gregory B. Graham, Chair H, Murray Claycomb Francis S. Fendler Johnnie R. Holcomb Tucker Raney Mathis Thomas L. Overbey John B. Peace Richard W. Williams

The System is at press and will be available no later than January 21. 1988. Take advantage of a special pre-publication discount of $25 by ordering in January 1988!

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Send order fonn and payment to Arkansas Bar Association 400 West Markham. Little Rock. AR 72201 (to order by telephone. call 375-4605 or 1·800·482·9406) __________________________________J

ARKANSAS BAR ASSOCIATION