Practice News

If you do any estate-planning work and have at least one client of means – a small-business owner, say, or a farmer or other landowner – you’ll want to familiarize yourself with Senate Bill 2115, Illinois’ spanking new QTIP legislation. “[The Illinois QTIP law] allows married couples with estates of more than $2 million to set up a QTIP trust (“qualified terminable-interest property trust”) to use marital tax deductions to defer estate taxes until both spouses are deceased,” writes ISBA Director of Legislative Affairs Jim Covington in the upcoming (August) issue of the Illinois Bar Journal. The law, which will take effect as soon as the governor signs it, started life as HB 255 only to end up as a senate bill. It’s a response to the "decoupling" of the federal and Illinois inheritance tax. The federal and Illinois tax used to kick in at the same dollar amount, but last January the federal exclusion went up to $3.5 million while the Illinois tax continues to apply to estates of $2 million or more.

In part because of the steadfast efforts of Sen. Richard J. Durbin, $10 million was included in the Senate CJS Appropriations bill for the John R. Justice Prosecutor and Defender Incentive Act. This loan forgiveness program requires balance in awards between prosecutors and public defenders and equitable distribution across the states. This is less than the full $25 million authorized, but it's unusual for a new program to get full funding. It now goes to a joint House-Senate conference committee for final markup.

Last week the Supreme Court of Illinois issued new Illinois Rules of Professional Conduct to take effect Jan. 1, 2010. New Rule 3.9 has created quite a buzz among the lawyer-lobbyists as to what it means. It may have broader applicability than those of us who lobby in Springfield to include appearances before other governmental bodies. The Rule states that “A lawyer representing a client before a legislative body or administrative agency in a nonadjudicative proceeding shall disclose that the appearance is in a representative capacity and shall conform to the provisions of Rules 3.3(a) through (c), 3.4(a) through (c), and 3.5.” The incorporation of Rule 3.5 creates the buzz. Rule 3.5 prohibits ex parte communication with an official during the proceeding. Can this be construed to prohibit all lobbying by a lawyer-lobbyist unless it is part of a scheduled public hearing? In other words, is all I can do to lobby is testify in committee? No position papers to elected members of the General Assembly? No one-on-one individual lobbying? I can’t imagine that was the intent. Rule 3.5’s title is “Impartiality and Decorum of the Tribunal.” Key word is “tribunal.” It is defined in Rule 1.0(m) as follows: “Tribunal” denotes a court, an arbitrator in a binding arbitration proceeding or a legislative body, administrative agency or other body acting in an adjudicative capacity.

A press release from the Illinois Supreme Court highlights some of the most important changes wrought by the new Illinois Rules of Professional Conduct. For example, the new rules "clarif[y] the earlier law and eliminate certain restrictions on the reasons for sale" of a law practice, "prohibit a lawyer from having sexual relations with a client unless a prior sexual relationship existed," and "[f]or the first time ... explicitly govern electronic [lawyer advertising] communications such as e-mail and websites." Here are the full highlights from the Illinois Supreme Court: 1. New Rules The Supreme Court of Illinois has adopted a number of ethics rules that have not appeared in any previously enacted conduct code. The new rules include, but are not limited to, the following:

• a) New Rule 1.18. Describes important duties that lawyers owe to a prospective client arising from preliminary discussions before the creation of a formal lawyer-client relationship;
• b) New Rule 2.4. Defines the duties of a lawyer who serves as a third-party neutral, such as a mediator or arbitrator;
• c) New Rule 3.9. Articulates the duties of an advocate in a nonadjudicative proceeding, such as before a legislative body or an administrative agency;
• d) New Rule 4.4(b). Addresses how a lawyer should respond when the lawyer receives a document that was inadvertently submitted to the lawyer;

2. Comments to the New Rules The new ethics rules contain comments that attempt to explain the rules, refer to court decisions relating to the rules and assist the lawyer in complying with the rules. The rules are authoritative; the comments serve as a guide.