“The most important thing lawyers do, in my opinion, is to
make sure that the parties are agreed.”
Often, Bark says, a business owner and buyer think they have
a deal worked out, but are looking at it two different ways, and
problems can arise when it comes to actually signing the paper-
work. “You have to make sure you’re agreeing to what you think
you’re agreeing to. Lawyers are good at that. That’s part of their
When a sale is made, lawyers are also needed to document the
purchase and to make it legally binding, he says. That includes
putting everything down on paper so if there’s an argument down
the road it can be resolved, something that’s paramount if the deal
An accountant, meanwhile, is also essential, especially if they’re
a skilled valuator, Bark says, because they have the background
and expertise to figure out the true worth of a business.
Kimberly Whaley, principal of Whaley Estate Litigation in Toronto, says investment advisors and estate
planners should also be part of the mix
when succession plans are being prepared or
carried out, particularly if it’s a family business, because they can provide solid financial advice to business owners.
For example, an investment advisor is invaluable in the event the owner of a family
business wants to use part of the proceeds
from a sale to set up a trust for a dependent
with a disability, she says.
The advisor would be able to crunch the
numbers from a pending sale and determine
what the value of a trust must be in order to
yield the rate of return that’s needed for the
dependent, she says.
Estate planners are also invaluable because they often have a long list of professional contacts they can call on to help out
if additional expertise is needed, she says.
So how do you pick the right professionals
to prepare and carry out a succession plan?
When bringing a lawyer or accountant
into the fold, Whaley says businesses should
first look to those who are already working
with them — provided they’re competent and have been doing a
It makes sense, she says, because they should already have a
good handle on the business.
“You wouldn’t want to be bringing somebody new into the equa-
tion. You’d want somebody who is already familiar with your port-
folio of assets.”
For lawyer Lillico, it’s important for barristers and accountants
to have experience either purchasing or selling a business, al-
though he concedes that should not be the only consideration.
“I don’t mean the only accountant you go to is the one who
specializes in purchases and sales, but you don’t want somebody
learning on your back kind of thing.
“The guy may also be well qualified but it’s also no good if it
takes two months to get through to him on the phone.”
To identify a good prospect, he suggests talking to other business
owners to find out who does succession planning work, then arranging a personal meeting.
At that meeting, the business owner should tell the professional
what they’re planning and ask the lawyer or accountant if they
can provide support and what it might cost, he says.
“You go in and talk to the lawyer and say: ‘I’m thinking about
doing this. Can you please relate to me your experience in do-
ing this?’ ”
At the end of the day, he says, the business owner should also
ask for references.
While lawyers can’t just disclose their clients, they can speak
to people they’ve dealt with in the past and ask for a reference,
Chartered accountant Bark, meanwhile, recommends that business owners do some digging on their own and look for professionals who can work as part of a succession planning team.
He suggests business owners ask around and get leads on professionals who can help them.
“Do your own research to find the best
fit, and that’s often a gut feeling to start,
but then you have to do your due diligence,” he says.
Once the list has been narrowed, Bark
suggests that business owners go out and
meet prospects, keeping in mind they have
to be team players.
A problem with many professionals, he
says, is that they’re good at what they do
but they’re also very narrow-minded and
don’t work well with others.
“You need a person who’s going to be
working for you — whether it be a lawyer, a
negotiator or accountant— who is a team
guy. You want someone who can look at
the big picture.”
Accountants are great at doing tax re-
turns and financial statements, Bark says,
but business owners who are transferring
ownership need someone who’s more than
a number cruncher.
When choosing professionals, Bark also
suggests that business owners look for good
communication skills, especially when picking a lawyer, because
they are often the key facilitator.
“A legal mindset is a tremendous tool,” he says. “But it’s no
good to be a tremendous lawyer if you can’t tell your client what
you’re doing and why.”
As for fees, business owners can expect to pay varying rates
when seeking the help of professionals, depending on the com-
plexity of their transaction and the size of the venture.
A big problem, according to Whaley, is that many business
owners try to cut corners when they draw up succession plans and
it leads to problems when the business is sold or transferred.
“People always like to do shortcuts and want to get their planning done for a cost which is minimal. But I think a well thought
out plan at the beginning, even if it costs you more money, costs
less down the road because if it’s properly implemented you won’t
end up in a litigious situation.” END
— Steven Bark,