Mandatory pre-dispute arbitration clauses in advisory contracts are all the rage… and I mean that both literally and figuratively. It has become both a popular dispute resolution mechanism between advisors and their clients, and at the same time has enraged critics the likes of which include a cadre of House […]
If you’re reading this article, my working assumption is that at some point in your life you’ve been employed by somebody other than yourself. Odds are you’re working for somebody else at this very moment, perhaps even plotting the day you jump ship and join a competitor or set out […]
A limited liability company is as easy to set up as it is to screw up. Though it is justifiably advisors’ favored business structure due to its simplicity, flexibility and liability protections, there are still a select few “corporate formalities” that should be observed. The primary such formality is what’s […]
Investment advisory contracts (and most contracts, in general) are typically long, laborious and full of legalese. Paid-by-the-word attorneys have to pay for their silk ties somehow, right? If drafted properly, however, such contracts can also be immensely helpful in clarifying roles and responsibilities between the advisor and the client, and […]
Advisor continuity and succession planning has been written about and talked about ad nauseam, but I would say justifiably so. It is a critical industry-wide issue that warrants industry-wide action. Yet each and every advisor’s individual situation is unique and requires individualized attention to the nitty-gritty details. One such detail […]
If an advisor is able to withstand narcoleptic impulses when reviewing its investment advisory contract, I suggest taking a moment to focus on the section that addresses the advisor’s limitations of liability. In regulatory-speak, this clause of the contract is known as a “hedge clause,” and is typically found near […]
The purchase, sale or merger of an advisory practice involves a whirlwind of tightly-coordinated efforts by a myriad of different parties. In the shuffle of negotiating the deal terms, settling on a valuation methodology, coordinating with custodians and integrating technological systems, when does the client get a say, if any? […]