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Estate Planning Excellence: The American College of Trust and Estate Counsel

Mar 8, 2022 | Podcasts

“Estate Planning Excellence: The American College of Trust and Estate Counsel,” that’s the subject of ACTEC Trust and Estate Talk.

Transcript/Show Notes

This is Natalie Perry, ACTEC Fellow from Chicago, Illinois. Today, we’re talking with ACTEC Fellow John. A. Terrill, II, also known as Jack, from Philadelphia, Pennsylvania. Jack was President of ACTEC from 2019 to 2020. He is going to give us some background today on ACTEC, what makes the College different than other organizations, and its mission to improve the profession. Jack, maybe you can start by telling us, when did ACTEC begin?

John. A. Terrill II:  Sure. Well, thanks, Natalie, and I appreciate ACTEC inviting me to participate in this program. ACTEC has been a very important organization to me for the better part of 30 years. I’m proud of it, as I know you are, and I’m very pleased to communicate more broadly who we are and what we do. ACTEC, The American College of Trust and Estate Counsel, actually was founded in 1949 in California, and it was named at the time the Probate Attorneys Association. Kind of a funny name. And then a dozen or so years later, it became the American College of Probate Counsel, and then years after that, The American College of Trust and Estate Counsel.

It was founded by several dozen prominent trust and estates lawyers throughout the United States. In its early days, it met only in conjunction with the American Bar Association (ABA) and its Real Property, Probate, Trust and Estate Law Section. Meetings did not occur separately from the ABA, so all of the ACTEC Fellows were also members of the ABA and its sections. It was founded initially largely with the purpose of connecting trust and estates lawyers in other states and countries with each other.

So, it was almost a kind of a big discussion group among trust and estates lawyers around the country, largely to make sure that each of them knew lawyers in other cities and jurisdictions who might be able to help them with their practice. It evolved over that period of time so that, for example, in 1966, the membership of the college passed 1,000 members.

Until 1973, as I said, the meetings were held in conjunction with the ABA mid-year meetings, particularly the real property, probate and trust law section. But in 1973, ACTEC split off and began to have its own meetings and its own existence, separate and apart, although in many ways overlapping with the American Bar Association. In those 70 plus years, ACTEC has grown so that it now has about 2,400 members, known as Fellows of the College. The Fellows come from all 50 states and the District of Columbia, plus 65 foreign Fellows from 24 foreign countries, including Canada. We have International Fellows- the foreign Fellows are referred to as international Fellows- they are lawyers who practice trust and estates law with a significant cross-border practice, which is how they are connected to the College. We have about 100 Academic Fellows who are full-time professors in the trust and estates arena at American law schools. We also have a handful of judicial, honorary, and quite a few retired Fellows.

I’ll just continue for another minute, Natalie, that while we call ourselves American College of Trust and Estate Counsel, and that might imply somewhat of a narrow specialty, our Fellows are focused very broadly in estate planning and administration, guardianship and conservatorship, transfer tax planning, fiduciary income tax, elder law, employee benefit planning, charitable planning, fiduciary litigation in the trust and estates and tax arenas, and asset protection planning as it bears on all of those other things.

So, our lawyers are broadly experts in a variety of different things. Many are quite specialized, and, over that 70 years, we’ve evolved to having 2,400 or so Fellows who have those breadths of interest.

Natalie Perry:  Okay. Can you tell us also what makes ACTEC different from other professional organizations?

John. A. Terrill II:  I think the first and most important thing to say, Natalie, is that becoming a Fellow of ACTEC is not a matter of applying for or joining if you will. To become a member of the college, a Fellow of the college, one needs to be nominated, and you can only become nominated if you satisfy a significant number of very serious criteria, and the College takes very seriously all of those criteria.

For example, at the very least, a lawyer has to – it’s only lawyers, and a lawyer has to have been in practice for at least 10 years of full-time either private practice or within certain kinds of trust entities in a category that we call Fiduciary Counsel. In addition to actively practicing over those years, a nominee has to be active in bar and other professional activities- teaching, writing, speaking, law reform. In short, a nominee can’t just be a great lawyer with significant experience. The nominee really must be involved in the active improvement of, and teaching of, trust and estates law in their particular communities, and it’s a fairly high threshold. There are lots of folks who might be appropriate ACTEC Fellows, but they don’t have the time or interest in those other activities, but it’s a critical element of our nominees. Having reached those descriptions, having served at – acted as a lawyer for that number of years and having been involved in those other activities, and I don’t mean just one and done, but significant involvement, then a lawyer can be proposed for membership by another ACTEC Fellow, and that proposal is carefully reviewed, both by the Fellows in the candidate’s jurisdiction and by a membership selection committee of the College.

And frankly, with these criteria, it’s a fairly hard thing to do. It’s an honor to be elected to ACTEC, and I know you feel that way, Natalie, and I certainly feel that way as well. But given those criteria, it suggests to the public and to the lawyers we deal with and to our clients and judges and the government and others that they can count on an ACTEC Fellow to be excellent in their professional life.

Those activities are things that most ACTEC Fellows continue to do even after they become Fellows. People continue to teach and write and speak as long as they’re able to, and many of our Fellows do that. So, I think it’s different in the sense that you have to meet some strict criteria, you have to be elected, and you’re expected to have a breadth of professional experience and activities that the public has come to expect of ACTEC Fellows.

Natalie Perry:  Yeah, that’s very helpful. Tell us also, once you become a Fellow, a little bit about once you’re in ACTEC. For example, I know ACTEC makes comments to the government. Can you share some about that?

John. A. Terrill II:  There’s a real variety of ways that ACTEC Fellows – as the College and its Fellows participate in practice, and we can talk about a number of those. But with respect to that specific question, ACTEC has, going back almost to the beginning, been sought by government agencies at the federal, and state, and local level to comment on proposed legislation, proposed regulation, ways of implementing the law that pertains to trusts and estates, whether it be tax or be sort of traditional trust and estate legal issues. So, state law issues. And because of that, many of our Fellows are asked to participate in the work of Congress and the Treasury when considering legislation regulation, and this happens constantly, that the Treasury or the Congressional committees will ask us to comment on proposals.

Now, we have a very strict practice, in fact, I think it’s something that we do very well, which is we don’t take political or policy positions. What we do is focus on what is best for the regulatory and legislative environment. So, if someone – if Congress is proposing legislation in the trusts and estates area, mostly in the federal government on the tax agenda, they will come to us and say, “What do you think about this? How do you feel about this legislative proposal?” And our Fellows are appearing before Congressional hearings, before hearings of administrative agencies. We’re sending written comments constantly. This happens not just at the federal level, but for most states, they look to ACTEC at the state level to weigh in on proposed legislative changes at the state level as well.

We’re experts, and we’re happy to share that expertise with the government that’s creating laws and regulations, and at least the theory is that those laws and legislation and regulations will be better because we actually apply them. We actually know how they work in a real-world setting.

We have a committee in Washington called the Washington Affairs Committee that vets most of that work, and so we have sort of a common voice and a common theme, but it’s really about trying to make sure that the best kind of legislation and the best kind of regulation comes out. Natalie, could I mention one that I’ve been recently involved with and might be an example of this?

Natalie Perry:  Sure.

John. A. Terrill II:  So, in the last two months or so, the Financial Crimes Enforcement Network (FinCEN), which is a branch of the United States Treasury, issued proposed rules designed to implement what’s known as the Corporate Transparency Act. The Corporate Transparency Act was passed a year or so ago by Congress, and it’s an act that requires certain legal entities to disclose who are their owners and their managers, and it’s largely designed to combat money laundering and terrorist financing.

The Treasury wants to – the Congress wants to and has delegated to Treasury the obligation to find out who owns LLCs and partnerships and so forth. Well, these proposed regulations, these rules that FinCEN proposed, included a proposal to address the consequences of when a trust is an owner of a legal entity. It’s a fairly common thing we deal with, and they proposed some rules, which may or may not have made sense, and weren’t necessarily consistent with how we at ACTEC viewed what role trusts played in conjunction with these sorts of entities. So, a committee was formed of ACTEC Fellows over a period of three or four weeks, prepared, and submitted to Congress, with the approval of the leadership, the college, and Washington Affairs Committee, some very thoughtful comments about how FinCEN, how Treasury, should think about trusts as owners of legal entities.

We weren’t taking a position, a policy position, do or don’t consider whether trusts are relevant here. What we said was, “If you’re going to consider them, here’s how to think about it,” and that’s really what we do. We say, “If you want to do a thing, Congress, Treasury, state legislatures, state administrative agencies, let us tell you how this might work in practice.” It’s a little behind the scenes, but it’s something that I think is a very important role of ACTEC.

ACTEC’s Comments Regarding the Corporate Transparency Act

Natalie Perry:  Well, that’s very interesting. So, shifting also then, besides impacting the government or how legislation is made, can you tell us how ACTEC impacts the profession?

John. A. Terrill II:  You know, it’s- this question, and you of course alerted me that you’d be asking me this, and I’ve thought a lot about it. It really is a matter of individual opinion, and I have opinions based on the role I’ve played over 30-some years as a Fellow of ACTEC. I think there probably are about as many answers to that question as there are Fellows being asked.

I think for some of our 2,400 Fellows, what ACTEC provides is the best kind of professional education, making them better at what – them, the Fellows- being better at what they do, and that education is provided in a number of ways. CLE at our three national meetings, which occur every year, or the ten or a dozen regional meetings that occur every year, or that occur at the state and local meetings, which happened throughout the year all over the country, through studies that are provided for Fellows of state and other legislation, and other materials available to the Fellows.

So, there’s a category of Fellows who, when you ask, “How does ACTEC impact the profession?” they are made better because of the access to the really best kind of teaching and writing. Now, many of them also are the teachers and writers, but for a lot of them, they just are better lawyers, and better lawyers impact the profession because it’s better for our clients and all of the other lawyers, including the non-ACTEC Fellows. Some of our Fellows would say that the real role of ACTEC and the impact on the profession, has to do with the broader community. Almost all of us, and I know you do this, Natalie, and I do it, teach at law schools, at bar associations, at CLE programs regionally and nationally, and sometimes internationally.

So many of us were teachers before we became ACTEC Fellows that we inevitably continued teaching afterwards, and we have a broader audience, and it doesn’t – I don’t think it’s vain for me to say if you want an excellent, knowledgeable teacher on a technical topic, find an ACTEC Fellow. ACTEC sets our Fellows up to be able to educate other lawyers and the broader community about the things we do and the substantive things. There’s another behind the scenes thing that goes on with ACTEC which is a focus on law improvement, and that happens in a variety of different ways, mostly at the state level.

Although, to some extent, to the uniform laws commissioners and uniform laws programs. And that is that, as people want to improve the substantive law of trusts and estates, they either through uniform laws or to – making changes to the laws in their jurisdictions, ACTEC Fellows are always involved, either directly, in the case of the uniform laws commissioners, or because they’re invited to participate at the state and local level when it comes to: “Should we pass the Uniform Probate Code or the Unform Trust Code or these other Uniform Laws?” And that is something that’s important to the College.

There’s another thing that goes on, and the people at the college know this, I see this from time to time, is that when the press wants comments on a trust and estates issue, they will frequently call ACTEC, and they’ll ask the staff in our Washington office, “Can you get us somebody to comment on this particular issue?” So, we’re informing the public because we are being asked to describe, or to answer, some of these complicated questions.

We publish the ACTEC Law Journal. It’s a very important, I think, very important journal. It’s an academic journal, mostly written by Fellows, with the assistance of Hofstra University School of Law. We publish that journal with scholarly articles periodically through the year. We publish in conjunction with some of our committees, and with the ACTEC Foundation, the Commentaries on the Model Rules of Professional Conduct. The commentaries is a superb product that comes only from ACTEC, and it’s largely generated by our Fellows, our academic and practicing Fellows, to comment on how the model rules of professional conduct bear on our practice. I refer to it frequently. If I have a complicated ethical question, the commentaries, which are updated every three or four years, is a very valuable tool for that. So, we educate ourselves, we educate others, and we provide materials out into the broader community, and we think collectively, that’s how we impact the profession.

Natalie Perry:  Okay. You’ve touched on the speaking and writing aspect, both before you become an ACTEC Fellow, but tell us more about what’s involved in becoming an ACTEC Fellow.

John. A. Terrill II:  Well, I touched on some of these things a little bit, Natalie, before, but people become aware of ACTEC through their communities. They know other ACTEC Fellows. Lawyers, I should say, they know other ACTEC Fellows, or they see our materials that I’ve described, or they attend our CLE, and somebody is introduced as a Fellow of the American College. As people become aware, they express their interest in possibly being nominated to become Fellows of the College.

I mentioned that it’s a 10-year threshold of practice, either in private practice or within certain kinds of trust companies’ doing similar sorts of work within the trust companies, but they also – they will be told, and I tell this to young lawyers, and I’m sure you do, Natalie, as well, you need to get out there and do bar association things. You need to write. You need to speak. You need to participate in the activities that lead to becoming a Fellow, because – and it isn’t, as I said earlier, just one and done. You’ve got to do this repeatedly.

Most of our Fellows are sought, or our pre-Fellows, if you will, are sought to speak on certain topics, and they become expert in certain things, and they present them at estate planning councils or at bar associations, state and local bar associations. So creating all of that, if you will, resume fodder then leads to a nomination process which starts at the state level, is reviewed by the college, and is voted on by a committee of the College, and then is voted on by the leadership- the Regents- of the College, twice a year for new Fellows. It’s a hard thing to do, but it’s worth doing if that sort of thing matters to you.

Natalie Perry:  Sure. Well, I think we’re just about out of time, Jack, but I know we’re going to do some additional podcasts to expand more on what resources are available through ACTEC, and perhaps a little bit about the ACTEC Foundation. Maybe you just want to comment on that before we wrap up..

John. A. Terrill II:  Yeah, I will briefly. There is a foundation, The ACTEC Foundation. It’s a sister organization with its own board and leadership. It raises charitable contributions from ACTEC Fellows and others. It is the organization that supports the ACTEC Commentaries, it supports activities at various law schools in wills clinics and that sort of thing.

We have a writing contest for law students that’s very well attended, and I’ve been grading those papers for a long time, and it’s fascinating. The ACTEC Foundation does a lot of important support of the improvement of the profession and trusts and estates in general, and I’m proud that we’re associated with the Foundation.

Natalie Perry:  Well, thank you so much, Jack. It was really interesting to hear your perspective on ACTEC and the future of the profession, as well as ACTEC’s commitment to excellence. I appreciate your time.

John. A. Terrill II:  I was very happy to do it, Natalie. Thanks for taking the time with me.

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