In fact, a significant portion of ethical complaints against lawyers arise in three contexts related to law practice organization: client communication, handling of money, and conflicts of interest. Lawyers who do not have good systems in place to stay on top of their obligations in these areas can get into trouble, even when they are honest and have the best of intentions.
Communication. Failure to communicate with clients is one of the most common complaints lodged against lawyers. Lack of communication can mean simply that—being chronically unresponsive to clients. But complaints about communication can also be about the adequacy of communication. For instance, a dissatisfied client may complain that the lawyer did not discuss the implications of a proposed course of action or did not listen to the client’s concerns about or goals for the representation.
ABA Model Rule 1.4 imposes the duty to “promptly” inform the client about decisions and developments in the client’s case that require the client’s input and consent. The rule also requires the lawyer to “reasonably consult” with the client about the means for accomplishing the client’s objectives, keep the client reasonably informed about progress in the case, and promptly respond to a client’s request for information. Finally, the rule requires the lawyer to let the client know about “relevant limitations on the lawyer’s conduct” if the client expects the lawyer to do something not permitted under the ethical rules.
It’s probably impossible to communicate too much with clients. As you develop your law practice, lay down a solid foundation for good client communication habits in several ways. First, make sure your clients know when and how they can expect to hear from you. Explain whether you communicate best by phone, e-mail, or letter, keeping in mind that not all clients will necessarily want to communicate the same way you do and you may need to adjust. Be clear about how you will communicate updates about a case and during what part of the day clients can expect to reach you or hear back from you if they have initiated contact.
Second, set up a time management system that builds in time every day for you to respond to client phone calls and e-mails. Remember that it is your responsibility to respond “promptly,” which generally means within a day. If you are not able to respond within a reasonable time, you should arrange for support staff to respond instead. Under the rules, you may not delegate your duty to communicate with clients, but support staff can acknowledge phone calls and e-mails and let clients know when to expect a response from you.
Third, put everything in writing so it can be sent to the client and copied to the client’s file. Fee agreements, case strategy and associated risks, case developments, advice, agreement terms, and even lack of case developments over certain time periods should all be memorialized in writing. These written communications should ask the client to review the information to make sure it is both accurate and consistent with his goals and understanding of the case.
And, of course, follow through with regular communication. Send regular status letters to clients with pending cases. If you have contacted a client and need a response, but have not heard back, follow up with a phone call, e-mail, or letter, and document your own follow up.
Money. There are, of course, some dishonest lawyers out there who warrant disciplinary action because they actually misappropriate client funds. But often lawyers just make mistakes, don’t follow good processes, or don’t follow the rules about lawyer trust accounts and get into trouble as a result.
Under ABA Model Rule 1.15, lawyers are prohibited from “commingling” their own funds with client funds. So when you enter practice, you must set up interest-bearing trust accounts for client funds, and you may not deposit client funds in your own general-operating business accounts or personal accounts. The rule protects client funds from certain risks, such as attachment by the lawyer’s creditors and actual lawyer mishandling, protects lawyers from even the appearance of impropriety, and ensures that clients themselves cannot hide funds in trust accounts. While lawyers may keep enough of their own money in client trust accounts to cover bank fees, the allowable amount is truly nominal—a few hundred dollars at most.
Under this rule, any fees the client pays in advance to the lawyer must be deposited in a trust account and may only be withdrawn by the lawyer after they are earned. The lawyer must keep careful records of all trust accounts and must return all trust account funds to the client when the representation ends.
Further, to hold small amounts of client money for short periods of time, a lawyer must establish an IOLTA account (Interest on Lawyers Trust Accounts). IOLTA accounts pool funds from multiple clients when the individual amounts belonging to each client do not merit separate trust accounts. Most states have a mechanism in place for the creation of IOLTA accounts that allow the interest on these accounts to fund legal aid or legal education programs in the state.
Protect yourself against ethical complaints resulting from how you handle money in your practice. Implement careful recordkeeping and be scrupulous about depositing the right funds in the right accounts. Never write checks for personal or business expenses out of trust accounts, and never draw on fees deposited in these accounts until they are earned.
Conflicts of interest. Finally, as a practicing lawyer, you need to establish and maintain a reliable system for identifying conflicts of interest for yourself and your firm. Model Rule 1.7 prohibits a lawyer from representing a client if the representation would be “directly adverse to another client,” or if the representation would be limited by the lawyer’s responsibilities to another client, a former client, a third party, or the lawyer’s personal interests. Whether you are prohibited from representing a particular client because of a conflict of interest, and whether any of the exceptions to the rule apply, can be a complex substantive question. But the first step to protecting yourself from ethical problems in this area is to identify potential conflicts.
Checking for conflicts should become a routine part of your case management. An easy, straightforward process should be established, and all members of the firm should follow the process for every case. Most law office management software includes some sort of conflict checking application, but it is also easy to set up client databases with Word or Excel and search for conflicts with routine search functions.
Information about a new client and other potentially involved parties should be collected before an initial consultation with the client so potential conflicts can be identified before a representation agreement is entered. This information should then be checked against the firm’s database of current and former clients to determine whether any potential conflicts exist. Potential conflicts may involve the client, the other parties in the case, the other attorneys in the case, or the subject matter of the case.
It’s also good procedure to circulate a “conflicts” e-mail or memo to other members of your firm to make sure a new client does not raise a conflict implicating someone else in the firm. All information collected from the client database check and the conflicts memo should then be analyzed as a whole. More facts may be collected from the client during the initial consultation. A final determination can then be made about whether you and your firm can represent the client, or whether further investigation or action is required. Finally, of course, information about new clients should be promptly entered into your client database so that subsequent client conflicts can be identified in turn.
Keep in mind that not all complaints filed against lawyers about these issues result in disciplinary action. But dealing with ethical complaints takes time and energy, and complaints can stay in your file and tarnish your reputation. Once you’re out there practicing law, minimize the chance of ethical complaints against you by instituting good law practice management habits and sticking with them.
Client Trust Accounts
To learn more about client trust accounts, check your state’s attorney registration and disciplinary commission website. For instance, the Minnesota Office of Lawyers Professional Responsibility offers extensive information about trust accounts, including a Frequently Asked Questions page.