The Basics of Client Files: File Organization
Proper maintenance of client files is a critical administrative function within a law office. A client file containing work product, client history, and critical correspondence is a valuable item that must be effectively organized and maintained. Numerous malpractice claims have resulted from lost files or misplaced documents. These mistakes were, of course, largely preventable had an organized internal filing system existed. Malpractice prevention aside, organized files are cost effective and efficient, both for the firm and client.
Devising an effective records and file management system requires exploration of the following issues: initial physical file organization, centralized vs. decentralized filing, file documentation, periodic file inventories, file closing, and file retention and destruction.
There have been many changes in recent years regarding digital technology systems, and lawyers have more options than ever when choosing how to create and retain client files. Systems involving scanning paper and storing files electronically are now available at affordable rates. With the right tools and systems in place, a law firm of any size now has the option of saving client files digitally and reducing much of its paper.
Initial file organization sets the standard for effective file maintenance. Right or wrong, competence is associated with organization; and client perception is crucial to malpractice claim avoidance and client retention. If clients must routinely wait on the phone or in attorneys’ offices while attorneys and secretaries frantically search through files for documents located either in file cabinets or on computers, competence is questioned.
Every law practice, regardless of size, should establish a uniform file organization system, applicable to both litigation and nonlitigation files. From a risk management perspective, standardized files reduce the chance of lost or misplaced documents. From an operations standpoint, standardized files are very efficient and reduce the amount of time spent searching through other firm members’ files for documents, trying to figure out their method of organization.
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Guidelines for Implementing Uniform File Organization
The following rules for establishing and maintaining compliance with uniform, initial file organization procedures presuppose that the law practice has at least one support staff person who may assume responsibility for opening and setting up files. Practitioners who handle administrative tasks themselves will have to modify these rules to fit their particular routines. See the appendix for a good example of a File Opening Checklist.
As a part of opening files and client intake, the file should be documented to reflect appropriate contact information on clients. Intake of a new client matter should include questions about the client’s preferred mode of communication and whether or not telephone numbers, faxes, and email addresses are accessible by others, be it family members, or employees, or an employer at work. This will then allow the attorney and staff to determine the most appropriate methods of communication based on the nature of this information.
No file number should be assigned for billing purposes until the retainer agreement is signed and the conflicts check has been completed. This is the practice at most larger firms and is recommended in MLM’s Law Practice Management’s Avoiding Conflicts of Interest booklet.
File Organization Checklist
Centralization of File Opening and Organization Is Optimal
- Preferably, one person within a law practice should be responsible for entering new client/matter information into the time/billing system, assigning a new client and/or matter number, and physically organizing the files. Practically speaking, this centralization prevents duplicate client/matter number assignments and promotes uniform file organization.
- If file opening responsibilities must be decentralized among individual office units, then they obviously should be responsible for physically setting up and organizing the files.
Standardized Subfile Categories With Corresponding Color Codes
- Every law practice should identify, through analysis of practice areas, standard subfile categories. The following is a standard list of categories, although certain areas of law require more specialized subfiles:
- attorney notes and file memoranda,
- substantive pleadings,
- discovery pleadings,
- legal research,
- client documents,
- corporate documents and
- demonstrative/documentary evidence.
Color Code Subfiles
- In order to readily identify a subfile within a voluminous file, each subfile category should be assigned a different color and the subfiles tabbed accordingly. For example, “correspondence” files will display a blue-framed tab which displays all necessary file information. “Attorney notes and memoranda” will display a red-framed tab.
Every Subfile Displays Case/Matter Name and Attorney Initials
- In order to readily identify a subfile within a voluminous file, each subfile category should display case/matter name and attorney initials.
Client and Matter Designations
- Every client represented and every matter handled by a law practice must have designation, whether alphabetical, numerical, or alphanumerical, so that time billed can be attributed to the appropriate client/matter and that files can be located quickly and easily.
- Many law practices designate their clients and matter either alphabetically, by client last name and matter title, or numerically by sequential number. Although there is certainly nothing wrong with these designation methods, they reveal very little about the client or the matter. Law firms should consider adopting more elaborate designations that reveal the following:
- Client’s last name
- Length of time client has been with the firm
- Year matter opened
- Type of matter
EXAMPLE Designation Method
An example of this type of designation is a follows:
This means that client Pam Anders was the first client under AN in 1989, when the matter was opened. The matter is a personal injury case (code #3). A particularly effective application of this designation is with word processing. The file number may be used as the prefix on word processing document names. Consistent display of the above file number on outgoing correspondence makes it exceptionally quick and easy to identify the file to which a misplaced document belongs.
APPENDIX I: FILE OPENING CHECKLIST
Client/Matter Name: ______________________________
Client/Matter No.: ________________
File Opening Date: _______________________________
Billing Atty: _____________________
Statute of limitations:
File tickler date:
Complete/submit new client intake form
Prepare file folder(s)
Prepare engagement ltr/fee agreements
Enter all critical dates
Assign/enter new file number
Set up client in time and billing system
(ENTER DUE DATES IN TICKLER SYSTEM)
*Substantive tasks assigned are based on practice area, type of case, and facts of case.
Todd Scott is the vice president of Member Services for Minnesota Lawyers Mutual Insurance Company. He is a member of the Minnesota State Bar Association, where he serves as co-chair of the Practice Management & Marketing Section, and the Nebraska State Bar Association.
© Copyright 2009, American Bar Association.