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Model Rules for Lawyers' Funds for Client Protection - Rule 3

Rule 3 Funding

  1. The Court shall provide for funding by the lawyers admitted and licensed to practice law in the jurisdiction in amounts adequate for the proper payment of claims and the costs of administering the Fund.

  2. A lawyer's failure to pay any fee assessed shall be a cause for suspension from practice until payment has been made.


Paragraph A suggests that the single most important factor in establishing and maintaining an effective client reimbursement program is ensuring adequate and continuous funding through a reliable source. The Court, pursuant to its power to regulate lawyers and the practice of law, has the power to impose a fee to support the regulatory system. In the exercise of its authority, the Court may assess lawyers an annual fee to finance systems that implement the Court’s regulatory authority.

Paragraph B is the enforcement mechanism for the failure to pay the assessment.  See Paragraph A of Rule 16 for restitution and subrogation enforcement standards.

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