All posts in Ethics Corner

Ethics Corner – When is Depositing Funds into Client Trust Account Required?

New California Rule of Professional Conduct 1.15 requires that “all funds ‘including advances for fees, costs and expenses,’” received by the lawyer from the client or on behalf of the client must be deposited into a client trust account IF the atty “owes a contractual, statutory, or other legal duty” to the client.

In English you say?  If it’s the client’s money it has to go into the client trust account with two exceptions set forth below.  It is the attorney’s money if he sends the client a bill and the client pays it.  If the attorney gets money for work TO BE DONE, it’s the client’s money and must be deposited into the client trust account  – see exceptions below.

Exception 1 – a flat fee.  BUT, the atty must -in writing – tell the client that he can require that the money be put into the trust account AND that the client is entitled to refund if the work isn’t done.  IF the the flat fee exceeds $1,000, the client must sign the “writing.”

Exception 2 – a “true retainer.”  Per Rule 1.5(d), “A true retainer is a fee that a client pays to a lawyer to ensure the lawyer’s availability to the client during a specified period or on a specified matter, but not to any extent as compensation for legal services performed or to be performed.”  Once paid, the money no longer belongs to the client and doesn’t need to be deposited into the trust account.

Nice Definition of Of Counsel

Haven’t you wondered what Of Counsel means?  The new Rules of Professional Conduct of the State Bar of California (effective November 10, 2018) tell us in Comment (2) to Rule 1.0.1 “Terminology.”  The definition is

The term “of counsel” implies that the lawyer so designated has a relationship with the law firm,* other than as a partner* or associate, or officer or shareholder, that is close, personal, continuous, and regular.

It’s a little strange that the definition is not in the definitions – only in the comments to the definitions.

By the way, the new rules are here.

Ethics and Getting Paid – Prof. Nancy Rapoport – July 21, 2018

Prof. Nancy Rapoport is our guest speaker along with Judge Erithe Smith for the cdcbaa Fifth Annual Jim King Bankruptcy Symposium.  Below is her top 15 most downloaded articles.  They can all be downloaded here.

(Rank)

 1.

Lord of the Flies (1963): Development of Rules Within an Adolescent Culture

SCREENING JUSTICE – THE CINEMA OF LAW: SIGNIFICANT FILMS OF LAW, ORDER AND SOCIAL JUSTICE, Rennard Strickland, Teree E. Foster & Taunya Lovell Banks, eds., William S. Hein & Co., 2006, UNLV William S. Boyd School of Law Legal Studies Research Paper No. 08-21
Number of pages: 23 Posted: 05 Dec 2006 Last Revised: 29 May 2008
Nancy B. Rapoport
University of Nevada, Las Vegas, William S. Boyd School of Law
Downloads707(31,176)
2.

Enron, Titanic, and the Perfect Storm

Fordham Law Review, Vol. 71, p. 1373, 2003
Number of pages: 23 Posted: 10 Feb 2004
Nancy B. Rapoport
University of Nevada, Las Vegas, William S. Boyd School of Law
Downloads600(38,868)

California State Bar Assn Looking for Public Comments to Ethics Rules Amendments

The California State Bar assn has sixty-eight proposed new and amended rules.  It is looking for comments from the “public,” presumably us.  The proposed Rules including the changes and amendments can be found here.  Its worth looking this over.

It’s worth remembering that there are also lots of rules in the California Business & Professions Code.  The relevant sections are below. Read more…