CODE Of PROfESSIONAL RESPONSIBILITY COMMINGLING FUNDS Many complaints involving the manner in which lawyers have handled funds for their clients are caused by poor law office management rather than by misappropriation or misuse of clients' funds, Often, the lawyer knows that the funds or property of the client have been properly preserved, but, due to poor office management, he is unable to demonstrate this fact or make prompt disposition of funds or property. Further, regardless of good intentions, if in fact the client's funds or other property have been commingled with those of the lawyer, there would be a violation of the Code of Professional Responsibility. The handling of funds by a lawyer is governed by Disciplinary rule 9-102(A) as follows: "All funds of clients paid to a lawyer or law firm, other than advances for costs and expenses, shall be depo-
sited in one or more identifiable bank accounts... and no funds belonging to the lawyer or law firm shall be deposited therein except as follows: (1) Funds reasonably sufficient to pay bank charges may be deposited therein ... [and] (2) Funds belonging in part to a client and in part presently or potentially to the lawyer or law firm must be deposited therein, but the portion belonging to the lawyer or law firm may be withdrawn when due unless the right of the lawyer or law firm to receive it is disputed by the client, in which event the disputed portion shall not be withdrawn until the dispute is finally resolved." Every lawyer and law firm should establish office management procedures designed to insure clear accountability for all funds and other property of each client.
Refusing To Be Discharged By A Client A related complaint is that the lawyer, who has been informed of his client's desire to retain other counsel, refuses to withdraw from the representation when requested to do so by the client. This refusal is often predicated on the erroneous assumption that it is justified by an existing lawyer's lien for his fee. There is no authority for such a position under the Code of Professional Responsibility. Disciplinary Rule 2-11 O(S) states: "A lawyer representing a client before a tribunal, ... and a lawyer representing a client in other matters shall withdraw from employment, if:... (4) He is discharged by his client." Withdrawal from representation is mandatory upon discharge by a client.
Disciplinary Rule 2-11 0(A)(2) further sets forth the duties of a lawyer upon withdrawal from employment, and Disciplinary Rule 2-11 0(A)(3) provides: "A lawyer who withdraws from employment shall refund promptly any part of a fee paid in advance that has not been earned." A lawyer can avoid this type of complaint by promptly taking the necessary steps to withdraw from employment as soon as a client has indicated to him that his services are no longer desired. If the lawyer wishes to assert a statutory or common law lien or recover any unpaid portion of his fee, he must rely on the civil procedures available for assertion of such rights.
f-...
July 1980/Arkansas Lawyer/163