RPC 1.15A - Safeguarding PropertyComments for RPC 1.15A must be received no later than October 19, 2013.
Submitted by the Board of Governors of the Washington State Bar Association
A. Purpose: The WSBA RPC Committee formed a subcommittee on trusts and accounts to address ethical concerns faced by lawyers who are increasingly using electronic banking services. Suggested amendments developed by that subcommittee and approved by the RPC Committee and the WSBA Board of Governors are enclosed for consideration.
Encouraging lawyers to read and comprehend RPC 1.15A has always been a challenge, and many lawyers are not conversant with bookkeeping and trust accounting methods in general. Over time, the rule has become increasingly detailed and complicated. The suggested changes are designed to clarify certain ambiguities within the trust account rule and streamline the Limited Practice Officer Rules of Professional Conduct (LPORPC) language to make it easier to understand.
Suggested Amendments to RPC 1.15A
The introductory LPORPC language added in 2009 applies to a very small number of transactions and does not apply to the vast majority of transactions about which a lawyer should be consulting RPC 1.15A. Additionally, the language uses the term “the Closing Firm” on three occasions. There is no definition of this phrase in the RPC 1.0 Terminology provisions.
The intent of the Suggested Amendment to RPC 1.15A is not to make any substantive changes, but to improve the readability of the rule by moving a discussion of the LPORPC from the introductory paragraph to a new subsection RPC 1.15A(j). The Suggested Amendment would remove unnecessary language and bulk while keeping the essential language regarding the LPORPC. Suggested revisions to the Comments are recommended to conform with the Suggested Amendment.
The Suggested Amendment to RPC 1.15A(h)(5) would eliminate the phrase “bank transfer” and substitute the more common language of “electronic transfer.” With increasing use of technology in banking transactions, more and more courts are requiring filing fees to be paid electronically. The rules presently do not define “bank transfer,” and attorneys must determine whether “bank transfer” includes electronic funds transfers. With ever increasing transactions occurring by way of electronic funds transfer, this revision would encourage interpretation of RPC 1.15A in a manner that is consistent with electronic banking vernacular.
Suggested Amendment to RPC 1.15B(a)(8)
RPC 1.15B provides for records to be maintained for 7 years. RPC 1.15B(a)(8) provides that the client ledger reconciliations must be maintained, but does not mention bank reconciliations. While this language might imply that bank reconciliations are a component to client ledger reconciliations, the language is incomplete and ambiguous. The Suggested Amendment to RPC 1.15B(a)(8) would clarify that bank and client ledger reconciliations must be kept for at least seven years after the events they record.
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