Proposed Rules Archives

ELC 15 REGS - Regulations 101 – 106

    Suggested Amendments to
    Rules for Enforcement of Lawyer Conduct (ELC)
    with conforming amendments repealing
    Audit Regulations 101 – 106

A. Proponent

    Washington State Bar Association
    1325 4th Avenue, Suite 600
    Seattle, WA 98101-2539

B. Spokesperson

    Douglas J. Ende
    Chief Disciplinary Counsel
    Washington State Bar Association
    1325 4th Avenue, Suite 600
    Seattle, WA 98101-2539

C. Purpose

    These amendments are suggested to revise, update, and clarify various procedures of the Random Examination Program as set forth in Title 15 of the Rules for Enforcement of Lawyer Conduct (ELC) and related ELC. It is also suggested that existing Regulations 101 – 106 be repealed because the matters formerly addressed by regulation will now be governed exclusively by the ELC. The most significant changes and clarifications suggested herein include the following:

  • The suggested amendments to the ELC anticipate the repeal of existing Audit Regulations 101-106. The matters addressed by the regulations will be governed directly in the amended ELC. Regulations 101 – 105 were adopted prior to 1990, and Regulation 106 (pertaining to the content of the trust account information form) was added in 1990 under the former Rules for Lawyer Discipline. Other than Regulation 106, which was amended once in 2009, these regulations have not been amended to account for the advent of the ELC in 2002 (and extensive ELC amendments in 2014), amendments to RPC 1.15A & B in 2006, 2007, 2008, 2009, 2011, and 2013, and changes to staffing structures and internal procedures at the Office of Disciplinary Counsel and the Washington State Bar Association. Furthermore, the regulations have never been published alongside other Washington State Court Rules on the Washington Courts website or in widely used private publications such as the Thomson-Reuters Washington Court Rules—State. Washington lawyers will benefit from all rules relating to lawyer trust accounts being accessible in one place. With respect to Regulation 106, its repeal is not intended to affect the Washington State Bar Association’s authority under ELC 15.5(a) to require disclosure of the information specified in the existing regulation.

  • The suggested amendments clarify that a random examination of a lawyer’s trust account is a process distinct from a disciplinary investigation. References to trust account examinations that are conducted as part of a disciplinary investigation of a grievance under ELC 5.3 (sometimes known as a “for-cause audit”) are removed from Title 15 in order to eliminate any confusion between the two types of trust account examinations. A clear procedural line is drawn between an investigative examination and a random examination, with action by a Review Committee of the Disciplinary Board being required before a random examination becomes a disciplinary investigation.

  • The responsibility for making a determination following a random examination as to whether a re-examination should be conducted, or whether a disciplinary investigation should be opened, or whether the matter should be dismissed, is transferred from the Disciplinary Board Chair to a Review Committee of the Disciplinary Board. Individualized review and decision-making on routine reports and recommendations of disciplinary counsel is not a typical duty of the Disciplinary Board Chair. By contrast, Review Committees are experienced in reviewing reports and determining whether a recommended action is appropriate. Review of random examination reports and recommendations within the Disciplinary Board’s review-committee system will capitalize on existing system efficiencies and enhance the consistency of decision-making.

  • The rules are clarified as to what can be required of a lawyer whose trust account is selected for examination, and a procedures is spelled out to address situations in which lawyers do not comply with the duty to cooperate with a random examination.

  • The interval following a random examination, before which another random examination may be conducted, is extended from two years (as specified by Regulation 105(a)) to seven years. The seven-year minimum interval, based on the RPC 1.15B(a) requirement that trust account records be retained for at least seven years, will avoid random recurrence of a trust account examination within a relatively short time-frame.

  • Random selection will be required by rule, rather than subject to indeterminate methodologies to be established by the Disciplinary Board and the WSBA Board of Governors. Additionally, a mechanism is provided to authorize a Review Committee to consider a challenge to the selection of a lawyer or law firm for random examination.

  • The retention interval for random examination records is changed from 60 days (the period now specified in the regulations) to three years, which is the same period for dismissed disciplinary grievance materials.

    Following are summaries and explanations of each suggested change:

  • ELC 15.1 clarifies that the authorization to conduct random examinations of the trust accounts of lawyers and law firms rests with the Office of Disciplinary Counsel (ODC) rather than ubiquitously with “the Association.” All references to trust account examinations conducted as part of a disciplinary investigation are removed. The rule authorizes both initial random examinations and re-examinations and provides specified options at the conclusion of an examination or re-examination as to further action, if any, that may be ordered. The authority of Review Committees to take action based on reports from ODC is set forth, and the rule clarifies that action by a Review Committee is not reviewable.

  • ELC 15.2 removes references to a lawyer’s duty to cooperate with a disciplinary investigation of the trust account, as that is adequately addressed in ELC Title 5 governing grievance investigations and disposition. The rule clarifies that the duty to cooperate with a random examination extends to both individual lawyers and to law firms and to any lawyer employed by or a member of the law firm. The amendments are not intended to alter the existing scope of an examiner’s access to records or the duties of the lawyer or law firm to cooperate with an examination. A new provision is added to address situations where a lawyer does not comply with the duty to cooperate with a random examination. The new provision is modeled on ELC 5.3(h), which applies when a lawyer does not cooperate with a disciplinary investigation.

  • ELC 15.3 is amended to broadly encompass all issues of confidentiality of random-examination information. New provisions for maintaining client confidentiality are added to the rule, modeled on the disciplinary-investigation provisions of ELC 5.4(b)(2) (as amended in 2014). Similarly, the provisions regarding disclosure are expanded and clarified, modeled on ELC 5.4(b)(3) (as amended in 2014). The net effect of these changes is to assure the same high degree of protection for client confidentiality as is provided in disciplinary investigations.

  • ELC 15.4(d) is changed to reference the “Office of Disciplinary Counsel” rather than the “Office of Disciplinary Counsel of the Association,” to conform to the usage throughout the ELC.

  • ELC 15.6 authorizing the promulgation of regulations regarding Title 15 is repealed and the rule number is reserved in order to maintain unchanged the numbering of ELC 15.7 (pertaining to IOLTA and the Legal Foundation of Washington). By this change, the existing regulations approved March 29, 1990 [Order No. 25700-A-499] as revised on July 8, 2009 [Order No. 25700-A-923] will be superseded. A copy of affected Regulations 101-106 is also included as an appendix to these materials.

  • ELC 3.6 is amended to add a new subsection regarding the destruction of random examination files. Other amendments address the existence of (and distinction between) disciplinary grievance records and random examination records.

  • ELC 7.2(a)(3) on interim suspensions is conformed to reflect amendments to ELC 15.2(b)(1) authorizing the interim suspension of a lawyer who fails to cooperate with a random examination.

D. Hearing

    The proponent does not request a public hearing.

E. Expedited Consideration

    The proponent requests expedited consideration so that the amendments can be adopted and made effective as soon as practicable. The existing audit regulations governing random examinations are obsolete or obsolescent in light of post-1990 amendments to the ELC and the RPC and changes to staffing structures and internal procedures at the Office of Disciplinary Counsel and the Washington State Bar Association. Accordingly, prompt amendment of the ELC will facilitate the ability of the Office of Disciplinary Counsel to conduct credible and effective random examinations at the earliest opportunity, as well as provide appropriate safeguards and procedural clarity for lawyer-examinees.

F. Appendix

    The appendix consists of existing Audit Regulations 101-106 with the notation [SUPERSEDED], reflecting the suggested repeal of those regulations. Also appended this Cover Sheet is a Disciplinary Board order dated March 9, 2015, recommending presentation of these amendments, together with the repeal of Regulations 101-106, to the WSBA Board of Governors and the Supreme Court.

  

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