Here’s an example of the sort of basic mistakes lawyers make that can get them into ethics trouble. Note that the common thread is that client money was entrusted to the lawyer, either from a settlement with an opponent or a deposit from the client (or his father, here).
Some lawyers have trouble managing their practice, including the money they handle. Others need the money — either because work is light or because they have a problem, like gambling, that makes the money disappear.
Having that money in the lawyer’s hands invites a couple of problems, illustrated here. First, the lawyer may invent or exaggerate fees or expenses that are due, then subtract them from the money on hand — with or without the client’s knowledge, let alone whether the amount has been earned or is reasonable. Second, the lawyer may use his or her control of your money to get leverage over you, e.g., to approve or not object to fees, sign off on terms you don’t agree with, and on and on.
There is very rarely any real reason for a lawyer to hang onto your money for very long. The settlement money may need to be parked until signatures are signed and documents are filed — like a couple of business days in most situations. If your lawyer’s holding onto money longer than that, there may be trouble.
In the second situation, the money is small but the lawyer apparently took the whole amount and didn’t take care of any of the tasks he was paid for. Giving your lawyer money to hold is generally a bad idea. Lawyers may want some money up front to cover costs and protect against clients who change their mind or don’t pay — but this system also gives the lawyer money for doing nothing in the hope the lawyer will get around to doing it.
While I’m not a big fan of bar organizations that don’t enforce ethics rules for unreasonable fees, to be fair, the bars are more aggressive when it comes to situations like these.
The Supreme Court of Ohio has indefinitely suspended the law license of Euclid attorney [that's a pretty serious sanction] … for misuse of client funds and other professional misconduct involving two client matters….
[The lawyer] violated multiple provisions of the Rules of Professional Conduct when he deposited a $50,000 settlement check he had received on behalf of an incarcerated client into his personal bank account rather than a client trust account. He also deducted more than $29,000 in legal fees from the proceeds of the check and failed to forward the remainder of the proceeds to the client despite his repeated requests to receive the money.
In a second case, a client [sought] an order sealing the client’s criminal record. The client’s father gave him $2,025, from which [the lawyer] was to deduct his legal fee and use the remainder to settle an outstanding restitution order and satisfy unpaid court costs in the client’s case.
However, [the lawyer] never filed a motion to seal the client’s record, did not settle the restitution order or pay the outstanding court costs and did not respond either to the client’s repeated attempts to contact him or to attempts by the father to obtain a refund of the money …
The message to clients is to keep track of your lawyer. If there’s money involved, keep the lawyer on a short leash and nag the lawyer if things aren’t getting done, calls or emails aren’t answered, papers that are supposed to be filed in court don’t show up in the court file (you can check with the clerk on this), or your money’s missing in action.
If the lawyer makes deductions or money disappears, make a written request for the lawyer to “account” for all the money — what came in, what you paid, what was deducted. If you disagree with the charges or just feel they’re unfair or unreal, object in writing. The lawyer should then hold the disputed amount — not the whole amount, just the amount in dispute — while the bar or court sorts this out.
Put your attempts in writing or by email and, if things drag out, consider going to the bar or, if it seems like a crime may have occurred, straight to the police.
Local Story: Euclid attorney suspended indefinitely
