What can a D.C. lawyer do with money sitting in a client trust account when the client cannot be located?
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This page answers the general question as of 2011. Ezel answers yours: whether it's allowed on your facts, under the current rules of professional conduct in your state, with citations.
Plain-English summary
Opinion 359 (published June 2011) responds to a recurring question the D.C. Bar's Legal Ethics Helpline receives: what may a lawyer do with client trust account monies when the client's whereabouts are unknown, often where the lawyer is retiring, the firm is closing, or the lawyer wants to close an outstanding trust account but cannot locate the client.
The opinion concludes the question sits at the intersection of Rule 1.15 and the D.C. Unclaimed Property Act. Under Rule 1.15(a) a lawyer must hold client (or third-party) property, including intangible property, separate from the lawyer's own funds in a trust account, exercising the care of a "professional fiduciary," and Rule 1.15(c) requires prompt notice to, and delivery of funds to, the client or third party entitled to them. The opinion observes that Rule 1.15 is silent on what a lawyer must or may do when the lawyer holds trust funds for a client who cannot be located.
The opinion then sets out its understanding of the D.C. Unclaimed Property Act (while noting the Committee does not opine on law outside the Rules). Under the Act, intangible personal property held in the ordinary course of business and unclaimed by the owner for more than three years after becoming payable is presumed abandoned, and the Act applies where the owner's last known address is in the District or the holder is domiciled in the District; holders of abandoned property must report it and transfer it to the Mayor. The opinion concludes that a lawyer holding funds for an unlocatable client whose last known address is in the District (or where the lawyer is domiciled in the District) must first exhaust reasonable efforts to locate the client, and thereafter it is not a violation of the D.C. Rules to report to the Mayor and transfer the funds deemed abandoned under the Act.
In practice
Under the D.C. rules as they stood at the time of the opinion, a lawyer who cannot locate a client but holds trust funds for that client must exhaust reasonable efforts to find the client, and may then report and transfer the funds as abandoned property if the D.C. Unclaimed Property Act applies. The opinion concludes Rule 1.15 does not itself resolve the missing-client problem, and that complying with the Act in these circumstances does not violate the Rules.
The opinion frames the abandonment analysis around the Act's three-year period and its application to property whose owner's last known address is in the District or where the holder is domiciled in the District. Because the opinion predates later rule developments and rests on a statute the Committee does not authoritatively interpret, verify the current D.C. rules and the current text of the Unclaimed Property Act before relying on specific requirements.
Common questions
Q: Can I just keep or move a missing client's trust funds to close the account?
A: The opinion concludes a lawyer must first make reasonable efforts to locate the client; only after exhausting those efforts may the lawyer treat the funds as abandoned and dispose of them under the D.C. Unclaimed Property Act, not simply retain them.
Q: When are trust funds considered abandoned?
A: The opinion explains that, under the D.C. Unclaimed Property Act, intangible personal property unclaimed by the owner for more than three years after it became payable is presumed abandoned, where the owner's last known address is in the District or the holder is domiciled there.
Q: Does transferring the funds to the District violate Rule 1.15?
A: The opinion concludes no. Rule 1.15 is silent on the missing-client situation, and once reasonable efforts to find the client are exhausted, reporting to the Mayor and transferring the abandoned funds as the Act requires is not a violation of the D.C. Rules.
Background and rules framework
The opinion interprets D.C. Rule 1.15 (safekeeping property): Rule 1.15(a) (separate trust account and fiduciary care), Rule 1.15(c) (prompt notice and delivery), and Rule 1.15(d) (disputed property), noting Rule 1.15(d) is not implicated here. It reads Rule 1.15 alongside the D.C. Unclaimed Property Act, which the opinion summarizes for context, and references Rules 1.6 and 1.14 in connection with the lawyer's obligations.
Citations and references
Rules of Professional Conduct:
- D.C. RPC 1.15(a), 1.15(c), 1.15(d) / Model Rule 1.15 (safekeeping client property)
- D.C. RPC 1.6 / Model Rule 1.6 (confidentiality); D.C. RPC 1.14 / Model Rule 1.14 (client with diminished capacity)
Statutes:
- D.C. Unclaimed Property Act (Disposition of Unclaimed Property Act), including the three-year abandonment presumption and reporting/transfer requirements
Other opinions cited:
- D.C. Bar Legal Ethics Op. 293 (Rule 1.15(d) "just claim" analysis)
See also
- NY State Bar Op. 1163: Duty With a Missing Client
- NY State Bar Op. 1182: Wills of Missing Testators
- ABA Formal Op. 92-369: Deceased Solo's Client Files
Source
- Landing page: https://www.dcbar.org/for-lawyers/legal-ethics/ethics-opinions-210-present/ethics-opinion-359
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