Ezel / Ethics Opinions / OSB
OSB February 2010

What must an Oregon lawyer do with money held in trust for a client the lawyer can no longer locate?

Short answer: The opinion holds the lawyer must keep the funds safeguarded in trust, use reasonable diligence to find the client, and, once the funds are presumed abandoned under Oregon's unclaimed-property act, report and pay them over as that act requires while keeping records so the client can later claim them.

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This page answers the general question as of 2010. Ezel answers yours: whether it's allowed on your facts, under the current Oregon Rules of Professional Conduct, with citations.

Currency note: this opinion is from 2010
Subsequent statutory amendments, court decisions, or later opinions or rule amendments may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.
Disclaimer: Advisory only. Not binding precedent.
About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official ethics opinion. The original opinion (linked on this page as a PDF) is the authoritative source for any reliance.
View original ethics opinion (PDF)

Plain-English summary

A lawyer obtained a judgment for a client against a defendant who had no assets, so the judgment was not enforced. Years later the defendant delivered money to the lawyer to satisfy the judgment. The lawyer deposited the funds in the lawyer's trust account but, despite a diligent effort, could not contact the client. The opinion asks what the lawyer should do with the money held in trust.

The opinion holds the lawyer must promptly notify the client and hold the funds in trust under Oregon RPC 1.15-1, and, if the amount justifies it, place them in an interest-bearing trust account for the client's benefit under RPC 1.15-2. The lawyer must continue to hold the funds in trust until they can be delivered to the client or are deemed abandoned under the Uniform Disposition of Unclaimed Property Act (ORS 98.302 to 98.436).

Under ORS 98.332(1), funds held by a fiduciary are presumed abandoned unless, within two years after they become payable, the owner has taken one of the steps the statute lists (such as accepting payment, corresponding about the property, or otherwise indicating an interest). The opinion explains the act requires the lawyer to exercise reasonable diligence to locate the client and prevent a presumption of abandonment, a duty the opinion describes as also implicit in the RPC 1.15-1 duty to safeguard client property.

Once the funds are presumed abandoned, the opinion holds the lawyer must comply with the act: report to the Department of State Lands and pay the abandoned funds to the Oregon State Bar, where they fund legal services under ORS 9.572. After paying the funds over, the lawyer should keep taking reasonable steps to locate the client and must maintain records sufficient to let the client claim the property for the period the act allows.

In practice

The opinion holds that, under the Oregon rules and statutes as they stood at the time of the opinion, a lawyer who cannot locate a client entitled to trust funds does not simply keep or release the money. Per the opinion, the lawyer safeguards the funds in trust, searches diligently, and then follows the unclaimed-property act's reporting-and-remittance steps once abandonment is presumed, retaining records so the client can later recover the funds. Because the opinion rests on specific statutory provisions and trust-accounting rules, verify the current text of Oregon RPC 1.15-1, RPC 1.15-2, and ORS chapter 98 before relying on any specific deadline or procedure described here.

Common questions

Q: Can I just keep trust funds if I can never find the client?

A: No. The opinion holds the funds remain client property to be safeguarded, and once presumed abandoned they must be reported and paid over under Oregon's unclaimed-property act, not retained by the lawyer.

Q: How long before client trust funds are treated as abandoned?

A: The opinion applies ORS 98.332(1), under which funds held by a fiduciary are presumed abandoned if the owner takes none of the listed steps within two years after the funds become payable.

Q: Where do abandoned client trust funds go in Oregon?

A: Per the opinion, the lawyer reports to the Department of State Lands and pays the funds to the Oregon State Bar, where they fund legal services under ORS 9.572; the lawyer keeps records so the client can later make a claim.

Q: Do I have to keep looking for the client after paying the funds over?

A: Yes. The opinion states the lawyer should continue reasonable efforts to locate the client and must maintain records sufficient to permit a later claim for the period the act allows.

Background and rules framework

The opinion interprets Oregon RPC 1.15-1 and RPC 1.15-2 (safekeeping and trust-accounting of client property), corresponding to Model Rule 1.15, together with Oregon's Uniform Disposition of Unclaimed Property Act (ORS 98.302 to 98.436) and ORS 9.572 (Legal Services Program). The duty to safeguard client property under the rules works alongside the statutory abandonment and escheat scheme.

Citations and references

Rules of Professional Conduct:

  • Oregon RPC 1.15-1 / Model Rule 1.15 (safekeeping client property)
  • Oregon RPC 1.15-2 (trust-account and IOLTA requirements)

Statutes:

  • ORS 98.302 to 98.436 (Uniform Disposition of Unclaimed Property Act)
  • ORS 98.332(1) (fiduciary funds presumed abandoned)
  • ORS 9.572 (Legal Services Program)

See also

Source

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