When a lawyer practices in more than one state, whose trust-account rules apply to client funds?

Plain-English summary

The committee was of the opinion that the Rules of Professional Conduct do not address conflicts that arise when trust-account rules differ across states for a lawyer with a multistate practice. As a general matter, the committee was of the opinion that when a lawyer acquires funds belonging to clients as a result of practice under the lawyer's Washington license, the lawyer must comply with the Washington rule.

Applying that test, the committee answered two specific questions. Representing an Idaho resident selling property to another Idaho resident, even though the property itself is in Washington, would not arise under the Washington license, so the lawyer should comply with Idaho rules. Representing an Idaho resident in Washington courts is clearly pursuant to the Washington license, so the lawyer should comply with the Washington rules.

Currency note

This opinion was issued in 1986, before the 2006 revisions to the Washington Rules of Professional Conduct. RPC 1.14 on safekeeping client funds was later renumbered and amended. Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific rule, deadline, or requirement mentioned here.

Common questions

Q: Do the Rules of Professional Conduct resolve conflicts between two states' trust-account rules?

A: The committee was of the opinion that the Rules do not address that issue directly.

Q: As a general matter, which state's rule governs client funds?

A: The committee was of the opinion that when a lawyer acquires client funds as a result of practice under the lawyer's Washington license, the lawyer must comply with the Washington rule.

Q: If a Washington lawyer represents an Idaho resident selling Washington property to another Idaho resident, which rule applies?

A: The committee was of the opinion that this would not arise under the Washington license, so the lawyer should comply with Idaho rules.

Q: And if the lawyer represents an Idaho resident in Washington courts?

A: The committee was of the opinion that this is clearly pursuant to the Washington license, so the lawyer should comply with the Washington rules.

Background and rules framework

The opinion concerns Washington RPC 1.14 on safekeeping client funds, corresponding to Model Rule 1.15, in the setting of a multistate practice. The committee observed that the Rules do not resolve conflicts between states' trust-account rules and answered by reference to whether the funds were acquired through practice under the Washington license.

Citations and references

Rules of Professional Conduct:

• Washington RPC 1.14 (safekeeping client funds), corresponding to Model Rule 1.15.

See also

• WSBA Ethics Op. 901: a Washington sole practitioner's out-of-state affiliation
• WSBA Ethics Op. 1032: trust funds a lawyer receives acting as a fiduciary
• WSBA Ethics Op. 1029: distributing pooled trust funds when clients cannot be reached

Source

• Landing page: https://ao.wsba.org/print.aspx?ID=142

Original opinion text

Reproduced from the official source for research purposes. The linked source is authoritative.

Advisory Opinion: 1031
Year Issued: 1986
RPC(s): RPC 1.14
Subject: Multi-state practice; compliance with conflicting trust account rules

The Committee is of the opinion that the Rules of Professional Conduct do not address the issue of conflicts arising regarding trust account rules in more than one state for lawyers conducting multi-state practice. The Committee is generally of the opinion that when a lawyer acquires funds belonging to clients as a result of practice under the lawyer's Washington license, that the lawyer must comply with the Washington Rule. Therefore, in answer to your specific questions, the Committee is of the opinion that when you represent a client who resides in Idaho selling property to another resident of Idaho, even though the property itself is in Washington, that practice would not arise under your Washington license and therefore you should comply with Idaho rules. On the other hand, where you are representing an Idaho resident in Washington courts, that practice clearly is pursuant to your Washington license and therefore you should comply with the Washington rules.