Maintaining Trust: Rules, Snares, and Worries in Trust Account Management

Every lawyer-client relationship begins (or should begin) with an engagement agreement that sets forth how and when the lawyer will be paid. This agreement will normally control the financial relationship between client and lawyer, and almost anything (except unconscionable or unreasonable fees) can be negotiated between the parties. As a general rule, however, the client's payment for work that has been performed is to be deposited into a lawyer's general account and payment for work that will be performed is to be deposited into a client's trust account. The engagement agreement should set forth in detail the circumstances under which funds may or must be transferred from the client's trust account to the lawyer's general account. When the lawyer is entitled to make the transfer, the lawyer must make the transfer or be guilty of commingling personal and client funds, which is prohibited by the rules of professional conduct.