Also known as: client trust accounts · trust account
Written by attorneys — see sources below.
A bank account maintained by a lawyer to hold funds belonging to clients or third persons separate from the lawyer's own property. A lawyer may deposit personal funds only in the limited amount necessary to cover bank service charges on the account.
Caleb Chang maintains a client trust account holding funds for Christian Coleman. The bank assesses monthly maintenance fees. Caleb deposits two hundred dollars of his own money after calculating the expected charges for the coming quarter and withdraws only the actual fees each month.
Craig Caldwell receives a ten-thousand-dollar advance fee from client Colin Chambers for upcoming litigation work. Craig deposits the full amount into his client trust account. He withdraws portions only after completing each stage of work and earning the corresponding fees.
No. The rule permits a lawyer to deposit personal funds only in an amount necessary to pay bank service charges. A fixed buffer far exceeding documented average monthly charges violates the narrow exception even if no client funds are lost.
Advance fees and expenses must be deposited into the client trust account and may be withdrawn only as the fees are earned or the expenses are incurred.
Failure to calculate the necessary amount or to adjust the deposit after observing actual charges means the lawyer cannot demonstrate compliance with the necessity requirement and risks a finding of improper commingling.