Rules of Professional Conduct
1. Client-Lawyer Relationship
ER 1.15. Safekeeping Property
(a) A lawyer shall hold property of clients or third persons that is in a lawyer's possession in connection with a representation separate from the lawyer's own property. Funds shall be kept in a separate account maintained in the state where the lawyer's office is situated, or elsewhere with the consent of the client or third person. Other property shall be identified as such and appropriately safeguarded. Complete records of such account funds and other property shall be kept by the lawyer and shall be preserved for a period of five years after termination of the representation.
(b) A lawyer may deposit the lawyer's own funds in a client trust account only for the following purposes and only in an amount reasonably estimated to be necessary to fulfill the stated purposes:
(1) to pay service or other charges or fees imposed by the financial institution that are related to operation of the trust account, or
(2) to pay any fees or charges related to credit card transactions or to offset debits for credit card chargebacks.
(c) A lawyer shall deposit into a client trust account legal fees and expenses that have been paid in advance, to be withdrawn by the lawyer only as fees are earned or expenses incurred.
(d) Upon receiving funds or other property in which a client or third person has an interest, a lawyer shall promptly notify the client or third person. Except as stated in this Rule or otherwise permitted by law or by agreement between the client and the third person, a lawyer shall promptly deliver to the client or third person any funds or other property that the client or third person is entitled to receive and, upon request by the client or third person, shall promptly render a full accounting regarding such property.
(e) When in the course of representation a lawyer possesses property in which two or more persons (one of whom may be the lawyer) claim interests, the property shall be kept separate by the lawyer until the dispute is resolved. The lawyer shall promptly distribute all portions of the property as to which the interests are not in dispute.
Amended June 9, 2003, effective Dec. 1, 2003, June 8, 2004, effective Dec. 1, 2004. Amended on emergency basis effective Jan. 1, 2009.
COMMENT [2003 AMENDMENT]
 A lawyer should hold property of others with the care required of a professional fiduciary. Securities should be kept in a safe deposit box, except when some other form of safekeeping is warranted by special circumstances. All property which is the property of clients or third persons, including prospective clients, must be kept separate from the lawyer's business and personal property and, if monies, in one or more trust accounts. Separate trust accounts may be warranted when administering estate monies or acting in similar fiduciary capacities. A lawyer should maintain on a current basis books and records in accordance with generally accepted accounting practice and comply with any recordkeeping rules established by law or court order. See Supreme Court Rules 43(i) and 44.
 While normally it is impermissible to commingle the lawyer's own funds with client funds, paragraph (b) provides that it is permissible when necessary to pay bank service charges on that account. Accurate records must be kept regarding which part of the funds are the lawyer's.
 Lawyers often receive funds from which the lawyer's fee will be paid. The lawyer is not required to remit to the client funds that the lawyer reasonably believes represent fees owed. However, a lawyer may not hold funds to coerce a client into accepting the lawyer's contention. The disputed portion of the funds must be kept in a trust account and the lawyer should suggest means for prompt resolution of the dispute, such as arbitration. The undisputed portion of the funds shall be promptly distributed.
 [Effective December 1, 2004] The Rule also recognizes that third parties may have just claims against specific funds or other property in a lawyer's custody, such as a client's creditor who has a lien on funds recovered in a personal injury action. A lawyer may have a duty under applicable law to protect such third-party claims against wrongful interference by the client. In such cases, when the third-party claim has become a matured legal or equitable claim, the lawyer must refuse to surrender the property to the client until the claims are resolved. A lawyer should not unilaterally assume to arbitrate a dispute between the client and the third party, but, when there are substantial grounds for dispute as to the person entitled to the funds, the lawyer may file an action to have a court resolve the dispute.
 The obligations of a lawyer under this Rule are independent of those arising from activity other than rendering legal services. For example, a lawyer who serves only as an escrow agent is governed by the applicable law relating to fiduciaries even though the lawyer does not render legal services in the transaction and is not governed by this Rule.
 A lawyer's fund for client protection provides a means through the collective efforts of the bar to reimburse persons who have lost money or property as a result of dishonest conduct of a lawyer. Where such a fund has been established, a lawyer must participate where it is mandatory, and, even when it is voluntary, the lawyer should participate. Every lawyer has a professional obligation to participate in the collective efforts of the bar to reimburse clients and escrow beneficiaries who have lost money or property as the result of dishonest conduct in the practice of law. A lawyer's financial contribution to a lawyers' fund for client protection is an acceptable method of fulfilling this obligation.
 For further obligations regarding client property and trust accounts, see Supreme Court Rule 43 ("Trust Account Verification") and Rule 44 ("Trust Accounts, Interest Thereon").
COMMENT [2009 AMENDMENT]
For purposes of this rule, "merchant fees" and "credit card transaction fees" are fees that are deducted from the amount of the credit card charge to pay the company that issued the client's credit card, the lawyer or law firm's credit card processing service, and the credit card association (e.g., Visa, MasterCard). Those fees typically include a percentage of the total amount billed plus a fixed fee, which, unless paid by the lawyer or law firm, reduces the amount that can be credited to the client's account. A "chargeback" (or reversal of charges) occurs when a client or former client writes to the credit card company that issued the credit card used to pay a lawyer to dispute the amount that should be paid to the lawyer or law firm. When a client or former client does so, the lawyer's or law firm's account is debited an amount equal to the disputed amount, plus a chargeback fee.
Three methods of accepting credit card payments are permitted: (a) the lawyer or law firm may accept credit card payments for earned fees and the reimbursement of costs or expenses, in which case the funds must be deposited into the lawyer's or law firm's operating or business account (see infra. for only exception), (b) the lawyer or law firm may accept credit card payments for advance fees, costs or expenses, in which case the funds must be deposited into the lawyer or law firm's trust account, or (c) the lawyer or law firm may use a credit card processing service that permits the lawyer or law firm to identify the account into which funds from each credit card transaction should be deposited (i.e., the lawyer or law firm must direct the deposit of funds for advance fees, costs or expenses into the trust account and the deposit of funds for account and the deposit of funds for earned fees and the reimbursement of costs or expenses into an operating or business account). Nothing in this rule prohibits lawyers from using one credit card account for the payment of earned fees and reimbursement of costs or expenses (with deposits made into an operating or business account) and another credit card account for the payment of advance fees, costs or expenses (with deposits made into the trust account).
Earned fees and funds for reimbursement of costs or expenses may be deposited into a lawyer's or law firm's trust account only if they are part of a single credit card transaction that also includes the payment of advance fees, costs or expenses. In such case, the earned fees and funds for reimbursement of costs or expenses must promptly be withdrawn from the trust account. When a lawyer or law firm uses a credit card processing service that permits the lawyer or law firm to identify the account into which funds from each credit card transaction will be deposited, earned fees and funds for reimbursement of costs or expenses may never be deposited into the trust account (a separate credit card transaction should be conducted for the payment of any earned fees or the reimbursement of costs or expenses). To further protect client and third-party funds, lawyers and law firms should strive to use a credit card processing service that deposits advance fees, costs and expenses into the trust account but which debits the operating or business account for all fees and charges related to credit card transactions (e.g., merchant or credit card transaction fees, chargebacks and fees associated therewith, other charges or fees related to credit card transactions).
Lawyers are responsible for knowing whether the company issuing a client's credit card allows charges for future services. If the company issuing a client's credit card does not permit the client to use the card for payment of future services, then the lawyer may not accept payment for advance fees or anticipated costs or expenses using that credit card.
Lawyers and law firms are permitted to place their own funds into their trust accounts in very limited circumstances. Lawyers and law firms that accept payment by credit card for advance fees, costs or expenses must at all times maintain sufficient funds of their own in their trust accounts to ensure that no bank or credit card fees or charges results in the conversion or misappropriation of funds belonging to clients or third parties. A lawyer violates this rule by failing to make the required deposit within three business days of receipt of notice or actual knowledge that a chargeback has been made to the trust account. When lawyers and law firms are required to maintain their own funds in their trust accounts to reimburse the account for trust account and credit card fees and charges, such funds must be deposited into their trust accounts before such fees or charges are imposed. Lawyers and law firms must maintain in their trust accounts sufficient funds of their own to pay fees and charges related to operation of the trust account, and to pay all credit card fees and charges (e.g., merchant and credit card transaction fees, chargeback fees, minimum monthly transaction fees, address verification fees). Lawyers and law firms must make a reasonable determination of the amount of their own funds that may appropriately be kept in their trust accounts to pay trust account and credit card fees and charges. Lawyers who maintain an unreasonable amount of their own funds in their trust accounts will be subject to a finding of misconduct. Lawyers and law firms that use credit card processing services that debit all chargebacks and credit card fees and charges from an operating or business account are not required to maintain their own funds in their trust accounts since no client or third-party funds will be at risk due to debits from the trust account.
When credit card funds are appropriately deposited into a trust account, the merchant or credit card transaction fees paid by the client as part of the credit card transaction must remain in the trust account until those funds are debited from the account. A lawyer or law firm, however, may agree to pay merchant or credit card transaction fees for the client. In that event, the lawyer or law firm must have funds of their own in their trust account in an amount at least equal to the merchant or credit card transaction fees before conducting the transaction. A failure to do so will result in the conversion or misappropriation of client or third-party funds when the merchant or credit card transaction fees are debited from the trust account.