No, that is not an appropriately secure safekeeping method.  A floor safe or safety deposit box is more appropriate/secure.  Also remember that for any property without a readily identifiable value, you should first have it appraised before you agree to hold or accept it.  Here, because the property is being held as collateral for your fee, you should have the client sign an agreement that specifies what happens to the ring if she doesn’t pay your fee. Try to avoid holding property for clients and avoid accepting property to pay your fee See ER 1.8(a) for requirements if you do accept property for your fee).

You don’t want to keep disputed funds in your trust account indefinitely.  Encourage a resolution of the dispute by suggesting fee arbitration, if appropriate, or use the ER 1.15(f) Notice procedure or an interpleader action.

A lawyer may have a legal duty to protect third-party claims “against wrongful interference by the client” and, if a third-party claim has become a “matured legal or equitable claim,” must hold the funds or property until the dispute is resolved. See Comment 4 to ER 1.15. State Bar of Arizona Ethics Op. 98-06 quotes a noted treatise describing matured legal or equitable claims as third-party interests for which failing to recognize the interest “is a species of fraud upon creditors or fraud upon the rendering court.” That Opinion concludes that an unsigned, unrecorded medical lien is not a matured legal or equitable claim but an assignment or letter of protection of which the lawyer has notice is.

No, the ERs do not require a lawyer to search public records or other sources for medical liens or claims in order to acquire knowledge of an “interest.” See State Bar of Arizona Ariz. Ethics Op. 11-03.

No. The Notice must be served on the third party in the manner provided under Rules 4.1 or 4.2, Ariz. R. Civ. P.  For more information about the ER 1.15(f) Notice, review Ethics Advisory Committee EO-19-0004/0005/0007.

ER 1.15 must be read in conjunction with Rule 43, Ariz. R. Sup. Ct., the rule on trust accounts. Rule 43(a)(4) directs that a joint check must be deposited into the trust account and the lawyer must withdraw the portion belonging to them within a reasonable time.

You are not required to remit to the client funds that you reasonably believe represent fees owed. However, you may not hold the entire amount as leverage in the fee dispute. You must first disburse the undisputed amount to the client, and then resolve the fee dispute before you take your fee. The State Bar’s Fee Arbitration program can be helpful in this unpleasant situation, as it is free and generally faster than formal litigation. Pro tip: Provide for Fee Arbitration in your engagement agreement.

Why do you say it “might” belong to the former client? If you don’t know to whom the money belongs, that’s a problem. Regardless, if you have money in your trust account that has been abandoned, or whose ownership you can’t determine, don’t send it to the State Bar. If you cannot find the client after reasonable efforts, you must comply with the Revised Arizona Uniform Unclaimed Property Act, A.R.S. §§ 44-301-340. See State Bar of Arizona Ariz. Ethics Op. 97-03 for a fuller discussion.

If an Arizona lawyer has funds relating to the representation of an Arizona client in a matter that requires the practice of law in Arizona, regardless of where the lawyer is physically located, the client or third-party funds should be maintained in an Arizona IOLTA. While the rules do not specifically address this issue, the rationale behind ER 1.15 and the trust accounting rules indicate that the funds should be kept where the legal matter and client are located. However, with client consent you may keep their funds in your “other state” IOLTA. If you do, you will be responsible for ensuring that any interest on those funds is remitted to the Arizona Foundation for Legal Services and Education unless the trust account is maintained only for the benefit of that client or is a pooled trust account with “sub accounting provided by the lawyer or law firm, which will provide for computation of interest or dividends earned by each client’s funds and the payment thereof” pursuant to Rule 43(f)(1)(C), Ariz. R. Sup. Ct. In that case, you must remit any interest on those funds to the client.