Can a law firm give its bank a list of client accounts receivable without the clients' consent?

Plain-English summary

A law firm's bank, as part of a line of credit, asked the firm to furnish a list of its accounts receivable identifying each client owing on an account, the balance, and the age of the account. The firm asked whether a client's billing records are confidences or secrets that cannot be disclosed to the bank without consent.

The opinion explained that the attorney-client privilege is a rule of evidence, not a substantive right, and that generally information about a client's fees is not privileged because payment of fees is an economic transaction incidental to the relationship rather than a confidential communication. It noted, however, that in exceptional circumstances fee information may be privileged, and that even non-privileged fee information may still be a secret, because disclosing the identity of the payer of attorney's fees may reveal the substance of a confidential communication.

The opinion concluded that, under Illinois Rule 1.6(a) (a lawyer may not reveal a confidence or secret unless the client consents after disclosure), the firm should obtain client consent before disclosing the fee information to the bank. It observed that in most instances the billing records would not reveal a confidence or secret, but because it is the client who determines what remains a confidence or secret, obtaining consent beforehand would protect the firm from a breach of confidentiality.

Currency note

This opinion was issued in 1993, before Illinois adopted the 2010 Illinois Rules of Professional Conduct. The ISBA Board of Governors affirmed the opinion in May 2010 as generally consistent with the 2010 Rules (pointing to Rule 1.6), while noting the specific standards referenced may differ from the 2010 Rules. Subsequent rule amendments or later opinions may have changed the analysis. Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific rule or requirement mentioned here.

Common questions

Q: Can a firm share an accounts-receivable list naming clients with its bank?

A: The opinion concluded the firm should obtain client consent first, because client fee information can be a secret under Rule 1.6(a) even when it is not privileged.

Q: Isn't fee information generally not privileged?

A: The opinion agreed that fee payment is usually an economic transaction outside the attorney-client privilege, but it concluded that fee information can still be a client secret, and in exceptional circumstances may even be privileged.

Q: Why obtain consent if most disclosures reveal nothing confidential?

A: The opinion concluded that because the client decides what remains a confidence or secret, requesting consent beforehand protects the firm against a breach when a particular client treats the information as confidential.

Background and rules framework

The opinion interpreted Illinois Rule 1.6 (confidentiality of information; "confidences or secrets"), reading the attorney-client privilege as a separate evidentiary rule. It applied case law including McDonald's Corp. v. Levine, U.S. v. DeFazio, the Special March 1980 Grand Jury matter, and King v. King on what fee information is protected and who controls its confidential status (Model Rule 1.6).

Citations and references

Rules of Professional Conduct:

• Model Rule 1.6 (confidentiality of information) / Illinois Rule 1.6(a) (confidences and secrets)

Cases:

• McDonald's Corp. v. Levine, 108 Ill. App. 3d 732, 439 N.E.2d 475 (1982), scope of attorney-client privilege
• U.S. v. DeFazio, 899 F.2d 626 (7th Cir. 1990), privileged communications limited to legal advice
• Matter of Witnesses Before the Special March 1980 Grand Jury, 729 F.2d 489 (7th Cir. 1984), fee information generally not privileged
• King v. King, 52 Ill. App. 3d 749, 367 N.E.2d 1358 (4th Dist. 1977), client controls what is a secret

See also

• ISBA Ethics Op. 10-01: Outside IT Vendor Access
• ISBA Ethics Op. 02-02: Fees From a Dissolved Client's Trust

Source

• Landing page: https://www.isba.org/ethics/opinions/9304