What should a lawyer do with money left in the trust account because the bank never debited a check the client already cashed?

Plain-English summary

The inquiring lawyer had issued a check to a client drawn on the trust account, which the client negotiated and whose funds the client received. The bank, however, never cleared the funds through the lawyer's account and, on inquiry, indicated it would do nothing to remove those funds.

The committee was of the opinion that, because the client had received the funds he or she was entitled to receive, the funds remaining in the account were no longer the property of the client or being held for the client. Since the bank was apparently laying no claim to the funds, the committee was of the opinion that the lawyer should remove the funds from the trust account and treat them as the lawyer's own.

Currency note

This opinion was issued in 1990, before the Washington State Bar Association's adoption of the 2006 revisions to the Washington Rules of Professional Conduct. 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 Treat this page as historical context, not current guidance.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, deadline, or requirement mentioned here.

Common questions

Q: Who owns trust-account money the bank never debited after a client cashed the check?

A: Under this 1990 opinion, not the client; the committee was of the opinion that because the client already received the funds entitled to, the leftover money is no longer the client's property or held for the client.

Q: What did the committee say to do with the funds?

A: Because the bank laid no claim, the committee was of the opinion that the lawyer should remove the funds from the trust account and treat them as the lawyer's own.

Background and rules framework

At the time of this opinion, Washington's RPC 1.14 governed the safekeeping of client property, the subject the current Model Rules place in Rule 1.15. The committee reasoned that once the client had received everything he or she was entitled to and no third party (here, the bank) claimed the residual funds, the money lost its character as client property held in trust.

Citations and references

Rules of Professional Conduct:

• ABA Model Rule 1.15 (safekeeping property)
• Washington RPC 1.14 (as numbered at the time of the opinion)

See also

• WA Ethics Op. 1354: Applying Client Property Toward Unpaid Fees
• WA Ethics Op. 1327: Trust Funds With More Than One Claimant

Source

• Landing page: https://ao.wsba.org/print.aspx?ID=455

Original opinion text

Reproduced from the official source for research purposes. The linked source is authoritative.

As I advised you, I submitted your inquiry regarding the situation in which you have issued a check to a client drawn on your trust account which the client has negotiated and which funds the client has received. However, the bank has never cleared the funds through your account and upon your inquiry, has indicated that they will do nothing to now remove those funds. The Committee is of the opinion that, as the client has received the funds that he or she was entitled to receive, the funds in your account are no longer the property of your client or being held for the client. Since the bank is apparently laying no claim on the funds, the Committee is of the opinion that you should remove the funds from your trust account and treat them as your own.