Paralegal Ethics Tips: Cash, Conflicts and Confidentiality

When you consider ethics issues, cash, conflicts and confidentiality should be at the top of your list.
Ethics are covered by the American Bar Association’s Model Rules of Professional Conduct (www.americanbar.org) and also by your state’s Model rules. For purposes of this article, I will refer to the ABA’s Model Rules.
Cash. Model Rule 1.15 covers the duty to protect the client’s property. Know your state’s rules regarding this duty as it varies from state to state. Here are some important tips for handling the client’s property:
  • The client’s funds cannot be commingled with the firm’s funds.
  • The firm can’t ‘borrow’ from the client’s funds, even with the intention of repaying the money before anyone finds out.
  • The client’s money may be transferred to the firm’s business account only at such time as the fees are earned.
  • Every firm must maintain a separate trust account which is also referred as an IOLTA account. (IOLTA = Interest on Lawyer Trust Accounts) In Florida this is referred to as IOTA.
  • There are strict rules for reconciling the trust account and also for persons who are allowed to handle the account. Again, check your state’s rules for more information.
Conflicts. Model Rules 1.7-1.11 refer to conflicts of interest that attorneys may encounter. Here are some tips to avoid conflicts:
  • Have a system in place to check conflicts. This should include both former and current clients.
  • Who’s the client? Be sure it is clear whom the firm is representing. Is it the husband, the wife, or the husband and the wife? Is it the insurance company or the insured? The corporation or a corporate employee?
  • Never use information you have gathered during the representation of a client to later sue that client.
  • Pay attention to new hires, both attorneys and support staff. If they have a conflict, the firm may avoid disqualification by obtaining waivers from opposing parties and/or by screening the employee from contact with the matter.
Confidentiality. Model Rule 1.6 refers to the duty to keep all information related to the representation of a client confidential.
  • Never discuss client matters with anyone outside the office. This includes billing information and factual situations…even if you don’t mention the client’s name. ‘Outside the office’ includes the hallway, elevator, rest rooms, courthouse hallways, restaurants, parties and seminars.
  • Be careful when you’re using electronics. Conversations on a cell phone have an expectation of privacy but only when the parties take steps to keep the conversation private.
  • Email and faxes also have an expectation of privacy but you should always have the client’s permission (preferably in writing) before communicating this way. Be sure the client is available to receive the email or the fax so that the communication is not intercepted by a third party.
  • There are some exceptions to the confidentiality rule: to prevent the client from killing or seriously harming someone; to prevent the client from committing a crime; to bring or defend a claim against a client. In each of these situations, the attorney may disclose only information essential to the matter.
Your challenge: Familiarize yourself with the ABA’s Model Rules of Professional Conduct, as well as the rules that have been adopted by your state. The ABA also has Guidelines for the Utilization of Paralegal Services that can be reviewed at www.americanbar.org.
The attorney’s ethical obligations are your obligations, too, and you should thoroughly understand ethics issues regarding cash, conflicts and confidentiality.
In the end, though, trust your instincts: if an action doesn’t feel right or ethical, it probably isn’t. Every state bar association maintains an ethics hot line. Call yours if you have questions.

                                                 Top 10 Qualities of a Great Paralegal

Vicki Voisin, “The Paralegal Mentor”, delivers simple strategies for paralegals and other professionals to create success and satisfaction by setting goals and determining the direction they will take their careers. Vicki spotlights resources, organizational tips, ethics issues, and other areas of continuing education to help paralegals and others reach their full potential. She is the co-author of The Professional Paralegal: A Guide to Finding a Job and Career Success. Vicki publishes Paralegal Strategies, a weekly e-newsletter for paralegals, and co-hosts The Paralegal Voice, a monthly podcast produced by Legal Talk Network.

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