Pg 12

Question 1

What is fee splitting?

Answer 1

Agreements for fees to be split between attorneys and different firms

Question 2

Agreements for fees to be split between attorneys in different firms must be what?

Answer 2

In Writing

Question 3

What are the rules under MR 1.5 when you are dividing fees between attorneys that don’t work in the same firm?

Answer 3

The division must be in proportion to the services performed by each attorney, or each must assume joint responsibility for the representation, the client must agree to the arrangement in a confirmed writing, and the total fee must be reasonable

Question 4

Attorneys can take property as payment for services as long as what?

Answer 4

It doesn’t involve acquiring a proprietary interest in the cause of action that is the subject matter of the litigation

Question 5

What is a true retainer fee?

Answer 5

Money earned just for agreeing to be available, not by doing work, so that money does not go into the client trust account.

Question 6

If an attorney has already taken a retainer fee, and then he withdraws or is fired, what must he do with the unearned portion?

Answer 6

Refund it

Question 7

What does an attorney do with money he has taken under a retainer agreement?

Answer 7

Initially it goes into the client trust fund, and at reasonable intervals the attorney gives client an accounting for the work done, and the amount he wishes to deduct, and if the client doesn’t dispute it, the attorney can withdraw it

Question 8

Model rule 1.8 says what about attorneys taking an ownership interest in the client’s cause of action or the subject matter of the litigation?

Answer 8

It is prohibited

Question 9

Is it proper for an attorney to get an interest in a client’s property, patent, or business when representing the client in litigation about that property?

Answer 9

No, because that exact thing is the subject matter of the litigation

Question 10

What is the exception to an attorney being prohibited from taking an ownership interest in a client’s cause of action or the subject matter of litigation?

Answer 10

Attorney can accept a contingency fee and can acquire a lien on the proceeds of the case to secure his fees or expenses

Question 11

When can a client pay an attorney with property?

Answer 11

Only once the litigation is concluded regarding that property, or if that property is not the subject of the litigation

Question 12

What is rule MR 1.15 regarding client trust accounts?

Answer 12

Attorneys must keep clients’ money and property separate from their own, maintain adequate records, notify clients promptly when money or property is gotten on their behalf, and promptly deliver money or property belonging to the client

Question 13

When an attorney gets money from a client or on the behalf of a client, who does that money belong to?

Answer 13

The client

Question 14

When an attorney takes money on behalf of a client, what must be done with it?

Answer 14

It must be put in a client trust account that is separate from the attorney’s personal or law office account

Question 15

What is the rule for comingling?

Answer 15

Attorneys cannot comingle personal or law office funds with client funds

Question 16

Is there any amount of money that an attorney can put into a client trust account?

Answer 16

Yes, he can put in only enough money to pay the bank service charges for the account

Question 17

Once a settlement has been reached, what should the attorney do with the money?

Answer 17

Deposit the whole settlement into the client trust account, confirm with the client the amount the attorney is owed in fees, then withdraw his own money

Question 18

What should be done when an attorney has to hold large sums of money for a client for long periods?

Answer 18

Attorney should make an agreement with the client about how to handle this, otherwise the money should be put in an interest-bearing trust account at a bank and the interest goes to the client

Question 19

What should attorneys do when they just have small sums of different clients’ money for a short period?

Answer 19

They should lump these together in a single trust account

Question 20

What is an IOLTA?

Answer 20

Interest on lawyer trust account

Question 21

What can IOLTAs be used for?

Answer 21

The bank sends the interest directly to a foundation that uses it to fund legal service programs for underrepresented people

Question 22

Why are IOLTAs ok?

Answer 22

They are a public taking, but they are OK because the clients do not suffer any loss

Question 23

If an attorney is in possession of property that two or more people claim an interest in, what must be done with the property?

Answer 23

It must be kept separate until the dispute is resolved and the attorney must promptly distribute all portions of the property not in dispute

Question 24

If an attorney must store property for a client, where’s the best place to do this?

Answer 24

Safety deposit box

Question 25

If third parties have lawful claims against property or funds that an attorney is holding for a client, what must the attorney do?

Answer 25

The attorney has a duty to protect the third-party claims against wrongful interference by the client. Attorney must refuse to surrender property to the client until the claims are resolved

Question 26

What happens to money that is paid for completed attorney work?

Answer 26

It belongs to the attorney, so it cannot go in the client trust account

Question 27

What happens to money for expenses that are involved in litigation?

Answer 27

It stays in the client trust account until it is needed for expenses

Question 28

Where do advance attorney fees go?

Answer 28

In the trust account until the attorney earns the fees

Question 29

Model rule 1.15 says attorneys must do what as far as records are concerned?

Answer 29

Must keep complete records of all of the client’s money and property

Question 30

How does an attorney keep a complete record of his client’s money?

Answer 30

Keep a ledger sheet plus a journal for each bank account, bank statement, or cancelled check

Question 31

How does an attorney keep complete records for all of his client’s property?

Answer 31

Keeps a journal that shows property is held for whom, when it was gotten, when and to whom it was handed over to

Question 32

For how many years must attorneys keep complete records of their client’s property and money?

Answer 32

Usually a certain period of years

Question 33

What is a client security fund?

Answer 33

Money that reimburses clients that fall prey to dishonest attorneys that is usually raised through state bar fees

Question 34

What is necessary before a non-attorney can handle the details of a client trust account?

Answer 34

The attorney must train and adequately supervise non-attorney assistants. Attorneys must make reasonable efforts to ensure that the non-attorney’s conduct is compatible with the professional obligations of the attorney

Question 35

If an attorney is negligent in supervising the person that handles the details of a client trust account, what happens?

Answer 35

He is liable for malpractice under respondeat superior

Question 36

What is the test to determine if an attorney was negligent in allowing a non-attorney to handle the details of a client trust account?

Answer 36

If a reasonably prudent attorney would not have allowed that person to handle the client trust account, considering the facts, then the attorney has breached a duty of care

Question 37

If a paralegal has worked for an attorney for years and the attorney always carefully reviews her work, and the attorney is given instructions to file a document in Court A, but she accidentally files it in court B, and that causes a client to miss the statute of limitations for filing, is the attorney subject to discipline for not supervising the paralegal?

Answer 37

No, but the attorney might be liable for malpractice since the paralegal is the attorney’s agent, so negligence is imputed to the attorney

Question 38

What is expense fraud?

Answer 38

Stealing from clients, partners, or both by representing personal expenses as business expenses, doctoring receipts for legitimate expenses to increase the amount, creating fake receipts for expenses that weren’t incurred, representing legitimate billable time as reimbursable expenses so that payment goes directly from the client to the attorney instead of to the firm as a fee, etc.

Question 39

What is billing fraud?

Answer 39

Fraud that happens from sloppy time records, padding timesheets, billing one client for another client’s work, creating fictitious timesheets, recording hours for an attorney based on the work done by a cheaper employee, billing non-billable time, etc.

Question 40

If there is a fee dispute, what should the attorney do?

Answer 40

Leave the money in the client trust account until the matter is settled