Inside Track: Ethical Dilemma: Office Clean Up: Considerations in Closed Client Files:

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    Office Clean Up: Considerations in Closed Client Files

    File cleanup: What do you need to know in storing and destroying old files from closed client cases? How long do you have to wait before destroying closed client files? And do you need permission of the former client before destroying them?

    Timothy J. Pierce

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    Aug. 21, 2019 – It may not be straightforward to do some office cleaning on your closed client files. Just how long do you have to wait before destroying old files? Should you destroy them at all? When do you need to notify the client?

    Question

    I was hired out of law school a few years ago to work for an older lawyer, with the idea that the older lawyer would retire and I would take over the practice. My boss is now getting ready to retire, and as part of the transition, I would like to do something about the firm’s old files. There are more than 40 years of closed files, and my boss is worried that it is improper to destroy the files without first obtaining the consent of the former clients, which would be a monumental task.

    Do I need the permission of my firm’s former clients before destroying their old files?

    Answer

    A law firm’s responsibilities with respect to closed client files was recently addressed in Wisconsin Ethics Opinion EF-17-01. That opinion withdrew some older, outdated ethics opinions addressing file retention responsibilities. One of those older opinions was E-98-1, and while EF-17-01 agreed in many respects with the older opinion, it differed in one important way:

    While Wisconsin Ethics Opinion E-98-1 recognized that maintaining former clients’ files forever was not practicable and that lawyers should not be burdened by the attendant economic costs, it also recognized that certain safeguards should be followed before a file is destroyed. While we agree with most of the safeguards recognized in E-98-1, we do not agree with all of them. One of the safeguards with which we disagree required that “[a]bsent an express agreement with the client, the lawyer should at a minimum try to reach the client by mail at the client's last known address, should advise the client of the intent to destroy the file absent contrary client instruction, and should wait a suitable period of time (perhaps six months) before taking action to destroy the files.” Although some practitioners may choose to follow this or a similar practice, such a requirement, regardless of the age of the file or the type of the matter, is not required by the Rules of Professional Conduct, nor by any Wisconsin case and can be unduly burdensome.

    (footnote omitted)

    Tim Pierceorg tpierce wisbar Tim Pierce is ethics counsel with the State Bar of Wisconsin. Reach him by org tpierce wisbar email or through the Ethics Hotline at (608) 229-2017 or (800) 254-9154.

    As the opinion notes, there has never been a requirement in the disciplinary rules that former clients be notified before old files are destroyed, and there is no instance of a Wisconsin lawyer being disciplined for failing to notify former clients before securely disposing of old files.

    That said, lawyers do have responsibilities with respect to closed files, which are set forth in the following guidelines from EF-17-01:

    1. The lawyer must preserve the file for a length of time sufficient to protect the client’s reasonably foreseeable interests. As discussed above, this should normally be a minimum of six years.

    2. The lawyer has specific responsibility to hold client property in trust under SCR 20:1.15, and important documents or other materials given to the lawyer by the client should not be destroyed without consent of the client. The lawyer must be satisfied that the files have been adequately reviewed or that the firm’s established procedures give reasonable assurance that the file does not contain client property. To do otherwise, such as a spot check, would run the risk that client property or original documents would be destroyed. Client property or original documents such as wills1 or settlement agreements ordinarily should not be destroyed.

    3. Lawyers should review their firm’s policies and ensure that the firm’s engagement letters and closing letters contain a statement informing the client of the right to the file and the firm’s file retention policy. While this is not explicitly required by the Rules, it is an important and relatively easy way to protect the client’s interests upon termination of the representation.2

    4. Likewise, the lawyer must take reasonable measures to ensure that the method by which closed client files are stored, whether the files are in physical or electronic format, protects the confidentiality of those files.

    5. Lawyers must take reasonable steps to ensure that closed client files are destroyed in a manner that preserves the confidentiality of the information contained in the files.3 This applies to files stored both physically and in electronic format. Normally, the retention of a professional shredding service that gives contractual promises of confidentiality will suffice for the destruction of physical files. With respect to electronic files, the lawyer must take steps to ensure that any information protected by SCR 20:1.6 is no longer retrievable from any hardware, software, or device that is no longer in the lawyer’s control.

    6. The lawyer should keep a record or index of files that have been destroyed for a reasonable period of time.4

      Lawyers are reminded that they must maintain records of trust account funds and property for at least six years after the termination of the representation.5

    The opinion thus provides guidelines for the safe retention and eventual destruction of closed client files.

    When confronted with the situation in the scenario – decades of closed client files – the law firm must make reasonable efforts to ensure there are no important original documents in the files, but then may proceed with the secure destruction of files over six years old without attempting to first reach the former clients.6

    Lawyers who have questions about what constitutes a client file and when the file must be surrendered to former clients or successor counsel should consult Wisconsin Ethics Opinion EF-16-03.

    In Case You Missed It: Read Past Ethical Dilemmas

    Ethical Dilemmas appears monthly in InsideTrack. Check out these topics from recent issues:

    • Job Negotiations and Conflicts, July 17, 2019
      Job searches can give rise to conflicts for lawyers. Just when do lawyers have to notify clients that they are seeking a new position?

    • Guardian ad Litem Work: Analyzing Potential Conflicts, June 19, 2019
      The unique role of guardians ad litem (GAL) pose challenges in applying the Rules of Professional Conduct for Attorneys, such as determining whether GAL work may conflict with your other cases. Tim Pierce, State Bar of Wisconsin ethics counsel, provides insight into one particular case that may help.

    Endnotes

    1 For example, Wis. Stat. section 856.05(1) states that a person having the custody of any will shall, within 30 days after he or she has knowledge of the death of the testator, file the will in the proper court or deliver it to the person named in the will to act as personal representative. If a lawyer cannot determine whether the testator has died, the lawyer must deposit the original will with the register of the probate court pursuant to Wis. Stat. section 853.09(1).

    2 Such a clause need not be lengthy, and should state the firm’s policy in plain language, such as:

    [Firm] will retain your client file for ten years from the conclusion of the matter. After ten years, your file will be destroyed, without further notice to you, in a manner which preserves the confidentiality of your information. Should you wish to receive your file, please notify [Firm] before ten years have elapsed and we will promptly provide your file.

    3 See SCR 20:1.6(d).

    4 See ABA Informal Op. 1384.

    5 SCR 20:1.15(g)(1).

    6 This assumes the law firm did not have a longer file retention policy that was conveyed to clients. If so, files should be retained for the period of time stated in the policy.




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