Opinion #74. Disposal of Client Files

Issued by the Professional Ethics Commission

Date Issued: October 1, 1986

Law Firm X does not wish to retain custody of its closed client files on matters for which it is no longer providing services. Can it return these files to the client absent such a request from the client? If the client refuses to take custody of the files, may the firm dispose of them? May the firm in the latter case assess the client for the cost of the storage of the files if it elects to retain the files to protect the client or the firm from future litigation?

Opinion

Before addressing each question raised, there are two rules in the Code of Professional Responsibility that provide general principles that have some application to the questions raised. Rule 3.5(a)(2) states:

A lawyer shall not withdraw from employment until he has taken reasonable steps to avoid foreseeable prejudice to the rights of his client, including giving due notice to his client, allowing time for employment of other counsel, delivering to the client all papers and property to which the client is entitled, and complying with applicable laws and rules.

Rule 3.6(f)(2) states:

A lawyer shall:

(i) Promptly notify a client of the receipt of his funds, securities, or other properties;

(ii) Identify and label securities and properties of a client promptly upon receipt and place them in a safe‑deposit box or other place of safekeeping as soon as practicable;

(iii) Maintain complete records of all funds, securities and other properties of a client coming into possession of the lawyer and render prompt and appropriate accounts to his client regarding them; and

(iv) Promptly pay or deliver to the client, as requested by the client, the funds, securities, or other properties in the possession of the lawyer which the client is entitled to receive.

From the above Rules several general conclusions can be made that have some application to the questions raised. First, a lawyer’s duty to safeguard a client’s property in his possession does not cease merely because his representation ends. Secondly, a client file containing any information of value to the client should not be destroyed without the client having been given timely advance notice and full and ample opportunity to take custody of it. Thirdly, no general rule can be made as to when it is safe to destroy a client file.[1] For example, a file should not be destroyed if the lawyer knows or has reason to know that the information may be necessary or useful to the client in a matter in which the applicable statute of limitations has not run. Finally, it must be recognized, on the other hand, that increasing the lawyer’s overhead expense by requiring him to indefinitely store all client files even if they contain no useful information serves no useful purpose for the client or the public.

With these general principles in mind, the Commission answers the specific questions raised by the inquiry as follows: The firm may return the file to the client absent a request from the client as long as in so doing it is satisfied that the client in fact will receive it under circumstances in which he is able to take reasonable measures to secure it and dispose of it responsibly. For instance, the attorney cannot simply deliver possession of a file to a client who is incapable of understanding or appreciating the importance of making an appropriate decision as to its disposal. There must also be no reasonable expectation on the part of the client that the firm would retain custody of the file for a period longer than the time it seeks to dispose of it.

If the firm cannot release custody of the file due to the existence of one of the above conditions, the firm can destroy it only if it determines there is no reasonable likelihood that the file contains valuable and useful information, not otherwise readily available to the client, that the firm knows or has reason to know would be useful to that client in a future matter. The firm should be particularly careful not to destroy original documents if there is any reasonable possibility that they may be needed in the future.

If the firm determines it can neither surrender custody of nor destroy the file for any of the reasons cited above, and if there has been no prior agreement with the client with respect to a charge for the cost of storage and the client had a reasonable expectation that the firm would retain custody of the file as part of its legal services, the firm may not assess a fee for storage without the client’s consent even if it determines it is doing so to protect the client from future litigation. Under no circumstances may it assess a fee without the client’s prior consent when the purpose of the storage is solely to protect the firm from future litigation.


Footnote

[1] The lawyer’s own interests may be served by retaining a client file beyond the six year limitation period when there is any reason to suspect that a client grievance may be brought concerning the subject matter which the file contains. The Supreme Court has impliedly held that no statute of limitations applies to client grievances. See Supreme Court order of April 11, 1979, 396 A.2d at p. LV.


Enduring Ethics Opinion

Enduring Ethics Opinion #74 [August 2017]