When you’re involved in a serious lawsuit, the last thing you want is to find out that your attorney has been misusing the funds that you’ve given them. You pay them a lot of money to fill out the correct documentation and to do the work that is necessary to give you the best chance of success in court.
Attorneys are required to use your funds responsibly with the care that is required of professional fiduciaries. That means that if you give them a fee for the court, they should be using that money to pay that fee. They should have separate billing for their hours and services.
Is it ever legal for an attorney to commingle their funds with funds for a case?
It is possible that an attorney may need to commingle funds, but only when it’s necessary to pay bank service charges on the account holding the funds. The attorney should be keeping close records that reflect which of those funds were theirs and which were the clients.
What happens if there is a dispute over funds and how they’re being held or used?
If there is a dispute, the American Bar Association states that attorneys should hold the disputed funds in a separate trust account until there is a resolution, such as through arbitration. Once there is a resolution, then the funds should be distributed to the appropriate party.
In your relationship, your attorney owes you the professional care of their position as a fiduciary. Your funds should be used as intended and held appropriately. Separate trusts or accounts should be used when warranted, and your attorney should have thorough records of how the funds you’ve paid them have been used.
What happens if your attorney misused funds or funds were lost?
In the case that your funds were misused or lost, then it’s possible that you could have a legal malpractice case on your hands. It’s a smart idea to talk to a new attorney about your concerns to have them review the situation and see if your other attorney may have violated your rights as a client.