On November 20 we hosted Solo by Choice in the Current Economy, featuring Carolyn Elefant of MyShingle.com.  Lucky attendees received a copy of Carolyn’s book along with other materials.

Carolyn shared her insight and advice across a wide array of areas.  Along the way, she busted the myths of practicing solo and shared useful tips.  Here is some of what she had to say:

Busting the Myths of Starting a Solo Practice

• Working for yourself is not a “dead end,” it can be a way to find a second chance in your career. 
• You are in control.  This is the best part of being a solo, because you call the shots.  You can reduce overhead, adapt your practice areas, or change your business plan on a dime. 
• Solo practice need not be isolating:  seek out opportunities to work with others.
• Going solo doesn’t mean you won’t be intellectually challenged.  A solo practice can be rich and varied, with complex legal issues. 
• Remember: you’re a lawyer like everybody else.  Why can’t you start your own law firm?

Setting Up a Practice On the Cheap

• Keep overhead low.  Learn from the trends:  Big Law is sending business overseas to cut costs and clients are becoming less and less tolerant of lawyers passing on overhead.
• Grow your practice economically by outsourcing in lieu of hiring full or part-time employees.  Options include virtual assistants, contract lawyers, law clerks, or bookkeeping services.
• Think of meeting with a client in their home as a convenience for them.  You don’t necessarily need to rent office space.
• Mobile technology gives you the freedom and flexibility to run a home-based practice.  Any cash you spend on a laptop, Smartphone or MiFi card will be a terrific return-on-investment.  If your budget won’t allow for mobile technology up front, repurpose what you already have.

Carolyn’s presentation and book, Solo by Choice are available now on the PLF Web site for $30 – a steal if you ask me.  Select Programs on Audio or Programs on Video.  If you missed the live program, order the CD/DVD from this terrific CLE.  I will feature more tips in future blog posts.

You don’t need to visit the Oregon Office of Economic Analysis to know that Oregon has been hit hard by the recession. While modest job growth is expected over the next ten years, Oregon’s unemployment rate is stubbornly holding at 11.3%. 

How is the current economy affecting your firm? You’ve probably noticed it’s gotten tougher to collect fees. If you never considered suing a client before, you may be giving it serious thought now.

As you might expect, the Professional Liability Fund advises lawyers to avoid suing clients if at all possible. Many legal malpractice suits result from counterclaims in response to a lawyer’s action to recover fees.

Before you sue, consider the following:

• Do you stand to gain or lose a substantial amount of money?
• Was a good result obtained in the underlying case?
• Has an uninvolved, experienced lawyer reviewed the file for possible malpractice?
• Are there any grounds on which the client can credibly dispute the debt or any part of it?
• Have you ruled out client dissatisfaction as a reason for non-payment or slow payment?
• Have you offered to arbitrate or compromise?
• Will a judgment be collectible if obtained?
• Will a lawsuit result in bad publicity reflecting negatively on you or your law firm?

Keep in mind that collection efforts could potentially affect your PLF coverage. See The Ethical Oregon Lawyer §15.17 Fee Disputes and Suits for Fees (Oregon State Bar 2006) and Roger Westendorf, “Fee Disputes and Binding Arbitration – Impact on PLF Coverage,” In Brief, no. 108 (June 2009) available online at the PLF Web site. Select In Brief, then June 2009.

Collection efforts can bring even more aggravation if the lawyer violates the Truth in Lending Act or state and federal debt collection statutes. For an excellent discussion of these topics, see the Fee Agreement Compendium Ch 3 The Truth in Lending Act and Attorney Fee Retainers (Oregon State Bar 2007) and Consumer Law in Oregon (Oregon State Bar 1996 & Supp 2005).  Both are included in BarBooks, the Oregon State Bar’s online library of legal resources.

Copyright 2009 Beverly Michaelis

Preparing return receipt certified mailings is a hassle.  It’s time consuming, costly, not exactly sustainable, and often guaranteed to make your staff tear their hair out. Enter the green alternative: the electronic return receipt.

Earlier this year, Washington state paved the way for use of electronic return receipt delivery with HB 1426. The bill provides:

“Whenever a statute allows or requires the use of “certified mail with a return receipt requested,” electronic return receipt delivery confirmation provided by the USPS  may be used.”

Can lawyers in Oregon use electronic receipts in instances where a statute requires notice by certified mail return receipt requested?  The answer is unclear.

Oregon has no precise corollary to Washington’s HB 1426, but neither do we have a statute prohibiting the use of electronic return receipts. ORS 174.160 provides some guidance:

Whenever, for the purpose of giving notice, registered or certified mail, with or without return receipt, is authorized or required by or pursuant to statute, it is sufficient to use in lieu thereof any mailing method that provides for a return receipt.  (Emphasis supplied.)

So doesn’t this give Oregon practitioners the green light? Maybe.  Maybe not. Oregon’s Legislative Counsel office recommends proceeding with caution.

Re-read the statute which applies to your specific situation. Does it require the recipient to sign the return receipt or is confirmation of delivery enough? If the return receipt is electronic, the validity of an electronic signature might come into question. Unfortunately, ORS Chapter 84, governing the use and validity of electronic signatures, doesn’t shed much light on return receipt signatures. If the parties have not previously agreed to conduct business by electronic means, you should assume that an electronic signature will not suffice. See ORS 84.013 and 84.019.  [CAVEAT: Washington practitioners should approach this issue cautiously as well. HB 1426 speaks only to delivery confirmation not electronically signed receipts.] 

What to do now?

Unless the parties have previously agreed to do business electronically, caution dictates using the old-fashioned paper method of certified mailings, at least in cases where a signature is required.  If you are particularly risk-averse, you may want to use the paper-based approach for all certified/return receipt mailings.  With luck, the law will catch up with the technology by the next legislative session.

Copyright 2009 Beverly Michaelis with thanks to our awesome Oregon Legislative Counsel’s office for their willingness to research this issue.

In her column, A Word of Caution: Social Media for Lawyers, Oregon State Bar Deputy General Counsel Helen Hierschbiel shares six cardinal rules for lawyers using social media.  The advice is spot-on.  If you or your clients are using Facebook, LinkedIn, MySpace, Twitter, or any other social networking site, be sure you understand the ethical implications of your online activity:

Rule 1 – Don’t Unwittingly Disclose Client Confidences

Seems obvious, doesn’t it? Evidently not. Three years ago, an Oregon lawyer stipulated to a 90-day suspension for posting confidential personal and medical information about a former client on a listserve. In re Qullinan, 20 DB Rptr 288 (2006).   More recently, an Illinois attorney was disciplined for referring to clients by first names or by jail identification numbers in her blog.

Rule 2 – Avoid Inadvertent ExParte Contact

Exparte communications are prohibited by ORPC 3.5.  In her column, Helen relates the story of a North Carolina judge who was reprimanded for communicating exparte with a lawyer regarding a pending trial.  The morale – always be mindful of the exparte prohibition, even when online.

Rule 3 – Is the Opposing Party Represented?

If so, don’t attempt to contact him (or her) via a social networking site. OSB Formal Ethics Opinion 2005-164 permits lawyers to visit an opposing party’s public Web site, but suggests that interacting with the Web site would be problematic. If you know the other party is represented, avoid all contact.

Rule 4 – What are Your Clients Posting?

What clients post on Facebook or MySpace can definitely come back to haunt them. Due diligence may require you to ask clients if they use social networking sites, then verify their answers by conducting an appropriate Internet search.

Rule 5 – Social Media as an Investigative Tool

Due diligence may play a role here as well – as Helen suggests, “The flipside of lawyers needing to be careful about what they and their clients post on the Internet, is needing to be cognizant of the abundance of information available online aobut others.  In fact, some might argue that competent representation these days requires investigation of any Internet presence or personae for parties and witnesses.”

Rule 6 – Avoid Deception

ORCP 8.4(a) prohibits lawyers from engaging in conduct involving dishonesty, fraud, deceit, or misrepresentation. OSB Formal Ethics Opinion 2005-173  makes it clear that covert activity (deceptive posts or personae) are not allowed under this rule when there are no “violations of civil law, criminal law, or constitutional rights” to investigate.  Helen notes, “An Oregon lawyer learned this lesson the hard way when he created an Internet bulletin board account in the name of a high school teacher and posted a message purportedly written by the teacher, implying that the teacher had engaged in sexual relations with his students. Although the lawyer intended the ruse to be a practical joke, the lawyer ultimately was reprimanded for violating (the rule).” In re Carpenter, 337 Or 226 (2004).

Copyright 2009 Beverly Michaelis

A recent Business Journal post suggests that the number of clients requesting flat fee arrangements in Oregon has doubled in the past year. 

Why would clients prefer a flat fee?

• Certainty – the client knows up front exactly what your services will cost.
• Budgeting – if the client knows what it’s going to cost, he or she can plan appropriately.
• Negotiating room – flat fees may offer a client more bargaining room if the lawyer is willing to commit to volume legal services.

Flat fee arrangements may or may not include costs. This should be clearly spelled out in your fee agreement.  Hybrid contracts – a mixture of flat fee and hourly billing – are also becoming more common.   If the hourly rate is triggered by a particular event, or when you reach a certain stage in the case, describe the event or stage in a way that leaves no doubt in the client’s mind. Remember, if a fee agreement is ambiguous, it must be construed against the lawyer.

Flat fees earned upon receipt (payable up front) are subject to strict regulation by the bar.  Read and understand OSB Formal Ethics Opinion 151.  Never call these fee arrangements “nonrefundable.”  Fees are always subject to refund if the work is not done.

For more information on this subject, see The Ethical Oregon Lawyer.  For a collection of fee agreements that comply with the ethical rules, consider purchasing the Fee Agreement Compendium. Both are included in the Oregon State Bar BarBooks subscription. Additional fee agreements are available on the PLF Web site.  Select Practice Aids and Forms, then Engagement Letters. 

When charging flat fees, be sure to track your time.  If you disengage from the case early or the client terminates your services, it will be easy to calculate the refund due the client.  Tracking your time will also allow you to monitor whether your flat fee needs adjustment based on the amount of time spent on a particular type of matter.

Copyright 2009 Beverly Michaelis

Excerpt from New York Court Scores Over Oregon In Recent Email Privacy Opinions by Jennifer Granick

Last week, two new district court opinions took opposing views on the question of whether the Fourth Amendment protects stored email. One of the cases easily adopted the prevailing view that the Constitution protects electronic communications, while the other ignored existing U.S. Supreme Court and Ninth Circuit precedent to find consumers have no expectation of privacy in messages stored with third parties.

[In] the Oregon case, In re: United States, [the government successfully argued that you have no protectable Fourth Amendment rights in your email, at least in part because it is stored with third parties. Agents had applied for a warrant for email under the Stored Communications Act (“SCA”), but did not want to serve post-seizure notice of the return of the warrant on the account holders. After concluding that the SCA only required notice to the ISP, the court then asked whether the Fourth Amendment required notice on the account holder, or whether notice on the ISP was constitutionally adequate. While giving lip service to the idea that email is protected by the Fourth Amendment, the court nevertheless stated that a user has no protected expectation of privacy when she stores her messages with a third party. The court also pointed to email service privacy policies to assert that users are, or should be, aware that their personal information and the contents of their online communications are accessible to the ISP and its employees and thus can be shared with the government “in appropriate circumstances”.

Read the entire post, and Jennifer’s insightful analysis, here.

Last week I spoke at the King County Bar Association Solo/Small Firm Success Strategies CLE.  I participated in the Basic Training/Bootcamp Track for newly admitted lawyers, and was fortunate enough to follow Joseph Shaub, a terrific speaker.  Joe’s presentation was peppered with great marketing tips which I’d like to share.

What Are You Good At?

Joe challenged the audience of newly admitted lawyers to come up with a marketing plan that suited their personality.  In Joe’s words:  Think about what you’re good at – everyone is good at something.  Are you a:

• Writer?
• Speaker?
• Schmoozer?
• One-on-one advisor?
• Joiner of organizations?
• Leader of organizations?

Find your strength – that is your marketing plan.  Do what you do well.   Find what is unique about you.   If you go outside your comfort zone, it won’t work.

How to Woo and Keep Clients

Joe also described David Maister’s four step process for wooing and keeping clients, which goes far beyond most lawyer’s perceptions of client service:

Court Clients

Tend to your clients needs.  Offer pleasant surroundings, greet clients warmly, and make clients comfortable.  Your office should be inviting and professional.  If you have a family law practice and your clients bring young children to appointments, have coloring books and other suitable toys on hand. 

Superplease

Clients should come away thrilled with your work.  Be prompt and responsive.  Take a personal interest in your clients.  Draft bills that are informative and justify the fees you are charging.  Remember – most clients don’t see any of the work you are doing.  Your bills should paint a clear picture. 

Nuture

Maintain a relationship with your clients after the work is done.  Make a call or drop clients a letter or e-mail nine to twelve months after the file is closed.  Ask how they are doing. 

Listen

Is there any greater gift?  Most clients just want to tell you their story.  Let them share it with you in their own words, without unnecessary interruption.  Also lend an ear to the market at large.  What are you hearing?  With the current economic crisis, many people have postponed filing for divorce – they simply can’t afford it.  Can you adjust your practice in some way to accommodate this reality?   

How to Create a Professional Mission Statement

Joe shared a 30 minute exercise for creating a mission statement, courtesy of Washington attorney Terry Leahy.  This is one of the easiest approaches I’ve ever seen to this potentially daunting task.  Here it is.

Part One (Ten Minutes)

Rank the values listed below on a scale of 1 to 4:  1 not important, 2 important, 3 very important, 4 extremely important.

Achievement, ambition, adventure, affection, beauty, broadmindedness, cheerfulness, cleanliness, competence, competitiveness, comfortable life, cooperation, courage, creativity, discipline, economic security, equality, exciting life, fame, family happiness, family security, forgiveness, freedom, friendship, happiness, health, helpfulness, inner harmony, integrity, involvement, intellectual, logic, loving, loyalty, mature love, national security, order, peace, personal development, pleasure, polite, power, recognition, religion, responsible, salvation, self-respect, wealth, and wisdom.

Part Two (Five Minutes)

Identify the values you ranked as very or extremely important.  Make a list of each (very important values grouped together; extremely important values grouped together).

Part Three (Ten Minutes – Allow Two Minutes Per Question)

Next, complete the following five statements.  Write down the first thought that comes to mind.

1. What I always dreamed of being or doing was:
2. My three or more greatest gifts or talents are:
3. The things I feel quite passionate about are:
4. The most satisfying moment in my professional/educational life so far was when:
5. What made that moment personally satisfying to me was:

Part Four (Allow Five Minutes)

Using the answers from Part Three, complete the following sentence: 

My mission is to apply my gifts (which are                                        ,                               , and                                                                )* in advancing that which I deeply value (                                                           ,                                               , and                                                    )** in the service of                                                                  .***

* See your answers to Part Three, item 2.

**See your answers to Part Three, item 3.

***Consider all the values you listed as extremely important from Part Two.  Also consider persons or groups you deeply desire to serve and/or causes or ideals you deeply wish to advance.

In closing, Joe reminded the group to stay true to themselves and strive to develop a practice consistent with their personal values.  Good advice, I’d say! 

Copyright 2009 Beverly Michaelis

Last week I went in for my regular dental cleaning, and it reminded me that we can learn a thing or two about how these professionals manage their solo practices.

Consider the typical dental office:  the dentist is a sole practitioner who usually employs two or more hygienists and at least one receptionist/secretary.  He or she has the latest technology, outsources his or her billing, and is closed on Fridays.  When you arrive, you are greeted, then escorted to a dental chair where you can watch a relaxing slideshow or listen to soft music over headphones.  Most of your time is spent with the hygienist.  The dentist oversees the work, but uses his or her time very judiciously, delegating as much responsibility to staff as possible. 

What can lawyers learn from this model?

Hire Friendly, Competent Staff and Delegate!

Many lawyers put off hiring staff because they are afraid of the overhead.  While this can be a valid concern, be sure you know the true value of your time – and the true value of staff’s time – before you conclude that you can’t afford to hire help.

The latest surveys for lawyers and staff in Oregon document the following:

• Average billable rate for an Oregon attorney:  $213 per hour
• Hourly salary for entry-level staff:  $11.49-$17.24
• Hourly salary for legal secretaries:  $18.19-$26.82
• Hourly salary for paralegals:  $21.79-$32.08  

What does this data reveal?  For every hour of work the lawyer performs, staff can perform 6.5 to 18 hours for the same value. 

Granted, these numbers do not include taxes and other benefits.  Even so, it is easy to see why a lawyer who spends time doing non-billable tasks (filing, billing, running errands) is losing money.  Dentists delegate so they can focus their time on work only they can do.  Lawyers should do the same.  Salaries can easily be recouped by giving staff billable projects.  As little as two to three hours per day of billable time can cover a full day’s compensation (salary, benefits, and taxes combined).

Beyond the numbers, dentists have also learned the intangible benefits of hiring friendly, competent employees.  At a time when poor customer service seems to be the norm, clients can’t help but be impressed when they are personally greeted and put at ease.  When you’re in conference or out of the office, staff add to your professionalism.  Instead of accumulating messages in voicemail, a real, live person can help your clients by relaying and taking information.  If you were a client, what would you prefer?

Embrace Technology

Lawyers are often the last to adopt new technology, which is truly a shame.  Some even flaunt it.  I spoke to a lawyer just the other day who proudly told me he was still using WordPerfect 5.1 for DOS. 

By contrast, dentists embrace technology.  Some of it is profession-specific, but some is not.  When I sat down in the examining chair for my appointment, the hygienist greeted me and asked how I had been.  In short order, she efficiently pulled on a headset.  With the words “start listening” she began dictating her findings into my digital dental record.

Lawyers can learn from this example, and thankfully more than ever are interested in exploring the advantages of digital dictation.  Read about electronic recordkeeping and going paperless at our Web site.  Select Practice Aids and Forms, then Technology.  See Also, Is It Time to Go Paper-Less?

Taking Fridays Off

I’ve been told that dentists are taught in dental school to close their office on Friday, and it has been my personal experience that they heed this advice – regardless of the true source. 

If you do try to run your office without staff, or if you have minimal staff, you will find that you need “catch up time.”  One way to achieve this is to avoid scheduling appointments or making commitments on Fridays.  While there may be a few unavoidable times when you can’t stick to this plan (the occasional Friday court appearance comes to mind), giving yourself one day out of five to take care of administrative work or attend to files uninterrupted will go a long way toward keeping your personal life and practice in reasonable balance. 

When I started at the PLF over 13 years ago, one of the first lawyers I met took Fridays off.  He described it as self-defense.  Before changing his schedule, he had been scrambling to take care of his aging parents.  Most every week there were doctor appointments, prescriptions to pick up, or other errands to run.  His schedule was chaotic and stressful.  After missing some deadlines, he realized he had to make a change.  Closing the office on Fridays made all the difference in the world.  Existing clients were understanding of the change.  New clients took the schedule in stride. 

We all need time to rejuvenate, meet personal obligations, or just catch up from time-to-time.  Follow the dentist’s example, and give yourself the gift of taking Fridays off – even if you only do it once in a while. 

Copyright Beverly Michaelis 2009

Accepting credit cards for payment is a common business practice some lawyers avoid because they are fearful of the ethical implications.  The process can be intimidating, unless you know the answers to some common questions:

Q:  Can I accept payments by credit card?

A:  Yes.  However, carefully review OSB Legal Ethics Opinion No. 2005-172.  If the bank requires that you designate a single merchant account for all credit card transactions and you accept credit card payments for earned and unearned fees, your merchant account should be a trust account.

Q.  If credit card payments for earned fees are deposited into my trust account, how do I avoid commingling?

A:  Promptly transfer those funds into your business account (once the credit card transaction has cleared the bank).

Q:  Who pays the credit card merchant fee?

A:  Merchant fees or other credit card charges deducted from the trust account are the lawyer’s responsibility.  The lawyer must ensure that sufficient funds are deposited or transferred into the trust account in a timely manner to cover these expenses.  OSB Legal Ethics Opinion No. 2005-172.  Passing the merchant fee on to the client or crediting the client for the net amount of the transaction only, even if the client agrees, may implicate Regulation Z of the Truth in Lending Act, 12 CFR §226.  As a result, you may be compelled to offer cash discounts to all clients and make specified disclosures to your clients who pay by credit card.  See CONSUMER LAW IN OREGON ch 14 (Oregon CLE 1996 & Supp 2000).

Q:  Can I designate my business account as my merchant account if I accept credit card payments for earned fees only?

A:  Yes.  This is a good approach if you want to spare yourself the extra bookkeeping involved in transferring funds and covering bank fees.  See the answer to the next question for another alternative.

Q:  Are there any other choices?  I don’t want merchant fees taken out of my lawyer trust account and I don’t want the hassle of reimbursing them either.

 A:  Yes and No.  In all likelihood, your bank will not be able to offer an agreeable alternative.   Most are stuck in lock-step when it comes to merchant accounts.  The solution is to give your credit card business to a private processor who can offer more flexibility in terms.  One option is Beacon Processing.  Beacon works exclusively with physicians and lawyers.  Processing fees are always assessed against your general account, not the lawyer trust account.  Payments can be deposited into either, based on whether they are earned or not.  This flexibility represents the best of both worlds – you control where each deposit goes and client money is never touched to pay credit card transaction fees.  If your bar association has partnered with Affiniscape, you may have access to a Law Firm Merchant Account program which operates in the same way.  Oregon’s Multnomah Bar Association offers this affinity program to it’s members.  Note:  This is not a paid endorsement of Beacon Processing or Affiniscape/Law Firm Merchant Account.  These vendors are only two of the many private credit card processing companies.  Practitioners should conduct their own research when selecting a private credit card processor.

Q:  What happens if a client disputes a fee paid by credit card?

A:  If a client disputes a fee paid by credit card, the credit card company will “charge back” the payment against the account to which it was originally credited.  This means the disputed funds will be deducted from the your account and given back to the client. If the charge back is against the trust account and you have already withdrawn the credit card payment as an earned fee, other clients’ money may be at risk.  You are ethically bound to ensure that any charge backs which jeopardize other client funds in trust are promptly covered with your own funds.  OSB Legal Ethics Opinion No. 2005-172.

Q:  Can I enter into a written fee agreement that allows me to charge the client’s credit card for the balance due?

A:  Yes.  Your agreement should carefully spell out the conditions under which you are authorized to charge the client’s credit card.  For example, your agreement may permit you to charge the client’s credit card for the full amount invoiced as soon as a bill is rendered or only if payment by check is not received within a certain time period.

Q:  Are there any other steps I should take before processing the client’s credit card for payment?

A:  Yes.  Ask the client to complete a credit card authorization form. The form should gather the following information:

• Client Name
• Matter
• Attorney
• Type of Card (Visa or MasterCard)
• Credit Card Number
• Expiration Date
• Card Verification Code
• Name as it Appears on Card
• Company Name on Card (if applicable)
• Credit Card Billing Address
• Telephone, Fax, and E-mail
• Client’s Signature below the following statement:

This authorization is given subject to the terms of the attached Fee Agreement which are incorporated by reference herein.

By signing this authorization, I acknowledge that I have read and agree to all of the above information and warrant all information given is true.

Protect this information from potential identity theft, as you would other personal identifying information belonging to the client.  See Protect Client Information from Identity Theft in the August 2008 issue of the In Brief, available on the PLF Web site.

Q:  Do you have a sample fee agreement or credit card authorization form?

A:  Yes.  A sample Fee Agreement and Authorization to Charge Credit Card with accompanying Credit Card Payment Authorization Form is available on the PLF Web site.  Select Practice Aids and Forms, then Engagement Letters.

For more information on accepting debit or credit cards in your business, see Credit and Debit Cards:  To Accept or Not to Accept from Business.Gov.

Copyright Beverly Michaelis 2009

Periodically, lawyers find they have unclaimed client funds in a trust account.  This can occur when clients disappear or checks remain uncashed.  Common situations include:

•  A client may deposit a retainer with the lawyer and then never return to the office.  When the lawyer tries to make contact, the client cannot be located.
•  Witnesses or others may fail to cash small checks received for appearance fees or other services.
•  A settlement check may be received that is payable to both the lawyer and the client, but the lawyer cannot find the client.

If unclaimed funds remain in the trust account, the lawyer must comply with ORS 98.302-98.436 (Disposition of Unclaimed Property Act).  This statute sets out the procedures for reporting unclaimed funds to the Department of State Lands.  In no circumstance may the lawyer take these unclaimed funds for his or her own purposes.  OSB Legal Ethics Op No 2005-48.

When a check paid out of client funds is not cashed by the recipient, those funds revert to the client and should be reimbursed to the client.  If you can’t find the client after holding the sum for two years, you must report it to the Department of State Lands and deliver the funds to the Oregon State Bar.  (SB 687 effective January 1, 2010.) You must take reasonable steps to find the client and must maintain reasonable records sufficient to permit the client to make a claim for the return of the property for the period permitted by the Act.  One way to avoid this problem is to carefully monitor canceled checks.  If a check has not cleared the trust account for two months, track it down immediately.  Another solution may be to print “void after 90 days” on the face of the check.

If a settlement check is made payable to both the lawyer and the client, the lawyer cannot sign the client’s name on the endorsement without the client’s authorization.  In re Maroney, 324 Or 457 (1996) (lawyer disbarred, in part, for signing settlement check without client’s knowledge or consent).  If the lawyer has a signed fee agreement from the client authorizing the lawyer to take a certain percentage of the settlement for fees, plus costs advanced, the lawyer may return the check to the issuer and request that two checks be issued – one for the lawyer’s fees and costs and one made payable to the client only.  The lawyer must still comply with OSB Legal Ethics Op No 2005-48 and ORS 98.302-98.436 with respect to the client’s portion of the settlement.  See also OAR 141-045-0031 (3)(d).  Instruct your clients to notify you if their address or phone number changes.  If a client will be unavailable during critical periods of time, discuss whether the client should give you a power of attorney to negotiate, settle, and sign documents on the client’s behalf.

Copyright Beverly Michaelis 2009