Supreme Court Rules Table of Contents
(1)
Interest-Bearing Trust Accounts. A member of the New Hampshire Bar shall
create or maintain an interest-bearing trust account for clients' funds which
are nominal in amount or to be held for a short period of time and must comply
with the following provisions:
A. An
interest-bearing trust account shall be established with any bank or savings and
loan association authorized by federal or State law to do business in New
Hampshire and insured by the Federal Deposit Insurance Corporation or the
Federal Savings and Loan Insurance Corporation ("financial
institution"). Funds in each interest-bearing trust account shall be
subject to withdrawal upon demand.
B. The rate of interest payable on
any interest-bearing trust account shall be the same rate of interest paid by
the depository institution for all other holders of similar accounts. Interest
rates higher than those offered by the institution on regular checking or
savings accounts may be obtained by a lawyer or law firm on some or all
deposited funds so long as there is no impairment of the right to withdraw or
transfer principal immediately.
C. Lawyers, law firms or others
acting on their behalf when depositing clients' funds in an interest-bearing
account shall direct the depository institution:
(i) to remit
interest or dividends, as the case may be, at least quarterly, to the New
Hampshire Bar Foundation; and
(ii) to
transmit with each remittance to the Foundation a statement showing the name of
the lawyer or law firm for whom the remittance is sent; and
(iii) to
transmit to the depositing lawyer or law firm at the same time a report showing
the amount paid to the Foundation.
D. The interest or dividends received
by the Foundation shall be used solely by the Foundation for the following
purposes:
(i) for the
support of civil legal services to the disadvantaged;
(ii) for public education relating to the courts and legal matters;
(iii) for
such other programs as may be approved by the supreme court.
Such income shall be applied only to activities permitted to
be conducted by organizations exempt from taxation under section 501(c)(3) of
the Internal Revenue Code of 1954, as from time to time amended.
E. Attorneys, either individually or
through their firm organizations, shall complete an annual Authorization to
Financial Institutions by August 1 of each year listing any interest-bearing
trust acccount(s) for clients' funds under paragraph (1) and directing the New
Hampshire Bar Foundation to act on behalf of the depositing lawyer or law firm
to convert clients' non-interest bearing trust account(s) to interest-bearing
trust account(s) under provisions of Rule 50(1).
F. A lawyer or law firm who declines
to maintain accounts described in subdivision (1)A of this rule must submit a
Notice of Declination in writing to the Clerk of the Supreme Court by August 1
of any year for the period beginning such August 1 and extending until such
declination is revoked.
(i)
Notwithstanding the foregoing, any participating lawyer or law firm may petition
the Court at any time and may be granted leave to file a Notice of Declination
at a time other than that specified above. An election to decline participation
may be revoked at any time by filing a request for enrollment in the program.
(ii) A lawyer
or law firm that does not file with the Clerk of the Supreme Court a Notice of
Declination in accordance with the provisions of this rule shall be required to
maintain accounts in accordance with subdivision (1)A of this rule.
G. This rule may be subsequently
amended to effectuate its purposes or to comply with any amendments to the
Internal Revenue Code.
(2)
Attorney's Financial Records:
A. Every attorney shall maintain
records of the handling, maintenance and disposition of all funds or securities
of a client at any time in his possession from the time of receipt to the time
of final distribution and shall preserve such records for a period of six (6)
years after final distribution of such funds or securities or any portion
thereof. Specifically, every attorney or the firm organization shall maintain a
trust accounting system that shall include at the minimum, (1) a ledger or
system showing all receipts and disbursements from the trust account or accounts
with appropriate entries identifying the source of the receipts and the nature
of the disbursement, and (2) a separate accounting page or columns for each
client for whom property is held, which shall show all receipts and
disbursements and carry a running account balance. Any other system that
preserves the above-mentioned features and sufficiently accounts for trust funds
may also be used. In addition there shall be maintained an index, or equivalent
single source for identification of all trust accounts, including special
interest-bearing trust accounts, probate accounts, custodial accounts and client
agency accounts.
B. All cash property of
clients received by attorneys shall be deposited in one or more clearly
designated trust accounts (separate from the attorney's own funds) in financial
institutions. Any attorney depositing client funds into an out-of-state
financial institution shall file a written authorization with the Clerk of the
Supreme Court authorizing the Court or its agents to examine and copy such
out-of-state account records. Under no circumstances may any attorney use
out-of-state banks other than those located in Maine, Vermont,
Massachusetts, or the state in which the attorney's office is situated, without
obtaining prior written approval from the Supreme Court.
C. Only those retainer fees, that are
refundable if not earned, and as to which the attorney has so informed the
client, shall be deposited in the trust account(s) described above. These shall
not be withdrawn from the account of the attorney or firm organization until
earned. All other retainer fees may be deposited in the attorney's general
operating account.
D. All funds received as proceeds of
collections or awards on behalf of a client shall be deposited in gross in the
trust account(s) required above, and shall not be charged with a fee until
distribution.
E. The practice of
law in the form of a partnership or a professional association shall not relieve
an attorney from the obligation of compliance with this Supreme Court Rule.
F. Each bank account required by Rule
50, except those accounts excluded by Rule 50-A(3), shall be reconciled by the
lawyer or law firm on a monthly basis. Such reconciliation shall disclose (a)
the balance of the account according to the bank's records; (b) the balance of
the account according to the lawyer or law firm's records; (c) a detailed
listing of all differences between items (a) and (b); (d) a listing of all
clients' funds in the accounts as of the reconciliation date; and (e) a detailed
listing of all differences between items (b) and (d).