The unique nature of the legal profession makes the management of records related to it likewise unique. While on one hand, some records are managed in a manner similar to other businesses, others, in particular those related to the actual practice of law, are subject to special rules and considerations. In this article, we’ll look at some of those rules and how they affect the management of sensitive legal records in a law practice.
Before considering the records themselves, it’s worth taking a moment to review the nature of law practice itself, and the nature of the attorney-client relationship. It’s the characteristics of these things that ultimately drive the characteristics of the records that derive from them.
First, the nature of an attorney-client relationship is inherently confidential. We’ve seen some recent examples of lawyers spouting off in the press about a few high-profile cases, but that’s unusual, and in most cases, highly improper. Rule 1.6 of the Model Rules of Professional Conduct states: “A lawyer shall not reveal information relating to the representation of a client unless the client gives informed consent …”
There are few exceptions and no mitigating circumstances. A lawyer has an absolute, unqualified duty to preserve the confidences of his or her client. Most lawyers are therefore quite circumspect about any discussion or revelations about their clients and the matters on which they represent them.
Second, when a client entrusts the lawyer with the client’s property, in any form – documents, physical objects, money, whatever – the lawyer has a duty to protect and preserve it until it is returned to the client or until it is otherwise disposed of in accordance with the client’s wishes. Rule 1.15 states: “A lawyer shall hold property of clients or third persons that is in a lawyer’s possession in connection with a representation separate from the lawyer’s own property. “Again, there are no exceptions and no time limitations.
Viewed from the client’s perspective, these rules and duties make perfect sense. The lawyer is a trusted advisor, to whom the client must disclose information that may be valuable, confidential, sensitive, or embarrassing. If the client is to do so with confidence, they must be absolutely assured that the lawyer will respect those confidences, no matter what. And indeed, attorney-client communications are protected by law, as well as by the ethics rules of the legal profession.
With respect to the property, once again, the client may entrust the lawyer with possession of valuable documents, family treasures, or large sums of money. In all of these cases, the client can only do so with confidence if they have complete trust in the lawyer.
Both duties directly impact the record-keeping of a law practice. Consider the duty of confidentiality. The matter file for any representation will be filled with client documents, notes of discussions between the client and the lawyer, and assorted other things that the client will in virtually all cases want to remain confidential, and that in all cases, the lawyer has a duty to maintain as confidential.
This duty cascades throughout the firm’s record-keeping system. File rooms must be physically secured in some appropriate manner. Electronic recordkeeping systems must be secure, and appropriate permissions must be employed to prevent unauthorized access, even by employees of the firm. Appropriate steps must also be taken to prevent data breaches and security incidents. This attention to confidentiality and security extends to the desktop – there’s no place where a clean desktop policy is more important than a lawyer’s desk. It also extends to cloud-based information systems and other external vendors. In both cases, the lawyer has an ethical duty to ensure that the vendor is taking appropriate steps to ensure that the records are being maintained in a safe and secure manner, protected from both loss and compromise.
Protection of client property and funds likewise impacts record-keeping, in several ways. First, consider client funds. A client may pay a retainer for a case; or, the lawyer may hold money in escrow or in trust for a client. In every case, the lawyer has a fiduciary duty to maintain strict accounting for the funds and to provide the client or beneficiaries with a detailed accounting of the funds on demand. No duty is taken more seriously – a lawyer’s license is on the line if money held in a fiduciary capacity cannot be properly accounted for.
The lawyer may also take possession of other client property as well: original or duplicate business records, wills, property titles, and many other kinds of records and artifacts. In many jurisdictions, the client’s ownership interest extends to the entire case file. In every case, the fact that the lawyer has possession of the records does not vest ownership in the lawyer, nor does it in any way impair the client’s ownership of them. That reality imposes some duties on the lawyer: The lawyer cannot destroy client property (such as, for example, the matter file, or duplicate records provided during discovery) unless and until the client has consented to its destruction. That consent can occur by agreement, as in the engagement letter, or it can occur later. But the lawyer cannot assume that mere passage of time, or the fact that the lawyer has lost track of the client, give rise to a right to destroy old client property or matter files. A clear understanding with the client, and a sound and effective management process for legal records to effectuate that understanding, are therefore key to fulfilling these duties.
The duty to preserve a client’s property can give rise to tension with the duty to preserve client confidentiality if records and relationships are not well-managed. A lawyer’s privilege extends to lawyer-client communications and lawyer work product, but it does not extend to client records in the lawyer’s possession if they are not otherwise privileged. Other lawyers can, and sometimes do seek discovery of the client’s legal records from the lawyer if they cannot obtain those records from the client. This can occur when the client has a records retention schedule and rigorously enforces it, but the law firm has no policy regarding the disposition of matter files or does not communicate it to the client. This is both embarrassing for the lawyer and a potential malpractice claim, so a sound retention policy and communication of it to the client are matters of considerable importance.
In sum, although many of a law firm’s records can and should be treated as normal business records, those parts of the records system that deal in any way with client matters are subject to different rules and considerations, and there are important consequences arising from that difference. Every lawyer should understand these distinctions and apply them for law firm records management.