Preservation and Disposition of Client Files
A beginning point for determining what to do with all the client files accumulating at your firm is ABA Informal Ethics Opinion 1384 (March 14, 1977). In pertinent part, the ABA Informal Opinion states: We cannot say that there is a specific time during which a lawyer must preserve specific files and beyond which he is free to destroy all files. Good common sense should provide answers to most questions that arise. Suggested considerations are as follows:
- Unless the client consents, the lawyer should not destroy or discard items that clearly or probably belong to the client. Such items include those furnished to the lawyer by or on behalf of the client, the return of which could reasonably be expected by the client, and original documents (especially when not filed or recorded in the Public Record).
- A lawyer should use care not to destroy or discard information that the lawyer knows or should know may still be necessary or useful in the assertion or defense of the clients position in a matter for which the applicable statute of limitations period has not expired.
- The lawyer should use care not to destroy or discard information that the client may need, has not previously been given to the client, and is not otherwise readily available to the client and which the client may reasonably expect will be preserved by the lawyer.
- In determining the length of time for retention or disposition of a file, the lawyer should exercise discretion. The nature and contents of some files may indicate a need for longer retention than do the nature and contents of other files, based upon their obvious relevance and materiality to matters which can be expected to arise.
- The lawyer should take special care to preserve, indefinitely, accurate and complete records of the lawyers receipt and disbursement of trust funds.
- In disposing of a file, the lawyer should protect the confidentiality of the contents.
- The lawyer should not destroy or dispose of a file without screening it in order to determine that consideration has been given to the matters discussed above.
- The lawyer should preserve an index or identification of the files that the lawyer has destroyed or disposed of. The index of files that have been disposed of and trust fund records should be preserved indefinitely.
It is recommended that a firm should establish an office policy with regard to closing, retaining and ultimately disposing of client files. The policy should address what the lawyer or firm does when the file is closed, what materials will be delivered automatically to the client upon closing, what procedure the client should follow to request additional materials from the file and whether there is a charge for copies, when the file will be discarded and whether the client will be notified before the file is discarded.
The policy should also address what, if any, materials will be retained by the firm and what obligation the firm will assume with regard to those materials. For example, if the firm holds original client wills, the policy should specifically state whether the firm retains any responsibility for periodically reviewing the wills and advising the clients of relevant changes in law. The policy should also inform clients how to go about retrieving the original will at the appropriate time as well as what will happen to the file if the originating attorney retires or dies.
The policy should provide that upon closing a file, all original client materials, together with any documents prepared by the firm for the client and any other documents designated by the client, will be
delivered to the client and that after a suitable period (10 years) the firm copy of the file will be destroyed without further notice to the client. It will be necessary to advise clients concerning the file retention policy.
The permanent firm records of discarded files should provide information concerning the clients name and last address, the date of the engagement, the name of the responsible attorneys, the identities of any opposing parties, the nature of the matter, the results of the representation, the date the file was closed and the date the file was destroyed.
Within the overall guideline of 10 years, when closing files, the attorney in charge should determine how long the file and its contents should be kept before destruction while considering the following factors:
- A file should not be destroyed until the statute of limitations period for bringing a legal malpractice action for that particular file has expired.
- A file involving minors or disabled individuals should not be destroyed until after the minor has reached the age of majority or the disability ends. The statute of limitations for legal malpractice claims is tolled in the case of a minor or disabled claimant until the claimant reaches majority or is no longer disabled.
- A file should not be destroyed if it pertains to a contract not fully paid or performed at the end of the ten (10) year period, or a judgment that must be renewed.
- A file should not be destroyed if there is a need for information in the future, such as the retention of tax related files to establish the cost basis of assets.
- Files related to estate planning or estate administration matters or containing permanent tax related information- should be retained indefinitely. It may also be advisable to retain environmental related files indefinitely.
- A file should not be destroyed until after all time requirements for appeal or for other statutory or law imposed purposes has expired.
Clients should be notified of file retention policies of the firm at the time the representation is undertaken. Language similar to the following could be added to the engagement letter:
"During the course of the matter, you may be required to provide us documents such as tax records, expense records, bank records, deeds, etc. We will hold these records as necessary for you during the pendency of your matter. At the conclusion of your matter, we will contact you and make arrangements for the return of the records you provided. We will retain the balance of your file for ____ years in accordance with the file retention policy of the firm. It is your responsibility to make arrangements to retrieve any other information you wish to retain from the file. If arrangements are not made for the return of information contained in the file within ___ years following the conclusion of your matter, they will be destroyed".
In addition to notification through the use of an engagement letter, the firm may wish to consider two alternative methods of ensuring client notification:
- Before destruction of a file, a letter is mailed to the clients last known address notifying the client that the file will be destroyed on a particular date unless the client indicates to the firm that the client wishes to retain the file.
- At the beginning of the representation, the client is notified of the firm policy concerning the destruction of files and a separate written client consent is obtained for file destruction. The notification should set forth a specific period for the destruction, such as 10 years after the matter is concluded, and should describe steps that the client can take to claim the file prior to destruction.