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Bar News - February 17, 2016

IOLTA Challenge Draws Defenders


On short notice, various legal services stakeholders came together earlier this month to oppose a House Bill that would effectively dismantle the Interest on Lawyers Trust Accounts (IOLTA) program, eliminating the most significant, reliable private funding source for indigent legal aid in New Hampshire.

HB 1491, as originally drafted, would have regulated interest on “charitable trusts,” so leaders of the NH Bar Foundation, which administers the IOLTA program, and other legal assistance programs that benefit from the funding, were not aware of its sponsor’s intentions until shortly before a public hearing Feb. 3.

The bill’s lone sponsor, State Rep. Neal Kurk (R-Weare), who chairs the House Finance Committee, said the bill had been drawn incorrectly, and put forth an amendment to replace the original bill. The new proposal would return the short-term interest on lawyers’ trust accounts to individual clients, eliminating the pooled accounts, on which certain banks pay 1-2 percent interest. That interest last year provided a total of $800,000 to support civil legal services for low-income litigants across the state.

“In my view that money belongs to the person who put the money in the hands of the lawyer in trust,” said Kurk, who called the measure “a property rights bill.”

But without lawyers’ pooled trust accounts and the charitable mission of the IOLTA program, the individual interest amounts would be negligible and the administrative costs to account for each payment would be higher than the interest to be paid out. “We’re maximizing money from no place,” NH Bar Association Vice President Scott Harris testified at the public hearing, before the House Commerce and Consumer Affairs Committee. “This is like manna from heaven in a sense.”

Representatives from various beneficiaries of IOLTA funds, including NH Legal Assistance and the Disability Rights Center – NH, also testified at the hearing, as did John Funk, of Gallagher, Callahan & Gartrell, who said, “Sometimes, principle needs to yield to practicality.”

Committee members, including the chair, State Rep. John Hunt of Rindge, and State Rep. Rebecca McBeath, a Portsmouth attorney and Pro Bono volunteer, seemed skeptical about the benefits of the proposal, which was referred to a subcommittee for further study.

In addition to its advocacy on HB 1491, the NH Bar Association Board of Governors has voted to support two proposed bills, oppose 12, and provide information to the Legislature on a variety of other pieces of pending legislation.

The Board supports HB 1280, which addresses grounds for the modification of parental rights and responsibilities, and SB 464, which would create a statewide drug court program, among other related provisions.

HB 1280 “provides for modification of a parenting order based on a change in travel time required for visitation, a change in the parent’s work schedule, or the age of the child. The bill also permits the court to modify a parenting order or schedule based on the relocation of a child’s residence,” according to the legislative analysis. Several members of the NHBA Family Law Section testified on their own behalf in favor of the bill at a hearing last month before the NH House Children and Family Law Committee.

SB 464 was introduced during the special legislative session Governor Maggie Hassan convened late last year in an effort to combat the growing problems of opioid addiction and overdose deaths in New Hampshire. The bill would create and staff a statewide office of the drug court coordinator and establish a statewide grant program that would provide state matching funds to counties that develop local drug courts as a sentencing alternative for addicts.

The NHBA opposes three proposed constitutional amendments, including one that would create judicial elections and specified terms (CACR 15), and nine proposed bills. The other two proposed constitutional amendments would 1) make it so that Supreme Court rules no longer have the force and effect of law (CACR 13) and 2) require the appointment of the NH Attorney General to be confirmed by the General Court (CACR 26).

The nine bills opposed by the association are: HB 1166 (appointment of non-bar attorneys for grievance victims), HB 1297 (cause of action for violation of rights and privileges), HB 1333 (court-required juror information), HB 1434 (findings of out-of-home placements: payments, misdemeanor), HB 1481 (jurors must be New Hampshire residents and read the NH Constitution), HB 1522 (adoption of Federal Rules of Civil Procedure in New Hampshire), HB 1607 (nolle pros cases), HB 1677 (abolish NH Judicial Council and NH Supreme Court counsel position), and HR 18 (redress of specific judges and clerk).

For more information about these bills, NH Bar Association members can consult Legislation Watch, a members-only website that tracks the bills the NHBA Legislation Committee reviewed this session.

Over the course of five meetings totaling about 15 hours, the 24-member Legislation Committee discussed each bill to determine whether it merits the association taking a position. The committee determines for each proposal whether it affects the administration of justice, the composition and operation of the courts, the practice of law or the legal profession and, if so, whether the bill is of significant interest to the Bar membership as a whole.

The committee also considers whether there is substantial unanimity within the Bar on any bill under consideration and is expected to exercise circumspection in all its deliberations prior to making any legislative recommendations to the Board of Governors. (Learn more about the limitations of association lobbying activities.)

The NHBA Board of Governors, at its meeting Jan. 21, voted to accept the recommendations of the Legislation Committee on all but one bill, SB 474 (relative to the administration of small estates), on which it shifted from an “information-negative” position to an “information-neutral” position. The Senate Judiciary Committee recently recommended that the bill go to interim study, meaning it is on hold for the remainder of the session.

If you are in doubt about the status of any meeting, please call the Bar Center at 603-224-6942 before you head out.

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