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Ethics of Practice Management in the 21st Century


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A discussion of trust accounting, conflicts, social media, metadata, cloud computing, and other ethical topics for lawyers.

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Ethics of Practice Management in the 21st Century

  1. 1. SHEILA BLACKFORD DEE CROCKER BEVERLY MICHAELIS ETHICS OF  PRACTICE MANAGEMENT I N   T H E   2 1 S T C E N T U RY TOPICS Trust Accounting Conflicts Social Media Metadata Cloud Computing Ethics Potpourri + Bonus Practice Tips!
  2. 2. TRUST ACCOUNTING KEY CONCEPTS “A LAWYER SHALL HOLD PROPERTY OF CLIENTS  OR THIRD PERSONS SEPARATELY…” 1. Retainers 2. Settlement proceeds 3. Overpayments 4. Third party payments Oregon RPC 1.15‐1
  3. 3. THIRD PARTY PAYMENT RULES 1. Follow Oregon RPC 1.8(f) g () 2. Redact billing statements 3. Specify who receives refund  of unearned fees OSB Formal Ethics Opinion 2005‐157 DUTY OF SAFEKEEPING Deposit daily Deposit daily Protect after hours Issue receipts for cash Protect other client property Protect other client property
  4. 4. PRACTICE Smartphone Apps Desktop Deposit DON’T SPEND WHAT YOU DON’T HAVE 1. Funds must clear 2. Use the minimum 3‐5‐10 day guideline 3. Be wary of scams
  5. 5. ACCOUNT TO THE CLIENT BEWARE OF PREPAID FIXED FEES 1. Put it in writing 2. Earned upon receipt 3. Subject to refund
  6. 6. Use stage of completion If half the work is done,  refund half the fee Hourly rate computations  not allowed How Much Do I Owe You? "New" Guidelines For Fixed And So‐called Nonrefundable Fees Designation of a prepaid fixed fee Designation of a prepaid fixed fee  as nonrefundable may be  misleading, if not false,  f g ( )( ) in violation of Oregon RPC 8.4(a)(3) 
  7. 7. PRACTICE Pros Cons  Clients like certainty  Easy to budget  Immediate income Solution? l ?  Bad bargain?  Calculating refunds  Money out‐of‐pocket  Requires timekeeping  Excessive fee?  • Fixed fee in trust • Specify when earned DIVISION OF FEES 1. Disclosure + consent 2. Total fee cannot be excessive 3. Includes “referral fees” 4. Get it in writing! See Chapter 12, “Referral Agreement Between Lawyers,”  Fee Agreement Compendium – OSB BarBooks
  8. 8. FEE AGREEMENT MODIFICATIONS Reason for change  Explanation of effect  Client consent  Objective fairness = + + + Allowable modification OSB Formal Opinion 2005‐97 PROTECT AGAINST THEFT 1. Endorse and lockup p 2. Protect credit card numbers 3. Supervise staff 4. Learn more
  9. 9. RESOURCES Oregon State Bar General Counsel   Bar Counsel Articles   Ethics Opinions BarBooks – Fee Agreement Compendium Professional Liability Fund Dee Crocker – Beverly Michaelis – Sheila Blackford y Forms  Books  In Brief articles   CLEs   Confidential Advice Oregon Law Institute Oregon Rules of Professional Conduct Annotated TRUST ACCOUNTING FOR SOLE PRACTITIONERS
  10. 10. METADATA “DATA ABOUT THE DATA” METADATA IS EVERYWHERE 1 Word processing documents 1. Word processing documents 2. Spreadsheets 3. Database files 4. Videos and photographs 5. Every electronic file!
  11. 11. Path and file names Author Date and time stamps Company or firm name Inserted text Document versions Comments Headers and footers
  12. 12. Tracked changes Template information Undo and redo history Network or server name ACT COMPETENTLY OSB Formal Opinion 2011‐187
  13. 13. USE REASONABLE CARE 1. Prevent inadvertent disclosure 2. Limit nature of metadata 3. Limit scope of metadata OSB Formal Opinion 2011‐187 PRACTICE Print to PDF
  14. 14. PRACTICE Agree not to review metadata Agree not to review metadata CONFLICTS OF INTEREST BEST PRACTICES
  15. 15. MANAGING CONFLICTS Establish a reliable system Capture all parties Know how to use your system Know when to run a conflict check ESTABLISH A RELIABLE SYSTEM Manual Systems Software Solutions The first golden rule
  16. 16. USE WHAT YOU ALREADY HAVE 1. Microsoft Outlook 2. Access or other database application 3. Searchable Address Book OR BUY A PROGRAM PC/Windows  Amicus Attorney  PracticeMaster  ProLaw Time Matters  Time Matters Mac  Daylite  LAWSTREAM  Legal Suite resources/charts_fyis/casemanagementcomparison.html
  17. 17. USE THE CLOUD OR STAND‐ALONE SOLUTIONS Cloud  Clio  Rocket Matter  RTG Conflicts Stand‐Alone  RTG Conflicts  Legal Software Systems resources/charts_fyis/coninterestfyi.html SEARCHING CASE MANAGEMENT SOFTWARE
  18. 18. CASE MANAGEMENT SEARCH RESULTS CAPTURE ALL PARTIES Clients Adverse Parties Related Parties Declined Clients Prospects Pro Bono Clients Firm Members The second golden rule
  19. 19. KNOW HOW TO USE YOUR SYSTEM  William, Bill, or Willy?  Elizabeth or Liz?  Former Names The third golden rule Always  document  your file  SSN or TIN  DOB  123 ABC Street
  20. 20. Add the new  names from  your intake  form  PRACTICE Remember to specify Remember to specify  the relationship to the client 
  21. 21. PRACTICE Circulate  New Matter y Lists Weekly SCREEN AND PREPARE Screen incoming lawyers Prepare outgoing lawyers Keep your own list Check conflicts here!
  22. 22. PRACTICE 1. Update your system at closing 2. Be aware of consent requirements 3. Avoid business deals with clients KNOW WHEN TO RUN A CONFLICT CHECK At first contact When the file is opened Whenever a new party enters the case Fourth
  23. 23. CLOUD COMPUTING O S B  F O R M A L  O P I N I O N  2 0 1 1 ‐ 1 8 8 Ethical due diligence is all about  doing your homework
  24. 24. VET THE VENDOR  Reputation? p  Duration in business?  Serving other lawyers? VET THE VENDOR  Secure facilities?  Geographically dispersed servers?  Meets industry standards?
  25. 25. UNDERSTAND ALL TERMS Review the terms of service 2. Read the vendor’s privacy policy 3. Is there a “business agreement?” 1. SHOULD YOU USE THE CLOUD? Any browser Any platform Any location (with Internet) Any time $$$
  26. 26. Source: Up, up and away! The cloud computing way!
  27. 27. RESOURCES Data protection and cloud backup (video)‐data‐protection‐and‐cloud‐backup‐ for‐any‐size‐firm/ What is cloud computing? resources/charts_fyis/saas.html Get the book! SOCIAL MEDIA
  28. 28. PUBLIC INFORMATION Up for Grabs OSB Formal Opinion 2013‐189 NON‐PUBLIC INFORMATION  Represented parties Represented parties  Non‐represented parties  Jurors‐ethics‐of‐using‐social‐media‐ for‐investigation/
  29. 29. YOUR USE OF SOCIAL MEDIA Social media for lawyers: a word of caution Sorting out social media: tools & etiquette Get the book! h // i b / b / ETHICS POTPOURRI
  30. 30. BE MINDFUL OF WHAT OTHERS HEAR  Inside the office Inside the office  Outside the office BE CAREFUL OF WHAT OTHERS SEE
  31. 31. PROTECT CONFIDENTIALITY  DURING DESTRUCTION Darik’s Boot and Nuke OFFICE SHARING AND CONFLICTS 1. Screen for conflicts if you share employees 2. Assure phone messages remain confidential 3. Assure mail remains confidential 4. Retrieve copies, faxes, print jobs OSB Formal Opinion 2005‐50
  32. 32. Contact Us PLF Practice Management Advisors b lf 503-639-6911 - 800-452-1639 Beverly Michaelis Sheila Blackford Dee Crocker and confidential