Court Opinion

ID: 9745343
Source: CourtListenerOpinion
Date Created: 2023-08-26 22:49:55.023179+00
Date Added: 2024-06-11T07:24:59.204843
License: Public Domain

Nolan, J.
(concurring). I concur in the opinion and order of the court, but I write to underscore what I think is important. Our opinion and order govern only amounts “so small or [which] are held for such a short period of time” that the attorney is under no obligation to put them in an interest bearing account. Let there be no misunderstanding as to this limitation because an attorney who holds money for a client is ethically bound to put such money at interest and to account for such interest to the client if the amount is at all significant and if the period of holding is beyond a few days unless the client unequivocally waives his right to interest.
Appendix.
On May 23, 1985, it was ordered by the Justices that the Rules of the Supreme Judicial Court be amended as follows:
Rule 3:07: By adding to DR 9-102 the new paragraph (C) set out below.
*10(C) A lawyer may elect to create, to maintain, and at any time to close an interest-bearing trust account (hereinafter “trust account”) for clients’ funds which in the judgment of the lawyer are nominal in amount, or are to be held for a short period of time, in compliance with the following provisions:
(1) The trust account may be established with any bank or savings and loan association authorized by Federal or State law to do business in Massachusetts and insured by the Federal Deposit Insurance Corporation, the Federal Savings and Loan Insurance Corporation, or similar State insurance programs for State-chartered institutions. Funds in the trust account shall be subject to withdrawal upon request and without delay.
(2) Lawyers or law firms electing to deposit client funds in the trust account shall direct the depository institution:
(a) To remit interest or dividends, net of any service charges or fees, on the average monthly balance in the account, or as otherwise computed in accordance with an institution’s standard accounting practice, at least quarterly, to a tax-exempt recipient disburser entity (hereinafter “charitable entity”) designated by the Supreme Judicial Court, for use in (1) improving the administration of justice or (2) delivering civil legal services to those who cannot afford them.1
(b) To transmit with each remittance to the charitable entity a statement showing the name of the lawyer or law firm which deposited the funds; and (c) At the same time to transmit to the depositing lawyer or law firm, with a copy to the IOLTA Implementation Committee or its designee, a report showing the amount paid to the charitable entity, the rate of interest applied, and the average account balance for the period for which the report is made.
(3) This court shall appoint an IOLTA Implementation Committee.2 (4) The representatives appointed to the Committee shall oversee the implementation of an IOLTA program, including:
(a) the encouragement of lawyers to create and maintain interest-bearing trust accounts under DR 9-102 (C);
(b) the encouragement of the banking community and the public to support an IOLTA program;
*11(c) the obtaining of tax rulings and other administrative approval for an IOLTA program as appropriate;3
(d) the preparation of such guidelines as may be deemed necessary or advisable for the operation of an IOLTA program, including (i) standards for the manner of recruiting of attorneys to participate in the IOLTA program, including the use of a common solicitation form describing all recipient charitable entities and a common fact sheet describing the IOLTA program for media and direct solicitation, and (ii) standards for recipient charitable entities in accounting for the expenditure of IOLTA funds, including permissible categories of, and a ceiling on, recipient expenses; and
(e) reporting to the court in such manner as the court may direct. (5) Any charitable entity designated by the Supreme Judicial Court hereunder may engage in attorney recruitment efforts. All charitable entities, other than Massachusetts Legal Assistance Corporation, shall pay to Massachusetts Legal Assistance Corporation not less than fifty percent (50%) of the IOLTA funds received less expenses properly allocable to such share. Massachusetts Legal Assistance Corporation will retain for its use in the furthering of its corporate purpose all of the IOLTA funds received by it, by direct solicitation and from other charitable entities.
(6) Each charitable entity shall submit an annual report to the court describing its IOLTA activities for the year and providing a statement of the source and application of IOLTA funds received pursuant to this Order. It was further ordered that the amendment accomplished by this order shall take effect on September 1, 1985.

 The Boston Bar Foundation, the Massachusetts Bar Foundation and Massachusetts Legal Assistance Corporation are hereby designated as “charitable entities,” as defined in DR 9-102 (C) (2) (a).

 The Boston Bar Foundation, the Massachusetts Bar Foundation, and the Massachusetts Legal Assistance Corporation each are requested to nominate by July 1, 1985, three representatives to the IOLTA Implementation Committee. The aforementioned charitable entities should be mindful in submitting their nominations of the need for the Committee to be truly representative of the constituency of persons interested in the provision of civil legal services to the poor and the improvement of the administration of justice.

 The IOLTA Implementation Committee may require that no deposits under the IOLTA program shall be made until a favorable tax mling has been obtained.