To Keep or Not to Keep: That is Always the Question.
A Liability Minute blog post on File Retention and Destruction written by ISBA Mutual Risk Management Counsel Jeremy N. Boeder of Tribler Orpett & Meyer P.C.
Lawyers tend to accumulate a large volume of files, whether in hard-copy form, in electronic storage, or both. For many of us, the top question on our minds is, “when can I safely get rid of these?” As a lawyer who practices in the areas of legal malpractice litigation and lawyer and law-firm risk management, this is a question that I field quite often so I wanted to summarize the applicable rules and guiding principles for you here.
There are no ethics rules or Supreme Court Rules that mandate an attorney to keep most portions of client files for any length of time. In my view, the best practice is for an attorney to keep the entirety of a client file for one year beyond the period of time during which a legal malpractice claim could potentially be timely brought. By preserving a file for at least that long, the attorney can be reasonably sure that information that may be essential to the effective defense of a legal malpractice claim or an ethical grievance will not have been destroyed. The statute of limitations for legal malpractice is two years from the time the person bringing the action knew or reasonably should have known of the injury (keeping in mind that the statute of limitations could be extended if the client is a minor or incompetent, if the engagement involved estate-planning, or under some other limited circumstances) and the statute of repose is six years from the last act of representation with regard to the act or omission upon which the malpractice claim is founded. 735 ILCS 5/13-214.3. It is very rare that we recommend keeping a file for fewer than seven years following the conclusion of an engagement.
Although no rule requires that the entirety of a client file be kept beyond the conclusion of an engagement, there are rules that dictate that certain portions of client files and other law-firm records be kept for certain periods of time. These rules are discussed in more detail below.
- Supreme Court Rule 769 (Maintenance of Records) requires a lawyer to maintain two types of records: (1) records identifying the name and last known address of the attorney’s clients and whether the representation is ongoing or concluded; and (2) all financial records relating to the attorney’s practice. The latter category of records must be kept for a period of no less than seven years after the representation is concluded.
- Supreme Court Rule 756(e) (Disclosure of Malpractice Insurance) requires a lawyer to maintain, for a period of seven years from the date malpractice coverage is reported as part of the registration process, documentation showing the name of the insurer, the policy number, the amount of coverage, and the term of the policy.
- Rule of Professional Conduct 1.15(a) (Safekeeping of Property) requires that all records of trust accounts or other property held in trust be kept for a period of seven years after the end of the representation.
- Supreme Court Rule 796 (Proof of MCLE Compliance) requires that each attorney shall maintain for three years after the end of the relevant reporting period, certificates of attendance received as well as sufficient documentation necessary to corroborate Continuing Legal Education activity hours earned.
In addition to the rules discussed above, Supreme Court Rule 764 imposes a record-retention duty upon attorneys who have been disciplined by the ethics authorities. Rule of Professional Conduct 1.15(d) and 1.16(d) require the lawyer, upon conclusion of the representation, to return all property and papers received from the client.
As discussed above, although most portions of a client file are not legally or ethically required to be kept beyond the conclusion of an engagement, good practice dictates that an attorney should exercise prudent judgment in determining how long to keep other portions of a client file. In addition to taking into consideration the date upon which the statutes of limitations and repose for a legal malpractice claim might expire, including factors like the nature of the engagement and the age of the client, the attorney should consider whether the client or an opponent was particularly difficult to deal with or threatened a claim against the attorney in the past, in which case a malpractice claim or ethical grievance may be more likely. The attorney may also want to take into consideration the ease with which key portions of the file can be maintained indefinitely, such as via electronic storage, and whether information contained in the file could be reconstructed from other sources if the file was destroyed. It should also be pointed out that there is no statute of limitations for a client or other person to complain about a lawyer’s conduct to the ARDC.
In summary, attorneys must keep a record of the name and contact information for all clients and former clients indefinitely, financial records related to the representation for seven years after the representation ends, records for property or funds kept in trust for seven years after the representation ends, and proof of CLE attendance for three years after the period ends in which the attorney was to receive credit. Best practices would also suggest that every attorney maintain complete client files for in excess of the period of time in which the attorney could possibly be sued for legal malpractice arising out of the representation.
If you are unsure about a specific client or file, you can always obtain a Risk Management Consultation or get more information by requesting a copy of the File Retention and Destruction guide by clicking here.