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Just because a case is resolved and the representation is over doesn’t mean a lawyer’s work is done. An ethics opinion published Monday makes clear that for years afterward, lawyers can still have obligations regarding closed case files. The opinion, by the New Jersey Supreme Court Advisory Committee on Professional Ethics, supplements Opinion 692, Retention of Closed Clients’ Files, issued in January 2001. The earlier opinion stated the general rule that unless the client agrees to an earlier time frame, closed case files must be kept for at least seven years and that, even then, lawyers cannot dump files in the trash but must dispose of them in a way that preserves any privileged or confidential material. Opinion 692 left lawyers with lots of questions, however, and the new opinion is an attempt to answer them. It clarifies aspects of the earlier opinion, including what constitutes client property, and details some steps attorneys must take. It also specifies obligations for insurance defense counsel, criminal defense lawyers and lawyers who represent minors. Under Opinion 692, items a client entrusts to a lawyer — such as original documents and photographs, or created or obtained by the lawyer “as part of the undertaking,” such as wills, deeds and executed contracts — are client property and must be returned. The supplement emphasizes that client property may never be destroyed without client permission or legal authorization, such as a court order. Otherwise it must be kept indefinitely or, if it has inherent value, like stocks, bonds or jewelry, and the client cannot be located, it should be dealt with under unclaimed property laws. At the end of the seven years, lawyers must examine closed files for client property and if they find any, must notify the client and allow a “reasonable time” for a response, the supplement states. INSURANCE DEFENSE CONCERNS The supplemental opinion also addresses special concerns that arise in insurance defense work. It refers to Opinion 542, issued in 1984 in response to an inquiry about whether an insurance defense attorney breached the duty of confidentiality by delivering closed files to the insurer without retaining copies. Opinion 542 answered that the attorney had to return to the insured all material unrelated to the claims at issue unless the insured authorized another means of disposal. The supplemental opinion rejects Opinion 542 to the extent it permits destruction of a file based on a contract between the insured and the insurer. Re-emphasizing the primacy of the lawyer’s obligation to the insured rather than the insurance company, the committee found that materials in a lawyer’s claims file that fall within the meaning of client property must be disposed of according to the client’s instructions or kept indefinitely. Such property would include medical and financial records. The insured’s consent to disposition must be fully informed — the insured has to know what is in the file when consent is given. That means consent cannot be by way of a provision in the liability policy. George Kenny, a partner with Roseland’s Connell Foley, who has decades of experience with insurance defense, criticizes this part of the opinion as being “murky” and raising “unnecessary problems,” which “indicate a lack of everyday knowledge as to how things work in developing a defense file.” For example, medical records obtained by insurance defense counsel are not, as the opinion states, delivered by the insured but obtained with the insured’s authorization or from the insurer, says Kenny. “The only thing you get from the insured usually are answers to interrogatories of which the insured has a copy,” he notes. Judith Heim, of Florham Park’s Heim & McEnroe, house counsel for Chubb Insurance, points out that when the committee speaks of “claims files” held by lawyers, it must be referring to legal files. Lawyers “don’t have any control over ‘claims files,’” which insurance carrier representatives maintain, she says. CRIMINAL DEFENSE CONSIDERATIONS Criminal lawyers also have a special obligation for their files “because criminal convictions can have significant consequences long after the final judgment, sentencing and closure of the case.” The supplemental opinion forbids criminal defense lawyers from discarding or destroying files while a former client is alive, unless the client expressly agrees. Richard Lehrich, the president of the Association of Criminal Defense Lawyers of New Jersey, calls the requirement “an imposition but a prudent thing to do. � You never know when a case is going to become relevant again.” Lehrich, who has 16 years of private practice behind him, says he keeps his files “forever.” Still, the Cranford solo practitioner says he is running out of room and “eventually, I will need to do something.” The state’s largest criminal defense firm, the Public Defender’s Office, has a 50-year record retention policy, says spokesman Jeff Beach. Because the policy was adopted in the late 1960s or early 1970s, the office has more than 10 years before it needs to start reviewing its files, says Beach. The number of cases the office closed in fiscal 2002 alone — 105,917 — provides a sense of the magnitude of the task. The files are not likely to contain any personal property, he predicts. Lawyers who represent minors are also singled out as having a duty extending past the seven-year retention requirement in some cases because “materials in the file may affect the client’s rights” beyond that period. Depending on the type of case, “a lawyer may need to retain file records relating to the representation of a minor until the minor reaches maturity and thereafter until the statute of limitations runs.” Where real estate is involved, for example, that means 20 years after the minor turns 18. PLANNING FOR DEMISE For lawyers who practice in firms, the firms and partners must maintain client files, even when the lawyer who handled the case leaves or the firm breaks up. Ronald Sturtz, a partner with Roseland’s Hannoch Weisman, which filed for bankruptcy in 1998, is well acquainted with the extent of a firm’s obligations regarding files. His efforts to wind up the firm included arranging for the disposition of over 20,000 boxes of files stored in a Newark warehouse. Those efforts will not be complicated by the Opinion 692 supplement, thanks to an order from the bankruptcy court authorizing the destruction of the files, which are being burned. First, however, every partner was provided with a list of his or her case files to decide whether they should be destroyed or preserved. Solo practitioners, on the other hand, have no firm to take over their files when they die, become disabled or retire. For that reason, the “reasonable diligence” requirement of RPC 1.3 imposes on them a special duty to plan ahead for what happens to their files.

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