Trash Talk — Create a File Retention Policy

A good way to start the new year, by cleaning out your old files.

Lawyers know they have to retain, indefinitely, the valuable property that belongs to clients where they are unable to return such property to the client.

The better approach, of course, is to return such property and not pay the storage costs in an escalating real estate market.

The best way to handle this, it seems to me, is to have a provision in one’s engagement agreement that allows the attorney to return the valuable documents and property to a last known address at the conclusion of a matter or by a date certain (e.g., in estate planning matters), whichever first occurs.

Valuable client property includes documents such as original notes or securities. This also includes original wills and settlement agreements.

There is another category of items, however, which is seldom discussed. That’s the notes of the attorney and related items used by the attorney to represent the client, though not matters of original origin. What are the rights of the attorney to destroy these items?

Massachusetts Bar Counsel states the conclusion as succinctly as any I’ve seen: “…a lawyer may dispose of those parts of the closed file which do not constitute ‘records of the receipt, maintenance, and disposition of [clients’] funds and other property’ and are likely to have no continuing value or future use to protect the client’s interests. Examples include copies of pleadings, correspondence, and other work papers…”

With real estate costs continuing to rise, it may well be worthwhile to cull old files to reduce required space for retaining old matters. Another approach being used by some is to image all old files and then destroy everything but original documents. One large firm in the Chicago area pays for its photocopy machine by the number of pages printed. However, the machine allows documents to be scanned without charge if paper is not used to print the image. And, the scanned documents are then stored on disks which are searchable … much easier than finding a “needle in a haystack!”

The cost of labor is offset by the reduced real estate storage costs! And, documents which had to be physically searched for in the past (and often depended on the memory of an attorney as to which file the desired item might be located) can now be searched for electronically at a much faster speed.

Tags: Management

Categorized in: Management