Opinion date: July 1, 2007
Ethics issue presented:
When a sole practitioner discovers that his IOLTA account is out of balance, what measures may he take to correct the balance, and must he report that imbalance to the IOLTA Board?
Facts as presented by Inquirer:
Inquirer is a sole practitioner who has been engaged in personal injury practice for well over twenty years. In the past he has never made a habit of reconciling his IOLTA account. Recently, in a first attempt to do so, Inquirer determined that the IOLTA account was not in balance, and in fact, that there was a deficit of several thousand dollars, even though the account had never reached a negative stage and had never been reported to the IOLTA Board by the depository bank. Attorney could not ascertain how, why, or when the imbalance occurred, but guesses that a past distribution to a client and/or attorney was greater than it should have been. Inquirer intends to deposit personal funds into the IOLTA account to bring it into proper "balance." Is this permissible? Must the IOLTA Board be notified?
Inquiring attorney was asked to review Rule 1.15 of the Pennsylvania Rules of Professional Conduct. Since Inquirer has no practical way of determining how or when the IOLTA account went out of balance, the Inquirer's proposed remedy of depositing his own funds into the account to bring it back into trust would not seem to be prohibited by Rule 1.15, despite the fact that Rule 1.15(e) states that: "A lawyer shall not deposit the lawyer's own funds into a trust account except for the sole purpose of paying bank service charges on that account, and only in an amount necessary for that purpose," since to do nothing would allow the IOLTA account to remain out of trust. Rule 1.15 does not require this sole practitioner to report himself to the IOLTA Board.
The foregoing is advisory only and is not binding on the Disciplinary Board of the Supreme Court of Pennsylvania or any given Court. It carries only such weight as an appropriate reviewing authority may choose to give it.