(a) A lawyer shall hold property of clients or third persons that is in a lawyer's possession in connection with a representation separate from the lawyer's own property. Funds shall be kept in a separate account maintained in a financial institution in New Jersey. Funds of the lawyer that are reasonably sufficient to pay bank charges may, however, be deposited therein. Other property shall be identified as such and appropriately safeguarded. Complete records of such account funds and other property shall be kept by the lawyer and shall be preserved for a period of seven years after the event that they record.

(b) Upon receiving funds or other property in which a client or third person has an interest, a lawyer shall promptly notify the client or third person. Except as stated in this Rule or otherwise permitted by law or by agreement with the client, a lawyer shall promptly deliver to the client or third person any funds or other property that the client or third person is entitled to receive.

(c) When in the course of representation a lawyer is in possession of property in which both the lawyer and another person claim interests, the property shall be kept separate by the lawyer until there is an accounting and severance of their interests. If a dispute arises concerning their respective interests, the portion in dispute shall be kept separate by the lawyer until the dispute is resolved.

(d) A lawyer shall comply with the provisions of R. 1:21-6 ("Recordkeeping") of the Court Rules.

Comment to RPC 1.15

The Court, with two revisions, has adopted the recommendation of the Debevoise Committee, which in turn differs somewhat from the ABA-approved version of this rule. The Court deleted from the Debevoise Committee recommendation the provision that would have permitted clients' funds to be maintained in another state with the consent of the client, instead requiring the funds to be maintained in New Jersey accounts.

There is no doubt that a lawyer, as pointed out by the ABA and the Kutak Commission, should hold the property of others "with the care required of a professional fiduciary." This rule details that requirement by defining the obligations of the attorney as to the holding of property of clients or third persons. It requires, inter alia, that attorneys utilize trust accounts for the funds of clients, echoing the mandate of R. 1:21-6(a), as well as holding separate other client property. See In re Lehet, 95 N.J. 466, 468 (1984); In re Jacob, 95 N.J. 132 (1984). The Court has added paragraph (d), emphasizing compliance with the recordkeeping provisions of R. 1:21-6.

The rule also imposes a duty upon the attorney to notify the client upon receipt of funds or property in which the client has an interest and in most cases to deliver that property to the client promptly. It further contains provisions for handling disputed interests in property.

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