Supreme Court Rules Table of Contents
(1) Interest-Bearing Pooled Trust Accounts. In addition to any individual client trust accounts, a member of the New Hampshire Bar who is not exempt from this requirement pursuant to Rule 50(1)(F) shall create or maintain a pooled, interest-bearing trust account known as "Interest on Lawyers Trust Accounts program" or "IOLTA" account for clients' funds which are nominal in amount or to be held for a short period of time and must comply with the following provisions:
interest-bearing trust account shall be established with any bank or savings and
loan association authorized by federal or State law to do business in New
Hampshire and insured by the Federal Deposit Insurance Corporation or the
Federal Savings and Loan Insurance Corporation or other financial institution
with adequate federal insurance covering client funds ("financial
institution"). Funds in each interest-bearing trust account shall be
subject to withdrawal upon demand.
B. The rate of interest payable on any interest-bearing trust account shall be the same rate of interest paid by the depository institution for all other holders of similar accounts. Interest rates higher than those offered by the institution on regular checking or savings accounts may be obtained by a lawyer or law firm on some or all deposited funds so long as there is no impairment of the right to withdraw or transfer principal immediately.
C. Lawyers, law firms or others acting on their behalf when depositing clients' funds in a pooled, interest-bearing account shall direct the depository institution:
(i) to remit interest or dividends, as the case may be, at least quarterly, to the New Hampshire Bar Foundation; and
(ii) to transmit with each remittance to the Foundation a statement showing the name of the lawyer or law firm for whom the remittance is sent, the account number(s), and rate of interest applied for the reporting period; and
(iii) to transmit to the depositing lawyer or law firm at the same time a report showing the accounts number(s), rate of interest applied for the reporting period, and amount paid to the Foundation.
D. The interest or dividends received by the Foundation shall be used solely by the Foundation for the following purposes:
(i) for the support of civil legal services to the disadvantaged;
(ii) for public education relating to the courts and legal matters;
(iii) for such other programs as may be approved by the supreme court.
Such income shall be applied only to activities permitted to be conducted by organizations exempt from taxation under section 501(c)(3) of the Internal Revenue Code of 1954, as from time to time amended.
E. Attorneys, either individually or through their firm organizations, shall complete an annual Trust Accounting Compliance Certificate by August 1 of each year which includes a listing of all interest-bearing trust account(s) for clients' funds under paragraph (1). Any pooled non-interest bearing client trust account(s) must be converted to interest-bearing trust account(s) under provisions of Rule 50(1).
Each attorney who has been on active status at any time during a reporting year must file such a certificate. An attorney who is requesting a change in membership status from active to inactive or retired status, or who is resigning from the New Hampshire Bar, must file such a certificate prior to the submission of the request for change in status or resignation.
F. A lawyer is exempt from the requirement that he or she create or maintain a pooled, interest-bearing trust account known as “Interest on Lawyers Trust Accounts program” or “IOLTA” account if:
(i) the lawyer is not engaged in the private practice of law;
(ii) the lawyer is a judge, attorney general, public defender, U.S. attorney, district attorney, on duty with the armed services or employed by a local, state or federal government, and is not otherwise engaged in the private practice of law;
(iii) the lawyer is a corporate counsel or teacher of law and is not otherwise engaged in the private practice of law;
(iv) the nature of the lawyer’s practice is such that the lawyer does not hold IOLTA-eligible funds of any client or third person; or
(v) the lawyer does not have an office within the State of New Hampshire, does not have a trust account in a financial institution within the State of New Hampshire, and any trust accounts the lawyer has in a foreign jurisdiction are maintained in compliance with the rules and regulations of that jurisdiction.
G. This rule may be subsequently amended to effectuate its purposes or to comply with any amendments to the Internal Revenue Code.
(2) Attorney's Financial Records:
A. Account Designation. All funds of clients or third parties received by attorneys in connection with a representation shall be deposited in one or more clearly designated trust accounts (collectively, "client trust accounts"), separate from the attorney's own funds in financial institutions. Any attorney depositing client or third party funds into an out-of-state financial institution shall file a written authorization with the Clerk of the Supreme Court authorizing the Court or its agents to examine and copy such out-of-state account records. Under no circumstances may any attorney deposit client or third party funds with out-of-state financial institutions other than those located in Maine, Vermont, Massachusetts, or the state in which the attorney's office is situated, without obtaining prior written approval from the Supreme Court.
B. Recordkeeping Generally. A lawyer who practices in this jurisdiction shall maintain current financial records as provided in these Rules and required by Rule 1.15 of the New Hampshire Rules of Professional Conduct, and shall retain the following records for a period of six years from the time of final distribution:
(i) receipt and disbursement journals or comparable records containing a record of deposits to and withdrawals from each client trust account, specifically identifying the date, source, and description of each item deposited, as well as the date, payee and purpose of each disbursement;
(ii) ledger or comparable records showing, for each separate trust client or beneficiary, the source of all funds deposited in a client trust account for or on their behalf, the names of all persons for whom the funds are or were held, the amount of such funds, the descriptions and amounts of charges or withdrawals, and the names of all persons or entities to whom such funds were disbursed;
(iii) copies of accountings to clients or third persons showing the disbursement of funds to them or on their behalf;
(iv) copies of records showing disbursements on behalf of clients or third parties;
(v) the physical or electronic equivalents of all checkbook registers, statements, records of deposits, and canceled checks, provided by a financial institution;
(vi) records of all electronic transfers from client trust accounts, including the name of the person authorizing transfer, the date of transfer, the name of the recipient and confirmation from the financial institution of the trust account number from which money was withdrawn and the date and the time the transfer was completed;
(vii) copies of monthly reconciliations of the client trust accounts maintained by the lawyer.
C. Client Trust Account Safeguards. With respect to client trust accounts required by Rule 1.15 of the New Hampshire Rules of Professional Conduct:
(i) only a lawyer admitted to practice law in this jurisdiction or, to the extent such person is bonded, a person under the direct supervision of the lawyer shall be an authorized signatory on or may authorize transations with respect to a client trust account;
(ii) attorneys who have authorized persons under their direct supervision to deal with a client trust account shall remain responsible for any and all transactions authorized by such persons;
(iii) each transfer of funds to or from a client trust account by way of electronic funds transfers must be specifically authorized by a party described in Rule 50(2)(C)(i).
(iv) receipts shall be deposited intact and records of deposit should be sufficiently detailed to identify each item;
(v) withdrawals shall be made only by check payable to a named payee and not to cash, or authorized electronic transfer;
(vi) each account at a financial institution that is required by Rule 50, except those accounts excluded by Rule 50-A(3), shall be reconciled by the lawyer or law firm on a monthly basis. Such reconciliation shall disclose (a) the balance of the account according to the financial institution's records; (b) the balance of the account according to the lawyer or law firm's records; (c) a detailed listing of all differences between items (a) and (b); (d) a listing of all clients' and third parties' funds in the accounts as of the reconciliation date; and (e) a detailed listing of all differences between items (b) and (d);
(vii) funds received as retainers shall not be withdrawn from the client trust account of the attorney or law firm until earned;
(viii) all funds received as proceeds of collections or awards on behalf of a client shall be deposited in gross in a client trust account, and shall not be charged with a fee until authorized or permitted distribution; and
(ix) the practice of law in the form of an entity that is permitted by these Rules shall not relieve an attorney from the obligation of compliance with this Supreme Court Rule.
D. Availability of Records. Records required by Rule 50(2)(B) and (C) may be maintained by electronic, photographic, or other media provided that they otherwise comply with these Rules and that printed copies can be produced. These records shall be readily accessible to the lawyer and shall not be dependent upon or solely available to the attorney via access to third party electronic sources.
E. Dissolution of Law Firm. Upon dissolution of a law firm, the lawyers shall make reasonable arrangements for the maintenance of the client trust account records specified in Rule 50(2)(B) and (C). The specific details of the arrangements must be provided to the Attorney Discipline Office and to the New Hampshire Bar Association.
F. Sale of Law Practice. Upon the sale of a law practice, the seller shall make reasonable arrangements for the maintenance of records specified in Rule 50(2)(B) and (C). The specific details of the arrangements must be provided to the Attorney Discipline Office and the New Hampshire Bar Association.
Supreme Court Rules Table of Contents