Multistate Professional Responsibility Exam Practice Question
Monica is setting up her practice in a new location. She accepts a check from a client who pays an advanced fee for representation. She considers depositing the funds into her operating account, under the label “anticipated costs.” Is it appropriate for her to place these unearned funds in her operating account?
Yes, if she labels them in her general account ledger
No, client funds are managed without being held in a special account
No, advanced funds remain in a separate account while the work is being performed
Yes, if her client provided an agreement for monthly withdrawals
Attorneys keep unearned fees in a separate trust account to avoid mixing them with the attorney’s funds. Placing them in the operating account risks them being treated as already earned. The correct answer clarifies that unearned funds remain in a dedicated account while tasks are performed. The other choices suggest labeling them in a general ledger, relying on an arrangement for withdrawals, or stating that a special account is not used, conflicting with recognized practices for client trust accounts.
Ask Bash
Bash is our AI bot, trained to help you pass your exam. AI Generated Content may display inaccurate information, always double-check anything important.
Why do attorneys need to keep unearned fees in a separate trust account?
Open an interactive chat with Bash
What could happen if an attorney mistakenly places unearned fees into their operating account?
Open an interactive chat with Bash
What are the general rules regarding client trust accounts for attorneys?