Records Retention Requirements for Law Firms and Legal Depar

Article excerpt

NOTICE: This article contains information related to sensitive and important legal issues. No section of this article should be construed as providing legal advice. All legal decisions related to records and information management should be reviewed by competent legal counsel.

This article addresses some special problems related to establishing a records retention program for law firms and legal departments. Law firms are private organizations providing legal services to different clients. Legal departments are departments within organizations that provide legal services to only one client -- the organization that employs the attorney.

Often the issues that motivate an organization to establish a records retention program -- space savings, improved access to information, legal compliance and litigation protection -- may not motivate lawyers to undertake a retention program for their organizations. Some reasons why law firms and legal departments show less interest in records retention are as follows:

* Few, if any, laws affect the retention of records.

* The attorney-client privilege generally prevents records from being subpoenaed during litigation.

* Lawyers keep records for long periods so that they can use reference material from one legal matter in the preparation of another.

* Lawyers do not want to review individual case files prior to destruction, but insist that this type of review take place.

* Lawyers are rarely concerned about the cost-savings issues provided by an effective records retention program.

LAWS AFFECTING RECORDS RETENTION

All organizations must comply with legal requirements related to their general business records. For law firms and legal departments, general business records consist of primarily accounting, employment and other administrative services records. These records, however, constitute only a small percentage of the total records used or created by lawyers.

Law firms must also be concerned about destroying records and other property that belongs to their clients. Clients provide them these records to assist them in preparing the case. Sometimes law firms serve as the corporate secretary for their corporate clients. As corporate secretaries, law firms create and preserve the corporate minutes and other documents for their corporate clients.

All states have laws that establish standards of conduct for professionals in a "custodial or fiduciary capacity." Lawyers, accountants and others that either hold the property of another (custodial) or the money of another (fiduciary) must protect those assets. Records belonging to another, for example, may not be destroyed, even after microfilming, without the permission of the owner. Unless these records are returned to their owners, law firms may have no choice but to keep them forever.

The legal files -- case files, client files, legal opinions, legal research, etc. -- represent the largest volume of records in the law firms and legal departments. Except for the custodial or fiduciary issue, no state or federal agencies regulate the recordkeeping requirements for these records. No standards nor guidelines exist indicating which legal files must be kept and how long.

In the absence of specific legal requirements for retention, most lawyers will opt to keep records to meet their perceived business needs -- future contacts with clients or reference, or for other legal considerations.

LEGAL CONSIDERATIONS

Both law firms and legal departments will maintain case files minimally until the appeal period has lapsed. Most states establish a relatively short period from the conclusion of a case when an appeal must be filed -- typically 30 days.

Law firms may be subject to malpractice suits initiated by unhappy clients. Most states specify a two to three year statute of limitations for legal malpractice or professional liability. If no specific malpractice statute exists, the typical statute of limitations for personal or property injury is also two to three years. …