Rule 7-2.4 - PREREQUISITES TO PAYMENT(a) Members in Good Standing. Payments from the fund will not be made unless the lawyer is suspended, deceased, placed on the inactive list for incapacity not related to misconduct, or has had the member's status as a member of The Florida Bar revoked or terminated. However, if the theft is by a nonlawyer employee of the lawyer or law firm, a payment may be made even if the lawyer remains in good standing. A claim against a member in good standing will be held until final disposition of the disciplinary matter. A claim alleging that a suspended lawyer took fees for legal services after the entry of an order of suspension will be processed in accordance with these rules. A claim alleging that a lawyer who has had the lawyer's status as a member of The Florida Bar revoked or terminated took fees for legal services after the lawyer's status was revoked or terminated will be closed by staff.(b) Complaints Required. The filing of a grievance complaint with The Florida Bar against the lawyer claimed against may be required as a prerequisite to the consideration of a Clients' Security Fund claim. Failure to file a grievance complaint within the time limitation in Rule 3-7.16(a) may be considered in denying a claim. The committee may require as prerequisites to the granting of relief from the fund that the claimant file a complaint against the lawyer with the appropriate state attorney's office; file a civil suit in an appropriate court; or cooperate with the committee in appropriate proceedings against the lawyer. It is not a prerequisite to claims against deceased members that discipline was imposed or pending at the time of the death.(c) Timeliness. A claim will not be considered unless it has been filed within 3 years after the date the disciplinary action becomes final. If the claim is against a deceased lawyer, the claim will not be considered unless it has been filed within 3 years of the date of the lawyer's death.(d) Exhaustion of Remedies. Claimants should reasonably exhaust other remedies before seeking reimbursement from the fund. Other remedies include bonds, professional liability policies, third party responsibility, the defalcating lawyer's partners, and a deceased lawyer's estate. In determining whether a claimant has met this requirement, the factors which the committee may consider include, but are not limited to, the: (1) availability of funds;(2) likelihood of collection;(4) ability of the claimant to retain legal counsel or to proceed pro se; and(5) ability to locate the lawyer.(e) Proof of Payment. A claimant must provide credible evidence that the funds the claimant seeks to recover were in the lawyer's possession or control before a claim may be approved. The following may be used to establish the payment, the amount of the payment, or the amount of the loss:(1) documentary evidence;(2) a finding by a court of competent jurisdiction;(3) an admission by the lawyer; or(4) a finding in an audit performed by a Florida Bar staff auditor. (f)Jurisdiction. The conduct causing the reimbursable loss must have occurred while the lawyer was a practicing member of The Florida Bar, and the claim must have arisen out of the practice of law in Florida or of Florida law regardless of the lawyer's physical location.Amended July 23, 1992, effective 1/1/1993 (605 So.2d 252); 9/24/1998, effective 10/1/1998 (718 So.2d 1179); amended May 28, 2010, by the Board of Governors of The Florida Bar, effective 7/1/2010; amended 7/25/2014 by the Board of Governors of The Florida Bar, effective 7/25/2014; amended and effective 3/29/2019 by the Board of Governors of The Florida Bar; amended March 3, 2022, effective 5/2/2022 (SC20-1467). Amended and effective 12/2/2022 by the Board of Governors of The Florida Bar; amended effective 5/10/2024.Comment
At times, the fund receives claims against a lawyer where the theft was by a nonlawyer employee of the lawyer or law firm. As stated elsewhere in these rules, the fund may require that the claimant file a grievance complaint against the lawyer. Rather than resulting in suspension or disbarment, the grievance may result in diversion, a finding of minor misconduct, or a finding of probable cause. Should this be the case, the lawyer would remain in good standing. As the claimant hired the lawyer or law firm, the claimant should not be penalized for theft by a nonlawyer employee of the firm and discipline should not be imposed for the sole purpose of meeting a prerequisite to payment. Therefore, under this rule, the status of the lawyer, in and of itself, will not act as a bar to payment of claims where the theft is by a nonlawyer employee of the lawyer or law firm. All other prerequisites to payment, including, but not limited to, exhaustion of remedies, apply to the claim and will be considered in analyzing the claim and recommending denial or payment. The prerequisite of exhaustion of remedies may include the claimant filing a civil suit against the lawyer, law firm, or nonlawyer employee.