Bill > SB31

This bill addresses the handling of interest on attorney trust accounts (IOLTA) in Montana by making participation in the program voluntary and requiring explicit client consent. Currently, the Montana Supreme Court mandates that lawyers deposit client funds into IOLTA accounts, with all interest automatically directed to the Montana Justice Foundation, effectively collecting 100% of the interest without client approval. The bill proposes three options for handling client funds: (1) depositing funds in a non-interest-bearing account, (2) placing funds in an interest-bearing account where the client receives the interest, or (3) participating in the existing IOLTA program, but only with the client's written consent. The legislation argues that the current mandatory IOLTA program is unconstitutional because it violates the Legislature's exclusive power to tax and appropriate funds, as outlined in the Montana Constitution. By making the program voluntary and requiring client consent, the bill aims to ensure that lawyers respect their ethical obligations to act in the client's best interests and obtain explicit permission before redirecting interest earnings.

Justice

https://bills.legmt.gov/#/laws/bill/20251/LC0621