Public Resources

Clients’ Protection Fund

Additional Info

Clients’ Protection Fund Petition (Word file)

Clients’ Protection Fund Petition (pdf file*)

What is the Clients' Protection Fund?
Why Was the Fund Created?
How is it Funded?
What Losses are Covered?
Who Investigates the Claims & Grants Payments?
How to File a Claim.

What is the clients’ protection fund?

The Virginia State Bar Clients’ Protection Fund was established in 1976 to make monetary awards to persons who have suffered financial losses because of dishonest conduct by Virginia lawyers. The fund is a remedy of last resort for clients who are not able to obtain reimbursement from other sources, such as a bond, surety agreement, or the lawyer involved.

Why was the fund created?

The lawyers of Virginia recognize that, despite the high standards of ethical conduct required of, and generally maintained by, members of the Virginia State Bar, there are and will be a very small number of lawyers who are not worthy of the trust that their clients place in them. The state bar has always had a strong disciplinary system for the purpose of reprimanding, suspending or disbarring lawyers who violate the strict standards of the Virginia Supreme Court’s Rules of Professional Conduct for lawyers. However, the state bar recognizes that a disciplinary system alone is not enough, and that it is desirable to maintain a Clients’ Protection Fund to assure the public that the state bar is concerned and wants to take effective action when lawyers licensed to practice in Virginia mishandle their clients’ funds.

How is it funded?

The Clients’ Protection Fund was established with a portion of the mandatory dues paid by all licensed lawyers practicing in Virginia. The fund truly represents an effort by all members of the Virginia State Bar to compensate for the misdeeds of a few lawyers.

What losses are covered?

Any person who has lost money or property because of dishonest conduct by a Virginia lawyer may be eligible to receive an award from the Clients’ Protection Fund. Dishonest conduct is defined by the rules to mean any wrongful act committed by a lawyer in the nature of theft or embezzlement of money or the wrongful taking or conversion of money, property or other things of value, including, but not limited to, refusal to refund unearned fees received in advance where the lawyer performed no services or such an insignificant portion of the needed service that the refusal to refund the unearned fees constitutes a wrongful taking or conversion of money.

Reimbursable losses must meet the following tests:

The loss must be caused by the dishonest conduct of the lawyer and shall have arisen out of and by reason of a lawyer-client relationship or a fiduciary relationship between the lawyer and the claimant;
the lawyer has been disbarred or suspended from the practice of law; or the lawyer has voluntarily resigned from the practice of law; or the lawyer has died, disappeared or left the state and is not subject to judicial process; or the lawyer is bankrupt or has been judged mentally incompetent; or the loss has been certified to the Clients’ Protection Fund Board by one of the state bar’s disciplinary committees as an appropriate case for consideration; and
the claim has been filed within seven years from the date of the occurrence giving rise to the claim, or within one year after the first occurrence of one of several events specified in the rules of the fund, whichever date is later.

Who investigates the claims and grants payments from the fund?

The Clients’ Protection Fund is operated by a 14-member board appointed by the Virginia State Bar’s governing council. Members of the board investigate each claim and the board grants payments from the fund at its discretion, according to the circumstances of each case. The sum reimbursed to a client may be the full amount lost, or may be only a portion of the amount lost, but the maximum payment allowed from the fund for a single claim is $25,000 for losses incurred prior to July 1, 2000, and $50,000 for losses incurred on or after July 1, 2000. The total amount available to reimburse all claimants on account of the dishonest conduct of any one lawyer or association of lawyers is limited to ten percent of the net worth of the fund at the time the first claim is filed.

How to file a claim?

If you believe you may be eligible for relief under the Clients’ Protection Fund because of the dishonest conduct of your lawyer, contact the Virginia State Bar office (phone (804) 775-0567 or 775-0575) to request a Clients’ Protection Fund Petition or to ask questions regarding the fund. You may download a Clients’ Protection Fund Petition from one of the links below. Please note that the Clients’ Protection Fund is not available for losses attributable to neglect or mishandling of work by an attorney, although you may in such instances have a civil remedy against the attorney in question.