Wednesday, April 1, 2009

Hands in the Client Security Fund Cookie Jar

In Defense of the Client Security Fund What do Connecticut attorneys, William F. Dow III, Hugh F. Keefe, Hope C. Seeley, Jacob B. Zeldes, Hubert J. Santos, Charles A. DeLuca, William F. Gallagher, Kathleen L. Nastri, Matthew Shafner, Frederic S. Ury, William R. Davis and Kathryn Emmett have in common. Well, besides being prominent attorneys in the Constitution State, they and the Connecticut Bar Association lodged a class action law suit against Governor Jodi Rell and other top state officials. So what's their beef against the state? Is it an attempt to get the Whalers back? Was Jodi involved in a fender bender? Actually, the suit is an attempt to stop a $2 million transfer from the Client Security Fund. You know, that special state fund that helps reimburse clients who've been ripped off by unscrupulous lawyers.

In a "deficit mitigation bill", the Governor wants to use some of the funds to help cut into Connecticut's projected multi-billion-dollar state budget deficit. The state would like to take approximately $2 million from the Client Security Fund. Those funds that were generated by that annual $110 fee paid by all 36,000 lawyers licensed in the state. Opponents, including Supreme Court Justice Joette Katz (Chair of the Security Fund), feel that taking the money would not leave any cushion for pending claims. According to Judge Katz, with a balance in the fund at the end of last year of $7.8 million, there are still about $5.8 million in pending claims against it. The plaintiffs claim that the taking of the dough would be a violation of the constitutionally protected separation of powers. "The payments made to the fund by [lawyers] were not levied or collected by the Legislative Department, were not assessed, paid or collected as a tax, and cannot retroactively be expropriated as tax revenues for deposit in the general fund," the suit claims.

Word is that the $2 million will not be touched until the action for a restraining order comes to a hearing, probably within two months.

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