{"formats":[{"name":"JSON","format":"json","url":"\/downloads\/2025\/code-json\/54.1-3936.json"},{"name":"Plain Text","format":"text","url":"\/downloads\/2025\/code-text\/54.1-3936.txt"},{"name":"XML","format":"xml","url":"\/downloads\/2025\/code-xml\/54.1-3936.xml"},{"name":"HTML","format":"html","url":"\/downloads\/2025\/code-html\/54.1-3936.html"}],"law_id":82515,"edition_id":1,"section_id":82515,"structure_id":14793,"section_number":"54.1-3936","catch_line":"Protection of client interests in proceedings pending disciplinary action","history":"1985, c. 418, \u00a7 54-74.01; 1988, c. 765; 1992, c. 574; 1997, c. 239; 2005, cc. 184, 212.","full_text":"A\n\nIf Bar Counsel has reasonable cause to believe that an attorney is engaging in any activity which is unlawful or violates the Virginia Rules of Professional Conduct and which will result in loss of property of one or more of the attorney’s clients or any other person, Bar Counsel may submit an ex parte petition to the circuit court of the city or county wherein the attorney who is the subject of the petition resides or is doing business for the issuance of an order authorizing the immediate inspection by and production to representatives of the petitioner of any records, documents, and physical or other evidence belonging to the subject attorney or any professional partnership, professional limited liability company, or professional corporation with which the subject attorney is associated. The court may issue such order without notice to the attorney if the petition, supported by affidavit of the petitioner and such other evidence as the court may require, shows reasonable cause to believe that such action is required to prevent immediate loss of property of one or more of the subject attorney’s clients or any other person. The papers filed with the court pursuant to this subsection shall be placed under seal.B\n\nIf Bar Counsel has reasonable cause to believe that an attorney is engaging in any activity which is unlawful or in violation of the Virginia Rules of Professional Conduct and which will result in loss of property of one or more of the attorney’s clients or any other person, Bar Counsel may file a petition with the circuit court of the county or city wherein the subject attorney resides or is doing business. The petition may seek the following relief: (i) an injunction prohibiting the withdrawal of any bank deposits or the disposition of any other assets belonging to or subject to the control of the subject attorney or any professional partnership, professional limited liability company, or professional corporation with which the subject attorney is associated; and (ii) the appointment of a receiver for all or part of the funds or property of the subject attorney’s law practice or of any professional partnership, professional limited liability company, or professional corporation with which the subject attorney is associated. The subject attorney shall be given notice of the time and place of the hearing on the petition and an opportunity to offer evidence. The court, in its discretion, may require a receiver appointed pursuant to this section to post bond, with or without surety. The papers filed with the court under this subsection shall be placed under seal until such time as the court grants an injunction or appoints a receiver. The court may issue an injunction, appoint a receiver or provide such other relief as the court may consider proper if, after a hearing, the court finds that such relief is necessary or appropriate to prevent loss of property of one or more of the subject attorney’s clients or any other person.C\n\nIn any proceeding under subsection B, any professional partnership, professional limited liability company, or professional corporation with which the subject attorney is associated and any other person or entity known to Bar Counsel to be indebted to or having in his possession property, real or personal, belonging to or subject to the control of the subject attorney’s law practice and which property Bar Counsel reasonably believes may become part of the receivership assets, shall be served with a copy of the petition and notice of the time and place of the hearing.D\n\nThe receiver shall, unless otherwise ordered by the court, (i) prepare and file with the Virginia State Bar an inventory of all case files under the subject attorney’s control; (ii) notify in writing all of the subject attorney’s clients of the appointment and take whatever action the receiver deems appropriate to protect the interests of the clients until such time as the clients have had an opportunity to obtain successor counsel, and in the case of a deceased attorney, notify in writing the personal representative, if any, of the deceased attorney’s estate and the commissioner of accounts of the circuit court in which the deceased attorney’s estate is being administered that the receiver may have a claim against the deceased attorney’s estate for fees and costs of the receivership; (iii) identify and take control of all bank accounts, including without limitation trust and operating accounts, over which the subject attorney had signatory authority in connection with his law practice; (iv) prepare and submit an accounting of receipts and disbursements and account balances of all funds under the receiver’s control for submission to the court within four months of the appointment and annually thereafter until the receivership is terminated by the court; (v) attempt to collect any accounts receivable related to the subject attorney’s law practice; (vi) identify and attempt to recover any assets wrongfully diverted from the subject attorney’s law practice, or assets acquired with funds wrongfully diverted from the subject attorney’s law practice; (vii) terminate the subject attorney’s law practice; (viii) reduce to cash all of the assets of the subject attorney’s law practice, and in the case of a deceased attorney notify in writing the personal representative, if any, of the deceased attorney’s estate, and the commissioner of accounts of the circuit court in which the deceased attorney’s estate is being administered of any proposed liquidations of assets; (ix) determine the nature and amount of all claims of creditors, including clients, of the subject attorney’s law practice; and (x) prepare and file with the court a report of such assets and claims proposing a distribution to such creditors and, in the case of a deceased attorney, notify in writing the personal representative, if any, of the deceased attorney’s estate and the commissioner of accounts of the circuit court in which the deceased attorney’s estate is being administered of the proposed distribution of the receivership funds. Upon the court’s approval of the receiver’s report, at a hearing after such notice as the court may require to creditors, the personal representative of the subject attorney’s estate and the commissioner of accounts of the circuit court in which the deceased attorney’s estate is being administered, the receiver shall distribute the assets of the subject attorney’s law practice first to clients whose funds were or ought to have been held in trust by the subject attorney, then to the receiver for fees, costs, and expenses awarded pursuant to subsection E, and thereafter to the general creditors of the subject attorney’s law practice, including clients whose funds were not required to have been held in trust by the subject attorney, and then to the subject attorney or the subject attorney’s personal representative.E\n\nA receiver appointed pursuant to this section shall be entitled, upon proper application to the court in which the appointment was made, to recover an award of reasonable fees, costs, and expenses. If there are not sufficient nontrust funds to pay the award, then the shortfall shall be paid by the Virginia State Bar, to the extent that the Virginia State Bar has funds available. The Virginia State Bar shall have a claim against the subject attorney or the subject attorney’s estate for the amount paid.F\n\nThe court may determine whether any assets under the receiver’s control should be returned to the subject attorney or the subject attorney’s personal representative during the receivership.G\n\nThis statute is declared to be remedial. Its purpose is to protect the interests of clients adversely affected by attorneys who have engaged in misconduct. It is to be liberally administered in order to protect those interests and thereby the public’s interest in the quality of legal services provided by Virginia attorneys.","order_by":null,"text":{"0":{"id":295615,"text":"If Bar Counsel has reasonable cause to believe that an attorney is engaging in any activity which is unlawful or violates the Virginia Rules of Professional Conduct and which will result in loss of property of one or more of the attorney’s clients or any other person, Bar Counsel may submit an ex parte petition to the circuit court of the city or county wherein the attorney who is the subject of the petition resides or is doing business for the issuance of an order authorizing the immediate inspection by and production to representatives of the petitioner of any records, documents, and physical or other evidence belonging to the subject attorney or any professional partnership, professional limited liability company, or professional corporation with which the subject attorney is associated. The court may issue such order without notice to the attorney if the petition, supported by affidavit of the petitioner and such other evidence as the court may require, shows reasonable cause to believe that such action is required to prevent immediate loss of property of one or more of the subject attorney’s clients or any other person. The papers filed with the court pursuant to this subsection shall be placed under seal.","type":"section","prefixes":["A"],"prefix":"A","entire_prefix":"A","prefix_anchor":"A","level":1,"next_prefix":"B"},"1":{"id":295616,"text":"If Bar Counsel has reasonable cause to believe that an attorney is engaging in any activity which is unlawful or in violation of the Virginia Rules of Professional Conduct and which will result in loss of property of one or more of the attorney’s clients or any other person, Bar Counsel may file a petition with the circuit court of the county or city wherein the subject attorney resides or is doing business. The petition may seek the following relief: (i) an injunction prohibiting the withdrawal of any bank deposits or the disposition of any other assets belonging to or subject to the control of the subject attorney or any professional partnership, professional limited liability company, or professional corporation with which the subject attorney is associated; and (ii) the appointment of a receiver for all or part of the funds or property of the subject attorney’s law practice or of any professional partnership, professional limited liability company, or professional corporation with which the subject attorney is associated. The subject attorney shall be given notice of the time and place of the hearing on the petition and an opportunity to offer evidence. The court, in its discretion, may require a receiver appointed pursuant to this section to post bond, with or without surety. The papers filed with the court under this subsection shall be placed under seal until such time as the court grants an injunction or appoints a receiver. The court may issue an injunction, appoint a receiver or provide such other relief as the court may consider proper if, after a hearing, the court finds that such relief is necessary or appropriate to prevent loss of property of one or more of the subject attorney’s clients or any other person.","type":"section","prefixes":["B"],"prefix":"B","entire_prefix":"B","prefix_anchor":"B","level":1,"prior_prefix":"A","next_prefix":"C"},"2":{"id":295617,"text":"In any proceeding under subsection B, any professional partnership, professional limited liability company, or professional corporation with which the subject attorney is associated and any other person or entity known to Bar Counsel to be indebted to or having in his possession property, real or personal, belonging to or subject to the control of the subject attorney’s law practice and which property Bar Counsel reasonably believes may become part of the receivership assets, shall be served with a copy of the petition and notice of the time and place of the hearing.","type":"section","prefixes":["C"],"prefix":"C","entire_prefix":"C","prefix_anchor":"C","level":1,"prior_prefix":"B","next_prefix":"D"},"3":{"id":295618,"text":"The receiver shall, unless otherwise ordered by the court, (i) prepare and file with the Virginia State Bar an inventory of all case files under the subject attorney’s control; (ii) notify in writing all of the subject attorney’s clients of the appointment and take whatever action the receiver deems appropriate to protect the interests of the clients until such time as the clients have had an opportunity to obtain successor counsel, and in the case of a deceased attorney, notify in writing the personal representative, if any, of the deceased attorney’s estate and the commissioner of accounts of the circuit court in which the deceased attorney’s estate is being administered that the receiver may have a claim against the deceased attorney’s estate for fees and costs of the receivership; (iii) identify and take control of all bank accounts, including without limitation trust and operating accounts, over which the subject attorney had signatory authority in connection with his law practice; (iv) prepare and submit an accounting of receipts and disbursements and account balances of all funds under the receiver’s control for submission to the court within four months of the appointment and annually thereafter until the receivership is terminated by the court; (v) attempt to collect any accounts receivable related to the subject attorney’s law practice; (vi) identify and attempt to recover any assets wrongfully diverted from the subject attorney’s law practice, or assets acquired with funds wrongfully diverted from the subject attorney’s law practice; (vii) terminate the subject attorney’s law practice; (viii) reduce to cash all of the assets of the subject attorney’s law practice, and in the case of a deceased attorney notify in writing the personal representative, if any, of the deceased attorney’s estate, and the commissioner of accounts of the circuit court in which the deceased attorney’s estate is being administered of any proposed liquidations of assets; (ix) determine the nature and amount of all claims of creditors, including clients, of the subject attorney’s law practice; and (x) prepare and file with the court a report of such assets and claims proposing a distribution to such creditors and, in the case of a deceased attorney, notify in writing the personal representative, if any, of the deceased attorney’s estate and the commissioner of accounts of the circuit court in which the deceased attorney’s estate is being administered of the proposed distribution of the receivership funds. Upon the court’s approval of the receiver’s report, at a hearing after such notice as the court may require to creditors, the personal representative of the subject attorney’s estate and the commissioner of accounts of the circuit court in which the deceased attorney’s estate is being administered, the receiver shall distribute the assets of the subject attorney’s law practice first to clients whose funds were or ought to have been held in trust by the subject attorney, then to the receiver for fees, costs, and expenses awarded pursuant to subsection E, and thereafter to the general creditors of the subject attorney’s law practice, including clients whose funds were not required to have been held in trust by the subject attorney, and then to the subject attorney or the subject attorney’s personal representative.","type":"section","prefixes":["D"],"prefix":"D","entire_prefix":"D","prefix_anchor":"D","level":1,"prior_prefix":"C","next_prefix":"E"},"4":{"id":295619,"text":"A receiver appointed pursuant to this section shall be entitled, upon proper application to the court in which the appointment was made, to recover an award of reasonable fees, costs, and expenses. If there are not sufficient nontrust funds to pay the award, then the shortfall shall be paid by the Virginia State Bar, to the extent that the Virginia State Bar has funds available. The Virginia State Bar shall have a claim against the subject attorney or the subject attorney’s estate for the amount paid.","type":"section","prefixes":["E"],"prefix":"E","entire_prefix":"E","prefix_anchor":"E","level":1,"prior_prefix":"D","next_prefix":"F"},"5":{"id":295620,"text":"The court may determine whether any assets under the receiver’s control should be returned to the subject attorney or the subject attorney’s personal representative during the receivership.","type":"section","prefixes":["F"],"prefix":"F","entire_prefix":"F","prefix_anchor":"F","level":1,"prior_prefix":"E","next_prefix":"G"},"6":{"id":295621,"text":"This statute is declared to be remedial. Its purpose is to protect the interests of clients adversely affected by attorneys who have engaged in misconduct. It is to be liberally administered in order to protect those interests and thereby the public’s interest in the quality of legal services provided by Virginia attorneys.","type":"section","prefixes":["G"],"prefix":"G","entire_prefix":"G","prefix_anchor":"G","level":1,"prior_prefix":"F"}},"ancestry":[{"id":14793,"edition_id":1,"name":"Revocation or Suspension of Licenses; Disbarment Proceedings","identifier":"6","label":"article","depth":4,"order_by":1,"parent_id":13488,"metadata":{},"date_created":"2026-06-26 03:49:55","date_modified":"2026-06-26 03:49:55","permalink":{"id":244411,"object_type":"structure","relational_id":14793,"identifier":"6","token":"54.1\/IV\/39\/6","url":"\/54.1\/IV\/39\/6\/","edition_id":1,"permalink":0,"preferred":1}},{"id":13488,"edition_id":1,"name":"Attorneys","identifier":"39","label":"chapter","depth":3,"order_by":1,"parent_id":13487,"metadata":{},"date_created":"2026-06-26 03:45:01","date_modified":"2026-06-26 03:45:01","permalink":{"id":244227,"object_type":"structure","relational_id":13488,"identifier":"39","token":"54.1\/IV\/39","url":"\/54.1\/IV\/39\/","edition_id":1,"permalink":0,"preferred":1}},{"id":13487,"edition_id":1,"name":"Professions Regulated by the Supreme Court","identifier":"IV","label":"subtitle","depth":2,"order_by":1,"parent_id":12754,"metadata":{},"date_created":"2026-06-26 03:45:01","date_modified":"2026-06-26 03:45:01","permalink":{"id":244225,"object_type":"structure","relational_id":13487,"identifier":"IV","token":"54.1\/IV","url":"\/54.1\/IV\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12754,"edition_id":1,"name":"Professions and Occupations","identifier":"54.1","label":"title","depth":1,"order_by":1,"parent_id":null,"metadata":{},"date_created":"2026-06-26 03:43:51","date_modified":"2026-06-26 03:43:51","permalink":{"id":239313,"object_type":"structure","relational_id":12754,"identifier":"54.1","token":"54.1","url":"\/54.1\/","edition_id":1,"permalink":0,"preferred":1}}],"structure_contents":[{"id":61301,"structure_id":14793,"section_number":"54.1-3934","catch_line":"Revocation of license by Board","url":"\/54.1-3934\/","token":"54.1\/IV\/39\/6\/54.1-3934","metadata":false},{"id":63454,"structure_id":14793,"section_number":"54.1-3935","catch_line":"Procedure for disciplining attorneys by three-judge circuit court","url":"\/54.1-3935\/","token":"54.1\/IV\/39\/6\/54.1-3935","metadata":false},{"id":82515,"structure_id":14793,"section_number":"54.1-3936","catch_line":"Protection of client interests in proceedings pending disciplinary action","url":"\/54.1-3936\/","token":"54.1\/IV\/39\/6\/54.1-3936","metadata":false},{"id":85023,"structure_id":14793,"section_number":"54.1-3937","catch_line":"Procedure for revocation of certificate of registration of professional law corporations or professional limited liability companies","url":"\/54.1-3937\/","token":"54.1\/IV\/39\/6\/54.1-3937","metadata":false},{"id":56586,"structure_id":14793,"section_number":"54.1-3938","catch_line":"Service of process in license revocation proceedings","url":"\/54.1-3938\/","token":"54.1\/IV\/39\/6\/54.1-3938","metadata":false},{"id":73696,"structure_id":14793,"section_number":"54.1-3938.1","catch_line":"Subpoena issued pursuant to law of another jurisdiction","url":"\/54.1-3938.1\/","token":"54.1\/IV\/39\/6\/54.1-3938.1","metadata":false}],"previous_section":{"id":63454,"structure_id":14793,"section_number":"54.1-3935","catch_line":"Procedure for disciplining attorneys by three-judge circuit court","url":"\/54.1-3935\/","token":"54.1\/IV\/39\/6\/54.1-3935","metadata":false},"next_section":{"id":85023,"structure_id":14793,"section_number":"54.1-3937","catch_line":"Procedure for revocation of certificate of registration of professional law corporations or professional limited liability companies","url":"\/54.1-3937\/","token":"54.1\/IV\/39\/6\/54.1-3937","metadata":false},"metadata":false,"official_url":"https:\/\/law.lis.virginia.gov\/vacode\/54.1-3936\/","history_text":"

This law was first created in 1985. The record of its establishment is cataloged in chapter 418 of that year\u2019s edition of \u201cActs of Assembly,\u201d the annual state publication listing all changes made to the Code of Virginia in that year. Unfortunately, the 1985 \u201cActs\u201d aren\u2019t available online. It has been modified 4 times. Those modifications are cataloged by \u201cThe Acts of Assembly,\u201d a state publication, by year and chapter. Those modifications that can be read on the General Assembly\u2019s website will be linked accordingly. Those modifications are as follows: in 1988, chapter 765; in 1992, chapter 574; in 1997, chapter 239<\/a>; in 2005, chapters 184<\/a> and 212<\/a>.<\/p>","references":[{"id":67299,"section_number":"2.2-1839","catch_line":"Risk management plans administered by the Department of the Treasury's Risk Management Division for political subdivisions, constitutional officers, etc","order_by":null,"url":"\/2.2-1839\/"}],"refers_to":false,"permalink":{"id":244421,"object_type":"law","relational_id":82515,"identifier":"54.1-3936","token":"54.1\/IV\/39\/6\/54.1-3936","url":"\/54.1-3936\/","edition_id":1,"permalink":0,"preferred":1},"url":"\/54.1-3936\/","token":"54.1\/IV\/39\/6\/54.1-3936","dublin_core":{"Title":"Protection of client interests in proceedings pending disciplinary action","Type":"Text","Format":"text\/html","Identifier":"\u00a7 54.1-3936","Relation":"Code of Virginia"},"html":"\n\t\t\t\t\t\t

A.<\/span> If Bar Counsel<\/span> has reasonable cause to believe that an attorney is engaging in any activity which is unlawful or violates the Virginia Rules of Professional Conduct and which will result in loss of property of one or more of the attorney’s clients or any other person, Bar Counsel<\/span> may submit an ex parte<\/span> petition<\/span> to the circuit<\/span> court<\/span> of the city or county wherein the attorney who is the subject of the petition<\/span> resides or is doing business for the issuance of an order<\/span> authorizing the immediate inspection by and production to representatives of the petitioner of any records, documents, and physical or other evidence<\/span> belonging to the subject attorney or any professional partnership, professional limited liability company, or professional corporation with which the subject attorney is associated. The court<\/span> may issue<\/span> such order<\/span> without notice to the attorney if the petition<\/span>, supported by affidavit<\/span> of the petitioner and such other evidence<\/span> as the court<\/span> may require, shows reasonable cause to believe that such action is required to prevent immediate loss of property of one or more of the subject attorney’s clients or any other person. The papers filed with the court<\/span> pursuant to this subsection shall be placed under seal. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

B.<\/span> If Bar Counsel<\/span> has reasonable cause to believe that an attorney is engaging in any activity which is unlawful or in violation of the Virginia Rules of Professional Conduct and which will result in loss of property of one or more of the attorney’s clients or any other person, Bar Counsel<\/span> may file a petition<\/span> with the circuit<\/span> court<\/span> of the county or city wherein the subject attorney resides or is doing business. The petition<\/span> may seek the following relief: (i) an injunction<\/span> prohibiting the withdrawal of any bank deposits or the disposition<\/span> of any other assets<\/span> belonging to or subject to the control of the subject attorney or any professional partnership, professional limited liability company, or professional corporation with which the subject attorney is associated; and (ii) the appointment of a receiver for all or part of the funds or property of the subject attorney’s law<\/span> practice or of any professional partnership, professional limited liability company, or professional corporation with which the subject attorney is associated. The subject attorney shall be given notice of the time and place of the hearing<\/span> on the petition<\/span> and an opportunity to offer evidence<\/span>. The court<\/span>, in its discretion, may require a receiver appointed pursuant to this section to post bond<\/span>, with or without surety<\/span>. The papers filed with the court<\/span> under this subsection shall be placed under seal until such time as the court<\/span> grants an injunction<\/span> or appoints a receiver. The court<\/span> may issue<\/span> an injunction<\/span>, appoint a receiver or provide such other relief as the court<\/span> may consider proper if, after a hearing<\/span>, the court<\/span> finds that such relief is necessary or appropriate to prevent loss of property of one or more of the subject attorney’s clients or any other person. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

C.<\/span> In any proceeding under subsection B, any professional partnership, professional limited liability company, or professional corporation with which the subject attorney is associated and any other person or entity known to Bar Counsel<\/span> to be indebted to or having in his possession<\/span> property, real or personal, belonging to or subject to the control of the subject attorney’s law<\/span> practice and which property Bar Counsel<\/span> reasonably believes may become part of the receivership assets<\/span>, shall be served with a copy of the petition<\/span> and notice of the time and place of the hearing<\/span>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

D.<\/span> The receiver shall, unless otherwise ordered by the court<\/span>, (i) prepare and file with the Virginia State Bar an inventory of all case files<\/span> under the subject attorney’s control; (ii) notify in writing all of the subject attorney’s clients of the appointment and take whatever action the receiver deems appropriate to protect the interests of the clients until such time as the clients have had an opportunity to obtain successor counsel<\/span>, and in the case of a deceased attorney, notify in writing the personal representative, if any, of the deceased attorney’s estate and the commissioner of accounts of the circuit<\/span> court<\/span> in which the deceased attorney’s estate is being administered that the receiver may have a claim against the deceased attorney’s estate for fees and costs of the receivership; (iii) identify and take control of all bank accounts, including without limitation trust and operating accounts, over which the subject attorney had signatory authority in connection with his law<\/span> practice; (iv) prepare and submit an accounting of receipts and disbursements and account balances of all funds under the receiver’s control for submission to the court<\/span> within four months of the appointment and annually thereafter until the receivership is terminated by the court<\/span>; (v) attempt to collect any accounts receivable related to the subject attorney’s law<\/span> practice; (vi) identify and attempt to recover any assets<\/span> wrongfully diverted from the subject attorney’s law<\/span> practice, or assets<\/span> acquired with funds wrongfully diverted from the subject attorney’s law<\/span> practice; (vii) terminate the subject attorney’s law<\/span> practice; (viii) reduce to cash all of the assets<\/span> of the subject attorney’s law<\/span> practice, and in the case of a deceased attorney notify in writing the personal representative, if any, of the deceased attorney’s estate, and the commissioner of accounts of the circuit<\/span> court<\/span> in which the deceased attorney’s estate is being administered of any proposed liquidations<\/span> of assets<\/span>; (ix) determine the nature and amount of all claims of creditors<\/span>, including clients, of the subject attorney’s law<\/span> practice; and (x) prepare and file with the court<\/span> a report of such assets<\/span> and claims proposing a distribution to such creditors<\/span> and, in the case of a deceased attorney, notify in writing the personal representative, if any, of the deceased attorney’s estate and the commissioner of accounts of the circuit<\/span> court<\/span> in which the deceased attorney’s estate is being administered of the proposed distribution of the receivership funds. Upon the court<\/span>’s approval of the receiver’s report, at a hearing<\/span> after such notice as the court<\/span> may require to creditors<\/span>, the personal representative of the subject attorney’s estate and the commissioner of accounts of the circuit<\/span> court<\/span> in which the deceased attorney’s estate is being administered, the receiver shall distribute the assets<\/span> of the subject attorney’s law<\/span> practice first to clients whose funds were or ought to have been held in trust by the subject attorney, then to the receiver for fees, costs, and expenses awarded pursuant to subsection E, and thereafter to the general creditors<\/span> of the subject attorney’s law<\/span> practice, including clients whose funds were not required to have been held in trust by the subject attorney, and then to the subject attorney or the subject attorney’s personal representative. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

E.<\/span> A receiver appointed pursuant to this section shall be entitled, upon proper application to the court<\/span> in which the appointment was made, to recover an award of reasonable fees, costs, and expenses. If there are not sufficient nontrust funds to pay the award, then the shortfall shall be paid by the Virginia State Bar, to the extent that the Virginia State Bar has funds available. The Virginia State Bar shall have a claim against the subject attorney or the subject attorney’s estate for the amount paid. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

F.<\/span> The court<\/span> may determine whether any assets<\/span> under the receiver’s control should be returned to the subject attorney or the subject attorney’s personal representative during the receivership. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

G.<\/span> This statute<\/span> is declared to be remedial. Its purpose is to protect the interests of clients adversely affected by attorneys who have engaged in misconduct. It is to be liberally administered in order<\/span> to protect those interests and thereby the public’s interest in the quality of legal services provided by Virginia attorneys. <\/i><\/a><\/p><\/section>","plain_text":" CODE OF VIRGINIA\n\nPROTECTION OF CLIENT INTERESTS IN PROCEEDINGS PENDING DISCIPLINARY ACTION (\u00a7\n54.1-3936)\n\nA. If Bar Counsel has reasonable cause to believe that an attorney is engaging\nin any activity which is unlawful or violates the Virginia Rules of Professional\nConduct and which will result in loss of property of one or more of the\nattorney’s clients or any other person, Bar Counsel may submit an ex parte\npetition to the circuit court of the city or county wherein the attorney who is\nthe subject of the petition resides or is doing business for the issuance of an\norder authorizing the immediate inspection by and production to representatives\nof the petitioner of any records, documents, and physical or other evidence\nbelonging to the subject attorney or any professional partnership, professional\nlimited liability company, or professional corporation with which the subject\nattorney is associated. The court may issue such order without notice to the\nattorney if the petition, supported by affidavit of the petitioner and such\nother evidence as the court may require, shows reasonable cause to believe that\nsuch action is required to prevent immediate loss of property of one or more of\nthe subject attorney’s clients or any other person. The papers filed with\nthe court pursuant to this subsection shall be placed under seal.\n\nB. If Bar Counsel has reasonable cause to believe that an attorney is engaging\nin any activity which is unlawful or in violation of the Virginia Rules of\nProfessional Conduct and which will result in loss of property of one or more of\nthe attorney’s clients or any other person, Bar Counsel may file a\npetition with the circuit court of the county or city wherein the subject\nattorney resides or is doing business. The petition may seek the following\nrelief: (i) an injunction prohibiting the withdrawal of any bank deposits or the\ndisposition of any other assets belonging to or subject to the control of the\nsubject attorney or any professional partnership, professional limited liability\ncompany, or professional corporation with which the subject attorney is\nassociated; and (ii) the appointment of a receiver for all or part of the funds\nor property of the subject attorney’s law practice or of any professional\npartnership, professional limited liability company, or professional corporation\nwith which the subject attorney is associated. The subject attorney shall be\ngiven notice of the time and place of the hearing on the petition and an\nopportunity to offer evidence. The court, in its discretion, may require a\nreceiver appointed pursuant to this section to post bond, with or without\nsurety. The papers filed with the court under this subsection shall be placed\nunder seal until such time as the court grants an injunction or appoints a\nreceiver. The court may issue an injunction, appoint a receiver or provide such\nother relief as the court may consider proper if, after a hearing, the court\nfinds that such relief is necessary or appropriate to prevent loss of property\nof one or more of the subject attorney’s clients or any other person.\n\nC. In any proceeding under subsection B, any professional partnership,\nprofessional limited liability company, or professional corporation with which\nthe subject attorney is associated and any other person or entity known to Bar\nCounsel to be indebted to or having in his possession property, real or\npersonal, belonging to or subject to the control of the subject attorney’s\nlaw practice and which property Bar Counsel reasonably believes may become part\nof the receivership assets, shall be served with a copy of the petition and\nnotice of the time and place of the hearing.\n\nD. The receiver shall, unless otherwise ordered by the court, (i) prepare and\nfile with the Virginia State Bar an inventory of all case files under the\nsubject attorney’s control; (ii) notify in writing all of the subject\nattorney’s clients of the appointment and take whatever action the\nreceiver deems appropriate to protect the interests of the clients until such\ntime as the clients have had an opportunity to obtain successor counsel, and in\nthe case of a deceased attorney, notify in writing the personal representative,\nif any, of the deceased attorney’s estate and the commissioner of accounts\nof the circuit court in which the deceased attorney’s estate is being\nadministered that the receiver may have a claim against the deceased\nattorney’s estate for fees and costs of the receivership; (iii) identify\nand take control of all bank accounts, including without limitation trust and\noperating accounts, over which the subject attorney had signatory authority in\nconnection with his law practice; (iv) prepare and submit an accounting of\nreceipts and disbursements and account balances of all funds under the\nreceiver’s control for submission to the court within four months of the\nappointment and annually thereafter until the receivership is terminated by the\ncourt; (v) attempt to collect any accounts receivable related to the subject\nattorney’s law practice; (vi) identify and attempt to recover any assets\nwrongfully diverted from the subject attorney’s law practice, or assets\nacquired with funds wrongfully diverted from the subject attorney’s law\npractice; (vii) terminate the subject attorney’s law practice; (viii)\nreduce to cash all of the assets of the subject attorney’s law practice,\nand in the case of a deceased attorney notify in writing the personal\nrepresentative, if any, of the deceased attorney’s estate, and the\ncommissioner of accounts of the circuit court in which the deceased\nattorney’s estate is being administered of any proposed liquidations of\nassets; (ix) determine the nature and amount of all claims of creditors,\nincluding clients, of the subject attorney’s law practice; and (x) prepare\nand file with the court a report of such assets and claims proposing a\ndistribution to such creditors and, in the case of a deceased attorney, notify\nin writing the personal representative, if any, of the deceased attorney’s\nestate and the commissioner of accounts of the circuit court in which the\ndeceased attorney’s estate is being administered of the proposed\ndistribution of the receivership funds. Upon the court’s approval of the\nreceiver’s report, at a hearing after such notice as the court may require\nto creditors, the personal representative of the subject attorney’s estate\nand the commissioner of accounts of the circuit court in which the deceased\nattorney’s estate is being administered, the receiver shall distribute the\nassets of the subject attorney’s law practice first to clients whose funds\nwere or ought to have been held in trust by the subject attorney, then to the\nreceiver for fees, costs, and expenses awarded pursuant to subsection E, and\nthereafter to the general creditors of the subject attorney’s law\npractice, including clients whose funds were not required to have been held in\ntrust by the subject attorney, and then to the subject attorney or the subject\nattorney’s personal representative.\n\nE. A receiver appointed pursuant to this section shall be entitled, upon proper\napplication to the court in which the appointment was made, to recover an award\nof reasonable fees, costs, and expenses. If there are not sufficient nontrust\nfunds to pay the award, then the shortfall shall be paid by the Virginia State\nBar, to the extent that the Virginia State Bar has funds available. The Virginia\nState Bar shall have a claim against the subject attorney or the subject\nattorney’s estate for the amount paid.\n\nF. The court may determine whether any assets under the receiver’s control\nshould be returned to the subject attorney or the subject attorney’s\npersonal representative during the receivership.\n\nG. This statute is declared to be remedial. Its purpose is to protect the\ninterests of clients adversely affected by attorneys who have engaged in\nmisconduct. It is to be liberally administered in order to protect those\ninterests and thereby the public’s interest in the quality of legal\nservices provided by Virginia attorneys.\n\nHISTORY: 1985, c. 418, \u00a7 54-74.01; 1988, c. 765; 1992, c. 574; 1997, c. 239;\n2005, cc. 184, 212.","edition":{"id":1,"name":"2025","slug":"2025","date_created":"2026-06-21 22:39:22","date_modified":"2026-06-21 22:39:22","current":1,"order_by":1,"last_import":null}}