Found Money, or Thievery?

Your money is being taken, and you don’t know it! Did you know that if you have any money on deposit with your friendly lawyer, that the interest it earns while sitting in "escrow" goes to IOLTA? IOLTA stands for Interest On Lawyers Trust Accounts. And IOLTA money, in Georgia and pretty much nationwide, goes to provide legal services for indigent persons. Yes, even to fund public defender programs.
I can hear Terry Everett screaming now "There goes Kelly again!" But I’m not complaining, I’m preparing to tell you about a vexing case before the United States Supreme Court.

You see, the Supremes are considering a legal challenge brought by the Washington Legal Foundation and two individuals that challenges whether property (in this case, money) should be "taken" from one person to benefit another. You see, if you have any money on deposit with a lawyer, you will not see any monetary benefit from that deposited money (unless it’s really a big sum of money, in which case the lawyer puts it in a special account just for you.) For most accounts, you’d never see the interest because it is not enough to offset the fees the bank would charge to create the account. So generally it is "no skin off your nose." And what is funny is that the challengers to this law agree that there is no real monetary benefit to them. Nevertheless, they say, the State is taking from them and giving to a program that they may not agree with. They argue that just because it may be a small amount of money doesn’t change that it is taken from them without just compensation.

The counter argument is, if there is no compensation due because you couldn’t earn it anyway, how is it a taking? And if it’s not a taking, then the challengers have no standing to complain. Plus the argument is that the programs funded by IOLTA include senior citizen scammed by con artists, domestic violence victims who need emergency legal services and a host of other worthy programs. So the public good should outweigh the harm to the challengers, especially when the challengers would get nothing anyway.

So there you have it. A legal conundrum. A good program funded with "found money"? Or a program that takes from others to fund somebody else’s pet projects? The Supremes are set to decide this one soon. I’ll let you know how it turns out.
 

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