OFFICES AND OFFICERS ‑- COUNTY ‑- CLERK ‑- FUNDS ‑- INTEREST ON INVESTMENT OF CLERK'S TRUST FUND
Where monies totalling $2,000 or more have been placed in trust with a superior court clerk in connection with a particular matter in litigation, and a litigant in the matter has filed a written request that investment be made of such funds and the income be paid to the beneficiary, all income from such investment is to be paid to the beneficiary with the exception of five percent thereof which the statute allows the clerk to deduct as an investment service fee.
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March 9, 1981
Honorable Arthur R. Eggers
Walla Walla County
407 Drumheller Building
Walla Walla, Washington 99362 Cite as: AGLO 1981 No. 5
This is written in response to your recent inquiry regarding the proper crediting of certain interest earned on the investment of monies in a superior court clerk's trust fund under RCW 36.48.090.
As we understand the underlying factual circumstances, a certain sum of money, in excess of $2,000, was delivered into the custody of the superior court clerk of your county on a given date‑-to be held in trust pending the outcome of a particular matter in litigation before the Court. That money, along with other monies in the clerk's trust fund, was then invested by the clerk as authorized by RCW 36.29.020. Subsequently, the litigant who had deposited the funds was notified by the clerk of the provisions of RCW 36.48.090, as required by the last paragraph thereof, and in response‑-some 35 days after the original deposit was made‑-the said litigant filed a written request with the clerk to the effect that ". . . any income from such investment shall be paid to the beneficiary of such trust upon the termination thereof . . ."
[[Orig. Op. Page 2]]
Quaere: Under the foregoing circumstances, and subject to the five percent investment service fee also provided for in RCW 36.48.090, is all interest earned on the investment of these particular trust funds properly payable to the beneficiary of the trust? Or, instead, is only such interest as was earned after the above‑noted written request was filed with the clerk to be so credited, with the remainder to be credited to the county current expense fund?
Our answer is in accordance with the first of these two alternatives.
Let us begin by setting forth in full the pertinent text of RCW 36.48.090. That statute, as last amended by § 1, chapter 227, Laws of 1979, 1st Ex. Sess., reads as follows:
"Whenever the clerk of the superior court has funds held in trust for any litigant or for any purpose, they shall be deposited in a separate fund designated 'clerk's trust fund,' and shall not be commingled with any public funds. The clerk may invest the funds in any of the investments authorized by RCW 36.29.020. The clerk shall place the income from such investments in the county current expense fund to be used by the county for general county purposes unless (1) the funds being held in trust in a particular matter are two thousand dollars or more, and (2) a litigant in the matter has filed a written request that such investment be made of the funds being held in trust and the income be paid to the beneficiary. In such an event, any income from such investment shall be paid to the beneficiary of such trust upon the termination thereof: PROVIDED, That five percent of the income shall be deducted by the clerk as an investment service fee and placed in the county current expense fund to be used by the county for general county purposes.
"In any matter where funds are held in the clerk's trust fund, any litigant who is not represented by an attorney and who has appeared in matters where the funds held are [[Orig. Op. Page 3]] two thousand dollars or more shall receive written notice of the provisions of this section from the clerk."
The premise from which your question arises is that certain funds, in excess of $2,000, have been deposited with the superior court clerk to be held in trust pending resolution of a particular matter in litigation before the Court. Those funds, along with other monies in the clerk's trust fund, have been invested in securities authorized by RCW 36.29.020‑-apparently without waiting for any instructions from the litigant or litigants involved. Subsequently, however, such instructions are received, in writing, and thereafter, following the clerk's later receipt of interest on the investment, the issue is presented.
If, at the outset, the funds being held in trust in the particular matter amounted to less than $2,000, it is clear that any interest earned on their investment would be creditable to the county current expense fund. Or, likewise, even if $2,000 or more was involved, the interest would still be payable to the current expense fund if no request to the contrary were made by an affected litigant. But here, at the time the interest is received by the clerk, both of those conditions‑-as set forth in the statute‑-will have occurred. The amount placed in trust with the clerk totals $2,000 or more, and a litigant has requested that the money be invested ". . . and the income be paid to the beneficiary . . ."
In that event, the statute then goes on to say that,
". . .any income from such investment shall be paid to the beneficiary of such trust upon the termination thereof: PROVIDED, That five percent of the income shall be deducted by the clerk as an investment service fee and placed in the county current expense fund to be used by the county for general county purposes." (Emphasis supplied)
We think the statute means what it says. The mere fact that the request was not made until some time after the funds were first received by the clerk and invested does not [[Orig. Op. Page 4]] provide the clerk with a legally- supportable basis, in our opinion, for segregating the interest thus earned and paying only a part of it to the designated beneficiary.1/
We trust that the foregoing will be of assistance to you.
Very truly yours,
KENNETH O. EIKENBERRY
PHILIP H. AUSTIN
Deputy Attorney General
*** FOOTNOTES ***
1/Instead it seems apparent that the legislature viewed the five percent investment service fee referred to in the proviso to the statute as the exclusive means of paying for the county clerk's investment services in that event.