Fees

Question 1

Fees (General)

Answer 1

MR: a lawyer must charge fees that are reasonable under the circumstances

CA: Fees must not be unconscionable
(Look for amount, time required to work, hourly fee, difficulty of case, lawyer’s experience)

Question 2

When is a written contract not required?

Answer 2

CHEW

Corportations
History of similar services provided to the client
Emergency
Waives in writing right to written fee contract

Question 3

When does it need to be in writing?

Answer 3

CA:
If fees exceed $1,000, they must…
(i) be in writing,
(ii) stating fees and services to be provided, and
(iii) signed by both parties

ALL contingency fee agreements need to be in writing

Question 4

When are contingent fees prohibited?

Answer 4

Generally permitted EXCEPT for (i) criminal cases and (ii) domestic cases when it is contingent on obtaining divorce or amount of support recovered

Question 5

Contingent Fee Agreement

Answer 5

Requires:
(i) Writing, signed by client;
(ii) Terms/basis for calculating fees; and
(iii) Expenses clients are liable for.

CA: ALSO include:
(iv) if lawyer’s fee is negotiable
(v) whether client would have to pay for matters not in the agreement
(vi) a duplicate copy of agreement must be provided to client at time of signing

CA: Agreement is voidable by client but attorney is entitled to reasonable fee

Question 6

Fee Splitting

Answer 6

TOTAL FEES MUST NOT BE HIGHER BECAUSE MULTIPLE ATTORNEYS ARE ON THE CASE

MR: Allowed if…
(i) fee is in proportion to services provided by each lawyer;
(ii) client agrees in writing to fee-splitting; and
(iii) total charged fee is reasonable.

CA: Allowed if…
(i) Lawyers enter in a written agreement to divide fee;
(ii) clients have provided written consent after full disclosure of splitting; and
(iii) total fee charged is not unconscionable

Question 7

Referral Fees

Answer 7

MR: generally, not permitted to pay someone for recommending services UNLESS
(i) legal services plan, or
(ii) approved lawyer referral service.

CA: Lawyer may give gift or gratuity for referral, so long as it was not offered in anticipation of referral or future referrals

Question 8

Non-Lawyers

Answer 8

Fees may not be split with non-lawyers

Partnerships may not be made with non-lawyers if any activities involve practice of law

Question 9

Client’s Fund Accounts

Answer 9

1. NO COMMINGLING OF FUNDS
   MR: must keep client property and funds separate from lawyer’s property and funds

CA: No funds belonging to lawyer or law firm may be deposited in client trust account (identifiable and labeled) or otherwise commingled, except for funds reasonably sufficient to pay bank charges

2. DISPUTES OVER FUNDS
   Undisputed funds must be distributed to client and disputed funds must remain in client trust account