attorneys fees Flashcards
Types
a. Hourly
b. Contingency
Flat Fee
Fee Limitations
i. MR 1.5(a)
1) A lawyer shall not charge or collect an unreasonable Fee
2) Factors
a) Time and labor (Amount of work involved and results obtained)
b) Novelty of issue
c) Difficulty of issue &
d) Skill required to perform services
e) Fixed or contingent
ii. MR 1.5 (a)(2)
1) Likelihood that acceptant of employment will preclude other employment by the lawyer
iii. MR 1.5(a)(3)
1) Fee customarily charged in locality for similar legal services
iv. MR 1.5(a)(4)
Amount of work involved and results obtained
Double Billing
i. M.R. 1.5
If a lawyer is able to serve more than once client during one time period, the lawyer must pass the economic benefits on to clients.
Padding your bill
i. MR 1.5 Comment 5
A lawyer many not bill for more time than is actually spent
Billing expenses
i. MR 1.5 (a):
1) a lawyer shall not charge or collect unreasonable expenses
2) They may charge for costs and expenses occurred in house (copying, telephone)
ii. MR 1.5 a comment 1
1) They must be reasonable and agreed in advance or must be the actual cost
iii. Overhead rule
A lawyer should not bill for overhead expenses
Contingency fees
i. MR 1.5(c)
1) A fee may be contingent on the outcome of a case unless it was prohibited by rule.
2) The agreement must be in writing and signed by the client
3) Agreement must state:
a) The method by which the fee was determined
b) The percentage the lawyer will receive
c) Whether expenses deducted before or after the fee is calculated
d) Expenses to be paid even if the client loses
4) After the case the lawyer shall provide the client a written statement stating the outcome of the case and remittance, and method of determination.
ii. MR 1.5 a and 1.8(i)(2) Comment C
1) Contingent fees may be larger than a hourly fee due to risks of non-recovery, but still must be reasonable.
iii. Restatement 35 comment C
1) Large contingent fees are unearned by effort or significant period risk are unreasonable.
2) Lawyers failure to disclose likelihood of recovery; probable size of recovery; or availability of alternative fee systems.
iv. MR 1.5 (d)(1)
1) A lawyer shall not charge any fee in domestic relations matters contingent upon securing a divorce, alimony or property settlements.
a) Prevents the lawyer from possible reconciliation
v. MR 1.5 (d)(2)
Contingency fees are not allowed in criminal cases
Terminating Contingency Fee Lawyers
i. Firing your lawyer
1) See Galanis
ii. M.R. 1.16 (withdrawal)
1) A withdrawing lawyer is not entitled to fees
Fee Shifting Statutes
1) Lodestar number = Number of reasonable hours x reasonable hourtly rate
2) Adjust the lodestar figure up or down based on the amount of success, quality of lawyers work, and the risk invovled in taking the case.
3) MR 1.5 Factors set out (8) same as above.
Fee sharing between lawyers
No rule
Fee sharing between lawyers in differnt firm
2) MR 1.5 (e)
a) Division of fees between lawyers of different firms must be in porportion to services performed by each lawyer
b) Client has to agree to the arrangement that each lawyer will receive and confirms that agreement in writing
c) The fee is reasonable
3) 1.5 (e)(1) A lawyer can still receive fee if the work is not porportional if the Lawyer accepts joint responsibility.
4) MR 1.7 Comment 7 and Restatment 47 commend D
a) Definition of Joint Responsibility
i) L1 and L2 if “Partnership”
ii) L1 and L2 if assuming joint and several liability for malpractice
L1 ethically responsbile to the bar
Fee sharing between lawyers and non lawyers
2) MR 5.4 a:
a) A lawyer shall not share legal fees with a non-lawyer
i) Including an inactive member of the bar.
b) Exceptions
i) Firm may pay money over a reasonable period of time after a lawyers death to his estate including the share of the firms captial account and legal fees due to the lawyer
ii) A lawyer who purchases the practice of a deceases or disabled lawyer may pay to the estate of lawyer an agreed upon purchase price
iii) A lawyer may include non lawyer employees in compensation or retirement plan, even if based on profit charing agreement (year end bonus based on profits of the firm)
iv) A lawyer may share court awarded legal fees with non-profit organizations that employs or recommended a lawyer. (not adopted in utah
3) MR 7.2 C
a) A lawyer shall not give anything of value to a person for recommending the lawyers services.
4) MR 7.2 b (No referal fees
a) Exceptions
i) Comments 5,6,7
a. A lawyer may pay for advertising and marketing and client development services. Not for profit or qualified lawyer referral services
ii) Comment 8
a. A lawyer may have mutual referral arrangement with lawyers and non-lawyers.
1. Must not interfere with the lawyers judgement
2. Agreement must not be exclusive
3. Client must be informed of the arrangement.
UTAH DOES NOT HAVE COMMENT 8 = NO REFFERAL FEES!
Associating with non lawyer s
a. MR 5.4 (b)
i. A lawyer shall not form a partnership with a non-lawyer if any partnership activities involve the practice of law.
b. MR 5.4 (D) Corporations
i. A lawyer shall not associate with a proffesional corporation is non-lawyer:
1) Owns interest in corporation
2) Is corporate director or officer, or
Controls proffesional Judgement of Lawyer.
Associating with non lawyers
a. MR 5.4 (b)
i. A lawyer shall not form a partnership with a non-lawyer if any partnership activities involve the practice of law.
b. MR 5.4 (D) Corporations
i. A lawyer shall not associate with a proffesional corporation is non-lawyer:
1) Owns interest in corporation
2) Is corporate director or officer, or
Controls proffesional Judgement of Lawyer.
