Sorted by Commenter - Ethics - State of California

No. Commenter Position 1
Comment
on Behalf
of Group?
Rule 1.5 Fees for Legal Services.
[Sorted by Commenter]
Rule
Paragraph
Comment RRC Response
their existence so that the membership could
meaningfully respond or object before the
Board of Governors’ tentative approval.
Paragraph (e) prevents fully-informed clients
and their lawyers from knowingly entering into
a non-refundable retainer agreement that
benefits clients. It ignores the reality that
since the 19 th century, thousands of California
lawyers have used some form of the nonrefundable
retainer (that falls outside of the
limited exceptions to Paragraph (e)’s ban on
non-refundable retainers in (e)(1) and (2)).
The Proposal ignores the fact that in October
of 1992, the Board of Governors concluded
that a non-refundable retainer “earned when
paid” was a perfectly appropriate fee
arrangement. The Board approved/endorsed
the continued use of “fixed fees,” “flat fees,”
and “non-refundable retainers” to be earned
when paid, with title immediately transferring
to the attorney so long as the written fee
agreement explicitly spelled out the
arrangement with the inclusion of an express
statement that such fees paid in advance of
legal services are “earned when paid.”
Paragraph (e)(1) and Comment [8] prohibit
the long-established practice of charging a
manner that can easily be understood by
the client, include the following: (i) the scope
of the services to be provided; (ii) the total
amount of the fee and the terms of
payment; (iii) that the fee is the lawyer’s
property immediately on receipt; (iv) that the
fee agreement does not alter the client’s
right to terminate the client-lawyer
relationship; and (v) that the client may be
entitled to a refund of a portion of the fee if
the agreed-upon legal services have not
been completed.
The Commission did not make the requested
revision, in part, because the Commission believes
that charging a non-refundable fee is inimical to
California’s strong policy of client protection. (See
also proposed Rule 1.5 Model Rule Comparison
Chart explanation of paragraph (e) of the rule.)
RRC - 4-200 1-5 - Public Comment Chart - By Commenter - XDFT1.1 (5-26-10) doc.doc Page 11 of 28 Printed: 5/26/2010
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