Sorted by Commenter - Ethics - State of California
Sorted by Commenter - Ethics - State of California Sorted by Commenter - Ethics - State of California
ABA Model Rule Rule 1.5 Fees Comment Reasonableness of Fee and Expenses [1] Paragraph (a) requires that lawyers charge fees that are reasonable under the circumstances. . . . [COMMENT [1] is continued in the next row] [COMMENT [1] continued] . . . . The factors specified in (1) through (8) are not exclusive. Nor will each factor be relevant in each instance. Paragraph (a) also requires that expenses Commission’s Proposed Rule Rule 1.5 Fees for Legal Services Comment ReasonablenessUnconscionability of Fee and Expenses [1] Paragraph (a) requires that lawyers charge fees that are not unconscionable or illegal under the circumstances. An illegal fee can result from a variety of circumstances, including when a lawyer renders services under a fee agreement that is unenforceable as illegal or against public policy, (e.g., Kallen v. Delug (1984) 157 Cal.App.3d 940, 950-951 [203 Cal.Rptr. 879] [fee agreement with other lawyer entered under threat of withholding client file]), when a lawyer contracts for or collects a fee that exceeds statutory limits (e.g., In re Shalant (Review Dept. 2005) 4 Cal. State Bar Ct. Rptr. 829; In re Harney (Review Dept. 1995) 3 Cal. State Bar Ct. Rptr. 266 [fees exceeding limits under Bus. & Prof. Code, § 6146]), or when an unlicensed lawyer provides legal services. (e.g., Birbrower, Montalbano, Condon and Frank v. Superior Court (1998) 17 Cal.4th 119, 136 [70 Cal.Rptr.2d 304 ]; In re Wells (Review Dept. 2006) 4 Cal. State Bar Ct. Rptr. 896.) [1B] Paragraph (ab) requires that lawyers charge fees that are reasonable under the circumstancesdefines an unconscionable fee. (See Herrscher v. State Bar (1934) 4 Cal.2d 399, 402 [49 P.2d 832]; Goldstone v. State Bar (1931) 214 Cal. Explanation of Changes to the ABA Model Rule The title for this section of the Rule has been revised to reflect the standard being recommended. The Commission recommends that Model Rule 1.5, cmt. [1] be rejected because it addresses the reasonable fee standard, which the Commission has recommended be rejected. See Introduction. In its place, the Commission has proposed Comment [1] and [1B], which clarifies paragraphs (a) and (b) and provides additional guidance for their application by citing to California decisional law concerning illegal or unconscionable fees. Comment [1B] emphasizes that the eleven factors in paragraph (c) are not exclusive, and that not all of them will necessarily be relevant in every instance. The next-to-last sentence observes that contingent fees are subject to the same unconscionability standard as other fee arrangements. Finally, the last sentence RRC - 4-200 1-5 - Compare - Rule Comment Explanation - DFT5 1 (02-08-10)KEM-ML-RD-KEM.doc {Note: Green/Italic text in the middle column indicates Model Rule text that has been moved rather than stricken.} 220
ABA Model Rule Rule 1.5 Fees Comment for which the client will be charged must be reasonable. A lawyer may seek reimbursement for the cost of services performed in-house, such as copying, or for other expenses incurred in-house, such as telephone charges, either by charging a reasonable amount to which the client has agreed in advance or by charging an amount that reasonably reflects the cost incurred by the lawyer. Basis or Rate of Fee [2] When the lawyer has regularly represented a client, they ordinarily will have evolved an understanding concerning the basis or rate of the fee and the expenses for which the client will be responsible. In a new client-lawyer relationship, however, an understanding as to fees and expenses must be promptly established. Generally, it is desirable to furnish the client with at least a simple memorandum or copy of the lawyer's customary fee arrangements that states the general nature of the legal services to be provided, the basis, rate or total Commission’s Proposed Rule Rule 1.5 Fees for Legal Services Comment 490 [6 P.2d 513].) The factors specified in paragraphs (c)(1) through (811) that are to be considered in determining whether a fee is conscionable are not exclusive. Nor will each factor necessarily be relevant in each instance. Paragraph Contingent fees, like any other fees, are subject to the unconscionability standard of paragraph (a) also requires that expenses for which the client will be charged must be reasonable. A lawyer may seek reimbursement for the cost of services performed inthis Rule. In-house, such as copying, or for other expenses incurred in-house, such as telephoneare charges, either by charging a reasonable amount to which the client has agreed in advance or by charging an amount that reasonably reflects the cost incurred by the lawyer or firm as opposed to thirdparty charges. Basis or Rate of Fee [2] When the lawyer has regularly represented a client, they ordinarily will have evolved an understanding concerning the basis or rate of the fee and the expenses for which the client will be responsible. In a new client lawyer relationship, however, an understanding as to fees and expenses must be promptly established. Generally, it is desirable to furnish the client with at least a simple memorandum or copy of the lawyer's customary fee arrangements that states the general nature of the legal services to be provided, the basis, rate or total Explanation of Changes to the ABA Model Rule explains what is meant by an “in-house expense.” The Commission recommends that Model Rule 1.5, cmt. [2] be rejected for the reasons given in the Explanation of Changes for Model Rule 1.5(b). RRC - 4-200 1-5 - Compare - Rule Comment Explanation - DFT5 1 (02-08-10)KEM-ML-RD-KEM.doc {Note: Green/Italic text in the middle column indicates Model Rule text that has been moved rather than stricken.} 221
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ABA Model Rule<br />
Rule 1.5 Fees<br />
Comment<br />
for which the client will be charged must be<br />
reasonable. A lawyer may seek reimbursement for<br />
the cost <strong>of</strong> services performed in-house, such as<br />
copying, or for other expenses incurred in-house,<br />
such as telephone charges, either <strong>by</strong> charging a<br />
reasonable amount to which the client has agreed in<br />
advance or <strong>by</strong> charging an amount that reasonably<br />
reflects the cost incurred <strong>by</strong> the lawyer.<br />
Basis or Rate <strong>of</strong> Fee<br />
[2] When the lawyer has regularly represented a<br />
client, they ordinarily will have evolved an<br />
understanding concerning the basis or rate <strong>of</strong> the fee<br />
and the expenses for which the client will be<br />
responsible. In a new client-lawyer relationship,<br />
however, an understanding as to fees and expenses<br />
must be promptly established. Generally, it is<br />
desirable to furnish the client with at least a simple<br />
memorandum or copy <strong>of</strong> the lawyer's customary fee<br />
arrangements that states the general nature <strong>of</strong> the<br />
legal services to be provided, the basis, rate or total<br />
Commission’s Proposed Rule<br />
Rule 1.5 Fees for Legal Services<br />
Comment<br />
490 [6 P.2d 513].) The factors specified in<br />
paragraphs (c)(1) through (811) that are to be<br />
considered in determining whether a fee is<br />
conscionable are not exclusive. Nor will each factor<br />
necessarily be relevant in each instance. Paragraph<br />
Contingent fees, like any other fees, are subject to<br />
the unconscionability standard <strong>of</strong> paragraph (a) also<br />
requires that expenses for which the client will be<br />
charged must be reasonable. A lawyer may seek<br />
reimbursement for the cost <strong>of</strong> services performed<br />
inthis Rule. In-house, such as copying, or for other<br />
expenses incurred in-house, such as telephoneare<br />
charges, either <strong>by</strong> charging a reasonable amount to<br />
which the client has agreed in advance or <strong>by</strong><br />
charging an amount that reasonably reflects the cost<br />
incurred <strong>by</strong> the lawyer or firm as opposed to thirdparty<br />
charges.<br />
Basis or Rate <strong>of</strong> Fee<br />
[2] When the lawyer has regularly represented a<br />
client, they ordinarily will have evolved an<br />
understanding concerning the basis or rate <strong>of</strong> the fee<br />
and the expenses for which the client will be<br />
responsible. In a new client lawyer relationship,<br />
however, an understanding as to fees and expenses<br />
must be promptly established. Generally, it is<br />
desirable to furnish the client with at least a simple<br />
memorandum or copy <strong>of</strong> the lawyer's customary fee<br />
arrangements that states the general nature <strong>of</strong> the<br />
legal services to be provided, the basis, rate or total<br />
Explanation <strong>of</strong> Changes to the ABA Model Rule<br />
explains what is meant <strong>by</strong> an “in-house expense.”<br />
The Commission recommends that Model Rule 1.5, cmt. [2] be<br />
rejected for the reasons given in the Explanation <strong>of</strong> Changes for<br />
Model Rule 1.5(b).<br />
RRC - 4-200 1-5 - Compare - Rule Comment Explanation - DFT5 1 (02-08-10)KEM-ML-RD-KEM.doc {Note: Green/Italic text in the middle column indicates Model Rule text that has been moved rather than stricken.}<br />
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