Sorted by Commenter - Ethics - State of California

unaware 2 of this new rule or that it would be considered at the November 14 , 2009 Board of Governors
meeting and were unable to meaningfully respond or object and be heard at the RAC and Board of Governors
November meetings. See enclosed opposition 12.
What is also troubling is that the Commission has not published any comprehensive or detailed factual
and legal analysis for
Rule Commission Charter." The Commission has
principle reason for this rule "is client protection. " However, since 1991 , I have asked the proponents of
attempts to abolish non-refundable retainers for evidence supporting the claim that in California there is a
pattern of unethical lawyers cheating clients by using nonrefundable retainers. None has
It is also significant that this prohibition appears nowhere in the ABA Model Rules. Since the 19th
Century nonrefundable retainers have been used in California and are currently permitted in many states. In
fact, in 1992 the Board of Governors of the California Bar endorsed the continued use of "fixed fees flat
fees " and "nonrefundable retainers " so long as the written
arrangement and that the fee was "earned when paid.
determine, the Commission has never provided a written analysis of this persuasive authority, advised the
current Board of Governors of its existence and certainly has not demonstrated why it should be ignored by
those who now sit on the Board of Governors.
In essence, the proposal abolishes and/or redefines a widely accepted historical fee arrangement and
prevents fully informed clients from entering into a fee agreement, the nonrefundable retainer, that far more
often than not reduces and limits the cost of legal representation. These changes will impact lawyers who
practice in many areas, including immigration, entertainment law, matrimonial/divorce, civil litigation
appellate, securities, bankruptcy, tax, real estate and criminal law and their clients.
One ofthe mosttroubling aspects of the proposed , see
1.5(e)(2), will make these fee payments the property of the client until the work is performed.
regardless of the inaccurate representation set out in Rule 1.5(e)(2)
2009 meeting # 132, p. 6, reflect that the "Board' s adoption of the proposed rules is subject to consideration
of possible revisions following a comprehensive public comment. . . " This
after-the- fact theoretical 1 O(A)
before adoption" or solve the notice and process problem.
It is indeed odd that the November 14 2009 minutes of the Board of Governors # 132, p. 6 that "adopts
Rule following publication for comment and consideration of
comment received" "the Board of Governors adopts" 35 Rules that included Rule 1.5(e)(1)-(2). There was
no "publication for comment" of Rule 1.5(
3 See
, "
Request That the
Professional Conduct " October 1992, page 9.
Although the proposed amendments would avoid use of the terms 'fixed fee,' 'flat fee' or
non-refundable fee,' such types of retainer fee agreements would be permissible
proposed amendments. However, such fees would be required to be placed in the member
client trust account unless the member s written attorney-client fee
provides that such fees, paid in advance of the provision of legal services, are earned when
paid.
" "
133