1. Contingent Fees, continued; Problem A.(3)--"Reasonableness"
and contingent fees
a. Contingent fees subject to Rule
1.5(a) reasonableness; and can be reviewed by court as happened in Rohon
v. Rosenblatt; Reasonableness in contingent fee requires lawyer to be fair
and not take cases with no risk;
b. Problem A.(4)--contingent fee in
structured settlement; Restatement;
i. If there is an advance fee agreement
about how to divide the fee in a structured settlement, the Restatement
appears to suggest that it be followed–but always subject to reasonableness
review;
ii. If there is no advance agreement,
the lawyer gets paid the lawyer’s share of each payment received by the
client;
iii. If lawyer gets all the fee at
the time of the settlement, then fee is based on present value of the settlement;
c. Counterclaim Issue–Does lawyer get contingent
fee on gross or net?
d. Needs to be spelled out in retainer agreement,
along with other difficult issues;
(1) check/draft to be deposited and
await collection;
(2) structured settlement;
(3) appeal;
(4) counterclaim issue
e. No contingent fee in domestic relations
case or one contingent on outcome of criminal case;
2. Section E(3) Division of Fees:
a. Under Model Rule 1.5(e), division
of fees between lawyers not in same firm can be made if:
i. First, either;
(1) the division is in proportion
to the services rendered, OR
(2) if
(a) the client consents
in writing and
(b) all lawyers who participate
in the fee assume joint responsibility for the representation; AND
ii. Second, the client is advised
and agrees to the share of each lawyer (and here there is a change from
the 2001 Rules which only required that client did not object); AND
iii. Third, the total fee charged
the client is reasonable;
b. Chambers v. Kay simply confirms the rule
and denies the attorney any fee;
c. Fee splitting with non-lawyers–not
allowed under Rule 5.4(a); There are numerous exceptions;
i. First, it is permissible to share
with the estate of a former member of the firm over a reasonable period
of time;
ii. Second, it is permissible to
pay the estate of a deceased or disappeared lawyer the reasonable value
of the practice of that lawyer when purchasing that practice under Rule
1.17;
iii. Third, non-lawyer employees
of the lawyer may be included in a firm benefit plan even though that plan
is funded entirely by law firm fees;
iv. Fourth, may share legal fees
with a non-profit organization if that organization hired or recommended
the lawyer;
3. Section F--Attorney Malpractice: Malpractice
and other Remedies;
a. F(1) Basic Obligation of Care:
Togstad v. Vesely, Otto, Miller & Keefe, Privity is required in malpractice
action;
b. Togstad gives two theories;
;
Under a Tort theory
Duty--Supplied by A/C relationship;
Breach of one of those duties;
damages;
causation;
Under a Contract theory
Request by Client that lawyer provide services
(Offer);
Consideration by Client which can be based
on reliance;
Acceptance by Attorney;
Breach of one of the contracted for obligations;
c. Togstad found a relationship which gives
us duty in tort and the contract relationship in contract;
i. “But for causation” is used in most
cases;
ii. Lawyer violates a Rule of Professional
Conduct;
(1) Use as evidence, but is not,
alone, malpractice;
iii. Case within a case–must have won case
below;
iv. Appeal–must show lost appeal and would
win below;