Hello and welcome to this JACPA Ethics Alert blog which will discuss the Florida Bar Board of Governors Rules Committee consideration of a proposed rule change which would prohibit non-refundable fees in Florida. If implemented, this would significantly impact a large number Florida lawyers.
The proposed Rule revision was on the agenda of the Bar’s Rules Committee’s telephone conference call on April 17, 2012; however, the Committee deferred any vote on the proposed rule change pending further discussion.
The proposed change to Florida Bar Rule 4-1.5(d) is set forth below:
When the lawyer has not regularly represented the client, the basis or rate of the fee and costs shall be communicated to the client, preferably in writing, before or within a reasonable time after commencing the representation. A fee for legal services that is nonrefundable in any part shall be confirmed in writing and shall explain the intent of the parties as to the nature and amount of the nonrefundable fee. A lawyer may not charge a fee that is termed “nonrefundable” or “earned on receipt.” A lawyer may charge a fee that is an advance fee payment that is the lawyer’s property subject to refund, if the lawyer and client agree in writing. The written agreement must set forth the basis of the fee, the amount of the fee, and that the fee is subject to refund if all or a portion of the fee is unearned. If the lawyer charges an advance fee payment that is the lawyer’s property subject to refund and the lawyer-client relationship ends before the entire fee is earned, the lawyer must refund the unearned portion of the fee. The test of reasonableness found in subdivision (b), above, applies to all fees for legal services without regard to their characterization by the parties.
The Minnesota Supreme Court implemented a a rule which is substantially the same as the proposed rule being considered by the BOG Rules Committee which became effective on July 1, 2011.
Any comments should be sent to the individual Rules Committee and/or other Board of Governors members and/or to Elizabeth Tarbert, Ethics Counsel, The Florida Bar, 651 E. Jefferson Street, Tallahassee, Florida 32399-2300, 850/561-5780. You can send comments via e-mail to Ms. Tarbert at email@example.com and she will provide them to the Rules Committee.
Bottom line: If you have an opinion about this proposed rule change, you should make that opinion known.
Be careful out there!
As always, if you have any questions about this Ethics Alert or need assistance, analysis, and guidance regarding these or any other ethics, risk management, or other issues, please do not hesitate to contact me.
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