Category Archives: Resolution of liens in contingency fee matters

Florida Supreme Court rejects Bar proposed rule amendment on resolution of extraordinary liens in contingency matters

Hello and welcome to this Ethics Alert update blog which will discuss the Florida Supreme Court’s rejection of a proposed amendment to Florida Bar Rule 4-1.5(f) which would have permitted a lawyer to retain and pay another lawyer (or non-lawyer entity) to resolve extraordinary liens in contingency matters and pay that lawyer’s fee from the settlement proceeds.  I previously blogged about the proposed revisions to Rule 4-1.5(f) in my 6/6/13, 9/5/13, and 12/14/15 Ethics Alerts.

The October 6, 2016 Florida Supreme Court opinion rejected the Bar’s proposed amendment to Rule 4-1.5(f) which would have specifically permitted the lawyer/client to retain an “extraordinary lien and subrogation lawyer” to resolve extraordinary liens and be paid a fee by the client beyond the contingent fee.  The Florida Supreme Court opinion is here:

In rejecting the Florida Bar’s proposed amendment to 4-1.5(f), the opinion stated:

On balance, we wish to reemphasize that lawyers representing clients in personal injury, wrongful death, or other cases where there is a contingent fee should, as part of the representation, also represent those clients in resolving medical liens and subrogation claims related to the underlying case. This should be done at no additional charge to the client beyond the maximum contingency fee, even if the attorney outsources this work to another attorney or non-attorney.

Although it may be true that, given the increased complexity of modern litigation, there will be some cases where the amount of work required to resolve a lien is more than initially anticipated, the notion of the percentage fee contract contemplates that there will be some cases that are profitable for the lawyer handling the claim and others that are unprofitable. That risk and reward is built into the contingency fee contract. 

If the circumstances of a particular case are such that the fee generated under the contingency fee agreement is expected to be insufficient for the work of resolving any outstanding lien, the attorney and client can seek leave of court pursuant to rule 4-1.5(f)(4)(B)(ii) of the Rules Regulating the Florida Bar to obtain an increased fee appropriate for the circumstances of the specific case.  (emphasis supplied).

Bottom line:  Pursuant to the language in the Court’s opinion, lawyers should be wary of participating in an agreement with a third party in which the client would pay a percentage of any reduction in the lien amount or any other payment for the reduction/resolution of the lien.

Be careful out there.

Disclaimer:  this Ethics Alert blog is for informational purposes only, is not an advertisement, and does not contain any legal advice and the comments herein should not be relied upon by anyone who reads it.

Joseph A. Corsmeier, Esquire

Law Office of Joseph A. Corsmeier, P.A.

29605 U.S. Highway 19 N. Suite 150

Clearwater, Florida 33761

Office (727) 799-1688

Fax     (727) 799-1670

Joseph Corsmeier

NOTICE OF CONFIDENTIALITY:  This electronic communication and the information contained herein is legally privileged and confidential proprietary information intended only for the individual and/or entity to whom it is addressed pursuant to the American Bar Association Formal Opinion No. 99-413, dated March 10, 1999 and all other applicable laws and rules.  If you receive this transmission in error, you are advised that any disclosure, copying, distribution, or the taking of any action in reliance upon the communication is strictly prohibited.  Any unauthorized use, distribution, or disclosure of this communication is strictly prohibited.  If you have received this in error, please notify us immediately by return e-mail at the above telephone number and then delete message entirely from your system.  Thank you for your cooperation.










Leave a comment

Filed under Attorney Ethics, Bar proposed rule amendment on resolution of extraordinary liens in contingency matters, Contingency fee agreements, Florida Bar, Florida Lawyer Ethics and Professionalism, Florida Supreme Court, joe corsmeier, Joseph Corsmeier, Lawyer ethics, Lawyer Ethics and Professionalism, lawyer excessive fee, Lawyer excessive fees, Lawyer fee agreements, Lawyer retaining separate counsel and payment over contingency fee, Resolution of liens in contingency fee matters, Supreme Court rejection of Bar proposed rule amendment on resolution of extraordinary liens in contingency matters