Can a bank require its own attorney to pass on title and make the borrower pay that attorney's fee, even if the borrower's own lawyer duplicates the work?

Plain-English summary

The inquiry concerned a bank that furnishes a mortgage in connection with a transaction. The committee stated that the bank is entitled to counsel to pass on the title and other aspects of the lending transaction, and may require the borrower to bear the resulting legal fee as a condition of the loan.

It found it not improper for the bank's attorney to insist on a fee for the service rendered to the bank, even though the work of the attorneys involved may be duplicated on behalf of their respective clients.

Currency note

This opinion was issued in 1963, before The Florida Bar's adoption of the 2006 revisions to the Rules of Professional Conduct. The opinion applied former Canons 12 and 38 of the Canons of Professional Ethics; lawyer fees are now governed by Rule 4-1.5 of the Rules Regulating The Florida Bar (Model Rule 1.5). Subsequent rule amendments or later opinions may have changed the analysis. Treat this page as historical context, not current guidance. Verify against the current rules before relying on any specific requirement mentioned here.

Common questions

Q: Can a bank make the borrower pay for the bank's own title work?

A: Yes. The committee found it not improper for a bank to condition the loan on the borrower bearing the fee of the bank's attorney for examining title.

Q: Does it matter that the borrower's lawyer does the same work?

A: No. The committee said the bank's attorney may insist on a fee for the service rendered to the bank even though the two attorneys' work may duplicate each other.

Background and rules framework

The opinion applied former Canon 12 (fixing the amount of the fee) and Canon 38 (compensation and commissions) of the Canons of Professional Ethics. Lawyer fees are now governed by Rule 4-1.5 of the Rules Regulating The Florida Bar (Model Rule 1.5). The committee treated the bank's counsel as charging the bank for the bank's own benefit, a fee the bank may pass through to the borrower as a loan condition.

Citations and references

Rules of Professional Conduct:

• Canons 12, 38 [Canons of Professional Ethics; fees and compensation; see current Rule 4-1.5]

See also

• FL Bar Ethics Op. 69-39: Charging the Borrower or Seller for the Lender's Attorney Fee
• FL Bar Ethics Op. 65-58: Disclosing Title Defects to an Unrepresented Borrower

Source

• Landing page: https://www.floridabar.org/etopinions/etopinion-63-21/
• Original PDF: https://www-media.floridabar.org/uploads/2017/04/FL-Bar-Ethics-Op-63-21.pdf

Original opinion text

Reproduced from the official source for research purposes. The linked source is authoritative.

FLORIDA BAR ETHICS OPINION
OPINION 63-21
September 18, 1963
Advisory ethics opinions are not binding.
It is not improper for a bank making a loan to require, as a condition thereof, that its attorney pass on the title to the property mortgaged and to require the borrower to bear the cost of its attorney's fee even though the work of the attorney representing the borrower may duplicate that of the bank's counsel.
Canons: 12, 38
Vice-Chairman Smith stated the opinion of the committee:
A bank, which furnishes a mortgage in connection with a matter, is entitled to counsel to pass on title and other aspects of the lending transaction. The bank further may require the borrower to bear the resulting legal fee as a condition of the loan. It is not improper for the bank's attorney to insist upon a fee for the service rendered the bank even though the work of the attorneys involved in the matter may be duplicated on behalf of their respective client.