Can a criminal defense lawyer charge a contingent fee, or take a secured promissory note for the fee balance?

Plain-English summary

A Florida lawyer posed four questions. The first two asked whether a criminal-defense fee could be structured so that the lawyer refunds a portion if the client is convicted or sentenced to jail or prison, or so that the client pays an additional fixed amount only if there is no guilty verdict or no incarcerating sentence. The third and fourth asked whether the lawyer could take all or part of the fee as a promissory note bearing reasonable interest and secure it with a mortgage, or take title to the client's car or other assets to sell if the client did not pay.

The committee had previously and informally addressed the third and fourth questions but withheld an opinion on the first two pending Florida's adoption of the Code of Professional Responsibility, which became effective October 1, 1970. It held that DR 2-106(C), barring a lawyer from arranging, charging, or collecting a contingency for representing a criminal defendant, required answering the first two questions in the negative. On the remaining questions, the committee said there is no reason why, with full disclosure, a lawyer may not take a note for an agreed fee balance bearing lawful interest comparable to lending institutions, citing Opinion 68-61. It added that any transfer of assets to perfect a security interest should not be absolute in form but should clearly reflect its nature as a security interest, and warned that onerous rules of law presumptively invalidate transactions between client and counsel, so the attorney must meet their stringent requirements.

Currency note

This opinion was issued in 1970, before The Florida Bar's adoption of the 2006 revisions to the Rules of Professional Conduct. It applied DR 2-106(C) of the then-newly-adopted Code of Professional Responsibility and the former Canons 12 and 13. The prohibition on contingent fees in criminal cases is now in Rule 4-1.5, and business or security transactions with a client implicate Rule 4-1.8(a). Treat this page as historical context, not current guidance.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 criminal defense lawyer use a contingent fee tied to the case outcome?

A: Under this opinion, no. The committee held that DR 2-106(C) barred arranging, charging, or collecting a contingency for representing a criminal defendant, including refund-on-conviction and bonus-on-acquittal structures.

Q: Can the lawyer take a promissory note for unpaid criminal-defense fees?

A: Under this opinion, yes, with full disclosure, where the note bears lawful interest comparable to lending institutions.

Q: Can the lawyer secure that note with the client's property?

A: The committee allowed a security interest, but said the transfer should not be absolute in form and must clearly reflect its nature as security, subject to the stringent rules governing client-lawyer transactions.

Background and rules framework

The opinion applied DR 2-106(C) of the former Code of Professional Responsibility, which barred contingent fees in criminal cases, along with the former Canons 12 and 13. That prohibition is now in Rule 4-1.5 of the Rules Regulating The Florida Bar, and security or business transactions with a client are governed by Rule 4-1.8(a). The Model Rule analogue for the fee question is Rule 1.5.

Citations and references

Rules of Professional Conduct:

• DR 2-106(C); Canons 12 and 13 [Code of Professional Responsibility; criminal contingent-fee bar now in Rule 4-1.5]

Other opinions cited:

• Florida Opinion 68-61: taking a note for an agreed fee balance

See also

No sibling opinions yet indexed.

Source

• Landing page: https://www.floridabar.org/etopinions/etopinion-70-12/
• Original PDF: https://www-media.floridabar.org/uploads/2017/04/FL-Bar-Ethics-Op-70-12-1.pdf

Original opinion text

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

FLORIDA BAR ETHICS OPINION
OPINION 70-12
July 6, 1970
Advisory ethics opinions are not binding.
It is improper for an attorney representing a criminal defendant to enter into an arrangement for a contingent fee.
It is not improper for such an attorney to take a note evidencing a balance on an agreed fee which bears a lawful interest rate comparable to that charged by lending institutions. Any transfer of assets to perfect a security interest under such a note should not be absolute in form, but should clearly reflect its nature as one of a security interest.
Canons: 12 and 13
CPR: DR 2-106(C)
Opinion: 68-61
Chairman MacDonald stated the opinion of the committee:
A member of The Florida Bar proposes the following questions:
May an attorney contract with his client, in a criminal case, that the fee will be a certain amount, to be paid in advance, providing, however, that in the event of a guilty verdict, or, in the event of sentence being imposed whereby the defendant spends time in a jail or prison, the attorney will refund a given amount of the fee previously paid?
Suppose that the situation is similar to that posed in Question One except that the agreement between the attorney and his client provides that the client must pay the attorney a given amount by a certain time, prior to the trial, and that he must then pay the attorney a fixed additional amount provided, however, that there is not a guilty verdict, or, if there is a guilty verdict, provided that there is not a sentence imposed resulting in the defendant being sent to a jail or prison?
May an attorney representing a criminal defendant take all or a portion of his fee in the form of a promissory note, bearing a reasonable interest and, may he also, if assets are available, secure such note with a mortgage covering such assets?
In a situation similar to Question Three, may an attorney, if the client agrees, take title to the defendant's automobile or title to some other assets, either real or personal, under an agreement whereby the attorney will be permitted to retain such assets and sell them in the event that the client does not pay whatever fee was agreed upon between the attorney and the client?
The Committee has previously and informally answered questions three and four, but because of the pendency of the petition for adoption of the Code of Professional Responsibility in Florida it has withheld rendition of an opinion as to questions one and two. The Code of Professional Responsibility has now been adopted in Florida effective October 1, 1970. DR 2-106(C) provides as follows:
A lawyer shall not enter into an arrangement for, charge, or collect a contingency for representing a defendant in a criminal case.
Accordingly, questions one and two must be answered in the negative.
With reference to the remaining questions, we are of the view that there is no reason why with full disclosure a lawyer may not take a note evidencing a balance on an agreed fee and that the same may bear lawful interest comparable to that charged by lending institutions, see our Opinion 68-61.
Any transfer of assets to perfect a security interest in connection with such a note should, of course, not be absolute in form, but should clearly reflect its nature as one of a security interest. Of course, there are onerous rules of law presumptively invalidating transactions between client and counsel and any attorney endeavoring to protect his fee arrangement by such a transaction must be ever watchful to meet the stringent requirements imposed by these rules of law.