If a lawyer agreed with a legal aid organization to take a case pro bono, can the lawyer later charge the client a fee or use the referral information against the client?

Plain-English summary

Bar Counsel asked three questions about a lawyer who agreed with a legal services organization serving the indigent to take a referred client pro bono. First, may the lawyer make a separate fee agreement with the client that contravenes the terms agreed with the organization, to the client's detriment? Second, does the answer change if the lawyer makes no explicit fee agreement but simply bills the client more than agreed? Third, may the lawyer use the client and case information disclosed by the organization (to inquire about taking the case) for a purpose detrimental to the client, such as inducing the client to hire the lawyer for a fee or advocating for an adverse client?

On the first two questions, the Commission concludes that charging a fee in excess of the pro bono agreement is an excessive fee under Bar Rule 3.3(a). A fee above what the lawyer agreed to charge for the benefit of an indigent client is per se unreasonable, and undermines the rule's factors keyed to the nature of the professional relationship and the fee that was fixed. If the client's financial circumstances change, the lawyer's obligation is to inform the legal services organization and obtain a change in that agreement before approaching the client about a different fee. A lawyer who instead extracts a greater fee from the client without disclosing the prior commitment has misused a fiduciary position and engaged in fraud, violating Bar Rule 3.2(f)(3); the Commission finds no distinction between the first and second questions.

On the third question, the Commission concludes the lawyer would violate at least Bar Rule 3.6(h)(1)(iv), which prohibits knowing disclosure or use of information received from a prospective client that would be detrimental to a material interest of the client, where the information was provided with a reasonable expectation it would not be disclosed. For this analysis there is no difference between information received from the legal services organization on the client's behalf and information received directly from the client.

In practice

Under the former Maine Bar Rules in effect when the opinion issued (the duties carry forward in Maine Rules of Professional Conduct 1.5 on fees, 8.4 on dishonesty, and 1.6/1.18 on confidentiality and prospective clients), the opinion holds that a lawyer who committed to a pro bono or reduced-fee arrangement with a legal services organization cannot charge the client more without first obtaining the organization's consent to change that agreement. The opinion holds that billing the client beyond the agreement, whether by a separate fee agreement or simply by sending a larger bill, is an excessive fee and, where the prior commitment is not disclosed to the client, a fraud. The opinion holds the lawyer also may not use the client or case information obtained through the referral in a manner detrimental to the client.

Common questions

Q: Can a lawyer who took a case pro bono later bill the client?

A: Not without the legal services organization's consent. The opinion concludes that charging a fee above the pro bono agreement is an excessive fee under Bar Rule 3.3(a) and is per se unreasonable.

Q: What if the lawyer never signed a fee agreement and just sends a bill?

A: The same answer applies. The opinion finds no distinction between making a contravening fee agreement and simply billing the client more than agreed.

Q: What must the lawyer do if the client turns out not to be indigent?

A: Inform the legal services organization and obtain a change in the agreement before approaching the client about a different fee. The opinion states that extracting a greater fee without disclosing the prior commitment misuses a fiduciary position and is fraud under Bar Rule 3.2(f)(3).

Q: Can the lawyer use the referral information against the client?

A: No. The opinion concludes that using the client and case information for a purpose detrimental to the client violates at least Bar Rule 3.6(h)(1)(iv), treating it the same as information received directly from the client.

Background and rules framework

The opinion interprets former Maine Bar Rule 3.3(a) (excessive fees, including the factors in 3.3(a)(6) and (8)), Rule 3.2(f)(3) (conduct involving dishonesty or fraud), and Rule 3.6(h)(1)(iv) (information received from a prospective client). These correspond to ABA Model Rule 1.5 (fees), Model Rule 8.4(c) (dishonesty), and Model Rule 1.18 (duties to prospective clients), read with Model Rule 1.6. The opinion cites Glynn v. Atlantic Seaboard Corp., 1999 ME 53, 728 A.2d 117, on silence as misrepresentation in a fiduciary relationship.

Citations and references

Rules of Professional Conduct:

• Model Rules 1.5, 8.4(c), 1.18, 1.6
• Maine Bar Rules 3.3(a), 3.2(f)(3), 3.6(h)(1)(iv)

Cases:

• Glynn v. Atlantic Seaboard Corp., 1999 ME 53, 728 A.2d 117, omission by silence as false information where a fiduciary relationship exists.

See also

• ABA Formal Op. 90-358: Protection of Information Imparted by a Prospective Client
• ABA Formal Op. 492: Obligations to Prospective Clients
• NY State Bar Op. 1126: Confidentiality Owed to a Prospective Client

Source

• Landing page: https://mebaroverseers.org/attorney_services/opinion.html?id=87366

Original opinion text

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

Issued by the Professional Ethics Commission

Date Issued: May 3, 2006

Questions

Bar Counsel has asked the Commission the following questions:

• When an attorney has made an agreement with a legal services organization serving the indigent to provide pro bono representation to a client referred to that attorney by that legal services organization, is it a violation of Maine Bar Rule 3.2(f)(3), 3.3(a) or any other Bar Rule for the attorney to make a separate fee agreement with the client that contravenes to the detriment of the client the terms to which the attorney agreed with the legal services agency?

• Would the answer to the first question change if the attorney does not make any explicit fee agreement with the client but simply sends the client a bill for services during or after the representation that exceeds that to which the attorney agreed with the legal services organization?

• When client and case information are disclosed by a legal services organization serving the indigent to an attorney for purposes of inquiring whether the attorney will agree to provide the client with pro bono representation, is it a violation of Maine Bar Rule 3.6(h) or any other Bar Rule for the attorney to use this information for a purpose detrimental to the client, such as in either later inducing the client to hire the attorney for a fee or in advocating for another client whose interests are adverse to those of the client referred by the legal services organization?

Opinion

The Commission finds the answers to these questions clear both in the context of any reasonable understanding of the broad ethical duties of attorneys as well as in the context of specific Bar Rules. This Opinion will directly examine the latter.

Alteration of Agreed Upon Fee to the Detriment of the Client

As to the first two questions, we believe that an attorney who violates an agreement undertaken for the benefit of the client in the manner indicated would be charging an excessive fee, in violation of Bar Rule 3.3(a), which states, in part: ?A fee is excessive when, after review of the facts, a lawyer of ordinary prudence would be left with the definite and firm conviction that the fee is in excess of a reasonable fee.? In the view of this Commission, a fee in excess of that to which the attorney agreed for the benefit of an indigent client is per se unreasonable and therefore in violation of this stated general principle of the Rule. Moreover, two of the specific factors to be considered under the Rule in determining the reasonableness of a fee are undermined by charging such a fee. The attorney has set a fee which is inconsistent with the nature of the professional relationship with the client, see Rule 3.3(a)(6), and the fee charged is in excess of that which was fixed, see Rule 3.3(a)(8).

If the financial circumstances of the client change or do not reflect those of indigence or financial need as the legal services organization referring the client had understood, then, if the attorney wishes to charge a fee, the attorney?s obligation is to so inform the legal services organization and obtain a change in its agreement before approaching the client about a different fee arrangement.[1]

If the attorney has not obtained a change in his/her agreement with the legal services organization before approaching the client about a different fee agreement, that attorney has misused a fiduciary position of trust with the client. An attorney who has agreed with a legal services organization, which is acting on behalf of the indigent client, to take a case pro bono or at a reduced fee, and then extracts a greater fee from the client, without telling the client about the lawyer?s prior commitment to charge a lesser fee or no fee at all, violates Bar Rule 3.2(f) (3). Through such silence, the attorney has essentially engaged in fraud. See Glynn v. Atlantic Seaboard Corp., 1999 ME 53 at ¶ 12, 728 A.2d 117, 120 (where fiduciary relationship exists between parties, omission by silence may constitute supplying of false information).

In sum, there are no facts conceivable to this Commission, in the absence of the legal services organization?s prior express consent, by which an attorney could agree to charge no fee for legal services and then ethically charge the client a fee. In this response, the Commission finds no distinction between the first and second questions.

Use of Confidential Information

Under the circumstances set forth in the third question, the Commission is of the opinion that the attorney would be in violation at least of Bar Rule 3.6(h)(1)(iv), which prohibits, except in circumstances not present here, knowing disclosure or use of information that is received from a prospective client, the disclosure of which would be detrimental to a material interest of the client, when the information is provided under circumstances in which the prospective client has a reasonable expectation that the information will not be disclosed. For purposes of this analysis, there is no difference between information received from the legal services organization on behalf of the client and information received directly from the client.

Footnotes

[1] The legal services organization?s materials that the Commission was provided document the client?s consent for the attorney to release such financial information to the organization.