Can a Nevada lawyer charge a non-refundable retainer in a divorce or criminal case?

Plain-English summary

The Committee considered whether non-refundable retainer agreements are ethical in domestic-relations and criminal cases. The question arose from a written divorce fee agreement that charged most of the anticipated fee in advance ($7,500); the lawyer was discharged after six hours of work but insisted the entire amount was non-refundable because the agreement said the retainer was earned regardless of how the matter resolved.

The Committee analyzed the question under SCR 155 (the reasonable-fee rule, based on ABA Model Rule 1.5), which lists factors for assessing a fee's reasonableness and which, when adopted, eliminated the prior "clearly excessive" threshold so that both unreasonable and patently unconscionable fees are now prohibited. It surveyed authorities holding that unearned fees must be refunded when a lawyer is discharged or withdraws, including a New York City Bar opinion (a lawyer may not label a fee non-refundable, though minimum fees, flat fees for contemplated services, and availability retainers are acceptable so long as unearned amounts are returned) and a Tennessee disciplinary decision censuring a lawyer for refusing to adjust a fee that became unjust under changed circumstances.

The Committee rejected the argument that freedom of contract lets a lawyer keep a non-refundable retainer based on skill, reputation, or case difficulty. Those factors are consistent with SCR 155 but do not override the ultimate requirement to test a disputed fee against the rule's reasonableness factors. The Committee observed that SCR 155 would be meaningless if a lawyer could defend a fee solely on the existence of a contract, and that relabeling the retainer a "minimum fee" or "fixed fee" changes nothing: if a retainer is not earned and cannot be shown reasonable under the circumstances, it cannot truly be non-refundable, a term the Committee called an "oxymoron."

Currency note

This opinion was issued in 1993, before Nevada's 2006 adoption of the current Nevada Rules of Professional Conduct (the renumbered Rules 1.0 et seq. that replaced the former Supreme Court Rules) and the related Ethics 2000-based revisions. The reasonable-fee rule is now Rule 1.5. Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific rule or fee standard mentioned here.

Common questions

Q: Are non-refundable retainers banned in Nevada?

A: Not categorically. The opinion concluded SCR 155 does not specifically prohibit them, but any such agreement is unethical if the fee would be unreasonable under all the circumstances.

Q: If a lawyer is fired after little work, can the lawyer keep a "non-refundable" retainer?

A: No, not beyond what is reasonable. Per the opinion, a discharged or withdrawing lawyer cannot retain an amount that cannot be justified by the time expended and results obtained, no matter how the agreement labels the fee.

Q: Does calling the fee a "minimum fee" or "fixed fee" change the analysis?

A: No. The opinion concluded the analysis is the same; the contemplated fee must be reasonable, and unearned amounts cannot be kept after discharge or withdrawal regardless of the label.

Background and rules framework

The opinion interprets former SCR 155 (reasonableness of fees, based on ABA Model Rule 1.5), which lists the factors used to gauge whether a fee is reasonable and which replaced the earlier "clearly excessive" standard. The opinion reads the reasonableness requirement as controlling over the label or contractual form a retainer takes.

Citations and references

Rules of Professional Conduct:

• Model Rule 1.5 / former Nev. SCR 155 (reasonableness of fees)

Other opinions cited:

• Association of the Bar of the City of New York Op. 1991-03 (a fee may not be labeled non-refundable; unearned fees must be refunded)
• In re Quillen (Tenn. Bd. of Prof'l Resp. 1984) (censure for refusing to adjust a fee rendered unjust by changed circumstances)

See also

• NV Ethics Op. 16: contingent fees in post-divorce property settlement disputes
• NV Ethics Op. 4: percentage-of-hourly-rate fee arrangement

Source

• Landing page: https://nvbar.org/for-lawyers/ethics-discipline/ethics-opinions/
• Original PDF: https://nvbar.org/wp-content/uploads/opinion_15.pdf