Can an Ohio criminal-defense lawyer charge a flat fee paid in advance, deposit it in the business account, and call it nonrefundable?
Ohio BPC Opinion 1996-004: Flat Fee Paid in Advance for Criminal Defense
Short answer: The opinion concluded that it is proper for a lawyer to charge a criminal defendant a flat fee in advance, and that by agreement the fee may be deposited in the lawyer's business account on receipt, but the fee must not be excessive under DR 2-106(A), the client must remain liable for litigation expenses under DR 5-103(B), the agreement must not impair competent and zealous representation under DR 6-101 and DR 7-101, and the advance flat fee may not be deemed nonrefundable under DR 2-106(A) and DR 2-110(A)(3).
Disclaimer: This is an advisory ethics opinion. Advisory opinions are not binding; they interpret the Ohio Board of Professional Conduct's rules of professional conduct and are persuasive authority. This summary is for research purposes only and is not legal advice. Verify current rules before acting on any specific guidance.
About this page: The plain-English summary and Q&A below were written by Ezel based on the official opinion. The opinion text is reproduced at the bottom; the official source (linked) controls.
Plain-English summary
The Board addressed a flat fee paid in advance for representation in a criminal matter (not a general availability retainer). It started from DR 2-106, which bars excessive fees and lists "whether the fee is fixed or contingent" as a reasonableness factor, and DR 2-106(C), which bars contingent fees in criminal cases, so fixed fee agreements are required there. A flat fee, based on factors other than hours, gives the client cost certainty; that criminal matters involve uncertain time is just one reasonableness factor.
Drawing on its Opinion 95-2, the Board listed the limits that apply to any flat fee: it must not be excessive (DR 2-106(A)), it cannot circumvent the client's liability for litigation expenses (DR 5-103(B)), and it must not impair competent and zealous representation (DR 6-101 and DR 7-101). It then addressed two advance-payment questions. On deposit, it concluded DR 9-102(A) does not require an advance criminal flat fee to be held in trust; by agreement that the fee is paid in advance in exchange for the promise to represent, it may go into the business account on receipt.
On refundability, the Board concluded an advance flat fee may not be deemed nonrefundable. It reasoned nonrefundable advance fees let lawyers keep unearned fees for which the client received little benefit, a problem on discharge or withdrawal, citing Cincinnati Bar Ass'n v. Schultz. It noted Ohio and other-state committees disapprove nonrefundable criminal-defense fees, and that DR 2-110(A)(3) requires prompt refund of any unearned advance fee on withdrawal.
Currency note
The Ohio Board reports that this opinion was withdrawn by Advisory Opinion 2016-01 on February 12, 2016. Because it has been withdrawn, it is indexed here as research only and is not current guidance. The Board also flags it as a "CPR Opinion" interpreting the former Ohio Code of Professional Responsibility, which was superseded by the Ohio Rules of Professional Conduct effective February 1, 2007.
This opinion issued in 1996. Treat this page as historical context, not current guidance. The treatment of flat and advance fees has changed under the current rules. Verify against the current Ohio Rules of Professional Conduct and Opinion 2016-01 before relying on any specific rule mentioned here.
Common questions
Q: Can a criminal-defense lawyer charge a flat fee paid in advance?
A: Yes. The Board concluded a lawyer may charge a criminal defendant a flat fee in advance, subject to the limits that it not be excessive, that the client stay liable for expenses, and that representation remain competent and zealous.
Q: Does the advance flat fee have to go in a trust account?
A: No. The Board concluded DR 9-102(A) does not require it; by agreement that the fee is paid in advance for the promise to represent, it may be deposited in the lawyer's business account on receipt.
Q: Can the advance flat fee be made nonrefundable?
A: No. The Board concluded an advance flat fee may not be deemed nonrefundable, because DR 2-110(A)(3) requires a prompt refund of any unearned advance fee on withdrawal.
Background and rules framework
The opinion interprets the former Ohio Code of Professional Responsibility: DR 2-106(A) (excessive fees) and DR 2-106(C) (no contingent fees in criminal cases), DR 5-103(B) (client liability for expenses), DR 6-101 and DR 7-101 (competent and zealous representation), DR 9-102 (preserving client funds), and DR 2-110(A)(3) (refund of unearned advance fees).
Citations and references
Rules of Professional Conduct:
- Former Ohio Code of Professional Responsibility DR 2-106(A), DR 2-106(C), DR 5-103(B), DR 6-101, DR 7-101, DR 9-102, DR 2-110(A)(3)
Cases:
- Cincinnati Bar Ass'n v. Schultz, 71 Ohio St. 3d 383 (1994); In re Cooperman, 83 N.Y.2d 465 (1994)
Other opinions cited:
- ABA Informal Op. 1389 (1977); Ohio BPC Op. 95-2 (1995); Ohio State Bar Informal Op. 90-8; Columbus Bar Op. 5; Cleveland Bar Op. 84-1; Toledo Bar Op. 93-8; plus Kansas, North Carolina, and Virginia opinions
See also
- Ohio BPC Op. 1995-002: Fixed Flat Fee for Insurer Subrogation Work
- Ohio BPC Op. 1995-007: Choosing the Larger of an Hourly or a Contingent Fee
- Ohio BPC Op. 1988-031: No Fee Where No Services Are Performed
Source
- Landing page: https://ohioadvop.org/advisory-opinion-index/
- Original PDF: https://www.ohioadvop.org/wp-content/uploads/2017/04/Op-96-004.pdf
Original opinion text
Reproduced from the official source for research purposes. The linked source is authoritative.
The Supreme Court of Ohio
BOARD OF COMMISSIONERS ON GRIEVANCES AND DISCIPLINE
41 SOUTH HIGH STREET-SUITE 3370, COLUMBUS, OH 43215-6105
(614) 644-5800 FAX: (614) 644-5804
OFFICE OF SECRETARY
OPINION 96-4
Issued June 14, 1996
[WITHDRAWN by Adv.Op. 2016-01 on February 12, 2016]
SYLLABUS: It is proper for a lawyer to enter a flat fee agreement requiring
a criminal defendant to pay a fixed amount in advance of representation in a
criminal matter. The flat fee agreement must comport with the Ohio Code
of Professional Responsibility. Under DR 2-106(A), the flat fee must not be
excessive. Under DR 5-103(B), the client must remain ultimately liable for
expenses of litigation. Under DR 6-101 and DR 7-101, the flat fee
agreement must not interfere with an attorney’s duties of competent and
zealous representation to each client. Under DR 9-102, a flat fee paid in
advance of representation may be deposited into the lawyer’s business
account upon receipt pursuant to the agreement between the lawyer and
client that the flat fee will be paid in advance of the representation. Under
DR 2-106(A) and DR 2-110(A)(3), a flat fee paid in advance of
representation in a legal matter should not be deemed nonrefundable.
OPINION: This opinion addresses a flat fee agreement requiring a client’s
payment of a fixed amount in advance of representation in a criminal matter.
It does not address payment of a retainer to an attorney to secure availability
of the lawyer’s services over a period of time without regard to a specific
matter.
Is it proper for a lawyer to enter a flat fee agreement requiring a
criminal defendant to pay a fixed amount in advance of
representation in a criminal matter?
Fee agreements must comply with DR 2-106 of the Ohio Code of
Professional Responsibility.
Opinion 96-4 2
DR 2-106. Fees for Legal Services
(A) A lawyer shall not enter into an agreement for, charge, or
collect an illegal or clearly excessive fee.
(B) A fee is clearly excessive when, after a review of the facts, a
lawyer of ordinary prudence would be left with a definite
and firm conviction that the fee is in excess of a reasonable
fee. Factors to be considered as guides in determining the
reasonableness of a fee include the following:
(1) The time and labor required, the novelty and
difficulty of the questions involved, and the
skill requisite to perform the legal service
properly.
(2) The likelihood, if apparent to the client, that the
acceptance of the particular employment will
preclude other employment by the lawyer.
(3) The fee customarily charged in the locality for
similar legal services.
(4) The amount involved and the results obtained.
(5) The time limitation imposed by the client or by
the circumstances.
(6) The nature and length of the professional
relationship with the client.
(7) The experience, reputation, and ability of the
lawyer or lawyers performing the services.
(8) Whether the fee is fixed or contingent.
(C) A lawyer shall not enter into an arrangement for, charge, or
collect a contingent fee for representing a defendant in a
criminal case.
Fixed fees are expressly recognized as a type of legal fee in DR 2-
106(B)(8). Fixed fee agreements are required in criminal representations,
since contingent fees in criminal cases are prohibited under DR 2-106(C).
Opinion 96-4 3
A flat fee is a type of fixed fee. Flat fees are based upon factors
independent of the actual number of hours involved in a representation. Flat
fees provide certainty to clients with regard to costs of legal services while
allowing attorneys to be paid a fair sum for their services. Flat fees are used
for routine and standardized services, but are increasingly being used in
representations that present uncertainties about the amount of time the
lawyer will expend. See ABA/BNA Lawyer’s Manual on Professional
Conduct, 41:306 (2/23/94).
Criminal matters do present uncertainty with regard to the amount of time
that may be expended, since the matters may be resolved through dismissal,
plea agreement, or trial. However, time is but one factor to consider when
determining the reasonableness of a fee under DR 2-106(B) . See e.g., ABA,
Informal Op. 1389 (1977) permitting the use of a fixed fee in advance for
legal work on tax matters or litigation before the Tax Court when the fixed
fee embraces all work to be done, whether it be relatively simple and of
short duration, or complex and protracted.
This Board has addressed the use of flat fees, but in the context of a flat fee
agreement between a law firm and an insurer/third party administrator of
group health benefit plans. In Opinion 95-2 (1995), the Board advised that
the propriety of a flat fee agreement is based upon a variety of factors. A
fixed flat fee is subject to the restriction in DR 2-106(A) that it not be
excessive. A fixed flat fee cannot circumvent the requirement of DR 5-
103(B) that clients must remain liable for expenses of litigation. A fixed
flat fee agreement must not limit an attorney’s duties of competent and
zealous representation to each client under DR 6-101 and DR 7-101. See
Ohio SupCt, Bd of Comm’rs on Grievances and Discipline, Op. 95-2
(1995).
When the payment of a flat fee is in advance of representation, there are
additional ethical considerations. Should a flat fee be place into the
attorney’s business account or should it be deposited into a client trust
account? May the fee be nonrefundable?
DR 9-102(A) requires that the identity of all client funds paid to a lawyer or
a law firm be preserved by deposit into an identifiable bank account,
Opinion 96-4 4
separate from an account for deposits of the lawyer’s or law firm’s funds.
Funds belonging in part to a client and in part presently or potentially to a
lawyer or law firm must be deposited therein as required under DR 9-
102(A)(2). These restraints are for the protection of clients.
DR 9-102. PRESERVING IDENTITY OF FUNDS AND
PROPERTY OF CLIENT
(A) All funds of clients paid to a lawyer or law firm, other than
advances for costs and expenses, shall be deposited in one
or more identifiable bank accounts maintained in the state in
which the law office is situated and no funds belonging to
the lawyer or law firm shall be deposited therein except as
follows:
(1) Funds reasonably sufficient to pay bank
charges may be deposited therein.
(2) Funds belonging in part to a client and in part
presently or potentially to the lawyer or law
firm must be deposited therein, but the portion
belonging to the lawyer or law firm may be
withdrawn when due unless the right of the
lawyer or law firm to receive it is disputed by
the client, in which event the disputed portion
shall not be withdrawn until the dispute is
finally resolved.
In this Board’s view, DR 9-102(A) does not require that flat fees paid in
advance for representation in a criminal matter be placed in a trust account.
A flat fee for representation in a matter may be placed into the attorney’s
business account upon receipt, based upon the agreement between the
lawyer and client that the flat fee will be paid in advance of representation.
By agreement, the funds are given to the lawyer in exchange for the promise
to represent the client in the matter. However, deposit into a business
account does not mean that the fee is nonrefundable.
Opinion 96-4 5
A flat fee paid in advance for representation in a legal matter should not be
deemed nonrefundable. Nonrefundable fees paid in advance of
representation allow attorneys to keep unearned fees for which a client
receives little or no benefit. Nonrefundable advance fees are a problem
when there is discharge of a lawyer by a client or when a lawyer withdraws
from a case . See Cincinnati Bar Ass’n v. Schultz, 71 Ohio St. 3d 383, 384
(1994).
Ethics committees in Ohio disapprove of nonrefundable fee agreements.
See Ohio State Bar Ass’n, Informal Op. 90-8 (1990); Columbus Bar Ass’n,
Op. 5 (1988); Bar Ass’n of Greater Cleveland, Op. 84-1 (1984). But cf.
Toledo Bar Ass’n, Op. 93-8 (1993) advising that nonrefundability is
improper or proper depending upon the fact situation.
Ethics committees in other states have found disfavor with nonrefundable
fee contracts in criminal defense representations. See Kansas Bar Ass’n,
Op. 84-12 (1984), North Carolina State Bar Ass’n, Op. 106 (1991), Virginia
State Bar, Op. 646 (1985). In New York, the state’s highest court has held
that nonrefundable retainers clash with public policy and contravene the
Code of Professional Responsibility. See In re Cooperman, 83 N.Y. 2d 465,
633 N. E. 2d 1069, 611 N.Y.S. 2d 465 (1994), aff’g 591 N.Y.S. 2d 855
(A.D. 2 Dept. 1993). Among the bar, the issue of nonrefundability attracts
attention. See Lester Brickman & Lawrence A. Cunningham,
Nonrefundable Retainers: A Response to Critics of the Absolute Ban, 64 U.
Cin. L. Rev. 11 (Fall 1995); Steven Lubet, The Rush to Remedies: Some
Conceptual Questions About Nonrefundable Retainers, 73 N.C.L. Rev. 271
(Nov. 1994); Lester Brickman & Lawrence A. Cunningham, Nonrefundable
Retainers Revisited, 72 N.C.L. Rev. 1 (Nov. 1993).
Nonrefundable advance fees contradict the requirement of DR 2-110(A)(3)
that “[a] lawyer who withdraws from employment shall refund promptly any
part of a fee paid in advance that has not been earned.” A nonrefundable
advance fee agreement unfairly penalizes a client who discharges a lawyer.
In conclusion, it is proper for a lawyer to enter a flat fee agreement requiring
a criminal defendant to pay a fixed amount in advance of representation in a
criminal matter. The flat fee agreement must comport with the Ohio Code
Opinion 96-4 6
of Professional Responsibility. Under DR 2-106(A), the flat fee must not be
excessive. Under DR 5-103(B), the client must remain ultimately liable for
expenses of litigation. Under DR 6-101 and DR 7-101, the flat fee
agreement must not interfere with an attorney’s duties of competent and
zealous representation to each client. Under DR 9-102, a flat fee paid in
advance of representation may be deposited into the lawyer’s business
account upon receipt pursuant to the agreement between the lawyer and
client that the flat fee will be paid in advance of the representation. Under
DR 2-106(A) and DR 2-110(A)(3), a flat fee paid in advance of
representation in a legal matter should not be deemed nonrefundable.
Advisory Opinions of the Board of Commissioners on Grievances and Discipline are
informal, nonbinding opinions in response to prospective or hypothetical questions
regarding the application of the Supreme Court Rules for the Government of the
Bar of Ohio, the Supreme Court Rules for the Government of the Judiciary, the
Code of Professional Responsibility, the Code of Judicial Conduct, and the
Attorney’s Oath of Office.