Ezel / Ethics Opinions / OSB
OSB August 2005

Can a personal-injury lawyer charge a contingent fee that is calculated in part on the recovery of uncontested PIP benefits?

Short answer: Yes, qualified. A contingent fee may include the recovery of PIP benefits as long as the lawyer's entire fee for the matter, both the PIP and non-PIP portions, is not clearly excessive or unreasonable; the form of the agreement does not control if the overall math is reasonable, but a more than nominal contingent fee on an uncontested PIP-only claim would be clearly excessive.

Apply this to your situation

This page answers the general question as of 2005. Ezel answers yours: whether it's allowed on your facts, under the current Oregon Rules of Professional Conduct, with citations.

Currency note: this opinion is from 2005
Subsequent statutory amendments, court decisions, or later opinions or rule amendments may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.
Disclaimer: Advisory only. Not binding precedent.
About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official ethics opinion. The original opinion (linked on this page as a PDF) is the authoritative source for any reliance.
View original ethics opinion (PDF)

Plain-English summary

A lawyer represents plaintiffs in personal-injury litigation and wants to use a written contingent-fee agreement, prepared under ORS 20.340, that provides for a contingent fee based both on the disputed portion of a recovery and on the recovery of PIP benefits. The opinion asks whether the lawyer may base a contingent fee in part on PIP benefits, and answers yes, qualified.

The opinion applies Oregon RPC 1.5(a), which bars an illegal or clearly excessive fee, and Oregon RPC 1.8(i)(2), which permits a reasonable contingent fee in a civil case; it treats the "clearly excessive" standard of RPC 1.5(a) and the "reasonableness" standard of RPC 1.8(i)(2) as coextensive, and notes that an ambiguous fee agreement is construed against the lawyer. Drawing on its flat-fee analysis in OSB Formal Ethics Op. No. 2005-98, the opinion frames the test as whether the lawyer's entire fee for handling the particular matter, both PIP and non-PIP, is excessive or unreasonable.

The opinion illustrates with an example: if a plaintiff stands to recover up to $100,000 in contested damages and $5,000 in clear-cut PIP benefits, and a flat fee plus one-third of any overall recovery would not be clearly excessive, then the lawyer may equally agree to take one-third of any PIP or non-PIP sums; if the math is the same, the form of the agreement should not control. By contrast, if the only claim were an uncontested $5,000 PIP claim with no separate personal-injury claim, the opinion states a more than nominal contingent fee would be clearly excessive.

In practice

The opinion holds that, under the Oregon rules as they stood at the time, including PIP benefits in a contingent-fee base is permissible when judged by the overall reasonableness of the fee for the matter, not by the label on any one component. Per the opinion, the analysis turns on whether the total fee is clearly excessive, with the warning that charging a real contingent fee on an uncontested, form-filling PIP-only recovery would be excessive. Verify the current text of Oregon RPC 1.5 and 1.8 before relying on any specific point.

Common questions

Q: Can a contingent fee include the recovery of PIP benefits?

A: Yes, qualified. The opinion concludes a contingent fee may be based in part on PIP benefits if the lawyer's entire fee for the matter is not clearly excessive or unreasonable.

Q: How is the fee judged for excessiveness?

A: Per the opinion, by the lawyer's entire fee for handling the particular matter, both the PIP and non-PIP portions together, treating RPC 1.5(a)'s "clearly excessive" and RPC 1.8(i)(2)'s "reasonableness" standards as coextensive.

Q: Is a contingent fee on a PIP-only claim allowed?

A: The opinion states that if the only claim is an uncontested PIP claim with no separate personal-injury claim, a more than nominal contingent fee would be clearly excessive.

Background and rules framework

The opinion interprets Oregon RPC 1.5(a) (no clearly excessive fee), Oregon RPC 1.5(c) (limits on contingent fees in certain matters), and Oregon RPC 1.8(i)(2) (reasonable contingent fee in a civil case), corresponding to Model Rules 1.5 and 1.8, with reference to ORS 20.340.

Citations and references

Rules of Professional Conduct:

  • Oregon RPC 1.5(a), (c) / Model Rule 1.5 (fees; clearly excessive fee)
  • Oregon RPC 1.8(i)(2) / Model Rule 1.8 (reasonable contingent fee in a civil case)

Statutes:

  • ORS 20.340 (contingent-fee agreements)

Other opinions cited:

  • OSB Formal Ethics Op. No. 2005-97 (fee-agreement modifications)
  • OSB Formal Ethics Op. No. 2005-98 (flat fees)
  • OSB Formal Ethics Op. No. 2005-54 (contingent to hourly on rejected settlement)

See also

Source

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