Ezel / Ethics Opinions / OSB
OSB August 2005

When a contingent-fee settlement is paid in installments, can the lawyer take more than the agreed percentage out of the early payments?

Short answer: No. The opinion concludes that, absent a contrary agreement, a lawyer must take only the agreed prorated percentage from each settlement installment, because charging more than the client agreed to pay is a clearly excessive fee under Oregon RPC 1.5(a).

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 Not binding precedent.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 settles a contingent-fee case for a client, and the settlement provides that payments will be made over time. The opinion addresses whether, absent a contrary agreement, the lawyer may ethically take more than the applicable percentage fee from each payment as it is made. The conclusion is no.

The opinion applies Oregon RPC 1.5(a), which bars an illegal or clearly excessive fee. The lawyer's contingent-fee agreement provides for a percentage of any settlement, not for payment off the top. Because the Oregon Supreme Court has held that a clearly excessive fee exists whenever a lawyer charges more than the client agreed to pay, the opinion concludes the lawyer cannot receive more than a prorated portion of each settlement installment.

In practice

The opinion holds that, under the Oregon rule as it stood at the time, the contingent-fee agreement's terms control how installment payments are split. The opinion treats taking more than the agreed percentage from early payments as charging more than the client agreed to pay, which is a clearly excessive fee under RPC 1.5(a).

Common questions

Q: Can a lawyer recover the full contingent fee from the first settlement installments?

A: No, absent a contrary agreement. The opinion concludes the lawyer may take only the agreed prorated percentage of each installment, because the agreement provides for a percentage and not payment off the top.

Q: Why would taking more up front be a problem?

A: The opinion concludes that charging more than the client agreed to pay is a clearly excessive fee under RPC 1.5(a), citing the Oregon Supreme Court's reading of the prior rule.

Background and rules framework

The opinion interprets Oregon RPC 1.5(a) (no illegal or clearly excessive fee), with RPC 1.8(i)(2) (a lawyer may contract for a reasonable contingent fee in a civil case). These track Model Rules 1.5 and 1.8.

Citations and references

Rules of Professional Conduct:

  • Oregon RPC 1.5(a) / Model Rule 1.5 (clearly excessive fee)
  • Oregon RPC 1.8(i)(2) / Model Rule 1.8 (contingent fees in civil cases)

Cases:

  • In re Sassor, 299 Or 720, 705 P2d 736 (1985)

See also

Source

Get today's answer for your situation

You just read a 2005 opinion on this question. Ezel checks the current Oregon Rules of Professional Conduct and answers your specific situation, with citations.

Opens in Ezel Pro. Every answer cites the rules it relies on.