My contingent-fee personal injury case was dismissed for the client's discovery failures. Can I now bill the client hourly instead?

Plain-English summary

The inquiring attorney represented a client in a personal injury matter on a contingency basis, agreeing to receive one-third of any settlement plus reimbursement of out-of-pocket expenses. The attorney filed suit in Superior Court, and the case was dismissed two years later as a result of the plaintiff's failure to comply with discovery. The attorney implies, but does not state, that the involuntary dismissal resulted from the client's refusal to comply with the discovery effort. Having expended numerous hours, the attorney asked whether he or she may now bill the client on an hourly rate basis in addition to reimbursement of out-of-pocket expenses.

The opinion applies Rule 1.5(c), which permits a lawyer to charge a fee contingent on the outcome of a matter and provides that the agreement should be in writing, reduced to writing at the beginning of the lawyer-client relationship to reduce the possibility of misunderstanding and dispute. The opinion notes the attorney does not state whether the contingent fee agreement was in writing.

The opinion concludes that the Panel cannot condone contingent fee agreements that are not in writing as contemplated by the Rule, nor will it condone the attorney attempting to avoid or restate the terms of the contingent fee agreement at this late date.

In practice

Under this opinion, the existing contingent fee agreement governs, and the opinion will not sanction converting it to an hourly charge after the case has been dismissed. The opinion frames the answer around Rule 1.5(c)'s writing expectation -- observing the attorney did not say whether the agreement was written and declining to condone unwritten contingent fee agreements -- and declines to condone restating the agreed terms at this late stage.

Common questions

Q: Can the lawyer bill the client hourly after the contingent case was dismissed?

A: The opinion declines to condone the attorney's attempt to avoid or restate the terms of the contingent fee agreement at this late date.

Q: Does the contingent fee agreement have to be in writing?

A: The opinion states Rule 1.5(c) provides the agreement should be in writing, reduced to writing at the beginning of the relationship, and that the Panel cannot condone contingent fee agreements that are not in writing.

Q: Does the client's alleged discovery failure change the fee analysis?

A: The opinion notes the attorney only implies the dismissal resulted from the client's refusal to comply, and rests its conclusion on the contingent fee agreement and Rule 1.5(c) rather than on the client's conduct.

Background and rules framework

The opinion interprets Rhode Island Rule of Professional Conduct 1.5(c) (fees; contingent fees), the analog of Model Rule 1.5. Rule 1.5(c) permits a fee contingent on the outcome and provides that the agreement should be in writing, reduced to writing at the outset of the relationship to reduce the possibility of misunderstanding and dispute.

Citations and references

Rules of Professional Conduct:

• MR 1.5 / RI RPC 1.5(c) (contingent fees; agreement should be in writing)

See also

• RI EAP Opinion 93-54: an investment adviser's referral fee under Rules 5.4 and 1.8

Source

• Landing page: https://www.courts.ri.gov/attorney-resources/Pages/Ethics-Advisory-Panel-default.aspx
• Original PDF: https://www.courts.ri.gov/Opinions/EAP%2093-69.pdf

Original opinion text

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

(FINAL)
ETHICS ADVISORY PANEL
OPINION #93-69, REQUEST #408
Issued September 14, 1993

The inquiring attorney represented a client in a personal injury matter. It was agreed that the inquiring attorney would be paid on a contingency basis and would receive one-third (1/3) of any settlement realized by the client, plus reimbursement for out-of-pocket expenses. The inquiring attorney filed suit in the Superior Court. The case was dismissed two (2) years later as a result of the plaintiff's failure to comply with discovery. The inquiring attorney implies, but does not state, that the involuntary dismissal of the action resulted from the client's refusal to comply with the discovery effort. The inquiring attorney indicates that he/she has expended numerous hours on this matter and asks whether he/she may now bill the client on an hourly rate basis in addition to reimbursement for out-of-pocket expenses.

Rule 1.5(c) permits a lawyer to charge a fee that is contingent on the outcome of a matter and provides that the agreement should be in writing. The agreement should be reduced to writing at the beginning of the lawyer/client relationship to reduce the possibility of misunderstanding and dispute. The inquiring attorney does not state whether the contingent fee agreement was in writing. The Panel cannot condone contingent fee agreements that are not in writing as contemplated by the Rule, nor will it condone the inquiring attorney attempting to avoid and/or restate the terms of the contingent fee agreement at this late date.