When a lawyer properly represents both an injured plaintiff and the plaintiff's health insurer claiming subrogation, can the lawyer collect a fee from both?

Plain-English summary

This opinion builds on Ethics Opinion 91-25, which held that a personal injury attorney could in some situations ethically represent both the injured plaintiff seeking damages and the health insurer claiming a subrogation interest in medical bills already paid for the plaintiff, where both clients give informed consent and the dual representation ceases if the plaintiff later does not want the health insurer paid. The new question was whether the attorney could collect a fee from both clients.

Assuming the requirements of Opinion 91-25 are met and the dual representation is permitted in the particular case, the committee said there is no prohibition on collecting a fee from both clients. It reasoned that collecting a fee from both would not marginally increase any conflict-of-interest potential, so long as the dual payment is adequately disclosed to both clients and their consent obtained, because a lawyer owes the same duties of diligence and loyalty whether or not he is paid, so the payment of a dual fee does not affect the lawyer's obligations on the conflict issues either way. The committee said the question is governed by Rule 1.5 (reasonableness of fees), decided case by case, and concluded there is no absolute prohibition on collecting dual fees.

Currency note

This opinion was issued in 1991, before the South Carolina Bar's adoption of the 2005 revisions to the Rules of Professional Conduct. Subsequent rule amendments or later opinions may have changed the analysis. Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific rule, deadline, or requirement mentioned here.

Common questions

Q: Can a lawyer who represents both the injured plaintiff and the subrogated insurer charge each a fee?

A: The committee said yes, where the dual representation is itself permitted under Opinion 91-25, there is no prohibition on collecting a fee from both clients.

Q: Does charging both clients add to the conflict of interest?

A: The committee said no. A lawyer owes the same diligence and loyalty whether or not paid, so a dual fee does not change the conflict analysis, provided the dual payment is disclosed and both clients consent.

Q: What is the limit on the dual fees?

A: The committee said the fees are governed by Rule 1.5's reasonableness requirement, decided case by case; there is no absolute prohibition on collecting dual fees.

Background and rules framework

The opinion applied Rule 1.5 (reasonableness of fees), which corresponds to Model Rule 1.5, and depended on the dual-representation conditions set in S.C. Bar Advisory Opinion 91-25. The analysis turned on disclosure and consent and on a lawyer's duties being unaffected by who pays.

Citations and references

Rules of Professional Conduct:

• South Carolina RPC 1.5 / Model Rule 1.5: a lawyer's fee must be reasonable.

Other opinions cited:

• SC Bar Advisory Opinion 91-25: conditions under which a lawyer may represent both the injured plaintiff and the subrogated health insurer.

See also

• SC Bar Ethics Op. 92-27: Lawyer-Defendants and Title Agents in a Land Suit
• SC Bar Ethics Op. 92-03: Closing Lawyer Also Serving as Title Insurance Agent

Source

• Landing page: https://www.scbar.org/for-lawyers/quicklinks/legal-resources/ethics-advisory-opinions/ethics-advisory-opinion-91-38/

Original opinion text

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

UPON THE REQUEST OF A MEMBER OF THE SOUTH CAROLINA BAR, THE ETHICS ADVISORY COMMITTEE HAS RENDERED THIS OPINION ON THE ETHICAL PROPRIETY OF THE INQUIRER’S CONTEMPLATED CONDUCT. THIS COMMITTEE HAS NO DISCIPLINARY AUTHORITY. LAWYER DISCIPLINE IS ADMINISTERED SOLELY BY THE SOUTH CAROLINA SUPREME COURT THROUGH ITS COMMISSION ON LAWYER CONDUCT.

Ethics Advisory Opinion 91-38

This is based upon the facts set out in Ethics Opinion 91-25 and must be read in conjunction with such opinion (copy attached). In that opinion, it was stated that a personal injury attorney could in some situations ethically represent both the plaintiff (injured party) seeking damages from an alleged tortfeasor, and also the health insurer claiming a subrogation interest in the amount of medical bills already paid on behalf of the plaintiff. Such dual representation requires the informed consent of both clients, and such dual representation must cease if the plaintiff later does not want the health insurer paid.

Question:
The question now is whether the attorney can collect a fee from both clients.

Summary:
Subject to the normal requirements that a fee must be reasonable, there is no prohibition of the attorney's collecting a fee from both clients if he is ethically allowed to represent both clients.

Opinion:
This opinion assumes that the requirements of Advisory Opinion 91-25 have been fulfilled, and that the dual representation is permitted in a particular case. As noted above, there are many situations wherein such dual representation is forbidden.

There is no logical reason why, assuming that dual representation is appropriate, collection of a fee from both clients would marginally increase any conflict of interest potential, so long as the fact of dual payment is adequately disclosed to both clients and their consent is obtained.

The reason for this is that when a lawyer undertakes to represent a client, he has the same duties of diligence and loyalty regardless of whether he is being paid. The payment of a dual fee thus does not affect the lawyer's obligations either way as it relates to the conflict of interest issues.

This question is governed by Rule 1.5, which relates to reasonableness of fees. This must be decided on a case-by-case basis.

Thus, there is no absolute prohibition of collecting dual fees.