Can a lawyer take a contingent fee to recover a valuable marital asset that both spouses forgot about and left out of an already-final divorce settlement?

Plain-English summary

A client and his wife had signed a property settlement agreement resolving all property matters after their 1986 separation; in 1987 they divorced (on a six-month separation, no children), and the agreement was ratified and incorporated into the final decree. About a year later, the client asked the lawyer to represent him regarding a valuable asset belonging to the parties that the settlement agreement had not contemplated; its existence had been forgotten by the client and was unknown to counsel when the agreement was negotiated. No spousal support was paid, and the client lacked sufficient funds to pay an hourly fee. The lawyer asked whether a contingent-fee arrangement would be proper.

The committee recalled LE Op. 189 (the State Bar's reluctance to approve contingent fees in domestic-relations cases, approving them only in rare circumstances where the impact on human relationships would clearly not be adversely affected). It compared LE Op. 405, where a contingent fee was appropriate (the long lapse without alimony payments precluded any meaningful relationship, the client could not pay hourly, court-awarded fees would be credited against the contingent fee, and the fee was fair and reasonable), and LE Op. 568, where it could not find a rare circumstance (the parties had been married 25 years and only recently divorced, with a possibility of reconciliation because the husband might be shown to have committed a fraud that would set the divorce aside).

Applying that line, the committee said that because the parties were divorced and no children were involved, it did not appear any human relationships would be adversely affected, and it relied on the lawyer's statement that the client could not pay reasonable hourly fees. On those facts, the committee opined it would not be improper to accept the case on a contingent-fee basis, provided the contingent fee is fair and reasonable under the circumstances.

Currency note

This opinion was issued in 1988, under Virginia's former Code of Professional Responsibility (the disciplinary rule it cites), before the Virginia State Bar's adoption of the Rules of Professional Conduct effective January 1, 2000. As the committee note observes, current Rule 1.5(d)(1) and Comment [3a] codify when lawyers may handle family-law matters on a contingent-fee basis. 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 take a contingent fee to recover a forgotten marital asset after the divorce is final?

A: Under this 1988 opinion, the committee said it would not be improper where the parties were already divorced with no children, so no human relationship would be harmed, and the client could not pay hourly, provided the fee is fair and reasonable.

Q: What factors made the contingent fee acceptable?

A: That the parties were divorced and no children were involved (so no relationship would be adversely affected), and the committee's reliance on the client's inability to pay reasonable hourly fees.

Q: What earlier opinions guided the analysis?

A: LE Op. 189 (general reluctance), LE Op. 405 (contingent fee appropriate on its narrow facts), and LE Op. 568 (no rare circumstance where reconciliation was possible).

Background and rules framework

The opinion interpreted former Virginia DR 2-105(C), the contingent-fee provision of the Code, as applied to domestic-relations matters through the LE Op. 189 line of opinions. Virginia's current counterpart is Rule 1.5, the analog of ABA Model Rule 1.5; as the committee note records, Rule 1.5(d)(1) and Comment [3a] now codify when family-law matters may be handled on contingency.

Citations and references

Rules of Professional Conduct:

• Former Virginia DR 2-105(C) (contingent-fee agreements)
• ABA Model Rule 1.5 (fees; contingent fees)

Other opinions cited:

• Virginia LE Op. 189, LE Op. 405, and LE Op. 568: contingent fees in domestic-relations matters.

See also

• VA LEO 1081: Contingent Fee in a Child-Abuse Suit
• VA LEO 1298: Contingent Fee in a Divorce Appeal
• VA LEO 1174: Contingent Fee in a Support Estate Claim
• VA LEO 1229: Advertising Contingent-Fee Support Cases

Source

• Landing page: https://vsb.org/Site/about/rules-regulations/leo-opinions.aspx
• Original PDF: https://www.vsb.org/common/Uploaded%20files/LEOs/1062.pdf

Original opinion text

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

Committee Opinion
April 8, 1988
LEGAL ETHICS OPINION 1062

CONTINGENT FEE - DOMESTIC
RELATIONS.

You advise that your client and his wife entered into a property settlement agreement
for the purpose of resolving all property matters between them subsequent to their
separation in 1986. In 1987, the parties were divorced and the property settlement
agreement was ratified, affirmed and incorporated into the final decree of divorce. The
divorce was based upon a six-month separation since there were no children born of the
marriage. Approximately one year after the entry of the final decree of divorce, your
client requested that you represent him with regard to a valuable asset that belonged to
the parties that was not contemplated by the settlement agreement. Not only was this
asset not contemplated by the parties in the agreement, its existence had been forgotten
by the client and, therefore, was also unknown to counsel at the time the property
settlement agreement was negotiated. You also advise that no spousal support is paid
pursuant to the final decree, any agreement or otherwise. Your client does not have
sufficient funds to pay you a fee if based on a reasonable hourly rate.
You wish to know whether or not a contingent fee arrangement would be proper in this
situation.
L E Op. No. 189 sets forth the reluctance of the State Bar to approve contingent fees in
domestic relations cases. In LE Op. 189 the Committee opined that contingent fees are to
be approved in domestic relations cases only in rare circumstances where the impact on
human relationships will clearly not be adversely affected.
In L E Op. No. 405, however, the Committee found that a contingent fee was
appropriate under the narrow facts of that situation. The Committee based its opinion on
the fact that (1) the lengthy period during which payment of alimony had not been made
precluded the continuing existence of any meaningful relationship which might be
undermined by litigation handled on a contingency fee basis; (2) the client was unable to
pay reasonable attorney's fees charged on an hourly basis; (3) attorney's fees awarded by
the court would be credited against the contingent fee; and (4) the contingent fee was fair
and reasonable under the circumstances.
In L E Op. No. 568, however, the Committee could not opine that the situation was one
of those rare circumstances when a contingent fee would be appropriate. The Committee
based this decision on the fact that the parties had been married 25 years and had only
recently been divorced. Also taken into consideration was the fact that there was a
possibility of reconciliation with the wife due to the fact that it might be shown that
the husband perpetrated a fraud on the court and, therefore, the divorce would be set
aside.
In this situation, because the parties are divorced and no children are involved, it does
not appear that any human relationships would be adversely affected. Furthermore, the

Committee Opinion
April 8, 1988
Committee relies on your statement that the husband is unable to pay reasonable hourly
fees.
Based upon the facts as set forth in your letter, the Committee opines that it would not
be improper in this situation for you to accept this case on a contingent fee basis,
provided the contingent fee is fair and reasonable under the circumstances.
Committee Opinion
April 8, 1988
Legal Ethics Committee Notes. – Rule 1.5(d)(1) and Comment [3a] codify the
circumstances in which lawyers may handle family law matters on a contingent fee basis.