Can a lawyer sign a medical provider's agreement guaranteeing the provider will be paid from the client's settlement proceeds?

Plain-English summary

The inquirer asked whether an attorney representing an individual may ethically sign an agreement with a medical provider under which the client consents to a lien against "all proceeds" of any settlement. The submitted documents, labeled "Assignment to Pay Doctor Directly" and "Contractual Guarantee of Payment for Health Care Services," would have the attorney sign a paragraph agreeing to observe the agreement's terms and to withhold from any settlement, judgment, or verdict the sums necessary to protect the named health care provider. The documents also recited that, if the attorney would not cooperate in protecting the provider's interests, the provider would require the client to pay currently, and one document stated the client agreed never to rescind it.

The committee did not analyze the question fresh. It concluded that the issues raised in the inquiry had previously been addressed in WSBA Formal Opinion No. 185, and recommended that the inquirer review that opinion and comply with its terms. The committee added one correction: the reference in Opinion No. 185 to RPC 14(b)(4) is no longer correct, and the applicable rule is RPC 1.15A(f) in the Rules of Professional Conduct effective September 1, 2006. The committee stated that this change in the numbering of the rule does not affect the substance of Opinion No. 185.

In practice

Under this opinion, an attorney asked to sign a medical provider's agreement promising payment from a client's settlement is directed to WSBA Formal Opinion No. 185, which the committee said addresses the same issues and should be reviewed and followed. The committee's only added guidance was the rule-citation update: the reference in Opinion 185 to former RPC 14(b)(4) should now be read as RPC 1.15A(f), effective September 1, 2006, a renumbering the committee said does not change Opinion 185's substance.

Common questions

Q: Does this opinion decide whether a lawyer can sign a medical lien or payment-guarantee agreement?

A: Not on its own. The committee concluded the issues had already been addressed in WSBA Formal Opinion No. 185 and recommended that the inquirer review that opinion and comply with its terms.

Q: Which rule governs after the 2006 renumbering?

A: RPC 1.15A(f). The committee said the reference in Opinion 185 to former RPC 14(b)(4) is no longer correct, and that the applicable rule effective September 1, 2006 is RPC 1.15A(f); the renumbering does not affect Opinion 185's substance.

Q: What did the proposed agreements ask the attorney to sign?

A: A paragraph agreeing to observe the agreement's terms and to withhold from any settlement, judgment, or verdict the sums necessary to adequately protect the named health care provider. The documents were labeled "Assignment to Pay Doctor Directly" and "Contractual Guarantee of Payment for Health Care Services."

Background and rules framework

The opinion's substantive analysis rests on WSBA Formal Opinion No. 185, which the committee said addresses the issues this inquiry raises about an attorney's obligations when asked to protect a medical provider's claim to a client's settlement funds. The governing rule is Washington RPC 1.15A(f) (safekeeping of property; the counterpart to Model Rule 1.15), which the committee identified as the current cite replacing former RPC 14(b)(4) after Washington's revised Rules of Professional Conduct took effect September 1, 2006.

Citations and references

Rules of Professional Conduct:

• Model Rule 1.15 / Washington RPC 1.15A(f) (safekeeping of property; current cite replacing former RPC 14(b)(4))

Other opinions cited:

• WSBA Formal Opinion No. 185: a lawyer's obligations when asked to ensure payment to a client's medical provider from settlement proceeds

See also

• WA Ethics Op. 185: Guaranteeing Creditor Payment From a Settlement
• WA Ethics Op. 1355: Hold-Harmless Agreement for Medical Bills
• WA Ethics Op. 1610: Paying Creditors After the Client Revokes Authorization

Source

• Landing page: https://ao.wsba.org/print.aspx?ID=1581

Original opinion text

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

Advisory Opinion: 2136
Year Issued: 2007
RPC(s): RPC 115A(f), Formal Opinion 185
Subject: Attorneys signature on clients contract with chiropractor ensuring payment to chiropractor from prospective settlement

The inquirer asks whether an attorney representing an individual may ethically sign an agreement with a medical provider that provides that the client will consent to a lien against “all proceeds” of any settlement. The agreements submitted for review also provide that the attorney would sign a paragraph that reads as follows:

The undersigned, being attorney of record for the above patient, does hereby agree to observe all the terms of the above, and agrees to withhold such sums from any settlement, judgment, or verdict, as may be necessary to adequately protect said health care provider named above.

Dated:_____

______ (Signature of Attorney)

The agreements have been labeled “Assignment to Pay Doctor Directly” and “Contractual Guarantee of Payment for Health Care Services”. In each of the proposed documents, the client has been “advised that if my attorney does not wish to cooperate in protecting the health care provider’s interests, the provider will not await payment, but would require me to make payments on a current basis.” The document labeled contractual guarantee of payment also indicates as follows: “I agree to never rescind this document and that any attempted rescission will not be honored by my attorney.”

The issues raised in this inquiry have been previously addressed in WSBA Formal Opinion No. 185. We recommend that you review this Formal Opinion and comply with its terms. Please note that the reference in Opinion No. 185 to RPC 14(b)(4) is no longer correct, and you should refer to RPC 1.15A(f) in the Rules of Professional Conduct, effective September 1, 2006 for the applicable rule. This change in the numbering of the applicable rule does not affect the substance of Opinion No. 185.