Advanced Torts:
8 February 2005 (Mardi Gras)
Professor Thomas D. Russell
FEES
For this class, we will talk about fees, especially
contingent fee agreements.
Before class, you should read all of this
document. There are three parts to this
document.
·
The first is Colorado Rules of Civil Procedure Rule
23.3. This Rule sets forth the formal
requirements for a contingent fee agreement.
·
The second part is the Rule 1.5 of the Colorado Rules
of Professional Conduct. This sets for
the requirements for the reasonableness of fees.
·
The third part is a section of the probate code that
sets forth the criteria for evaluation of fees in probate.
Read these so that that you can understand
procedurally and substantively what it takes to have a valid fee agreement.
At the start of class, I will put you into pairs and
have one of you explain an agreement to the other.
After that, I’d like to solve the following dispute:
Attorney A has a 40% fee agreement that
meets all the Rule 23.3 requirements.
After Attorney A spends $100,000 in costs on the case, the attorney is
successful in getting the defendant to offer $1,000,000 to settle the
case. The client refuses to settle,
fires Attorney A, and hires Attorney B.
They sign a 40% fee agreement that meets all 23.3 requirements. Attorney B spends an additional $100,000 on
the case and is successful in getting the defendant to offer $2,000,000 to
settle the case, which offer the client accepts.
How much money does each Attorney get?
Read some of the cases from the annotations if you
find that you need more guidance that the rules give you.
Table of contents for this Packet
CHAPTER
23.3 RULES GOVERNING CONTINGENT FEES
Rule 6. Sanction for Non-Compliance
Form 2 CONTINGENT FEE AGREEMENT (To be Executed in
Duplicate)
Colorado Rules of Professional Conduct, Rule 1.5. Fees
C.R.S.A. 15-14-417. Compensation, fees, costs, and expenses
of administration - expenses.
Source:
Colorado Court
Rules/COLORADO RULES OF CIVIL PROCEDURE /CHAPTER 23.3 RULES GOVERNING
CONTINGENT FEES
CHAPTER
23.3
RULES GOVERNING CONTINGENT FEES
Analysis
Rule 6. Sanction for Non-Compliance
Document
2 of 10
Source:
Colorado Court
Rules/COLORADO RULES OF CIVIL PROCEDURE /CHAPTER 23.3 RULES GOVERNING
CONTINGENT FEES/Rule 1. Definitions
Rule 1. Definitions
In this rule, the term "contingent fee agreement" means a written agreement for legal services of an attorney or attorneys (including any associated counsel), under which compensation is to be contingent in whole or in part upon the successful accomplishment or disposition of the subject matter of the agreement.
ANNOTATION
Court may scrutinize contingent fee contracts. Under its general supervisory power over attorneys as officers of the court, a court may and should scrutinize contingent fee contracts and determine the reasonableness of the terms thereof. Anderson v. Kenelly, 37 Colo. App. 217, 547 P.2d 260 (1975).
Oral agreement does not substantially comply with this rule. Beeson v. Industrial Claim Appeals Office, 942 P.2d 1314 (Colo. App. 1997).
Lack of a written agreement does not preclude an attorney from recovering fees based on the theory of quantum meruit. Beeson v. Industrial Claim Appeals Office, 942 P.2d 1314 (Colo. App. 1997).
Reasonableness of an attorney's fee depends on various factors, no one of which is determinative. The existence of a contingent fee contract is determinative only to the extent that it sets the maximum amount permitted. Beeson v. Industrial Claim Appeals Office, 942 P.2d 1314 (Colo. App. 1997).
© 2004 by The Committee on Legal Services for the State of Colorado and Matthew Bender & Company, Inc., a member of the LexisNexis Group. All rights reserved.
Document
3 of 10
Source:
Colorado Court
Rules/COLORADO RULES OF CIVIL PROCEDURE /CHAPTER 23.3 RULES GOVERNING
CONTINGENT FEES/Rule 2. Construction
Rule 2. Construction
Unless expressly prohibited by this rule, no written contingent fee agreement shall be regarded as champertous if made in an effort in good faith reasonably to comply with this rule. The Colorado Rules of Professional Conduct may be considered in reviewing disputed contingent fee agreements.
Source: Amended November 5, 1992, effective January 1, 1993.
© 2004 by The Committee on Legal Services for the State of Colorado and Matthew Bender & Company, Inc., a member of the LexisNexis Group. All rights reserved.
Document
4 of 10
Source:
Colorado Court
Rules/COLORADO RULES OF CIVIL PROCEDURE /CHAPTER 23.3 RULES GOVERNING
CONTINGENT FEES/Rule 3. Prohibitions
Rule 3. Prohibitions
No contingent fee agreement shall be made (a) in respect to the procuring of an acquittal upon any favorable disposition of a criminal charge, (b) in respect of the procuring of a dissolution of marriage, determination of invalidity of marriage or legal separation, (c) in connection with any case or proceeding where a contingency method of a determination of attorneys' fees is otherwise prohibited by law, the Colorado Rules of Professional Conduct, or governmental agency rule, or (d) if it is unconscionable, unreasonable, and unfair.
Source: Amended November 5, 1992, effective January 1, 1993.
© 2004 by The Committee on Legal Services for the State of Colorado and Matthew Bender & Company, Inc., a member of the LexisNexis Group. All rights reserved.
Document
5 of 10
Source:
Colorado Court
Rules/COLORADO RULES OF CIVIL PROCEDURE /CHAPTER 23.3 RULES GOVERNING
CONTINGENT FEES/Rule 4. Procedure
Rule 4. Procedure
(a) Before a contingent fee agreement is entered into the attorney shall disclose to the prospective client in writing:
(1) The nature of other types of fee arrangements;
(2) The nature of specially awarded attorney fees;
(3) The nature of expenses and the estimated amount of expenses to handle the matter to conclusion;
(4) The potential for an award of costs and attorneys' fees to the opposing party.
(5) What is meant by "associated counsel"; and
(6) What is meant by "subrogation" and effect of any subrogation interest or lien.
(b) Each contingent fee agreement shall be in writing in duplicate. Each duplicate copy shall be signed both by the attorney and by each client. One signed duplicate copy shall be mailed or delivered to each client within ten days after the making of the agreement. One such copy (and proof that the duplicate copy has been delivered or mailed to the client) shall be retained by the attorney for a period of six years after the completion or settlement of the case or the termination of the services, whichever event first occurs.
(c) A written disbursement statement shall issue to the client at the time of final disbursement.
Source: Entire rule amended and effective January 31, 1992.
ANNOTATION
Rules imposed upon an attorney the absolute burden to ensure that a proper contingent fee agreement is in place. This rule allows for no exception for instances in which an attorney does not comply with the requirement of the rules but simply relies on the client's representation. Fasing v. LaFond, 944 P.2d 608 (Colo. App. 1997); Hansel-Henderson v. Mullens, 39 P.3d 1200 (Colo. App. 2001), rev'd on other grounds, 65 P.3d 992 (Colo. 2002).
© 2004 by The Committee on Legal Services for the State of Colorado and Matthew Bender & Company, Inc., a member of the LexisNexis Group. All rights reserved.
Document
6 of 10
Source:
Colorado Court
Rules/COLORADO RULES OF CIVIL PROCEDURE /CHAPTER 23.3 RULES GOVERNING
CONTINGENT FEES/Rule 5. Contents
Rule 5. Contents
Each contingent fee agreement shall contain (a) the name and mail address of each client; (b) the name and mail address of the attorney or attorneys to be retained; (c) a statement of the nature of the claim, controversy and other matters with reference to which the services are to be performed; (d) a statement of the contingency upon which the client is to be liable to pay compensation otherwise than from amounts collected for him by the attorney; (e) a statement of the precise percentage to be charged subject to the limitations of Rule 3(d); and (f) a stipulation that the client, except as permitted by the Rules of Professional Conduct, including Rule 1.8(e), is to be liable for expenses, such stipulation including an estimate of such expenses, authority of the attorney to incur the expenses and make disbursements, a maximum limitation not to be exceeded without the client's further written authority. The final disbursement statement shall reflect the amount received, expenses incurred in handling of the case and computation of the contingency fee.
Source: Entire rule amended and adopted, effective November 16, 1995.
ANNOTATION
Contract unenforceable where it is silent as to liability when either the attorney unilaterally terminates the agreement or the attorney and the client mutually terminate the agreement, thus failing to expressly include a contingency as required by the rule. Elliott v. Joyce, 889 P.2d 43 (Colo. 1994).
Under section (d) of this rule and rule 6, chapter 23.3 limits recovery to situations in which the contingent fee agreement specifically sets forth circumstances under which the client will be liable. Elliott v. Joyce, 889 P.2d 43 (Colo. 1994).
Attorney may proceed on a quantum meruit claim if outlined in the contingency fee agreement, even if the agreement contains other deficiencies and is unenforceable for purposes of the contingency. As long as the client has some notice of the possibility of equitable recovery should the contingency fail, the agreement cannot prohibit the attorney from seeking such recovery. Language in a contingent fee agreement notifying the client that, upon termination, the attorney may seek recovery based on a predetermined hourly rate provides insufficient notice of the possibility of equitable relief. Dudding v. Norton Frickey & Assocs., 11 P.3d 441 (Colo. 2000).
Attorney earned reasonable attorney fees, despite unenforceable contingency agreement, under quantum meruit. An attorney is entitled to fees under quantum meruit when the agreed upon services are successfully completed but the contingent fee agreement is not in writing. Mullens v. Hansel-Henderson, 65 P.3d 992 (Colo. 2002).
© 2004 by The Committee on Legal Services for the State of Colorado and Matthew Bender & Company, Inc., a member of the LexisNexis Group. All rights reserved.
Document
7 of 10
Source:
Colorado Court
Rules/COLORADO RULES OF CIVIL PROCEDURE /CHAPTER 23.3 RULES GOVERNING
CONTINGENT FEES/Rule 6. Sanction for Non-Compliance
Rule 6. Sanction for
Non-Compliance
No contingent fee agreement shall be enforceable by the involved attorney unless there has been substantial compliance with all of the provisions of this Chapter 23.3.
Source: Entire rule amended and adopted May 24, 2001, effective July 1, 2001.
ANNOTATION
Contract unenforceable where it is silent as to liability when either the attorney unilaterally terminates the agreement or the attorney and the client mutually terminate the agreement, thus failing to expressly include a contingency as required by the rule. Elliott v. Joyce, 889 P.2d 43 (Colo. 1994).
Under rule 5 (d) and this rule, chapter 23.3 limits recovery to situations in which the contingent fee agreement specifically sets forth circumstances under which the client will be liable. Elliott v. Joyce, 889 P.2d 43 (Colo. 1994).
© 2004 by The Committee on Legal Services for the State of Colorado and Matthew Bender & Company, Inc., a member of the LexisNexis Group. All rights reserved.
Document
8 of 10
Source:
Colorado Court
Rules/COLORADO RULES OF CIVIL PROCEDURE /CHAPTER 23.3 RULES GOVERNING
CONTINGENT FEES/Rule 7. Forms
Rule 7. Forms
The following forms may be used and shall be sufficient. The authorization of these forms shall not prevent use of other forms consistent with this Chapter 23.3.
Source: Entire rule amended and effective January 31, 1992; Form 2 amended and effective November 16, 1995; entire rule, Form 1, and Form 2 amended and adopted and committee comment added and adopted May 24, 2001, effective July 1, 2001.
Form 1
Disclosure Statement
Type of Attorney Fee Agreements:
I have been informed and understand that there are several types of attorney fee arrangements: (1) time based, (2) fixed, (3) contingent, or (4) combinations of these types of fee arrangements. "Time based" means a fee that is determined by the amount of time involved such as so much per hour, day or week. "Fixed" means a fee that is based on an agreed amount regardless of the time or effort involved or the result obtained. "Contingent" means a certain agreed percentage or amount that is payable only upon attaining a recovery regardless of the time or effort involved. I understand that not all attorneys offer all of these different types of fee arrangements, and I acknowledge that I have the right to contact other attorneys to determine if they may provide such other fee arrangements for my case or matter. After such consideration or consultation, I have elected the fee arrangement set forth in the accompanying contingent fee agreement.
Specially Awarded Attorney Fees:
I have been informed and understand that the court or an arbitrator may sometimes award attorney fees in addition to amount of recovery being claimed. I understand that the fee agreement I enter into with my attorney should contain a provision as to how any specially awarded attorney fees will be accounted for and handled.
Expenses:
I have been informed and understand that there may be expenses (aside from any attorney fee) in pursuing my claim. Examples of such expenses are: fees payable to the court, the cost of serving process, fees charged by expert witnesses, fees of investigators, fees of court reporters to take and prepare transcripts of depositions, and expenses involved in preparing exhibits. I understand that an attorney is required to provide me with an estimate of such expenses before I enter into an attorney fee agreement and that my attorney fee agreement should include a provision as to how and when such expenses will be paid. I understand that the fee agreement should tell me whether a fee payable from the proceeds of the amount collected on my behalf will be based on the "net" or "gross" recovery. "Net recovery" means the amount remaining after expenses and deductions. "Gross recovery" means the total amount of the recovery before any deductions. The estimated amount of the expenses to handle my case will be set forth in the contingent fee agreement.
The Potential of Costs and Attorney's Fees Being Awarded to The Opposing Party:
I have been informed and understand that a court or arbitrator sometimes awards costs and attorney fees to the opposing party. I have been informed and understand that should that happen in my case, I will be responsible to pay such award. I understand that the fee agreement I enter into with my attorney should provide whether an award against me will be paid out of the proceeds of any amount collected on my behalf. I also understand that the agreement should provide whether the fee I am obligated to pay my attorney will be based on the amount of recovery before or after payment of the awarded costs and attorney fees to an opposing party.
Associated Counsel:
I have been informed and understand that my attorney may sometimes hire another attorney to assist in the handling of a case. That other attorney is called an "associated counsel." I understand that the attorney fee agreement should tell me how the fees of associated counsel will be handled.
Subrogation:
I have been informed and understand that other persons or entities may have a subrogation right in what I recover in pursuing my claim. "Subrogation" means the right to be paid back. I understand that the subrogation right may arise in various ways such as when an insurer or a federal or state agency pays money to or on behalf of a claiming party like me in situations such as medicare, medicaid, worker's compensation, medical/health insurance, no-fault insurance, uninsured/underinsured motorist insurance, and property insurance situations. I understand that sometimes a hospital, physician or an attorney will assert a "lien" (a priority right) on a claim such as the one I am pursuing. Subrogation rights and liens need to be considered and provided for in the fee agreement I reach with my attorney. The fee agreement should tell me whether the subrogation right or lien is being paid by my attorney out of the proceeds of the recovery made on my behalf and whether the fee I am obligated to pay my attorney will be based on the amount of recovery before or after payment of the subrogation right or lien.
I acknowledge that I received a complete copy of this Disclosure Statement and read it this of , 20 .
(Signature)
Alternative Attorney Compensation:
I have been informed and understand that if, after entering into a fee agreement with my attorney, I terminate the employment of my attorney or my attorney justifiably withdraws, I may nevertheless be obligated to pay my attorney for the work done by my attorney on my behalf. The fee agreement should contain a provision stating how such alternative compensation, if any, will be handled.
I acknowledge that I received a complete copy of this Disclosure Statement and read it this day of , 20 .
(Signature)
Form 2
CONTINGENT FEE AGREEMENT
(To be Executed in Duplicate)
Dated ______, 20
The Client____________________________________________________ retains the
(Name) (Street & No.) (City or Town)
Attorney____________________________________________________
(Name) (Street & No.) (City or Town)
to perform the legal services mentioned in paragraph (1) below. The attorney agrees to perform them faithfully and with due diligence.
(1) The claim, controversy, and other matters with reference to which the services are to be performed are:
(2) The contingency upon which compensation is to be paid is:
(3) The client is not to be liable to pay compensation otherwise than from amounts collected for the client by the attorney, except as follows:
In the event the client terminates this contingent fee agreement without wrongful conduct by the attorney which would cause the attorney to forfeit any fee, or if the attorney justifiably withdraws from the representation of the client, the attorney may ask the court or other tribunal to order the client to pay the attorney a fee based upon the reasonable value of the services provided by the attorney. If the attorney and the client cannot agree how the attorney is to be compensated in this circumstance, the attorney will request the court or other tribunal to determine: (1) if the client has been unfairly or unjustly enriched if the client does not pay a fee to the attorney; and (2) the amount of the fee owed, taking into account the nature and complexity of the client's case, the time and skill devoted to the client's case by the attorney, and the benefit obtained by the client as a result of the attorney's efforts. Any such fee shall be payable only out of the gross recovery obtained by or on behalf of the client and the amount of such fee shall not be greater than the fee that would have been earned by the attorney if the contingency described in this contingent fee agreement had occurred.
(4) The client will pay the attorney (including any associated counsel) * percent of the (gross amount collected) (net amount collected) [indicate which]. ("Gross amount collected" means the amount collected before any subtraction of expenses and disbursements) ("Net amount collected" means the amount of the collection remaining after subtraction of expenses and disbursements [including] [not including] court-awarded costs or attorneys' fees.) [indicate which]. "The amount collected" (includes) (does not include) [indicate which] specially awarded attorneys' fees and costs awarded to the client.
(5) Costs and attorneys' fees awarded to an opposing party against the client before completion of the case will be paid (by the client) (by the attorney) [indicate which] when ordered. Any award of costs or attorneys' fees, regardless of when awarded, (will) (will not) [indicate which] be subtracted from the amount collected before computing the amount of the contingent fee under this agreement.
(6) The client is to be liable to the attorney for reasonable expenses and disbursements. Such expenses and disbursements are estimated to be $ . Authority is given to the attorney to incur expenses and make disbursements up to a maximum of $ which limitation will not be exceeded without the client's further written authority. The client will reimburse the attorney for such expenditures (upon receipt of a billing), (in specified installments), (upon final resolution), (etc.) [indicate which].
WE HAVE EACH READ THE ABOVE AGREEMENT BEFORE SIGNING IT.
Witnesses to Signatures:
(Signature of Client)
Witness to Client's Signature (Signature of Attorney)
_________________________________________
Witness to Attorney's Signature
* [Here insert the percentages to be charged in the event of collection. These may be on a flat basis or on a descending scale in relation to amount collected.]
(7) The client (authorizes) (does not authorize) [indicate which] the attorney to pay from the amount collected the following: (e.g., all physicians, hospitals, subrogation claims and liens, etc.). Where the applicable law specifically requires the attorney to pay the claims of third parties out of any amount collected for the client, the attorney shall have the authority to do so notwithstanding any lack of authorization by the client, but if the amount or validity of the third party claim is disputed by the client, the attorney shall deposit the funds into the registry of an appropriate court for determination. Any amounts paid to third parties (will) (will not) [indicate which] be subtracted from the amount collected before computing the amount of the contingent fee under this agreement.
WE HAVE EACH READ THE ABOVE AGREEMENT BEFORE SIGNING IT.
Witnesses to Signatures:
(Signature of Client)
Witness to Client's Signature (Signature of Attorney)
_________________________________________
Witness to Attorney's Signature
* [Here insert the percentages to be charged in the event of collection. These may be on a flat basis or on a descending scale in relation to amount collected.]
FINAL DISBURSEMENT STATEMENT
GROSS RECOVERY $______
Itemization of expenses incurred in handling of case:
$
$
$
$
Total Expenses $______
Amount of Expenses
Advanced by Attorney $______
Amount of Expenses
paid by Client $______
NET RECOVERY $______
Computation of Contingent Fee:
______% of (Net) (Gross)
Recovery = $______
Total Fee
(and expenses advanced by attorney)*
$______
DISBURSEMENT TO CLIENT__________ $______
(Signature of Attorney)
_________________________________________
(Signature of Client)
By signature of client acknowledges receipt
of a copy of this disbursement statement.
*(If fee is on "Net Recovery" and attorney has advanced expenses which are being reimbursed from the "gross recovery.")
COMMITTEE COMMENT
The Rules contained in this Chapter 23.3 set forth the minimum requirements of all enforceable contingency fee agreements in Colorado. The Rules do not prohibit additional terms, provided that such terms are not inconsistent with these Rules or the Colorado Rules of Professional Conduct.
One type of provision that is sometimes included in contingent fee agreements is a "conversion clause." A conversion clause is a provision that converts the fee due from the contingent amount set forth in the contract to some other type of fee, often an hourly based fee, when the contract is terminated before the contingency occurs.
There are a number of factors that must be considered to determine the ethical propriety and legal enforceability of a conversion clause. These factors are set forth and analyzed in detail in Formal Opinion 100, issued by the Colorado Bar Association Ethics Committee. Opinions of the CBA Ethics Committee are available on the Internet at www.cobar.org. This Committee notes that any conversion clause that purports to remove the contingency by making the attorney's fees payable without regard to the occurrence of the contingency, is presumptively invalid, unless the client is relatively sophisticated, has the demonstrated means to pay the attorney's fee even before the occurrence of the contingency, and has specifically negotiated the conversion clause.
The Colorado Supreme Court has held that an attorney cannot recover a fee based upon quantum meruit or unjust enrichment, unless the contingent fee agreement provides notice to the client of the possibility of such a fee. Dudding v. Norton Frickey & Associates, 11 P.3d 441 (Colo. 2000). Section (3) of the form Contingent Fee Agreement, which is a part of Chapter 23.3, provides notice to the client of the possibility of a quantum meruit or unjust enrichment fee recovery.
——————————
Colorado Rules of Professional Conduct, Rule 1.5. Fees
(a) A
lawyer's fee shall be reasonable. The
factors to be considered in determining the reasonableness of a fee include the
following:
(1) the time and labor
required, the novelty and difficulty of the questions involved, and the skill
requisite to perform the legal service properly;
(2) the likelihood, if
apparent to the client, that the acceptance of the particular employment will
preclude other employment by the lawyer;
(3)
the fee customarily charged in the locality for similar legal services;
(4) the amount involved and
the results obtained;
(5) the time limitations
imposed by the client or by the circumstances;
(6) the nature and length of
the professional relationship with the client;
(7) the experience,
reputation, and ability of the lawyer or lawyers performing the services; and
(8) whether the fee is fixed
or contingent.
(b) When the lawyer has not regularly represented
the client, the basis or rate of the fee shall be communicated to the client,
in writing, before or within a reasonable time after commencing the
representation.
(c)
A fee may be contingent on the outcome of the matter for which the service is
rendered, except in a matter in which a contingent fee is otherwise
prohibited. A contingent fee shall meet
all of the requirements of Chapter 23.3 of the Colorado Rules of Civil
Procedure, "Rules Governing Contingent Fees."
(d)
Other than in connection with the sale of a law practice pursuant to Rule 1.17,
a division of a fee between lawyers who are not in the same firm may be made
only if:
(1) the division is in
proportion to the services performed and responsibility assumed by each lawyer;
(2)
the client consents to the employment of an additional lawyer after a full
disclosure of the division of fees to be made;
(3) the total fee is
reasonable; and
(4) the division is set forth
in writing signed by the lawyers and by the client with informed consent.
(e)
Referral fees are prohibited.
(f)
Fees are not earned until the lawyer confers a benefit on the client or
performs a legal service for the client.
Advances of unearned fees are the property of the client and shall be
deposited in the lawyer's trust account pursuant to Rule 1.15(f)(1) until
earned. If advances of unearned fees are
in the form of property other than funds, then the lawyer shall hold such
property separate from the lawyer's own
property pursuant to Rule 1.15(a).
(g)
Nonrefundable fees and nonrefundable retainers are prohibited. Any agreement that purports to restrict a
client's right to terminate the representation, or that unreasonably restricts
a client's right to obtain a refund of unearned or unreasonable fees, is
prohibited.
Adopted eff. Jan. 1, 1993. Amended eff. July 1, 2000; July 1, 2001;
July 1, 2002.
2003 Main Volume
Basis or Rate of
Fee
In a new
client-lawyer relationship, the basis or rate of the fee must be promptly communicated in writing to the
client. When the lawyer has regularly
represented a client, they ordinarily will have reached an understanding
concerning the basis or rate of the fee;
but, when there has been a change from their previous understanding, the
basis or rate of the fee should be promptly communicated in writing. All contingent fee arrangements must be in
writing, regardless of whether the client-lawyer relationship is new or
established. See C.R.C.P., Ch. 23.3,
Rule 1. A written communication must
disclose the basis or rate of the lawyer's fees, but it need not take the form
of a formal engagement letter or agreement, and it need not be signed by the
client. Moreover, it is not necessary to
recite all the factors that underlie the basis of the fee, but only those that
are directly involved in its computation.
It is sufficient, for example, to state that the basic rate is an hourly
charge or a fixed amount or an estimated amount, to identify the factors that
may be take into account in finally fixing the fee, or to furnish the client
with a simple memorandum or the lawyer's customary fee schedule. When developments occur during the
representation that render an earlier disclosure substantially inaccurate, a
revised written disclosure should be provided to the client.
A written
statement concerning the fee reduces the possibility of misunderstanding. Lawyers are well-advised to use written
disclosures even when they are not required.
Moreover, it is preferable, although not mandatory,
to obtain the client's signature acknowledging the basis or rate of the fee.
In setting a fee,
a lawyer should also consider the inability of the client to pay a reasonable
fee. Persons unable to pay all or a
portion of a reasonable fee should be able to obtain necessary legal services,
and lawyers should support and participate in ethical activities designed to
achieve that objective.
Terms of Payment
A lawyer may
require advance payment of a fee, but is obliged to return any unearned
portion. See Rule 1.16(d). A lawyer may accept property in payment for
services, such as an ownership interest in an enterprise, providing this does
not involve acquisition of a proprietary interest in the cause of action or
subject matter of the litigation contrary to Rule 1.8(j). However, a fee paid in property instead of
money may be subject to special scrutiny because it involves questions
concerning both the value of the services and the lawyer's special knowledge of
the value of the property.
An agreement may
not be made whose terms might induce the lawyer improperly to curtail services
for the client or perform them in a way contrary to the client's interest. For example, a lawyer should not enter into
an agreement whereby services are to be provided only up to a stated amount
when it is foreseeable that more extensive services probably will be required,
unless the situation is adequately explained
to the client. Otherwise, the client
might have to bargain for further assistance in the midst of a proceeding or
transaction. However, it is proper to
define the extent of services in light of the client's ability to pay. A lawyer should not exploit a fee arrangement
based primarily on hourly charges by using wasteful procedures. When there is doubt whether a contingent fee
is consistent with the client's best interest, the lawyer should offer the
client alternative bases for the fee and explain their implications. Chapter 23.3 of the Colorado Rules of Civil
Procedure governs contingent fee arrangements, and contingent fees otherwise
may be limited by applicable law.
Division of Fee
A division of fee
is a single billing to a client covering the fee of two or more lawyers who are
not in the same firm. A division of fee
facilitates association of more than one lawyer in a matter in which neither alone
could serve the client as well, and most often is used when the fee is
contingent and the division is between a referring lawyer and a trial
specialist. Paragraph (d) permits the
lawyers to divide a fee on the basis of the proportion of services they render
and responsibility assumed by each. The
client must consent to the fee division in writing. The client must be advised of and agree to
the share of the fee that each lawyer is to receive.
Disputes over
Fees
If a procedure
has been established for resolution of fee disputes, such as an arbitration or
mediation procedure established by the bar, the lawyer should conscientiously
consider submitting to it. Law may
prescribe a procedure for determining a lawyer's fee, for example, in
representation of an executor or administrator, a class or person entitled to a
reasonable fee as part of the measure of damages. The lawyer entitled to such a fee and a
lawyer representing another party concerned with the fee should comply with the
prescribed procedure.
Advances of
Unearned Fees and Engagement Retainer Fees
The analysis of
when a lawyer may treat advances of unearned fees as property of the lawyer
must begin with the principle that the lawyer must hold in trust all fees paid
by the client until there is a basis on which to conclude that the lawyer has
earned the fee; otherwise the funds must
remain in the lawyer's trust account because they are not the lawyer's
property.
To make a
determination of when an advance fee is earned, the written statement of the
basis or rate of the fee, when required by Rule 1.5(b), should include a
description of the benefit or service that justifies the lawyer's earning the
fee, the amount of the advance unearned fee, as well as a statement describing
when the fee is earned. Whether a lawyer
has conferred a sufficient benefit to earn a portion of the advance fee will
depend on the circumstances of the particular case. The circumstances under which a fee is earned
should be evaluated under an objective
standard of reasonableness. Colo. RPC
1.5(a).
Rule 1.5(f) Does
Not Prohibit Lump-sum Fees or Flat Fees
Advances of
unearned fees, including "lump-sum" fees and "flat fees,"
are those funds the client pays for specified legal services that the lawyer
has agreed to perform in the future.
Pursuant to Rule 1.15, the lawyer must deposit an advance of unearned
fees in the lawyer's trust account. The
funds may be earned only as the lawyer performs specified legal services or
confers benefits on the client as provided for in the written statement of the
basis of the fee, if a written statement is required by Rule 1.5(b). See also Restatement (Third) of
the Law Governing Lawyers § § 34, 38 (1998). Rule 1.5(f) does not
prevent a lawyer from entering into these types of arrangements.
For example, the
lawyer and client may agree that portions of the advance of unearned fees are
deemed earned at the lawyer's hourly rate and become the lawyer's property as
and when the lawyer provides legal services.
Alternatively,
the lawyer and client may agree to an advance lump-sum or flat fee that will be
earned in whole or in part based upon the lawyer's completion of specific tasks
or the occurrence of specific events, regardless of the precise amount of the
lawyer's time involved. For instance, in
a criminal defense matter, a lawyer and client may agree that the lawyer earns
portions of the advance lump-sum or flat fee upon the lawyer's entry of
appearance, initial advisement, review of discovery, preliminary hearing,
pretrial conference, disposition hearing,
motions hearing, trial, and sentencing.
Similarly, in a trusts and estates matter, a lawyer and client may agree
that the lawyer earns portions of the lump-sum or flat fee upon client
consultation, legal research, completing the initial draft of testamentary
documents, further client consultation, and completing the final documents.
The portions of
the advance lump-sum or flat fee earned as each such event occurs need not be
in equal amounts. However, the fees
attributed to each event should reflect a reasonable estimate of the proportionate
value of the legal services the lawyer provides in completing each designated
event to the anticipated legal services to be provided on the entire
matter. See Colo. RPC
1.5(a); Feiger, Collison &
Killmer v. Jones, 926 P.2d 1244,
1252-53 (Colo. 1996) (client's sophistication is
relevant factor).
Rule 1.5(f) Does
Not Prohibit an "Engagement Retainer Fee"
"[A]n
'engagement retainer fee' is a fee paid, apart from any other compensation, to
ensure that a lawyer will be available for the client if required. An engagement retainer must be distinguished
from a lump-sum fee constituting the entire payment for a lawyer's service in a
matter and from an advance payment from which fees will be subtracted (see § 38, Comment g). A fee is an engagement retainer only if the
lawyer is to be additionally compensated for actual work, if any,
performed." Restatement (Third) of
the Law Governing Lawyers § 34 cmt. e. An engagement
retainer fee agreement must comply with Rule
1.5(a), (b), and (g), and should expressly include the amount of the engagement
retainer fee, describe the service or benefit that justifies the lawyer's
earning the engagement retainer fee, and state that the engagement retainer fee
is earned upon receipt. As defined
above, an engagement retainer fee will be earned upon receipt because the
lawyer provides an immediate benefit to the client, such as forgoing other
business opportunities by making the lawyer's services available for a given
period of time to the exclusion of other clients or potential clients, or by
giving priority to the client's work over other matters.
Because an
engagement retainer fee is earned at the time it is received, it must not be
commingled with client property.
However, it may be subject to refund to the client in the event of
changed circumstances.
It is unethical
for a lawyer to fail to return unearned fees, to charge an excessive fee, or to
characterize any lawyer's fee as nonrefundable. Lawyer's fees are always subject to refund
if either excessive or unearned. If all
or some portion of a lawyer's fee becomes subject to refund, then the amount to
be refunded should be paid directly to the client if there is no further legal
work to be performed or if the lawyer's employment is terminated. In the alternative, if there is an ongoing
client-lawyer relationship and there is further work to be done, it may be
deposited in the lawyer's trust account, to be withdrawn from the trust account
as it is earned.
2003 Main Volume
The fee splitting
provisions of Model Rule 1.5(e), now 1.5(d), have been revised to resemble more
closely DR 2-107(A) and to tighten up the client consent requirements.
LAW REVIEW AND
JOURNAL COMMENTARIES
Alternative Billing Methods: Not Just By the Hour Anymore. Laurel L. Burke, 28 Colo.Law. 59 (April
1999).
Enforcing Civility: The Rules of Professional Conduct in
Deposition Settings. Patrick T.
O'Rourke, 33 Colo.Law. 75 (March
2004).
Fee Agreements: The New Writing Requirement and Other
Observations. Alec Rothrock, 49 Trial
Talk 30 (April/May 2000).
Presenting Your Claim for Attorneys' Fees to
the Court. Alan C. Friedberg, 45 Trial
Talk 14 (March 1996).
Revisiting the Recovery of Attorney Fees and
Costs in Colorado. John R. Webb, 33 Colo.Law. 11 (April
2004).
Ten of the Easiest Ethics Violations for
Honest Lawyers. Forrest W. Lewis, 27 Colo.Law. 75
(Aug.1998).
LIBRARY REFERENCES
2003 Main Volume
Attorney
and Client 
32(7), 44(1), 130 to 151.
Westlaw
Topic No. 45.
C.J.S. Attorney and
Client § § 78 to 79, 87, 280 to 297, 299 to 331.
Amount
recovered, reasonableness 8
Breach of
trust actions 25
Calculation
of attorney fees 20
Community
standards, reasonableness 7
Construction
and application 1
Contingent
fee, reasonableness 9
Contingent
fees, generally 13
Disbarment,
sanctions 29
Division
of fees 19
Divorce
proceedings 30
Excessive
fees, generally 15
Explanation
of fee 14
Factors
considered, reasonableness 5
Indigent
clients 10
Lodestar
rule 21
Nonattorney
services 12
Public
censure, sanctions 27
Public
policy 2
Reasonableness
4-9
Reasonableness - In general 4
Reasonableness - Amount recovered 8
Reasonableness
- Community standards 7
Reasonableness - Contingent fee 9
Reasonableness - Factors considered 5
Reasonableness - Time and labor 6
Reduction
of fees 22
Referral
fees 17
Refund of
excess fees 18
Retainer
agreements 23
Sanctions 26-29
Sanctions - In general 26
Sanctions - Disbarment 29
Sanctions - Public censure 27
Sanctions - Suspension 28
Suspension,
sanctions 28
Time and
labor, reasonableness 6
Trust
accounts 24
Unearned
fees 16
Value of
legal services 11
Willful
misconduct 3
1. Construction and application
When a lawyer accepts fees from a client,
abandons the client and causes serious harm while keeping their money, the
lawyer violates the trust and confidence necessarily placed in him to care for
the client's legal needs and he brings disrepute upon the entire
profession. People v. Romero,
1999, 35 P.3d 164. Attorney And Client 44(1)
Supreme Court had authority in attorney
disciplinary case to determine reasonableness of fee charged by attorney in
client's workers' compensation case. In re Wimmershoff,
2000, 3 P.3d 417. Attorney And Client 44(1)
2. Public policy
Provisions in representation agreement
prohibiting client from "unreasonably" refusing settlement, and
permitting law firm to withdraw if client did so and, upon such withdrawal, to
recover costs and fees equal to firm's "normal" hourly rates for work
it had performed were unenforceable as against public policy; provisions had
potential to create unanticipated pressure on client to settle after attorney-client
relationship been established and representation begun. Jones v. Feiger,
Collison & Killmer, App.1994, 903 P.2d 27, modified on denial of rehearing,
certiorari granted, reversed 926 P.2d 1244, rehearing denied. Attorney
And Client 101(1)
3. Willful misconduct
Attorney's conduct in failing to prepare a
written free agreement for client, whom attorney had not previously
represented, that outlined the basis or rate of attorney's fee before, or
within a reasonable time after, attorney commenced representation, violated the
professional rules that required a lawyer to provide written communication of
the basis or rate of the fee. People v. Lindemann,
2004, 93 P.3d 1125. Attorney And Client 44(1)
Attorney's extensive and prolonged neglect
rose to the level of willful misconduct for purposes of attorney disciplinary
proceeding under the rules of professional conduct, where attorney accepted $2,965
from a client to assist in the adoption of client's grandchild and the
immigration of client's 3 adult children from Honduras, deceived replacement
attorney regarding filings he had made, and failed to provide replacement
attorney with original documentation provided to him by client. People v. Romero,
1999, 35 P.3d 164. Attorney And Client 44(1)
4. Reasonableness--In general
Attorney's demand that client pay him an
additional $4,465 to proceed to trial in the misdemeanor assault case against
client constituted an unreasonable fee, in violation of disciplinary rules,
where attorney had agreed to represent client for flat-fee of $1,000 and there
was no basis for requesting additional fees.
People v. Clough,
2003, 74 P.3d 552. Attorney And Client 44(1)
Attorney's taking $2,000 as payment for her
professional services and failing to take any action for a nine-month period on
behalf of client constituted the charging of an unreasonable fee. People v. Milner,
2001, 35 P.3d 670. Attorney And Client 44(1)
The requirement that an attorney's fee be
reasonable includes all charges included within attorney's statement to the
client for services rendered to the client by the attorney or members of his or
her support staff. People v. Gray, 2001,
35 P.3d 611.
Attorney And Client 44(1)
Entry of default in attorney disciplinary
action established violations of disciplinary
rules prohibiting attorney from neglecting legal matter, engaging in conduct
involving dishonesty, fraud, deceit, or misrepresentation, and charging an unreasonable
fee, and rules requiring attorney to keep clients reasonably informed and to
surrender clients' property after termination, and provided grounds for
discipline pursuant rule on failure to cooperate and respond to requests from
Office of Attorney Regulation Counsel. People v. Schmeiser,
2001, 35 P.3d 560. Attorney And Client 52
Colorado attorney violated Rules of
Professional Conduct concerning neglect of a legal matter, failure to keep
client reasonably informed, and charging unreasonable fee by failing to respond
to communications from lawyer representing client's wife in her dissolution
proceeding in Oregon that default judgment would be entered if no attorney made
appearance on client's behalf, by failing to contact client during four-month
period before scheduled trial date, by failing to respond to proposed permanent
orders which were to be entered by default and were unfavorable to client, and
by charging client $600. People v. Hohertz,
1996, 926 P.2d 560. Attorney And Client 44(1)
An award of attorney fees must be reasonable
and determination of such reasonableness is a question of fact for trial court
and will not be disturbed on review unless
it is patently erroneous and unsupported by the evidence. Hartman v. Freedman,
1979, 591 P.2d 1318, 197 Colo. 275. Appeal And Error 1024.1;
Costs 194.18
5. ---- Factors considered, reasonableness
Fee charged by attorney to client for his
representation did not violate rule requiring attorney's fee be reasonable,
absent clear and convincing evidence that the tasks attorney undertook were
either unnecessary or unreasonable or that either the hourly or total fee
charged was not in accord with those customarily charged for similar legal
services; attorney initially assembled necessary information to undertake
representation, prepared and filed response to petition and motion for
temporary orders, filed notice to set temporary orders hearing, and represented
his client at temporary orders hearing. People v. Carvell,
2000, 62 P.3d 167. Attorney And Client 44(1)
The determination of what fees are reasonable
involves more than simply multiplying the number of hours spent on a given case
times a specific rate; an attorney must use judgment and discretion in
rendering a bill, and this includes recognizing the limits of one's own
capacity and one's own inefficiencies. In re Green, 2000, 11
P.3d 1078, rehearing denied. Attorney And
Client 44(1)
Whether or not government agency with whom
attorney had contracted was satisfied with attorney's work or with his billing
practices was not significant for purposes of assessing appropriate discipline
for his intentional misrepresentations of attorney time so as to overbill
agency for total of $7,000. People v. Shields,
1995, 905 P.2d 608. Attorney And Client 58
In awarding attorney fees, trial court may
consider, among other factors, amount in controversy, length of time required
to represent client effectively, complexity of case, value of legal services to
client, and usage in legal community concerning fees in similar cases; however, no one of these factors is
conclusive. Hartman v. Freedman,
1979, 591 P.2d 1318, 197 Colo. 275. Costs 194.18
6. ---- Time and labor, reasonableness
Attorney's failure to perform any services
with regard to bankruptcy and failure to
take action on behalf of client in divorce proceeding beyond the filing of
petition while retaining $969 in client funds constituted the charging of an
unreasonable fee. People v. Milner,
2001, 35 P.3d 670. Attorney And Client 44(1)
The fee that attorney requested as an attorney
fee award for successfully defending, on appeal, the judgment in favor of
client was unreasonable, where the attorney requested reimbursement at his
customary rate for tasks that could have been done by a non-lawyer, such as
faxing documents, making telephone calls to office of court of appeals clerk,
and delivering documents to opposing counsel, and attorney claimed to have
spent six hours "reviewing" and faxing the court of appeals' 12-page
opinion. In re Green, 2000, 11
P.3d 1078, rehearing denied. Attorney And Client 44(1)
Charging an attorney's hourly rate for
clerical services that are generally performed by a non-lawyer, and thus for
which an attorney's professional skill and knowledge add no value to the
service, is unreasonable as a matter of law.
In re Green, 2000, 11 P.3d
1078, rehearing denied. Attorney And Client 54
7. ---- Community standards, reasonableness
If fee requested is reasonable in light of
community standards and other criteria to be considered by court, it is not
appropriate for court to take into consideration what major client may pay
attorney on hourly basis or possible absence of overhead expenses comparable to
those borne by lawyers in private practice.
Mau v. E. P. H. Corp.,
1981, 638 P.2d 777. Costs 194.18
8. ---- Amount recovered, reasonableness
Attorney violated disciplinary rule
prohibiting charging or collecting of unreasonable fees, by attempting to
collect 75 percent or 100 percent of total fee generated by case in which his
firm did less than all work. People v. Wilson,
1998, 953 P.2d 1292. Attorney And Client 44(1)
Award of $20,000 in attorney fees in favor of
new shareholders of corporation in action brought in corporation's name against
former shareholders for breach of fiduciary duty and by new shareholders
against former shareholders for breach of stock sale agreement was not made
excessive by relatively small recovery by individual plaintiffs on breach of
contract claim where trial court considered
all of relevant factors. Rifkin v. Steele
Platt, App.1991, 824 P.2d 32. Costs 194.25
9. ---- Contingent fee, reasonableness
Attorney violated Rule of Profession Conduct
requiring attorneys to charge reasonable fees, where attorney replaced prior
attorney who had represented client on personal injury claim, entered into a
35% contingent fee agreement, over the course of a three week period did no
more than make a few phone calls to adjuster, meet with client and conduct some
research to determine the reasonable range of settlement for similar claims,
advised client to accept offer that had already been extended to client through
prior attorney, and collected and retained entire contingency fee. People v. Egbune,
1999, 58 P.3d 1168. Attorney And Client 44(1)
Viewing attorney's conduct under the totality
of circumstances, attorney's violation of several provisions of Rules of
Professional Conduct established a separate violation of Rule prohibiting an
attorney from engaging in conduct that reflected adversely on his fitness to practice
law, and gave rise to an enhanced sanction; attorney entered a pre-existing
case on behalf of client after substantially
all of the necessary legal work had been performed, accepted a settlement
amount which had been advanced before attorney was involved, collected a 35%
contingent fee even though his involvement did nothing to enhance client's
recovery, ignored client's previous attorney's claim for a portion of the
settlement proceeds, ignored obligations under Rules of Professional Conduct,
and exposed client to potential liability as to the prior attorney's request
for payment of attorney's fees. People v. Egbune,
1999, 58 P.3d 1168. Attorney And Client 37.1;
Attorney And Client 58
Attorney fee charged by claimant's counsel in
workers' compensation case was unreasonable, where claimant and counsel entered
into straight 20% contingent fee agreement and then subsequently modified the
agreement to provide counsel with additional $1000 payment; contingency fees in
workers' compensation cases were restricted by statute to maximum of 20%, and
the fee agreement violated rules governing contingent fees. In re Wimmershoff,
2000, 3 P.3d 417. Attorney And Client 44(1)
Law firm retained to represent city in toxic
tort case on noncontingent fee basis was entitled to recover reasonable value
of services rendered before firm was
discharged without cause, even though litigation required firm to devote
substantially all of its time to case and to forego other employment. Olsen and Brown v.
City of Englewood, 1995, 889 P.2d 673. Attorney And Client 134(1)
Attorney who is discharged without cause may
not recover damages under noncontingency contract for services not rendered
prior to discharge; attorney's remedy is recovery of reasonable value of
services rendered before discharge on basis of quantum meruit. Olsen and Brown v.
City of Englewood, 1995, 889 P.2d 673. Attorney And Client 134(1)
Apportionment of contingency fee between
original and successor counsel for personal injury plaintiff was improperly
based only on costs advanced by each attorney;
it was unclear whether replacement attorney's recovery was predicated on
quantum meruit rather than contingency contract, replacement attorney may also
have been entitled to fees under separate hourly fee contract, and there was no
finding that fees awarded were reasonable.
Law Offices of J.E.
Losavio, Jr. v. Law Firm of Michael W. McDivitt, P.C., App.1993, 865 P.2d 934. Attorney And Client 151
Existence
of contingency fee contract between injured party and such party's attorney is
but one factor to be considered by court in determining reasonable value of
attorney services. Heller v. First Nat.
Bank of Denver, N.A., App.1982, 657 P.2d 992. Costs 194.20
10. Indigent clients
Every lawyer has a duty to support proper
efforts and appropriate programs to meet the needs of persons unable to pay
reasonable fees. In re Marriage of
Swink, App.1991, 807 P.2d 1245. Attorney And Client 23
11. Value of legal services
Statutory factors to consider in evaluating
whether attorney fee is reasonable are also to be considered when determining
reasonable value of attorney's services for recovery based on quantum
meruit. Law Offices of J.E.
Losavio, Jr. v. Law Firm of Michael W. McDivitt, P.C., App.1993, 865 P.2d 934. Attorney And Client 140
Testimony of beneficiary's expert witness as
to value of attorneys' services involved in
breach of trust case was evidence to be considered by trial court, but was not
conclusive. Heller v. First Nat.
Bank of Denver, N.A., App.1982, 657 P.2d 992. Evidence 571(7)
12. Nonattorney services
Statements submitted to client, which did not
correlate to services provided to a particular case, disclose relative
complexity of issues presented nor, on their face, identify paralegal time
versus lawyer time were insufficient to establish charging paralegal time at
the rate of $100.00 per hour in collection cases constituted an unreasonable
fee, absent evidence bearing upon the customary fee for specified paralegal
services. People v. Gray, 2001,
35 P.3d 611.
Attorney And Client 53(2)
13. Contingent fees, generally
Disbarment of attorney was warranted, where
attorney charged client an unreasonable contingency fee in a workers'
compensation case, he failed to consult with client regarding a settlement
offer, he forged client's signature to a settlement document, he impersonated a
notary, he failed to adequately communicate
with client, and he knowingly misappropriated funds belonging to a client. People v. Barringer,
2001, 61 P.3d 495. Attorney And Client 58
Six month suspension from the practice of law
was warranted, where attorney failed to reduce a contingency fee agreement with
a client to writing, he provided a client an advance on a potential settlement,
he failed to appear hearings, he failed to inform the client of the status of
her case, and when the client requested her file he failed to provide it to her. People v. Kocel, 2003,
61 P.3d 56.
Attorney And Client 58
Judgment debtor stated claim against judgment
creditor's counsel for restitution of allegedly excessive contingency fees
after judgment debtor obtained enforcement of settlement that was smaller than
original judgment; counsel represented judgment creditor throughout litigation,
were involved in all aspects of settlement negotiations, directly attempted to
revoke settlement offer after judgment debtor had accepted it, knew that suit
to enforce settlement was pending when they distributed and received part of
supersedeas bond proceeds, and knew of possibility that award on which fees had
been based could be set aside. Berger v. Dixon &
Snow, P.C., App.1993, 868 P.2d 1149, certiorari denied. Attorney And Client 26
Attorney was entitled to his fee pursuant to
agreement to divide contingency fee with two other attorneys, where he
substantially performed under the contract, and where nothing indicated
bad-faith division of the fee. Rutenbeck v.
Grossenbach, App.1993, 867 P.2d 36,
certiorari denied. Attorney And Client 151
Contingent fee arrangement is generally valid,
except in criminal and divorce cases. People v. Nutt, 1984,
696 P.2d 242.
Attorney And Client 147
Under its general supervisory power over
attorneys as officers of the court, court may and should scrutinize contingent
fee contracts and determine reasonableness of their terms. People v. Nutt, 1984,
696 P.2d 242. Attorney And Client 147
Court reviewing contingent fee agreement will
test contract against quantum meruit standard and determine from all facts and
circumstances amount of time spent, novelty of questions of law, and risk of
nonrecovery to client and attorney; lawyer bears burden of proving that services
to be performed were reasonably worth amount
stated in agreement. People v. Nutt, 1984,
696 P.2d 242.
Attorney And Client 147
Findings that contingent fee agreement for
representing litigant in will contest was openly and fairly made and that
client had full knowledge of facts and legal rights before agreement was made,
that agreement was supported by adequate consideration and that services
contracted for were fully performed were supported by the record as was
conclusion that fee was reasonable. Matter of Estate of
Reid, App.1983, 680 P.2d 1305. Attorney And Client 166(3);
Attorney And Client 166(4)
Under its general supervisory power over
attorneys as officers of the court, a court may and should scrutinize
contingent fee contracts and determine the reasonableness of the terms
thereof. Anderson v. Kenelly,
App.1975, 547 P.2d 260, 37 Colo.App. 217. Attorney And Client 147
Where dispute over payment of proceeds under
employer's group life policy affording coverage for accidental death was caused
by confusion concerning date of insured's enlistment in military service, and
not only was little skill or effort required to obtain correct information,
but, had parties been aware of correct date
of enlistment, it was unlikely that contingent fee contract would have been
considered, much less agreed to, trial court, faced with failure of attorney to
reduce his fees after insurer paid a sum of $26,373 under policy, properly
reviewed contract and reduced fee upon determining from evidence that contract
was unconscionable, unreasonable, and unfair.
Anderson v. Kenelly,
App.1975, 547 P.2d 260, 37 Colo.App. 217. Attorney And Client 147
14. Explanation of fee
Attorney violated disciplinary rule mandating
compliance with the rules governing contingent fees, where he did not issue a
written disbursement statement to clients at the time of final disbursement of
settlement funds. People v. Hassan,
2002, 45 P.3d 1283. Attorney And Client 44(1)
Attorney failed to adequately communicate
basis of her fee to client before or within a reasonable time after commencing
her representation, in violation of disciplinary rule. People v. Milner,
2001, 35 P.3d 670. Attorney And Client 44(1)
15. Excessive fees, generally
Attorney's fee of $2,500
for work he performed for clients was excessive, in violation of rule of
professional conduct providing attorney's fee shall be reasonable; although fee
of $2,500 could be reasonable for preparation of trust providing tax and asset
protection benefits upon client, where documents neither addressed client's
objectives, evidenced some measure of meaningful legal analysis for client, or
conferred some legally recognizable benefit upon client, such a fee was not
reasonable. People v. Woodford,
2003, 81 P.3d 370. Attorney And Client 44(1);
Attorney And Client 140
By charging and collecting $3,800 for work
that was of no benefit to client, attorney charged and collected unreasonable
or clearly excessive fee. People v. Boyle, 1997,
942 P.2d 1199, reinstatement granted 94 P.3d 644. Attorney And Client 44(1)
Three-year suspension and numerous conditions
for reinstatement were warranted for attorney's neglect of five separate client
matters, charging of excessive fee in two of those matters, and failure to
notify client of his suspension from practice of law; long suspension was also
supported by fact that prior disciplinary proceedings had shown extensive pattern
of neglect. People v. Hohertz, 1996, 926
P.2d 560.
Attorney And Client 58
Attorney who failed to file application for
approval of prepetition and postpetition fees and left state while bankruptcy
proceeding was pending without providing client with means to communicate with
him violated ethical rules prohibiting lawyer from engaging in conduct
involving dishonesty, fraud, deceit, or misrepresentation, prohibiting lawyer
from charging or collecting illegal or clearly excessive fees, and prohibiting
lawyer from engaging in conduct prejudicial to administration of justice. People v. Mills, 1996,
923 P.2d 116.
Attorney And Client 38;
Attorney And Client 42; Attorney And Client 44(1)
Neglect of two legal matters, resulting in
their dismissal for failure to file adequate notice of claim, and charging
excessive fee by failing to explain basis for fee adequately was conduct
warranting suspension from practice of law for one year and one day, given
attorney's previous history of discipline and pattern of neglecting legal
matters, notwithstanding timely good faith effort to make restitution and
cooperation with disciplinary counsel. People v. Calvert,
1996, 915 P.2d 1310. Attorney And Client 58
Attorney's
conduct regarding retention of first portion of client's workers' compensation
settlement violated disciplinary rules against engaging in conduct prejudicial
to administration of justice and entering agreement for, charging, or
collecting illegal or clearly excessive fee, and, along with attorney's
advancement of loans to client while client's claims were pending, warranted
public censure, as misconduct constituted more than single isolated instance of
negligence, and attorney had been disciplined previously. People v. Maceau,
1996, 910 P.2d 692. Attorney And Client 58
Attorney's conduct violated disciplinary rule
stating that lawyer shall not enter into agreement for or collect illegal or
clearly excessive fee where client in wrongful death action had been informed
that driver's insurance company would tender the policy limits of $15,000,
attorney told client that she might be entitled to more and she signed
one-third contingency fee contract, insurer paid the policy limits of $15,000,
and attorney collected $5,000 contingency fee when there was effectively no
risk of nonrecovery and little work was performed on client's behalf. People v. Robertson,
1995, 908 P.2d 96. Attorney And Client 44(1)
Suspension from practice for one year and one
day was appropriate for attorney who
intentionally overbilled government agency for attorney time on consistent
basis for over a year and as result collected $7,000 in overpayments, where
attorney's only mitigating factor was lack of prior disciplinary record, where
aggravating factors included dishonest or selfish motive, refusal to
acknowledge wrongfulness of his conduct, and substantial experience in practice
of law, where hearing board found portions of his testimony not credible, and
where Supreme Court believed shorter period of suspension would not adequately
protect public. People v. Shields,
1995, 905 P.2d 608. Attorney And Client 58
Attorney's collection of clearly excessive fee
for dissolution of marriage and neglect of legal matters entrusted to attorney
warrants 30-day license suspension and restitution. People v. Kardokus,
1994, 881 P.2d 1202. Attorney And Client 58
Charging and collecting excessive attorney
fees as personal representative of estate and failing to notify beneficiaries
of charges over a period of years warrants only six-month suspension in light
of attorney's 40 years of practice with no prior disciplinary record and
diagnosis of depression. People v. Sullivan,
1990, 802 P.2d 1091. Attorney And Client 58
Charging of clearly
excessive "investigation" fee, failure to advise client of applicable
statute of limitations on his claim, failure to return file and unearned fee at
client's request, failure to pay judgment creditor in accordance with client's
request and conversion of monies given for that purpose to attorney's own use, and
making of false statement to investigatory board constitutes professional
misconduct and, in light of mitigating factor of migraine headaches and
aggravating factor of prior private censure for crime of dishonesty, warrants
one year and one day suspension from practice of law. People v. Distel,
1988, 759 P.2d 654. Attorney And Client 58
Failure to disclose interest as lender and
holder of long-term mortgage on property owned by clients, billing for
excessive time for work done, for services not performed or work on matters
unrelated to clients' legal problems and entering fee arrangement in which
compensation is directly related to royalties clients might receive from oil
and gas wells is misconduct, warranting suspension from practice of law for
period of six months. People v. Nutt, 1984,
696 P.2d 242.
Attorney And Client 58
Amount of attorney fees awarded to former
employee, which was more than 50% of her
judgment on her claims against employer for past compensation, vacation pay and
statutory penalties due her, was not excessive.
Hartman v. Freedman,
1979, 591 P.2d 1318, 197 Colo. 275. Labor And Employment 2405
16. Unearned fees
Evidence did not establish that attorney
charged an unreasonable fee in violation of disciplinary rule; although some
portion of the $1,500 flat fee was subject to refund due to termination of
representation by an order suspending attorney from practice of law, no
evidence was offered from which it could be determined with any precision what
portion of the $1,500 attorney actually earned or which would be reasonable for
services provided. People v. Jaramillo,
2001, 35 P.3d 723. Attorney And Client 53(2)
Attorney's conduct including abandonment of
four separate client matters, making knowing misrepresentations to clients
about resolutions of disputes, and failing to return files to clients violated
disciplinary rule requiring attorney to act provide competent representation,
and rules prohibiting attorney from neglecting client matter, failing to
communicate, charging unreasonable fee, failing to return client files,
entering into business transaction with a
client, and engaging in conduct involving dishonesty, fraud, deceit, or
misrepresentation. People v. Essay, 2001,
35 P.3d 590. Attorney And Client 37.1;
Attorney And Client 44(1)
Upon discharge, an attorney must return all
unearned fees in a timely manner, even though the attorney may be entitled to
quantum meruit recovery for the services that the attorney rendered and for
costs incurred on behalf of the client. In re Sather, 2000, 3
P.3d 403, modified on denial of rehearing.
Attorney And Client 137
Disbarment was warranted for attorney who
accepted fees from number of clients, then abandoned them, causing some clients
substantial harm, and who failed to keep clients informed of status of their
cases or to respond to requests for information, who failed to return unearned
fees after termination by client, and who failed to respond to request for
investigation by grievance committee; absence of prior discipline was not in
itself sufficient to justify sanction less than disbarment. People v. Jamrozek,
1996, 914 P.2d 350. Attorney And Client 58
Abandoning criminal client to represent
client's wife on charge of shooting client,
failing to fulfill contract with client, and failing to refund $2,500 retainer
violated rules of professional conduct prohibiting neglect of legal matter,
requiring keeping client reasonably informed about status of matter, requiring
that fees be reasonable, and prohibiting representation that may be materially
limited by responsibilities to another client.
People v. Odom, 1996,
914 P.2d 342.
Attorney And Client 44(1)
Neglecting entrusted legal matters, committing
fraud and misrepresentation in dealings with clients, acting in way that
adversely reflects on fitness to practice law, failing to represent clients
zealously, failing to perform services in timely manner, and failing to account
to clients for unearned fees warrant nine-month suspension from practice of
law. People v. Fleming,
1986, 716 P.2d 1090. Attorney And Client 58
Failing to file bankruptcy proceedings,
misrepresenting that steps had been taken to file dissolution of marriage,
failing to disclose effects of dual representation when filing dissolution
proceedings on behalf of husband and wife, failing to remit funds to client,
failing to file petitions in uncontested dissolutions of marriage, receiving
fees for cases which were never completed, failing to complete real estate transactions,
failing to inform client of status of
collection efforts on note, and failing to cooperate with investigators for
grievance committee warrant indefinite suspension from practice of law. People v. Meldahl,
1980, 615 P.2d 29, 200 Colo. 332. Attorney And
Client 58
17. Referral fees
Payment of referral fees by attorney to jail
inmates who refer other inmates to him pursuant to agreement violates
prohibitions on compensation for recommendation of attorney and prohibition on
violation of disciplinary rules. People v. Shipp, 1990,
793 P.2d 574.
Attorney And Client 38
18. Refund of excess fees
Attorney's receiving and refusing to refund
portion of a professional fee in divorce matter in excess of that which was
reasonable violated disciplinary rule prohibiting the charging an unreasonable
fee. People v. Espinoza,
2001, 35 P.3d 552. Attorney And Client 44(1)
Attorney's failure to deposit retainer in
trust account, instead depositing it in his
operating account, failure to refund unused portion of retainer, and refusal to
withdraw from representation at client's request, violates Disciplinary Rules
and Rules of Professional Conduct. People v. Crews, 1995,
901 P.2d 472.
Attorney And Client 44(1);
Attorney And Client 44(2)
Multiple instances of habitual disregard of
established rules of procedure, which did not amount to outright neglect of
clients' causes, and failure to timely account for and return unearned
attorney's fees, warrants six-month suspension from practice of law, given
aggravating factors of prior disciplinary proceedings, and substantial
experience in practice of law, balanced by mitigating factors of serious health
problems during relevant time period and full and free disclosure and
cooperative attitude during disciplinary proceedings. People v. Kerwin,
1993, 859 P.2d 895. Attorney And Client 58
Neglect of clients' affairs to extent of
failing to appear on their behalf in matters set for trial, when combined with
a failure to account to clients for fees and a failure to return funds to which
clients were entitled, evinced a pattern of professional misconduct warranting
disbarment. People v. Coca, 1987, 732 P.2d 640. Attorney And Client 58
19. Division of fees
Contract to apportion attorney fees upon
attorney's departure from the firm was enforceable in accordance with its terms
and was not contrary to public policy; professional responsibility rule
limiting the division of fees between attorneys who were not in the same firm
did not apply, the clients benefited from the agreement by permitting them to
choose their attorney freely, and clients were not charged additional fees as a
result of the agreement, nor were they in any way deceived or misled. Norton Frickey, P.C.
v. James B. Turner, App.2004, 94 P.3d 1266. Attorney And Client 30
Attorney violated disciplinary rule governing
division of fees, by his attempts to enforce "Covenant Not to Steal,"
in which required division of fees between attorney and former associate, who
was retained by former firm client, bore no relation to services
performed. People v. Wilson,
1998, 953 P.2d 1292. Attorney And Client 37.1
Original attorney was not precluded from
recovering fees, in proceeding to allocate
fees between original and replacement attorney, even if he was responsible for
procedural flaws that rendered first incompetency proceeding against client
invalid, thereby giving rise to replacement attorney's work; flawed procedures
could have been cured without reopening of case and there was evidence that
original attorney's task was far greater than replacement attorney's in every
dimension. Law Offices of J.E.
Losavio, Jr. v. Law Firm of Michael W. McDivitt, P.C., App.1993, 865 P.2d 934. Attorney And Client 141
20. Calculation of attorney fees
Attorneys are not immune from liability to
nonclient for restitution of fees that had been calculated on basis of judgment
against nonclient that exceeded amount of enforceable settlement; permitting restitution of fees based on
judgment which has been reduced does not interfere with any professional duties
owed to client and is not premised on assertion of any duty owed to
nonclient. Berger v. Dixon &
Snow, P.C., App.1993, 868 P.2d 1149,
certiorari denied. Attorney And Client 26
Reconstruction of time records from memory is
not favored, in proceeding for attorney
fees, because it poses danger of overstatement or understatement; however, such
records are not ipso facto improper and their lack of contemporaneity simply
bears on weight they should be given. Law Offices of J.E.
Losavio, Jr. v. Law Firm of Michael W. McDivitt, P.C., App.1993, 865 P.2d 934. Attorney And Client 166(1)
Although courts may award attorney fees for
work upon issues of fact or law on which client did not ultimately prevail,
provided such issues were all part and parcel of one matter and were reasonably
calculated to promote client's interest, such determination is within
discretion of court. Heller v. First Nat.
Bank of Denver, N.A., App.1982, 657 P.2d 992. Costs 194.14
No one factor to be considered in determining
award of attorney fees is conclusive, and court should consider them all; thus, amount recovered is only one factor to
be considered in fashioning appropriate fee award. Mau v. E. P. H. Corp.,
1981, 638 P.2d 777. Costs 194.18
Under statute which provides for award of
reasonable attorney fees and costs in a successful action by tenant for
wrongful withholding of security deposit, tenant's attorney should be paid for
time necessary to prevail. Mau v. E. P. H. Corp., 1981, 638
P.2d 777.
Landlord And Tenant 184(2)
Attorney fees allowable in connection with
successful action by tenants for wrongful withholding of their security
deposits included those incurred in resolving fee dispute, and those incurred
on appeal of fee dispute. Mau v. E. P. H. Corp.,
1981, 638 P.2d 777. Landlord And Tenant 184(2)
21. Lodestar rule
Once lodestar amount is determined for
purposes of awarding attorney fees, that basic amount may be adjusted upward or
downward by application of factors such as amount in controversy, length of
time required to represent client effectively, complexity of case, value of
legal services to client, and awards in similar cases, together with degree of
success achieved and those factors set forth in professional conduct rule
governing fees. Tallitsch v. Child
Support Services, Inc., App.1996, 926 P.2d 143, rehearing denied, certiorari denied. Costs 194.18
For attorney fee purposes, in determining
whether lodestar figure should be adjusted up or down based on degree of
success achieved, amount of damages recovered
by plaintiff is relevant, and court may also consider amount in controversy and
amount of damages sought. Tallitsch v. Child
Support Services, Inc., App.1996, 926 P.2d 143, rehearing denied, certiorari denied. Costs 194.18
22. Reduction of fees
It was improper for county court to reduce
attorney fee requested by tenants' counsel, following successful action for
wrongful withholding of tenants' security deposit, without giving reasons for
reduction, since without reasons it was impossible to determine basis for
award, and case therefore had to be remanded for redetermination of tenants'
attorney fees and articulation of reasons behind award. Mau v. E. P. H. Corp.,
1981, 638 P.2d 777. Landlord And Tenant 184(2)
23. Retainer agreements
Unenforceable provisions in representation
agreement for withdrawal of law firm if client unreasonably refused to settle
could not be severed from terms providing for calculation of fees, and thus
latter provisions were also unenforceable. Jones v. Feiger,
Collison & Killmer, App.1994, 903 P.2d 27, modified on denial of rehearing, certiorari granted, reversed 926 P.2d 1244, rehearing denied. Attorney
And Client 142.1
Although provisions of representation
agreement prohibiting client from unreasonably refusing to settle and
permitting law firm, in such event, to withdraw, together with provision for
calculating fees, were unenforceable, it was equitable for law firm to be
compensated on basis of quantum meruit, in absence of fraudulent or grossly
unprofessional conduct. Jones v. Feiger,
Collison & Killmer, App.1994, 903 P.2d 27, modified on denial of rehearing, certiorari granted, reversed 926 P.2d 1244, rehearing denied. Attorney
And Client 130
Duty to respond to disciplinary matters is
duty personal to attorney involved, but there may be unusual and extraordinary
circumstances which would allow attorney to bill client pursuant to fee
agreement for legal cost incurred in defending against unfounded disciplinary
charges brought by third party. People v. Brown, 1992,
840 P.2d 1085.
Attorney And Client 144
24. Trust accounts
Public censure, not
suspension, was appropriate disciplinary sanction based on attorney's
conditional admission that he failed to insure that co-counsel had in fact
filed pleadings required by federal statutes and bankruptcy rules to be
employed as debtor's counsel and for disclosure and authorization of
compensation, and attorney's failure to place attorney fees in trust account;
attorney's misconduct was largely attributable to unlucky choice of and unwise
reliance on co-counsel. People v. Davis, 1998,
950 P.2d 598.
Attorney And Client 58
25. Breach of trust actions
Object of award of attorney fees in breach of
trust action is to make injured party whole.
Heller v. First Nat.
Bank of Denver, N.A., App.1982, 657 P.2d 992. Trusts 268
Award of attorney fees in breach of trust
action must be supported by evidence adduced at trial and trial court may
consider, among other factors, amount in controversy, length of time required
to represent client effectively, complexity of case, value of legal services to
client and usage in legal community
concerning fees in similar cases. Heller v. First Nat.
Bank of Denver, N.A., App.1982, 657 P.2d 992. Trusts 268
Existence of contingency fee contract between
attorney and trust beneficiary who was injured by trustee's breach of duty does
not preclude award of attorney fees to beneficiary. Heller v. First Nat.
Bank of Denver, N.A., App.1982, 657 P.2d 992. Trusts 268
26. Sanctions--In general
Though attorney's violation of several
provisions of Rules of Professional Conduct established a separate violation of
Rule prohibiting an attorney from violating the Rules, under the circumstances
the separate violation of such Rule did not enhance sanction to be imposed;
attorney had replaced prior attorney who had represented client on personal
injury claim and still claimed an interest in settlement proceeds, entered into
a contingent fee agreement, over the course of a three week period did no more
than make a few phone calls, meet with client and conduct some research,
advised client to accept offer that had already been extended to client through
prior attorney, collected and retained entire contingency fee, did not provide
an accounting to prior attorney, failed to
keep funds received separate, and failed to disclose to prior attorney that
case had been settled. People v. Egbune,
1999, 58 P.3d 1168. Attorney And Client 58
Fact that attorney refunded excessive fees he
took out of client's personal injury protection (PIP) insurance recovery almost
three years earlier was not significant factor in mitigation for disciplinary
purposes. People v. Sather,
1997, 936 P.2d 576. Attorney And Client 58
27. ---- Public censure, sanctions
Public censure with restitution requirement,
rather than suspension or private discipline, was appropriate discipline for
attorney's misconduct in charging unreasonable fee in workers' compensation
case, failing to adequately convey basis and rate of his fee to client and in
entering into contingent fee agreement which did not comply with rules
governing contingent fees, where attorney had selfish motive, had substantial experience
in practice of law and had not previously been disciplined in over 20 years of
practice. In re Wimmershoff,
2000, 3 P.3d 417. Attorney And Client 58
Multiple
instances of charging and collecting excessive fees, failing to perceive or
warn clients about potential conflicts of interest arising from multiple
employment and attorney's personal interests, and failing to return unearned
fees, when coupled with handling legal matters without adequate preparation was
conduct warranting public censure of attorney who had prior disciplinary
history of two admonishments, where conduct caused only minor harm to clients,
and attorney expressed remorse and made full disclosure. People v. O'Donnell,
1998, 955 P.2d 53. Attorney And Client 58
Conduct in connection with disputes among
three persons involving conflict of interest and charge of illegal and
excessive fee warrants public censure. People ex rel. Cortez
v. Calvert, 1980, 617 P.2d 797, 200 Colo. 157. Attorney And Client 58
28. ---- Suspension, sanctions
Attorney's misconduct in preparing
unenforceable trust documents, preparing invalid trust for clients, failing to
pursue objectives of his client, neglecting legal work entrusted to him,
charging excessive fee for work he performed, and failing to file tax returns,
along with aggravating factors of engaging
in pattern of misconduct, failing to participate in consolidated disciplinary
proceeding, and demonstrating indifference to making restitution, warranted
15-month suspension from the practice of law.
People v. Woodford,
2003, 81 P.3d 370. Attorney And Client 58
One year and one day suspension, rather than
disbarment, of attorney from the practice of law was warranted, where
attorney's conduct constituted abandonment of his client in violation of rules
of professional conduct, but no allegation or finding was made that attorney
had misappropriated client's funds. People v. Carvell,
2000, 62 P.3d 167. Attorney And Client 58
Attorney's engaging in three distinct acts of
technical conversion of client funds, submitting false documents in connection
with disciplinary investigation, failure to communicate with client, and
knowingly failing to perform services on client's behalf warranted 18-month
suspension from the practice of law. People v. Hassan,
2002, 45 P.3d 1283. Attorney And Client 58
Neglecting legal matter, engaging in conduct
involving dishonesty, fraud, deceit, or misrepresentation, charging an
unreasonable fee, failing to keep clients
reasonably informed, and failing to surrender clients' property after
termination warranted suspension from practice of law for period of one year
and one day. People v. Schmeiser,
2001, 35 P.3d 560. Attorney And Client 58
Failure to file complaint and effect service
of process, failure to provide client with any accounting of time and legal
services performed to justify fee, failure to ship cat to client while
retaining money paid to do so, failure to refund retainer after trial court
denied motion for substitution of counsel, failure to respond to law firm
requesting transfer of former client's records, practicing law with suspended
license, and driving under influence of alcohol warranted one year and a day
suspension from practice of law. People v. Reedy, 1998,
966 P.2d 1057.
Attorney And Client 58
Failing to file guardianship petition,
neglecting tort and paternity suits, practicing while under administrative
suspension for failure to comply with mandatory continuing legal education
(CLE) requirements, commingling funds, charging unreasonable fee, failing to
refund unearned fee and failing to withdraw from representation or protect
client's interests upon termination was conduct warranting 18-month suspension
from practice of law, with conditions imposed
upon reinstatement. People v. Johnson,
1997, 946 P.2d 469. Attorney And Client 58
Attorney's misconduct in submitting fraudulent
mileage reimbursement request and billing time sheets warranted suspension for
only three, not six, months, in light of significant mitigating circumstances,
including stressful and debilitating separation from his wife and subsequent
dissolution of marriage, lack of prior discipline, payment of restitution, full
and free disclosure and cooperation during disciplinary process, inexperience
in practice of law, loss of his job, and remorse. People v. Kotarek,
1997, 941 P.2d 925. Attorney And Client 58
Thirty-day suspension was warranted,
considering nature of attorney's misconduct, including failure to communicate
with clients and charging excessive or unreasonable fees, together with factors
in mitigation, including presence of personal or emotional problems, full and
free disclosure during disciplinary process, and presence of remorse. People v. Sather,
1997, 936 P.2d 576. Attorney And Client 58
In light of attorney's previous discipline,
including public censure, 60-day suspension
was appropriate sanction for violations of ethical rules prohibiting lawyer
from engaging in conduct involving dishonesty, fraud, deceit, or
misrepresentation, prohibiting lawyer from charging or collecting illegal or
clearly excessive fees, and prohibiting lawyer from engaging in conduct
prejudicial to administration of justice.
People v. Mills, 1996,
923 P.2d 116.
Attorney And Client 58
Three-year suspension, with payment of
restitution, was warranted for attorney's conduct in failing to keep one client
informed about status of social security case and to tell her about former
husband's offer to increase child support, and attorney's conduct in abandoning
criminal client to represent client's wife on charge of shooting client,
failing to fulfill contract with client, and failing to refund $2,500 retainer,
considering in aggravation attorney's prior history of similar discipline, his
dishonest and selfish motive, his pattern of misconduct, his refusal to
acknowledge wrongful nature of conduct, vulnerability of victims, attorney's
substantial experience in practice of law, and his indifference to making
restitution. People v. Odom, 1996,
914 P.2d 342.
Attorney And Client 58
Attorney's charging excessive fees for
managing client's business, failing to provide
appropriate accountings, entering into business transactions with clients
without revealing conflict of interest, and handling legal and investment
matters in which he did not have experience warranted three-year suspension
from the practice of law. People v. Banman,
1995, 901 P.2d 469. Attorney And Client 58
Delay in filing bankruptcy petition on behalf
of clients, and failure to file civil complaint on behalf of another client or
return that client's retainer fee, following prior discipline, warrants
six-month suspension. People v. Archuleta,
1995, 898 P.2d 1064. Attorney And Client 58
Charging excessive fee, misrepresenting to
bankruptcy court amount of money collected for attorney fees, failing to
communicate with client, to file bankruptcy petition in timely manner, to send
letters of administration to personal representative, to promptly return funds
owed to client, to respond to request for investigation by grievance committee
without good cause, to protect client's interest following termination of
representation, knowingly disobeying obligation under rules of tribunal, and
knowingly engaging in conduct prejudicial to administration of justice warrants
three-year suspension, despite alleged physical disability, mental disability,
and personal and emotional problems. People v. Johnson,
1994, 881 P.2d 1205. Attorney And Client 58
Over-billing for travel time and court time
spent while serving by appointment in juvenile proceedings results in charging
of excessive fee and exceeding compensation authorized by law and warrants
90-day suspension. People v. Walker,
1992, 832 P.2d 935. Attorney And Client 58
Perpetrating fraud upon court in use of
general assignment for benefit of creditors, imposition of charges exceeding
statutory standards and attempt to tamper with jury would justify indefinite
suspension and payment of costs. People v. Radinsky,
1971, 490 P.2d 951, 176 Colo. 357. Attorney And Client 58
29. ---- Disbarment, sanctions
Disbarment of attorney was warranted, in
attorney disciplinary proceeding, where attorney had previously had his license
to practice law suspended, attorney failed to turn over property belonging to
client in a timely fashion, he failed to communicate with clients effectively,
he failed to keep his clients properly
informed, and he failed to return an unearned portion of a retainer fee to
client. People v. Lindemann,
2004, 93 P.3d 1125. Attorney And Client 58
Absence of prior discipline, standing alone,
was insufficient to justify a sanction less than disbarment for attorney who
engaged in misconduct including knowing conversion of client funds and
abandonment of clients. People v. Milner,
2001, 35 P.3d 670. Attorney And Client 58
Disbarment was appropriate sanction for extent
of neglect and other rule violations, including failure to communicate, failure
to comply with court orders, and failure to adequately supervise nonlawyer,
demonstrated in 14 separate client matters.
People v. Milner,
2001, 35 P.3d 670. Attorney And Client 58
Lack of competent representation, neglect of
client matter, failure to communicate, charging unreasonable fee, failing to
return client files, entering into business transaction with a client, and
engaging in conduct involving dishonesty, fraud, deceit, or misrepresentation
warranted disbarment. People v. Essay, 2001,
35 P.3d 590.
Attorney And Client 58
Disbarment was proper sanction to impose on
attorney who engaged in a pattern of serious misconduct, committed multiple
offenses, caused serious injury to vulnerable clients, had substantial
experience in the practice of law, and was indifferent to making restitution;
attorney abandoned client, charged an unreasonable fee, and failed to protect
client's interest in violation of the rules of professional conduct, and
engaged in conduct constituting dishonesty, fraud, or deceit under the code of
professional responsibility. People v. Romero,
1999, 35 P.3d 164. Attorney And Client 58
Attorney's actions in knowingly
misappropriating client funds, commingling his personal funds with client
funds, consistently mismanaging his trust account, and misrepresenting status
of case to client warranted disbarment. In re Cleland, 2000, 2
P.3d 700.
Attorney And Client 58
Disbarment, rather than three-year suspension,
was warranted, in attorney disciplinary proceeding, where attorney's existing
suspension was disciplinary, as opposed to administrative, and attorney's
conduct, accepting advance fees in client matters after order of suspension had
been entered against him, even though it was
obvious that he could not represent those clients because of his impending
suspension, caused actual harm since clients received little or no benefit from
fees they paid to him had to pay other lawyers additional fees for legal
services they had paid attorney to perform.
People v. Zimmermann,
1998, 960 P.2d 85. Attorney And Client 58
Disbarment from practice of law was
appropriate disciplinary sanction for attorney's misconduct involving his
effective abandonment of client after acceptance of retainer, thereby
misappropriating unearned attorney fees, and his extreme indifference to
welfare of clients and their cases. People v. Roybal,
1997, 949 P.2d 993. Attorney And Client 58
Disbarment was warranted by attorney's conduct
of accepting legal fees in eight separate client matters, performing at the
most very limited services for clients, and abandoning clients while
misappropriating the unearned fees. People v. Kuntz, 1997,
942 P.2d 1206.
Attorney And Client 58
Disbarment was warranted for attorney's
appearance on behalf of client while suspended, failure to communicate with
clients, conviction of fraud by check, failure to deliver client funds upon
request, failure to pursue matters on behalf
of clients, and failure to respond to requests for investigation. People v. Fager, 1997,
938 P.2d 138.
Attorney And Client 58
Attorney's abandonment of clients, causing
them serious harm, and his knowing misappropriation of client funds warranted
his disbarment. People v. Wallace,
1997, 936 P.2d 1282. Attorney And Client 58
Disbarment was warranted for meeting with
clients following order of suspension, practicing law during suspension period,
pleading guilty to felony offenses of possession of cocaine and contributing to
delinquency of minor, failing to report in criminal proceedings his prior
convictions in foreign country, pleading guilty to drug and firearm offenses in
foreign country, falling asleep during court hearing, failing to provide
clients with accounting or refund of unearned retainers, failing to promptly
return clients' documents and neglecting legal matter. People v. Ebbert,
1996, 925 P.2d 274. Attorney And Client 58
Attorney's conduct in accepting legal fees
from number of clients and then abandoning them, causing some of the clients
substantial harm, warranted attorney's disbarment; attorney consented to
disbarment and no mitigating evidence was
presented that would make lesser sanction appropriate. People v. Jenks, 1996,
910 P.2d 688.
Attorney And Client 58
Multiple instances of accepting clients'
retainer, depositing retainer in operating account although not yet earned,
neglecting case, misrepresenting to client that work has been performed or
failure to communicate with client at all, and ultimate abandonment of client,
writing checks on firm's operating account for personal expenses when there is
insufficient money to pay firm's operating expenses, drawing checks on client
trust account for personal expenses and then repaying part of deficit with
money from client retainer not yet earned in case that had been neglected, and
failure to respond to request for investigations warrants disbarment. People v. Brown, 1993,
863 P.2d 288.
Attorney And Client 58
Violation of disciplinary rules prohibiting
conduct involving dishonesty, fraud, deceit, or misrepresentation, failure to
carry out contract of employment with client, failure to refund fees to client,
engaging in conduct prejudicial to administration of justice, charging or
collecting of excess fee and neglect of legal matter warrants disbarment. People v. Golden,
1982, 654 P.2d 853. Attorney And Client 58
30. Divorce proceedings
Attorney violated Rules of Professional
Conduct concerning neglect of a legal matter, failure to keep a client
reasonably informed, and unreasonable fees by charging $5,200 to client in
connection with proceeding to dissolve common-law marriage in which he
performed no discovery, failed to inform client of scheduled hearings and of
discovery issues, and failed to file response to discovery order, resulting in
an order excluding all of client's witnesses and exhibits pertaining to
discovery requests and a judgment against client for attorney fees. People v. Hohertz,
1996, 926 P.2d 560. Attorney And Client 44(1)
Rules of Prof. Cond., Rule 1.5, CO ST RPC Rule 1.5
Current with amendments received
through August 15, 2004
© 2005 Thomson/West
END OF DOCUMENT
Source:
Colorado Statutes/TITLE 15 PROBATE, TRUSTS, AND FIDUCIARIES/COLORADO PROBATE
CODE/ARTICLE 14 PERSONS UNDER DISABILITY - PROTECTION/PART 4 PROTECTION OF
PROPERTY OF PROTECTED PERSON/15-14-417. Compensation, fees, costs, and expenses
of administration - expenses.
C.R.S.A. 15-14-417. Compensation, fees, costs, and expenses of administration - expenses.
(1) Compensation. If not otherwise compensated for services rendered, any visitor, guardian, conservator, special conservator, lawyer for the respondent, lawyer whose services resulted in a protective order or in an order beneficial to an incapacitated person or to a protected person's estate, any physician, guardian ad litem, or any other person appointed by the court is entitled to reasonable compensation from the estate even if no fiduciary is appointed. Except as limited by court order, compensation may be paid and expenses reimbursed without court order. In a special conservatorship, compensation may only be paid with court approval after notice and hearing. If the court determines that the compensation is excessive or the expenses are inappropriate, the excessive or inappropriate amount must be repaid to the estate.
(2) Fees. Factors to be considered as guides in determining the reasonableness of any fee referred to in this section or in this article or in article 16 of this title, include the following:
(a) The time and labor required, the novelty and difficulty of the questions involved, and the skill requisite to perform the service properly;
(b) The likelihood, if apparent, that the acceptance of the particular employment will preclude the person employed from other employment;
(c) The fee customarily charged in the locality for similar services;
(d) The amount involved and the results obtained;
(e) The time limitations imposed by the circumstances;
(f) The experience, reputation, and ability of the person performing the services.
(3) Expenses in estate litigation. For purposes of this article or article 16 of this title, if any guardian, conservator, special conservator, or court-appointed fiduciary defends or prosecutes any proceeding in good faith, whether successful or not, he or she is entitled to receive from the estate his or her necessary time, expenses, and disbursements including reasonable attorney fees incurred. Any such person or fiduciary who is unsuccessful in defending the propriety of his or her actions in a breach of fiduciary duty action shall not be entitled to recover expenses under this section to the extent of any matters on which such breaches are found.
(4) Expenses incurred in defense of fiduciary fees. For purposes of this article and article 16 of this title, if any fiduciary is required to defend his or her fees or costs, at the end of the proceedings, the court shall consider the fees and expenses incurred by the fiduciary in a fee review. The court has the authority and duty to determine whether to award to the fiduciary the fiduciary's own fees and costs, including the fiduciary's own attorney fees and costs, incurred in the defense of the fiduciary's fees and costs as the court deems equitable under the circumstances of the case. Any award of fees or costs to the fiduciary may be ordered paid from, and may be allocated among, the estate or trust, or from the person, party, or organization that required the fiduciary to defend his or her fees or costs, as the court deems just.
(5) Priority for payment of guardianship or conservatorship costs and expenses of administration after the death of the incapacitated person or protected person. When an incapacitated person or a protected person dies, all fees, costs, and expenses of administration of the guardianship or conservatorship including any unpaid guardian or conservator fees and costs and those of their counsel may be submitted to the court for court approval in conjunction with the termination of the guardianship or conservatorship estate. Thereafter, all court-approved fees, costs, and expenses of administration arising from the guardianship or conservatorship shall be paid as court-approved claims for costs and expenses of administration in the decedent's estate. In the event that there are insufficient funds to pay all claims in the decedent's estate in full, the fees, costs, and expenses of administration arising from the guardianship or conservatorship shall retain their classification as "costs and expenses of administration" in the decedent's estate and shall be paid pursuant to section 15-12-805.
(6) A fiduciary who is a member of a law firm may use that law firm and charge for the legal services of the members and staff of that firm to assist the fiduciary in his or her duties as a fiduciary.
Source: L. 2000: Entire part R&RE, p. 1818, § 1, effective January 1, 2001 (see § 15-17-103). L. 2001: (1) amended, p. 889, § 9, effective June 1.
Editor's note: This section was contained in a part that was repealed and reenacted in 2000. Provisions of this section, as it existed in 2000, are similar to those contained in 15-14-414 as said section existed in 1999, the year prior to the repeal and reenactment of this part.
ANNOTATION
Am. Jur.2d. See 39 Am. Jur.2d, Guardian and Ward, §§ 222-224.
C.J.S. See 39 C.J.S., Guardian and Ward, §§ 162-164.
Because this section does not specify the amount of compensation to be granted a conservator, the determination of such amount is within the sound discretion of the probate court. Such determination will not be overturned except upon a showing of abuse of discretion. Estate of Binford v. Gibson, 839 P.2d 508 (Colo. App. 1992) (decided prior to 2000 repeal and reenactment).
© 2004 by The Committee on Legal Services for the State of Colorado and Matthew Bender & Company, Inc., a member of the LexisNexis Group. All rights reserved.