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Rule 1.5. Fees.

?(a) A lawyer shall not make an agreement for,charge, or collect an unreasonable fee or an unreasonable amount for expenses.The factors to be considered in determining the reasonableness of a fee includethe following:

(1) thetime and labor required, the novelty and difficulty of the questions involvedand the skill requisite to perform the legal service properly;

(2) thelikelihood, if apparent to the client, that the acceptance of the particularemployment will preclude other employment by the lawyer;

(3) the feecustomarily charged in the locality for similar legal services;

(4) theamount involved and the results obtained;

(5) thetime limitations imposed by the client or by the circumstances;

(6) thenature and length of the professional relationship with the client;

(7) the experience, reputation andability of the lawyer or lawyers performing the services; and

(8) whether the fee is fixed orcontingent.

(b)The scope of the representation and the basis or rate of the fee and expensesfor which the client will be responsible shall be communicated to the client,preferably in writing, before or within a reasonable time after commencing therepresentation, except when the lawyer will charge a regularly representedclient on the same basis or rate. Any changes in the basis or rate of the feeor expenses shall also be communicated to the client.

(c)A fee may be contingent on the outcome of the matter for which the service isrendered, except in a matter in which a contingent fee is prohibited by paragraph(d) or other law. A contingent fee agreement shall be in a writing signed bythe client and shall state the method by which the fee is to be determined,including the percentage or percentages that shall accrue to the lawyer in theevent of settlement, trial or appeal; litigation and other expenses to bededucted from the recovery; and whether such expenses are to be deducted beforeor after the contingent fee is calculated. The agreement must clearly notifythe client of any expenses for which the client will be liable whether or notthe client is the prevailing party. Upon conclusion of a contingent fee matter,the lawyer shall provide the client with a written statement stating theoutcome of the matter and, if there is a recovery, showing the remittance tothe client and the method of its determination.

(d)A lawyer shall not enter into an arrangement for, charge, or collect:

(1)any fee in a domestic relations matter, the payment or amount of which iscontingent upon the securing of a divorce or upon the amount of alimony orsupport, or property settlement in lieu thereof; or

(2)a contingent fee for representing a defendant in a criminal case.

(e) Alicensed paralegal practitioner may not enter into a contingent fee agreementwith a client.

(f) Before providingany services, a licensed paralegal practitioner must provide the client with awritten agreement that:

(1) states the purpose for whichthe licensed paralegal practitioner has been retained;

(2) identifies the services to be performed;

(3) identifies the rate or fee forthe services to be performed and whether and to what extent the client will beresponsible for any costs, expenses or disbursements in the course of therepresentation;

(4) includes a statement printed in 12-point boldface typethat the licensed paralegal practitioner is not an attorney and is limited topractice in only those areas in which the licensed paralegal practitioner islicensed;

(5) includes a provision stating that the client may reportcomplaints relating to a licensed paralegal practitioner or the unauthorizedpractice of law to the Office of Professional Conduct, including a toll-freenumber and Internet website;

(6)describes the document to be prepared;

(7)describes the purpose of the document;

(8)describes the process to be followed in preparing thedocument;

(9) states whether the licensed paralegal practitioner willbe filing the document on the client?s behalf; and

(10)states the approximate time necessary to complete the task.

(g) A licensedparalegal practitioner may not make an oral or written statement guaranteeingor promising an outcome, unless the licensed paralegal practitioner has somebasis in fact for making the guarantee or promise.

 

Comment

Reasonablenessof Fee and Expenses

[1]Paragraph (a) requires that lawyers charge fees that are reasonable under thecircumstances. The factors specified in (a)(1) through (a)(8) are notexclusive. Nor will each factor be relevant in each instance. Paragraph (a)also requires that expenses for which the client will be charged must bereasonable. A lawyer may seek reimbursement for the cost of services performedin-house, such as copying, or for other expenses incurred in-house, such astelephone charges, either by charging a reasonable amount to which the clienthas agreed in advance or by charging an amount that reasonably reflects thecost incurred by the lawyer.

Basisor Rate of Fee

[2]When the lawyer has regularly represented a client, they ordinarily will haveevolved an understanding concerning the basis or rate of the fee and theexpenses for which the client will be responsible. In a new client-lawyerrelationship, however, an understanding as to fees and expenses must bepromptly established. Generally, it is desirable to furnish the client with atleast a simple memorandum or copy of the lawyer?s customary fee arrangementsthat states the general nature of the legal services to be provided, the basis,rate or total amount of the fee and whether and to what extent the client will beresponsible for any costs, expenses or disbursements in the course of therepresentation. A written statement concerning the terms of the engagementreduces the possibility of misunderstanding.

[3]Contingent fees, like any other fees, are subject to the reasonablenessstandard of paragraph (a) of this Rule. In determining whether a particularcontingent fee is reasonable, or whether it is reasonable to charge any form ofcontingent fee, a lawyer must consider the factors that are relevant under thecircumstances. Applicable law may impose limitations on contingent fees, suchas a ceiling on the percentage allowable, or may require a lawyer to offerclients an alternative basis for the fee. Applicable law also may apply tosituations other than a contingent fee, for example, government regulationsregarding fees in certain tax matters.

Termsof Payment

[4]A lawyer may require advance payment of a fee but is obligated to return anyunearned portion. See Rule1.16(d). A lawyer may accept property in payment forservices, such as an ownership interest in an enterprise, providing this doesnot involve acquisition of a proprietary interest in the cause of action orsubject matter of the litigation contrary to Rule 1.8(i). However, a fee paidin property instead of money may be subject to the requirements of Rule 1.8(a)because such fees often have the essential qualities of a business transactionwith the client.

[5]An agreement may not be made whose terms might induce the lawyer improperly tocurtail services for the client or perform them in a way contrary to theclient's interest. For example, a lawyer should not enter into an agreementwhereby services are to be provided only up to a stated amount when it isforeseeable that more extensive services probably will be required, unless thesituation is adequately explained to the client. Otherwise, the client mighthave to bargain for further assistance in the midst of a proceeding ortransaction. However, it is proper to define the extent of services in light ofthe client's ability to pay. A lawyer should not exploit a fee arrangementbased primarily on hourly charges by using wasteful procedures.

ProhibitedContingent Fees

[6]Paragraph (d) prohibits a lawyer from charging a contingent fee in a domesticrelations matter when payment is contingent upon the securing of a divorce orupon the amount of alimony or support or property settlement to be obtained.This provision does not preclude a contract for a contingent fee for legalrepresentation in connection with the recovery of post-judgment balances dueunder support, alimony or other financial orders because such contracts do notimplicate the same policy concerns.

Disputesover Fees

[7]If a procedure has been established for resolution of fee disputes, such as anarbitration or mediation procedure established by the Bar, the lawyer mustcomply with the procedure when it is mandatory, and, even when it is voluntary,the lawyer should conscientiously consider submitting to it. Law may prescribea procedure for determining a lawyer's fee, for example, in representation ofan executor or administrator, a class or a person entitled to a reasonable feeas part of the measure of damages. The lawyer entitled to such a fee and alawyer representing another party concerned with the fee should comply with theprescribed procedure.

[8] This rule differs from the ABAmodel rule.

[8a] This rule differs from the ABA Model Rule by includingcertain restrictions on licensed paralegal practitioners.

EffectiveMay 1, 2021.