OPINION 433
October 1986

Question Presented

 Situation One:

An attorney agrees with a client who is charged with a Class C misdemeanor traffic offense, punishable only by fine not to exceed $200 to charge a certain amount. The total amount charged includes the maximum amount of the fine potentially assessable under the law and a smaller amount in addition thereto. The arrangement provides that, in the event a fine is imposed against the client, it shall be paid by the attorney from the total monies charged the client by the attorney. The remaining balance of such monies received from the client shall be kept by attorney as fee for representation of the client. No additional charge shall be made to client, and no refund shall be payable, regardless of the outcome of the case. May an attorney properly enter into such an agreement?

Situation Two:

Attorney agrees with a client who is charged with a Class C misdemeanor traffic offense, punishable by fine not to exceed $200 to charge a certain amount. The amount is less than the maximum potential fine assessable under the law, with the arrangement that, in the event a fine is imposed against client, such fine shall be paid by the attorney from the monies charged client by attorney. It is agreed that any deficiency between the amount received from client and the total amount of the assessed fine will be payable by attorney from his own funds. In the event the fine assessed is equal to or less than the amount received from client, then the attorney shall keep such excess as fee for his representation of client. No additional charge shall be made to the client, and no refund shall be payable, regardless of the outcome of the case. May an attorney properly enter into such an agreement?

Discussion

Disciplinary Rule ("DR") 2-106(C) provides that a lawyer shall not enter into an arrangement for, charge, or collect a contingent fee for representing a defendant in a criminal case.

Under both of the above factual situations, the total amount of money charged to and payable by the client is known and fixed at the time the attorney is hired. However, the amount of money netted by the attorney as fee (under Fact Situation One), and the amount of money netted, if any, by the attorney as fee (under Fact Situation Two), as well as the potential for loss, or negative fee result (under Fact Situation Two) are all dependent upon the outcome of the traffic violation charge and the results of the representation by attorney.

If the charge is dismissed, or if the client is acquitted, the attorney would receive a "net fee" equal to the full amount paid by client. If, however, a fine is imposed, the "net fee" would be reduced, possibly to zero or even result in a negative figure (under Fact Situation Two) depending under both fact situations on the amount of the fine assessed. In either event, the amount of the fee of the attorney is dependent upon the results or outcome of the case and the effectiveness of representation by the attorney.

In both of the above fact situations, the "fee arrangement" clearly appears to be violative of DR 2-106(A).

An additional vice under both fact situations, although potentially magnified in Fact Situation Two, is the conflict, or at least the reasonable possibility thereof, between the best interests of the client and the personal financial interests of the attorney. DR 5-101(A) provides that, except with the consent of his client after full disclosure, a lawyer shall not accept employment if the exercise of his professional judgment on behalf of his client will be or reasonably may be affected by his own financial, business, property, or personal interests.

It might be argued, under both of the above fact situations, that client manifestly understood what the attorney charged, and that after paying, the money was gone and would not be refunded. Also, that client would owe no additional amount regardless of the fine assessed, and the client thereby, at least impliedly, consented. Neither of the fact situations stated above indicate that any consent of client to the arrangement with attorney was made after full disclosure. The full disclosure prerequisite to an informed consent by client would seem to require an explanation of the circumstances which could influence the attorney toward plea bargaining for a reduced fine, rather than electing to run the risks of contesting the traffic offense charge. Contesting the offense might result in an increased fine, and, automatically thereby, a reduced or eliminated "fee" for the attorney, even in circumstances when the client's best interests could be served by resisting the charged offense.

Conclusion

  1. An attorney may not properly enter into an agreement with a client who is charged with a Class C misdemeanor traffic offense, punishable only by fine not to exceed $200 to charge a certain amount, which total includes the maximum amount of the fine potentially assessable under the law, plus a smaller amount in addition thereto. The arrangement cannot provide that, in the event a fine is imposed against client, such fine shall be paid by the attorney from the total monies charged the client, and the remaining balance of such monies received from client be kept by attorney as fee with no additional charge made to client, and no refund payable to him, regardless of the outcome of the case.
  2. An attorney may not properly enter into an agreement with a client who is charged with a Class C misdemeanor traffic offense, punishable by fine not to exceed $200, to charge a certain amount which amount is less than the maximum potential fine assessable under the law, with the arrangement providing that, in the event a fine is imposed against client, such fine shall be paid by the attorney from the monies charged client by attorney, with any deficiency between the amount received from client and the total amount of the assessed fine to be payable by attorney from his own funds, and in the event the fine assessed is equal to or less than the amount received from client, then the attorney shall keep such excess over the fine, if any, as fee for his representation of client, and no additional charge shall be made to client and no refund shall be payable to him, regardless of the outcome of the case. (9-0 vote)