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Ethics Opinion

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This opinion has been questioned and modified in ethics opinion R-19, effective August 4, 2000.

RI-203

March 29, 1994

SYLLABUS

    A lawyer may not ethically exercise a retaining lien on client property if the client needs the property to pursue the client's legal rights or when a refusal to turn over the file would prejudice the client's case.

    In the absence of an agreement for the client to pay for file copies, a lawyer may not ethically charge the client for copying the representation file.

    A withdrawing lawyer may not condition release of a client's property on the agreement by successor counsel to pay or advance the unpaid portions of a client's bill.

    References: MRPC 1.5, 1.8(a), 1.8(e), 1.8(j), 1.16(d); CI-623, CI-628, CI-722, CI-743, CI-758, CI-766, CI-845, CI-926.

TEXT

A defendant in a divorce action retains a lawyer. At the time the professional relationship commences, an agreement is signed whereby the lawyer will represent the client. The client will pay for services at a given rate per hour and pay specified advanced costs and expenses that are incurred. The client paid a minimum amount of money per month but later failed to pay for the legal services. The lawyer informed the client in writing that the client should bring the account current within ten days or a motion would be filed to withdraw from representation.

To facilitate a transition, the withdrawing lawyer offered to provide the file if the client meet certain conditions including the payment by successor counsel of the copying costs for the contents of the client's file. Successor counsel insists that the file be turned over without the payment of the copying costs. If the withdrawing lawyer refuses, successor counsel will report the matter to the Attorney Grievance Commission for "unethical" conduct. The withdrawing lawyer believes that releasing the client file will be a release of the retaining lien.

The questions posed to this Committee are as follows:

  1. May a lawyer ethically exercise a retaining lien when a client has an outstanding bill for legal service fees, advanced costs and expenses incurred and require the client to make a reasonable effort to make payments as agreed to at the inception of the lawyer/client relationship?
  2. May the withdrawing lawyer require the client to secure the unpaid fee from assets distributed to the client in a divorce action?
  3. May the lawyer require that successor counsel recognize a "lien" against the divorce assets as a condition of releasing the retaining lien?
  4. May the withdrawing lawyer charge the client or the successor counsel for the cost of copying the file?

Questions concerning the method of payment of the legal fees, and whether a lawyer has a valid lien, are questions of law beyond the jurisdiction of this Committee. ABA Op 209 quoted with approval from ABA Op 63:

    "Any question as the amount of an attorney's fee or method of its payment is a matter of contract, expressed or implied to be construed as other contracts are construed. Any controversy concerning such a matter is a matter of law to be determined by the courts. Ordinarily no ethical question is involved in such a controversy."

While the enforceability of the lawyer's possessory lien is a legal matter, consideration should be given to the ethical standards imposed upon the lawyer. MRPC 1.5 discusses the reasonableness of the fees. MRPC 1.8(a) prohibits a lawyer from entering into a business transaction with a client unless certain requirements are met. MRPC 1.8(j) allows the acquisition of a lien granted by law to secure the lawyer's fee or expenses.

The Michigan Rules of Professional Conduct are clear concerning the obligation to provide documents to the client or to successor counsel at the request of the client. Upon termination of the lawyer/client relationship, MRPC 1.16(d) states:

    "(d) Upon termination of representation, a lawyer should take reasonable steps to protect a clients interests, such as giving reasonable notice to the client, allowing time for employment of other counsel, surrendering papers and property to which the client is entitled, and refunding any advance payment of fee that has not been earned. The lawyer may retain papers relating to the client to the extent permitted by law." Emphasis added.

For further information on what a client is "entitled to receive," see CI-722, CI-743, CI-758, CI-766.

This Committee has previously addressed the possibility of retention of the client's file upon the payment of the legal fees when there is pending litigation. CI-628. A lawyer may not ethically exercise a retaining lien on client property if the client needs the property to pursue the client's legal rights or when a refusal to turn over the file would prejudice the client's case. The Committee has concluded that it would be improper for a lawyer to condition the release of the file upon the payment of the fees. CI-623.

If the file is being turned over to a new lawyer, the purpose of the retention of the papers by the lawyer must be examined to determine who should be responsible for the costs of copying. If the only purpose is to provide the lawyer with a copy of the file in the event that questions should arise at a later date concerning representation of the client, then the cost of copying should be the responsibility of the withdrawing lawyer as the copying is being done for the withdrawing lawyer's benefit. CI-845.

While the obligation to pay for the copies is also a legal contractual issue, in the situation where there is no agreement as to who should pay the costs, the lawyer may not ethically charge the client for production of the files that the client is entitled to receive. CI-926. The inquiry posed takes this situation a step further and seeks to impose a condition of payment of the costs of copying upon successor counsel. Since the withdrawing lawyer has no contract with successor counsel, and MRPC 1.8(e) prohibits a lawyer from providing financial assistance to a client in connection with pending or contemplated litigation, a withdrawing lawyer may not require successor counsel to pay the client's overdue bills. Successor counsel may agree to cover advanced costs and expenses, but is not required to do so.

 
     

 

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