The Absent Ethics of Legal Fees : Putting Profit-Seeking in Its Place

A lawyer must be a loyal ally for an individual with a authorized want. This loyalty is on the core of our career’s worth proposition to society. Thus, authorized ethics strives to ensure devoted service to purchasers. Battle of curiosity guidelines prohibit all conditions creating “substantial danger” that the lawyer’s loyalty to a shopper “can be materially and adversely affected by the lawyer’s personal curiosity.” Attorneys, as fiduciaries, should be “involved solely for the beneficiary [client]’s pursuits, by no means the fiduciary [lawyer]’s personal.”

There may be, nonetheless, a evident exception to the obligation of selfless loyalty to purchasers. Attorneys are allowed to pursue their very own pecuniary pursuits in accumulating charges, on the expense of the purchasers who pay them. When a lawyer acts to acquire charges from a shopper, (s)he’s clearly not appearing as a fiduciary who places the beneficiary’s curiosity first.

Everybody deserves to be paid for his or her work, and with out the revenue motive only a few authorized companies can be made obtainable to anybody. Nevertheless, authorized ethics should reconcile legal professionals’ self-interested pursuit of charges with the overall prohibition of conflicts of curiosity, and with the commonly fiduciary nature of the lawyer-client relationship.

I don’t assume that Canadian authorized ethics has adequately squared this circle. Guidelines of skilled conduct, that are very long-winded on many subjects, are extraordinarily terse on the subject of charges. The Mannequin Code of Skilled Conduct, a 122 web page doc, dedicates solely four pages to the subject, which may be very advanced. Fees should be “truthful and affordable” and “disclosed in a well timed trend,” however there’s little or no steerage about whether or not particular billing and retainer-drafting practices adjust to these imprecise directives. A earlier column, and feedback thereto, listed “Corridor of Disgrace” shady billing practices utilized by Canadian legal professionals that aren’t particularly forbidden by the Guidelines. These embody legal professionals arbitrarily awarding themselves bonuses from shopper funds, charging “disbursements” at charges that generate revenue for the agency, and over-lawyering information simply because there’s large cash concerned.

Excessively directive regulation can choke versatile and inventive skilled service. However, the inherent battle of curiosity concerned in fee-seeking requires extra detailed guidelines. In different conditions the place legal professionals act in opposition to their purchasers, the Guidelines are admirably fulsome. An instance is the lawyer defending a shopper who has privately admitted guilt, however needs to plead “not responsible.” This lawyer should refuse sure defence methods, even when these methods would manifestly serve the shopper’s pursuits. When refusing to mislead the courtroom, the lawyer doffs the garb of shopper ally, and dons the garb of officer of the courtroom. The Guidelines rightly acknowledge that permitting (or requiring) a lawyer to behave in opposition to her shopper’s pursuits is to not be finished flippantly. Thus, Rule 5.1-1 Commentary 10 fastidiously delineates precisely what a lawyer in this place could and will not do.

Like avoiding an unethical defence technique that would result in a “not responsible” verdict, pursuing the shopper’s cash is a mandatory – however jarring — notice in a usually fiduciary lawyer-client relationship. In some shopper conferences, an ungainly second comes when the lawyer strikes between (i) information-gathering, advice-giving, and strategy-devising in the shopper’s curiosity, to (ii) demanding or negotiating fee of overdue authorized charges, in the lawyer’s curiosity. When this happens, the lawyer doffs the garb of the shopper’s loyal ally, and dons the garb of the self-interested businessperson. For such a big, and probably problematic costume change, it’s inadequate for authorized ethics to merely mutter vaguely that the lawyer should be “truthful and affordable.” The regular stream of payment disputes proves the inadequacy of the established order.

Each purchasers and legal professionals should know precisely what choices and proposals the lawyer could make qua profit-seeking businessperson. I feel the Legislation Society of Ontario’s transfer towards necessary retainer agreements is a step in the best route, which must be prolonged from contingency charges into different billing fashions as nicely. Below a compulsory retainer settlement, the lawyer-qua-profit-seeker “bids” a small outlined record of worth phrases to the shopper – e.g. hourly price, contingency proportion, and money retainer deposit requirement. Exterior of this stuff, none of the retainer phrases could be drafted in a self-interested means by the lawyer. Revenue-seeking is an ungainly however mandatory half of the lawyer-client relationship. Applicable regulation can cut back its potential to contaminate all the relationship with mistrust and uncertainty.

The Absent Ethics of Legal Fees : Putting Profit-Seeking in Its Place

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