Florida Supreme Court rejects Bar proposed rule amendment on resolution of extraordinary liens in contingency matters

Hello and welcome to this Ethics Alert update blog which will discuss the Florida Supreme Court’s rejection of a proposed amendment to Florida Bar Rule 4-1.5(f) which would have permitted a lawyer to retain and pay another lawyer (or non-lawyer entity) to resolve extraordinary liens in contingency matters and pay that lawyer’s fee from the settlement proceeds.  I previously blogged about the proposed revisions to Rule 4-1.5(f) in my 6/6/13, 9/5/13, and 12/14/15 Ethics Alerts.

The October 6, 2016 Florida Supreme Court opinion rejected the Bar’s proposed amendment to Rule 4-1.5(f) which would have specifically permitted the lawyer/client to retain an “extraordinary lien and subrogation lawyer” to resolve extraordinary liens and be paid a fee by the client beyond the contingent fee.  The Florida Supreme Court opinion is here:  http://www.floridasupremecourt.org/decisions/2016/sc16-104.pdf

In rejecting the Florida Bar’s proposed amendment to 4-1.5(f), the opinion stated:

On balance, we wish to reemphasize that lawyers representing clients in personal injury, wrongful death, or other cases where there is a contingent fee should, as part of the representation, also represent those clients in resolving medical liens and subrogation claims related to the underlying case. This should be done at no additional charge to the client beyond the maximum contingency fee, even if the attorney outsources this work to another attorney or non-attorney.

Although it may be true that, given the increased complexity of modern litigation, there will be some cases where the amount of work required to resolve a lien is more than initially anticipated, the notion of the percentage fee contract contemplates that there will be some cases that are profitable for the lawyer handling the claim and others that are unprofitable. That risk and reward is built into the contingency fee contract. 

If the circumstances of a particular case are such that the fee generated under the contingency fee agreement is expected to be insufficient for the work of resolving any outstanding lien, the attorney and client can seek leave of court pursuant to rule 4-1.5(f)(4)(B)(ii) of the Rules Regulating the Florida Bar to obtain an increased fee appropriate for the circumstances of the specific case.  (emphasis supplied).

Bottom line:  Pursuant to the language in the Court’s opinion, lawyers should be wary of participating in an agreement with a third party in which the client would pay a percentage of any reduction in the lien amount or any other payment for the reduction/resolution of the lien.

Be careful out there.

Disclaimer:  this Ethics Alert blog is for informational purposes only, is not an advertisement, and does not contain any legal advice and the comments herein should not be relied upon by anyone who reads it.

Joseph A. Corsmeier, Esquire

Law Office of Joseph A. Corsmeier, P.A.

29605 U.S. Highway 19 N. Suite 150

Clearwater, Florida 33761

Office (727) 799-1688

Fax     (727) 799-1670

jcorsmeier@jac-law.com

www.jac-law.com

Joseph Corsmeier

about.me/corsmeierethicsblogs

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About jcorsmeier

Joseph A. Corsmeier is an “AV” rated attorney practicing in Clearwater, Florida. He concentrates his practice primarily in the areas of defense of attorney disciplinary matters before The Florida Bar, attorney admission matters before the Florida Board of Bar Examiners, and professional license and disciplinary matters before the Boards of the State of Florida. He provides expert analysis and opinion on conflict of interest and other attorney disqualification and legal malpractice issues and he testified as an expert in the Florida courts. He served as an Assistant State Attorney in the Sixth Judicial Circuit from 1986 to 1990 where he prosecuted felonies exclusively from June 1987, and as Bar Counsel for The Florida Bar’s Department of Lawyer Regulation from 1990 to 1998. He also practices in the areas of estate planning and Medicaid qualification, workers’ compensation, and labor law. Mr. Corsmeier is the author of numerous articles for various bar publications, has spoken at numerous local and statewide seminars on various topics, including ethics and professionalism, and was an instructor of legal ethics for paralegals at Rollins College until the Tampa campus closed. He received his undergraduate degree from Florida State University and his J.D. from Mercer University. He is admitted to practice in all Florida Courts, the Supreme Court of the United States, the United States Court of Appeals for the Eleventh Circuit, and the Middle District of Florida. He is a member of The Florida Bar, American Bar Association, the Association of Professional Responsibility Lawyers, and the Clearwater and St. Petersburg Bar Associations.
This entry was posted in Attorney ethics, Contingency fees - lawyer retaining another lawyer or entity to resolve liens, corsmeier, Florida Bar ethics, Florida Bar Rules, Florida Supreme Court, Florida Supreme Court opinions, Florida Supreme Court rejection of Bar proposed rule amendment on resolution of extraordinary liens in contingency matters, joe corsmeier, joseph corsmeier, Lawyer Ethics, Uncategorized and tagged , , , , . Bookmark the permalink.

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