UPON THE REQUEST OF A MEMBER OF THE SOUTH CAROLINA BAR, THE ETHICS ADVISORY COMMITTEE HAS RENDERED THIS OPINION ON THE ETHICAL PROPRIETY OF THE INQUIRER鈥橲 CONTEMPLATED CONDUCT. THIS COMMITTEE HAS NO DISCIPLINARY AUTHORITY. LAWYER DISCIPLINE IS ADMINISTERED SOLELY BY THE SOUTH CAROLINA SUPREME COURT THROUGH ITS COMMISSION ON LAWYER CONDUCT.
Ethics Advisory Opinion 94-37
Can an attorney bill a client for a secretary, receptionist or file 91黑料爆料rk's time at an hourly rate where the secretary, receptionist or file 91黑料爆料rk has completed a six-weekend paralegal study certificate?
Summary:
Whether a secretary, receptionist or file 91黑料爆料rk is a "paralegal" due to the completion of a six-weekend paralegal study certificate is a question of law. This Committee does not render decisions on legal issues. However, there are important ethical issues in this question which must be addressed. An attorney may charge a client a flat hourly rate for services rendered, regardless of whether the services were performed by a lawyer or by support staff, such as a secretary, receptionist or file 91黑料爆料rk, provided the client agrees to the billing arrangement in advance, and the agreement does not call for the attorney to charge or collect an illegal or unconscionable fee, or one that misrepresents the legal services rendered.
Opinion:
Although it is not the responsibility of this Committee to advance opinions on legal issues such as what justifies denoting someone as a paralegal, the Committee does note that the American Bar Association has suggested that "[a] legal assistant is a person, qualified through education, training or work experience, who is employed or retained by a lawyer, law office, governmental agency or other entity in a capacity or function which involves the performance, under the ultimate direction and supervision of an attorney, of specifically-delegated substantive legal work, which work, for the most part, requires a sufficient knowledge of legal concepts that, absent such assistant, the attorney would perform the task." (American Bar Association, Memorandum: ABA Standing Committee on Legal Assistance - Position Paper on Licensure or Certification, and Definition of Legal Assistant (April 24, 1986).
Rule 1.5(a) provides that a lawyer's fee must be reasonable. Under Rule 1.5(b), when the lawyer has not regularly represented the client, the basis or rate of the fee shall be communicated to the client, preferably in writing, before or within a reasonable time after commencing the representation.
Thus, a lawyer has a duty to disclose to a client the amount to be charged for the services rendered by the lawyer's non- lawyer employees. The lawyer may not include such services within the time billed by the lawyer without disclosing that the services were would be performed by non-lawyers. The client should be informed of the rate for each lawyer, paraprofessional, and other non-lawyer who will work on the client's case.
Further, Rule 1.4(b) requires that "[a] lawyer shall explain a matter to the extent reasonably necessary to permit the client to make informed decisions regarding the representation." This obligation suggests that the lawyer must disclose the qualifications of and type of work to be performed by the secretary, receptionist or file 91黑料爆料rk. This duty is supported by Rule 7.1 which provides: "A lawyer shall not make a false or misleading communication about the lawyer or the lawyer's services. A communication is false or misleading if it: (a) contains a material misrepresentation of fact or law, or omits a fact necessary to make the statement considered as a whole not materially misleading." A lawyer may not, therefore, bill a client for paralegal services rendered by an individual who is not performing paralegal services. Likewise, the issuance of paralegal certificates to a lawyer's staff does not transform all of the duties of those individuals into paralegal services. Recent ABA Formal Opinion 93-379 (December 6, 1993) states [i]n the absence of disclosure to the client in advance of the engagement to the contrary, the client should reasonably expect that the lawyer's cost in maintaining a library, securing malpractice insurance, renting of office space, purchasing utilities and the like would be assumed within the charges the lawyer is making for professional services." General overhead expenditures such as the salaries of secretaries, receptionists and file 91黑料爆料rks, therefore, may not be billed to a client in the absence of an agreement to the contrary. "The lawyer's stock in trade is the sale of legal services, not photocopy paper, tuna fish sandwiches, computer time or messenger services." Id.