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 98-32B
Plaintiff's attorney has left his former law firm, taking a file with him by consent. The agreement between attorney and former firm is, at time of settlement, to reimburse each for costs expended and to divide the fee equally. Attorney believes that the costs being charged by the former firm have been inflated and are greater that the actual cost incurred. Attorney believes this is improper, even though former firm claims to have obtained an opinion from a "consulting legal ethics attorney" that the practice is proper.
QUESTION:
1. What should attorney do?
2. Would the opinion of the "consulting legal ethics attorney" be a safe haven for attorney should he choose to pay the costs?
SUMMARY:
1. Attorney must inform client if he believes costs being charged are improper. If client objects to paying the costs, then attorney must hold the amount of the costs until the dispute is resolved.
2. An opinion from a "consulting legal ethics attorney" would not protect attorney from any action by client.
OPINION:
1. Rule 1.4(b) requires an attorney to explain a matter to the extent reasonably necessary to permit the client to make informed decisions regarding the representation. There are few matters more important to a client than how his or her money is to be spent. Consequently, attorney has a duty to explain to the client the costs being paid in a case and the basis. If attorney believes costs are not proper, he certainly must inform the client of this. If the client chooses to pay the costs, attorney may disburse accordingly. If client objects to the costs, attorney must hold the amount of the costs, or interplead them into Court, until the matter is resolved between client and former firm. Also, excessive charges must be pointed out to the client.
2. The Supreme Court alone has authority to determine whether an attorney has violated ethical rules. A judge or jury would determine if the attorney has committed malpractice. While either could take cognizance of an opinion from a "consulting legal ethics attorney," such would not insulate attorney from action in either case.