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Can a lawyer change a contract from an hourly fee to a contingency fee six months after filing a lawsuit?

Spokane, WA |

After my husband was fired from his job due to ADA discrimination, our lawyer thought he could negotiate his job back. We signed a fee agreement based on his hourly rate. When that didn't work, the lawyer said it was time to file a lawsuit and that it would be on a contingency basis. The lawyer said he would tell us when it was time to sign it. He had us wait six months during which time he kept charging us hourly rates and sending invoices for work on the lawsuit. He said it was time to sign the contingency starting the next calendar year talking about how expensive trials and depositions are. After that, he refused to do any discovery on our behalf and said if we didn't mediate he would renegotiate his representation of us. Husband and I both have a mental disability.

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Attorney answers 2

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Posted

You should consider consulting with a different lawyer, one who specializes in legal ethics or legal malpractice. There is not a simple answer to the questions you have posed and many other facts will affect the analysis. There are excellent lawyers in your area who can help you with this.

In theory, a lawyer and client can agree to modify their fee arrangement. However, once a fee agreement has been signed, the lawyer is in a fiduciary relationship to the client and must be able to show that any modification is fair and reasonable to the client. A modification of the fee agreement that increases the lawyer's gain is inherently suspect. In your situation, switching to a contingency fee agreement for purposes of filing a lawsuit may have reduce your fees considerably, although it is impossible to know that for certain or in advance, and it is quite common for litigation of this sort to be conducted on a contingent-fee basis. A critical issue, which you point out, is the several months of continued hourly billing between the time the lawyer raised the need to switch to a contingency fee agreement and the time the lawyer actually agreed to make the change.

Some of the other factors that would be important to consider include: (a) the scope and duration of the initial fee agreement; (b) the advice the lawyer gave concerning the proposed fee modification; (c) whether the lawyer suggested or recommended getting another opinion; (d) why the lawyer waited to switch to the contingency fee agreement; and (e) the nature of the work performed in the interim. There are other issues as well; this is just to highlight some obvious considerations.

In your comment, you mentioned ABA Formal Opinion 11-458. ABA Formal Opinions are not binding on lawyers in Washington. The law in this state is based on the Washington Rules of Professional Conduct and cases decided by the Washington Supreme Court. For many years, the Washington State Bar Association (WSBA) issued Formal and Informal Opinions on ethics issues, but the Supreme Court held a few years ago that even WSBA Formal Opinions are advisory, not binding. Now, the WSBA has combined all of its Formal and Informal opinions into one large group of "Advisory Opinions." There's a searchable database of them on the WSBA website. Given that they are not binding, however, they are not all that useful, and in some cases, they are outdated and misleading.

Although the ABA Formal Opinion is not binding, it gives a good overview of the law on modifying fee agreements. You should also understand, though, that ABA Formal Opinions are based on the ABA Model Rules of Professional Conduct. Washington's Rules of Professional Conduct are not identical to the ABA Rules. This is another reason why it is important to consult with a lawyer well-versed in Washington ethics law to get advice on whether your lawyer violated any rules and what your options are.

Going beyond the modification of the fee agreement, you have raised issues of your mental disability and the lawyer's conduct after the new fee agreement was signed. These are separate issues, but ones you should also discuss with a different lawyer.

Every person and every case is unique and the information I provide on this forum is not a substitute for consulting with an attorney licensed in your jurisdiction to obtain appropriate legal advice specific to your situation. Any information I have provided is of a general nature. It is not legal advice and should not be construed as such. I am unable to give you legal advice on this forum. Further, I am not your lawyer and by providing information on this forum, I am not agreeing to enter an attorney-client relationship with you. Communications on this forum are not privileged or confidential and should not be treated as such. It is unwise to disclose information of a confidential or personal nature on this forum. If you are unable to afford an attorney in a criminal matter, the court should be able to appoint counsel for you at no cost to you. Also, most state bar associations can provide contact information for free or low-cost legal advice.

Posted

In WA, an attorney may not enter into a contingency fee arrangement with his client on a matter involving a criminal law violation or a family law proceeding. Other than the prohibition against contingency fee agreement in those two areas, the attorney and client may enter into a contingency fee agree with each other as long as the attorney takes certain steps (such as having a written agreement).

An attorney may have a duty to take special steps when representing a client who has a mental disability to avoid any appearance that the attorney is taking advantage of the client.

I am not sure I understand how your husband has been harmed by having a contingency fee arrangement instead of having to paid by the hour. Unless your husband knows for sure that he is going to win the case or the contingency fee is high, he may end up paying less under a contingency fee arrangement instead of paying by the hour.

Under a contingency fee arrangement, if your husband does not win the case, he should not owe fees for the attorney's work. (Your husband may still owe costs, filing fees, and similar expenses.)

You can call the WA State Bar Association for information. The WSBA licenses and regulates attorneys in WA. Its website is www.wsba.org .

Your husband can also review the specific facts with another attorney to see whether the first attorney is following the law and ethical rules.

Asker

Posted

I thought that the new ABA ethics opinion: Modification of fee agreement would apply. Formal Opinion 11-458. The mental disability would show that it would be easier for the lawyer to do this.