State Bar of California Ethics Opinions
Free plain-English summaries of legal ethics opinions issued by the State Bar of California, with full citations and source links on every page.
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What must a California lawyer do when charging a flat fee, refunding an advance flat fee after early termination, or renegotiating a flat fee mid-engagement?
The opinion concludes a California lawyer must clearly state which services the flat fee covers and when it is earned, must refund any unearned portion of an advance flat fee on early termination (eve…
What ethical duties does a California lawyer owe when a third-party litigation funder is involved in the case?
Per California Formal Opinion 2020-204, lawyers must preserve independent professional judgment, comply with the duty of confidentiality, obtain the client's informed written consent before sharing co…
When a third party pays the lawyer's fees for the client and unused funds remain in the trust account at the end of the case, who gets the refund?
Per California Formal Opinion 2013-187, absent a fee agreement specifying otherwise, the lawyer must return the surplus to the third-party payor, not the client, because the concept of 'refund' implie…
In a transactional negotiation, does a California lawyer have a duty to alert opposing counsel to (A) an apparent material error opposing counsel made or (B) a material change the lawyer made in revised contract language?
Per California Formal Opinion 2013-189, no duty arises in Scenario A if the lawyer did not induce opposing counsel's error; in Scenario B, once the lawyer realizes that an unintended defect in the red…
In settling a fee or malpractice dispute with a former client, what kinds of representations or agreements about not filing a State Bar complaint can a California lawyer ask for, and what is foreclosed by Business and Professions Code section 6090.5?
Per California Formal Opinion 2012-185, section 6090.5 bars seeking any written or oral client agreement not to file a State Bar complaint, and may also bar settlement recitations of the client's past…
When does a California lawyer violate the rule against inducing a substantial gift from a client?
Per California Formal Opinion 2011-180, a lawyer who demonstrates by words or conduct an intent to cause a client to give the lawyer a substantial gift violates former Rule 4-400, and whether a gift i…
When a California lawyer settles a fee dispute with a client, may the settlement agreement include a general release and a Civil Code section 1542 waiver that also covers legal malpractice, and what does the lawyer have to do first?
Per California Formal Opinion 2009-178, a lawyer must promptly disclose to the client the facts giving rise to any actual or potential malpractice claim before entering into such a settlement. The law…
When a settlement check in a California personal injury matter is made jointly payable to the client, the former attorney with a charging lien, and successor counsel, may the former attorney refuse to endorse it without violating former Rule 4-100(B)(4), and what must she do with the undisputed portion the client demands?
Per California Formal Opinion 2009-177, yes, the former attorney may refuse to endorse, because endorsing would extinguish her charging lien under Civil Code section 2913 (per Feldsott). But she must …
In a California case under a fee-shifting statute, may plaintiff's counsel block a settlement her client wants to accept because it waives statutory fees, and does defense counsel violate any ethical rule by recommending or conveying a fee-waiver settlement offer, either in a particular case or as a general practice?
Per California Formal Opinion 2009-176, no on all three counts. Plaintiff's counsel must inform the client of a fee-waiver settlement offer and consummate it in accordance with the client's wishes, ev…
When a California client tells her new lawyer not to notify her prior lawyer (who has a valid charging lien on the recovery) of a settlement, what may and must the successor lawyer do with the disputed fees held in her trust account?
Per California Formal Opinion 2008-175, the successor lawyer must first counsel the client on the adverse consequences of concealing the settlement, then, if the client persists, must nonetheless disc…
May a California attorney accept payment of earned legal fees, deposits for unearned fees, and advances for costs and expenses by credit card?
Per California Formal Opinion 2007-172, yes for earned fees and yes for deposits of unearned fees, in each case taking care to discharge the duty of confidentiality (the charge-slip description must b…
Once an attorney has properly withdrawn a fee from the Client Trust Account at the earliest reasonable time after the interest became fixed, does the attorney have to redeposit the fee if the client later disputes it?
Per California Formal Opinion 2006-171, no. Once a fee has been properly withdrawn from a CTA under former Rule 4-100(A)(2), the funds cease to have trust account status; a later client dispute is a m…
Does the inclusion of a charging lien in a contingency fee agreement require California compliance with former Rule 3-300, including written advice to consult independent counsel and written client consent?
Per California Formal Opinion 2006-170, no. A charging lien is a natural corollary of a contingency fee agreement and does not create an 'adverse interest' under former Rule 3-300, distinguishing *Fle…
What may a California lawyer do for a missing client who already authorized settlement of claims within a defined range, and how must the lawyer handle settlement proceeds and fees?
Per California Formal Opinion 2002-160, an attorney who has been given express authority to settle claims at or above a specified percentage of face value retains independent ethical duties (competenc…
Can a California lawyer refer a prospective client to an independent broker for a real-estate loan to pay legal fees, with the loan proceeds going into a third-party escrow from which the lawyer is paid?
Per California Formal Opinion 2002-159, the lawyer may make the referral and use the escrow arrangement so long as the lawyer receives no compensation for the referral, has no undisclosed business or …
When a California lawyer also offers non-legal services like investment advising, when do the Rules of Professional Conduct apply, can the lawyer market with 'Esq.' and tax credentials, and is a referral commission from a portfolio manager a Rule 1-320 fee-share?
Per California Formal Opinion 1999-154, when the same lawyer is providing legal and non-legal services to a client, all of the services are subject to the Rules; Rule 1-400 applies to non-legal market…
When discovery sanctions are sought (or awarded) against a California lawyer and the client jointly, what must the lawyer do to satisfy the duties to inform the client, oppose the motion, and (where necessary) withdraw?
Per California Formal Opinion 1997-151, a motion for discovery sanctions against the lawyer and client is ordinarily a significant development the lawyer must communicate under former Rule 3-500; an o…
May a California lawyer pay a non-expert witness for time spent preparing for a deposition or trial, even when preparation does not cause a loss of income?
Per California Formal Opinion 1997-149, a lawyer may pay a non-expert witness for time spent preparing for a deposition or trial, but must comply with former Rule 5-310(B). Compensation for preparatio…
When a California lawyer works on more than one client's matter during the same time period, may the lawyer bill each client a full hourly rate (or a multiple of it) for that time?
Per California Formal Opinion 1996-147, a lawyer may not bill more than one client at full hourly rates for the same time period, or bill a single client a multiple of that rate for shared time, unles…
Can a California lawyer advise a client to buy insurance, refer the client to a specific insurance agent, and accept a commission from that agent for the referral?
Per California Formal Opinion 1995-140, a lawyer may do so only by making full written disclosure under former Rule 3-310(B)(4) of the referral arrangement and its actual and reasonably foreseeable ad…
When does a California lawyer's compensation of a non-employee outside lawyer constitute a 'division of fees' triggering former Rule 2-200's client-consent requirement, and when must the client be told about the outside lawyer's involvement?
Per California Formal Opinion 1994-138, former Rule 2-200(A) applies when the outside lawyer is paid a portion of the fee paid by the client. It does not apply where (1) the amount paid to the outside…
Can a California lawyer contract with a client at the outset of representation in a civil rights case that the client irrevocably assigns to the lawyer the right to seek and collect attorney's fees under 42 U.S.C. section 1988, so the client cannot waive that right in settlement?
Per California Formal Opinion 1994-136, such agreements are not prohibited in 42 U.S.C. section 1988 actions so long as the lawyer fully complies with former Rule 3-300 (business transactions or pecun…
Under a California contingent fee agreement, if the contract is silent on payment from a structured settlement, may the lawyer take her fee in full from the up-front cash payment, or can she agree in advance to do so?
Per California Formal Opinion 1994-135, where the contract is silent, the lawyer may take her fee only on the same pro rata basis the client receives compensation; she cannot front-load her fee at set…
Under former California rules, may a probate lawyer receive the statutory probate legal fee from the estate and, separately, personal compensation from the executor for performing some of the executor's duties?
Per California Formal Opinion 1993-130, yes, but only if (i) the estate is not paying twice for the same service, (ii) the lawyer obtains the executor's informed written consent, (iii) the agreement c…
May a California attorney-client retainer agreement include a mandatory binding arbitration clause for future malpractice claims against the attorney?
Per California Formal Opinion 1989-116, yes. The committee opined that nothing in the rules prohibits an arbitration provision in the initial retainer. For an initial retainer (no prior attorney-clien…
In a federal civil rights or other private-attorney-general case, must a California lawyer tell the client that the client can settle by waiving the statutory attorney's fees, even though doing so will leave the lawyer unpaid?
Per California Formal Opinion 1989-114, yes. Because the U.S. Supreme Court treated statutory fee awards as the client's property, the lawyer's duties of communication under former Rules 3-500 and 3-5…
Under former California Rule 2-109, may a lawyer offer or accept a settlement provision that bars plaintiff's counsel from later representing anyone in litigation or arbitration against the settling defendant?
Per California Formal Opinion 1988-104, no. Both the offering and the accepting lawyer violate former Rule 2-109, which prohibits a member from being party to any agreement, whether or not in connecti…
Can a contingent-fee lawyer recommend a structured settlement, and how is the lawyer's fee calculated on one?
The committee concluded that a lawyer may use structured settlements and may recommend that a client accept or reject one even though the lawyer's contingent fee is affected, because contingent-fee ar…
Can a California lawyer take a divorce case on a contingent fee?
The committee concluded that a contingent fee in a dissolution proceeding is not per se improper if it is not promotive of divorce and the fee is not unconscionable; recovering past due spousal or chi…
Can a California lawyer raise the client's fee to recover the percentage the lawyer must pay back to a lawyer referral service?
The committee concluded that, although a lawyer may participate in a qualified lawyer referral service and pay it a percentage of fees, the lawyer may not raise the fee charged to the client to cover …
Can a California lawyer who is also a licensed real estate broker act in both roles in the same real property transaction for a client?
The committee concluded that a lawyer may also act as a licensed real estate broker in the same transaction, but the broker work is so law-related that the lawyer must meet State Bar standards through…
Can a California lawyer mail nonclients letters quoting fees for routine services and describing the firm's qualifications?
The committee concluded that mailing nonclients letters that state fees and costs for routine legal services and describe the firm members' qualifications is not prohibited, so long as the letters are…
Can a lawyer take a promissory note or a security interest from a client to secure payment of fees?
The committee concluded that a lawyer may take a promissory note or a lien or other security interest to protect fees for services, but only in strict compliance with former Rule 5-101, which required…
Can a California lawyer put a binding fee-arbitration clause in a retainer agreement that the client signs before any fee dispute exists?
The committee concluded that a lawyer may not condition employment on a client's advance agreement to binding fee arbitration; a binding waiver of the right to a trial de novo may be made only after a…
Can a lawyer guarantee or indemnify a client's litigation cost bond, and does the size of the bond change the analysis?
The committee concluded that a lawyer is not ethically barred from guaranteeing a client's obligation to a surety on a litigation bond, treating it like advancing litigation costs, but that for a rela…
Can a California lawyer charge interest on a client's past-due bill, and can the lawyer change the interest rate later?
The committee concluded that a lawyer may charge interest on past-due receivables if the client gives informed consent in advance, and that the rate may not later be changed unless the original fee ag…
Can a lawyer require a new client to agree, as a condition of being hired, to arbitrate any future legal malpractice claims against the lawyer?
The committee concluded a lawyer may not condition employment on the client's agreement to arbitrate future malpractice claims unless the lawyer is satisfied the client is fully advised of the possibl…
Can a California lawyer advance the costs of a lawsuit for a client who probably cannot repay them, when the lawyer is unlikely to sue the client to collect?
The committee concluded it is ethically proper to advance litigation costs even where repayment is unlikely, provided the client remains ultimately responsible for the costs and is informed of that ob…
Can a California lawyer defend a subordinate in a criminal case when the boss pays the fee on the condition that the subordinate not cooperate with the prosecution?
The committee concluded the representation may not properly be undertaken under those facts. Even with the subordinate's informed written consent, the lawyer could not honestly assure the client that …
Can California lawyers agree, when their partnership dissolves, that a former partner who later probates a named client's will must split the fee with the other former partners or their heirs?
The committee concluded the arrangement is improper. It violates former Rule 2-108 because the retired or separated partner performs no services and assumes no responsibility on the matter, and former…
Can a lawyer delay a client's divorce case to pressure the client into paying fees?
The committee concluded it was not proper for an attorney to delay a divorce case because of nonpayment while remaining the attorney of record, since that conflicts with the client's interest in promp…
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Legal ethics opinions from the State Bar of California interpret the rules of professional conduct for working lawyers, in response to inquiries from members and committees. They are not binding like court discipline decisions, but courts and discipline boards treat formal opinions as substantial guidance on how the rules apply. Every opinion above has a plain-English question and short answer, plus a link to the original source on the bar's site.