North Carolina State Bar Ethics Opinions
Free plain-English summaries of legal ethics opinions issued by the North Carolina State Bar, with full citations and source links on every page.
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When a contingency-fee lawyer wins a structured settlement paid over years, can the lawyer collect the full fee up front and without discounting the future payments to present value?
The opinion concluded that a lawyer entitled to a percentage contingent fee may collect immediately only the prescribed percentage of the total settlement reduced to its present value, when the recove…
Can a law firm take an assignment of a client's judgment as payment or security for fees while it is still handling the appeal of that judgment?
The opinion concluded that a firm may not take an assignment of a client's judgment while it is conducting the appeal of that judgment, because Rule 5.3(a) bars a lawyer from acquiring a proprietary i…
Can plaintiff's counsel agree to bear all or part of the costs of litigation, whether in a class action or an ordinary civil suit?
The opinion concluded that an attorney may never ethically agree to be ultimately responsible for the costs of litigation. Rule 5.3(b) lets a lawyer advance litigation costs only if the client remains…
If a criminal case ends early, must a lawyer refund part of a flat fee even though the fee was described as nonrefundable?
The opinion concluded that, because a lawyer may never charge or collect a clearly excessive fee, the lawyer must look back at all the circumstances to decide whether the flat fee was reasonable; to t…
Can a lawyer put a clause in the engagement agreement requiring any future fee or malpractice dispute with the client to go to binding arbitration?
The opinion concluded that a lawyer may suggest, and even require by an engagement-letter clause, that future disputes with the client be referred to a private alternative dispute resolution program f…
Can a lawyer lend money to a personal injury client during the case, for living expenses or anything beyond litigation costs?
The opinion concluded that a lawyer generally may not advance or guarantee financial assistance to a client during contemplated or pending litigation. The one narrow exception lets the lawyer advance …
Can a criminal defense lawyer pay a client's fine and court costs up front, expecting the client to reimburse him?
The opinion concluded that a lawyer may advance a client's fine and court costs from the lawyer's own funds while representing the client in pending litigation, so long as the client remains ultimatel…
When a client stops responding, can the lawyer take a fee and pay a doctor's lien out of the client's trust funds without the client's direction?
The opinion concluded that a lawyer may not take a fee from a client's trust balance or pay a doctor's lien out of it without the client's direction. The trust-account rule requires the lawyer to pay …
After being appointed to defend an indigent criminal client, can the lawyer accept private payment from that client to keep representing them in the same case?
The opinion concluded that appointed counsel may not accept payment from the client because appointment rules and the illegal-fee rule limit compensation to what the court awards; if the client wants …
Can a law firm treat a single all-inclusive fee as earned, deposit it all in its general account, and pay litigation costs from there if the client agreed in writing?
The opinion concluded no: part of an all-inclusive 'fee' that is really intended to cover litigation costs is an entrustment, and the trust-accounting rules require funds received in a fiduciary capac…
Can a law firm require all clients to pay a nonrefundable retainer, and how is a true retainer different from an advance fee deposit for trust-accounting purposes?
The opinion concluded that a lawyer may charge a reasonable nonrefundable retainer as consideration for the exclusive use of the lawyer's services and, because the arrangement is unusual, should expla…
Can a firm holding a client's refunded appeal-bond money in trust keep it to satisfy unpaid fees the client owes?
The opinion concluded that the firm may not apply the refunded appeal-bond funds to unpaid fees unless its agreement with the client authorizes taking fees from funds held for the client, because trus…
Can a lawyer charge a contingent fee to collect undisputed medical-payments benefits under a liability policy?
The opinion concluded that an elevated contingent fee is unreasonable where there is no real risk of nonpayment, as with undisputed med-pay claims; without genuine uncertainty about recovery at the ti…
Can insurer-appointed defense counsel for uninsured motorists withdraw once the insurer settles with its own insured and wants to pursue subrogation against those same motorists?
The opinion concluded that the lawyer may not simply withdraw from the uninsured motorists he represents; he must comply with the tribunal's rules, take reasonable steps to avoid foreseeable prejudice…
Can a lawyer turn past-due client accounts over to a collection agency, including paying the agency a percentage of what it collects?
The opinion concluded that a lawyer may employ a collection agency for delinquent client accounts, even on a percentage basis, if the original fee was proper, the client was not known to be unable to …
Can a lawyer charge a contingent fee, a percentage of what is collected, to enforce a court order for past-due child support?
The opinion concluded that a lawyer is not automatically barred from a contingent fee to collect specific past-due child support reduced to a sum certain, but must avoid an excessive fee; where collec…
Can a lawyer let clients pay legal fees with a credit card such as Master Charge?
The opinion concluded that it is ethical for a lawyer to offer credit card services to clients for the payment of fees for services rendered.
Can a lawyer who owns a substantial interest in a title insurance company certify title to that company in a real estate deal and take compensation from it?
The opinion concluded that it is unethical for a lawyer who owns a substantial interest, directly or indirectly, in a title insurance company, agency, or agent to certify title to it in a real estate …
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Legal ethics opinions from the North Carolina State Bar 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.