New Jersey Supreme Court Advisory Committee on Professional Ethics Ethics Opinions
Free plain-English summaries of legal ethics opinions issued by the New Jersey Supreme Court Advisory Committee on Professional Ethics, with full citations and source links on every page.
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Can a New Jersey lawyer charge a contingent fee in a municipal-court motor vehicle or disorderly-persons case, such as refunding the fee if the charge is not reduced?
No. The Committee concluded that RPC 1.5(d)(2)'s ban on contingent fees in criminal cases also applies to quasi-criminal municipal-court matters, so lawyers may not offer to refund fees if a motor veh…
Can a New Jersey lawyer charge a 50 percent contingent fee in a consumer-protection case where the recovery includes statutory attorneys' fees?
The Committee concluded a fixed 50 percent contingency cannot be deemed reasonable per se and cannot be broadly approved where it would exceed the statutory, regulatory, or decisional framework that g…
Can a New Jersey lawyer and client sell a final judgment to a factor at a discount, and can the lawyer use the fee portion as loan collateral?
The Committee found no impropriety in an attorney and client selling a finally concluded judgment to an independent factor at a discount, or in the attorney advising the client of that option, so long…
Can a New Jersey lawyer buy a client's own judgment at a discount?
The Committee held that a lawyer may purchase a client's JUA judgment at a discount, with full RPC 1.8(a) disclosure and written consent, only after judgment has been entered, because the lawyer is th…
With the client's consent, can a lawyer keep the interest on trust funds, trade it for a lower fee, or invest trust funds overnight?
The Committee answered yes to all three: with the client's knowledge and consent, a client may waive interest on funds in a non-IOLTA interest-bearing general trust account (letting the lawyer receive…
Can a New Jersey lawyer charge a nonrefundable retainer?
The Committee held that a nonrefundable retainer is not unethical per se, provided the fee arrangement is fair and reasonable under RPC 1.5; even so, the unused portion should be returned if later eve…
Can a lawyer take a contingent fee to collect unpaid alimony arrears after a divorce judgment?
The Committee concluded that RPC 1.5(d)(1) does not bar a contingent fee for recovering post-judgment alimony arrears, because the action seeks to collect already-determined alimony rather than the in…
Can an attorney who had to withdraw from a driver/passenger case because of a conflict still collect a referral fee for sending one client to a certified trial attorney?
The Committee concluded a referral fee is not authorized: where a counterclaim creates a conflict requiring the attorney to withdraw from representing both driver and passenger, the forwarding of one …
Can a lender's attorney do the borrower's title and closing work, billed through the lender, in a mortgage loan?
The Committee answered 'a clear yes,' it is improper: the arrangement was a scheme to avoid N.J.S.A. 46:10A-6, the statute guaranteeing a mortgage borrower the right to choose his own counsel.
Can a law firm borrow money to advance litigation costs and recover the interest from the client's recovery in a contingent-fee case?
Yes. The Committee found nothing unethical in a firm borrowing to advance disbursements and recovering principal and interest from the recovery, provided the arrangement is disclosed to the client at …
Can a lawyer advertise as a specialist in the legal problems of the elderly and offer reduced or no fees to seniors?
No, as proposed. The opinion concluded the advertisement was misleading and improper because it promised reduced or no fees without stating any definite fee terms, creating unjustified expectations, a…
Can a municipality include its township attorney's fees in the condemnation costs it requires a developer to reimburse, without creating a conflict of interest?
Yes, on these facts. The opinion concluded that where the township attorney represents only the municipality and his services are not subject to the developer's approval, including his fees in the rei…
Can a developer's attorney use a sale contract that makes the buyer reimburse a flat fee for the developer's legal work, including title review and closing documents?
No. The opinion concluded the clause was improper because its broad references to title review and preparation of closing documents are likely to mislead buyers into thinking that work was done for th…
Can a New Jersey lawyer participate in a bar-sponsored plan that finances clients' legal fees through a bank?
Yes. The opinion reversed earlier opinions that had condemned fee-financing as commercializing the practice, and approved attorney participation in the State Bar Foundation's plan, finding no ethicall…
Can a New Jersey lawyer charge interest on a client's overdue legal-fee bill?
Yes, if the lawyer made clear at the outset that interest at a lawful rate would be charged if the fee is not paid within 30 days after the client receives a written statement; this modified an earlie…
When a New Jersey lawyer leaves a professional corporation, can the firm and the departing lawyer split fees by fixed percentages on the pending and future files?
For files that originated while the lawyer was a member, a separation-agreement percentage split is permitted; but for entirely new files that come to him only after he leaves, the rule against splitt…
If a foreign attorney collects a contingent fee above New Jersey's limit, calling the excess 'nonlitigation services,' what must the New Jersey local counsel of record do?
The opinion held the over-limit contingent fee violates R. 1:21-7(c), DR 2-106(A), and DR 1-102(A), even though the client was a lawyer who knew the rule; the local attorney of record is responsible f…
Can a lawyer who drafted and witnessed a will charge a legal fee to appear before the surrogate's probate clerk to testify as a witness to that will?
No. The opinion concluded a lawyer is acting simply as a fact witness when testifying to a will before a surrogate or probate clerk, so no legal fee may be charged for that appearance; the matter fall…
When a firm must withdraw from representing multiple parties because their interests have become adverse, may it still seek fees for the work it did before the conflict arose?
Yes. The opinion concluded the firm had to withdraw from all parties under DR 5-105(B), but may seek the reasonable value of services rendered before withdrawal, since the conflict over dividing any r…
May a lawyer charge a client interest on a past-due fee, for example by printing a notice that interest accrues on accounts unpaid more than thirty days?
The opinion concluded it is improper to demand interest on delinquent accounts, but a lawyer may agree with the client in advance to charge interest within legal limits, or accept a client's note bear…
After an associate leaves a firm, can he represent a former client of that firm in fighting the firm's bill for legal work the associate himself did while employed there?
Effectively no. The opinion concluded that while a client may always choose new counsel and the new lawyer need not collect the old firm's fee, a lawyer must not encroach on the prior attorney's pract…
Can a bar association set up, and lawyers join, a plan to finance clients' legal fees through local banks?
No, as revised. The opinion concluded that even after deleting the provision letting the bank hire the lawyer to sue a defaulting client, the legal-fee financing plan still connoted a commercializatio…
Can a lawyer collect a finder's fee from a bank for steering client funds into its accounts, and must he disclose and hand over the fee?
Yes with consent, but the fee belongs to the client. The opinion concluded a lawyer may recommend such investments only with full disclosure and knowledgeable consent, and must turn over or credit the…
Could a lawyer collect legal fees through a bank credit-card plan, validating and depositing the bill for immediate payment?
No, at the time. The opinion concluded that, following the ABA, it would be unprofessional for a lawyer to subscribe to a bank credit-card plan for collecting legal fees, because such plans treat prof…
In a matrimonial case, may a wife pay her lawyer's fee up front and then be reimbursed out of the counsel fee the court later orders the husband to pay?
Yes. The opinion concluded the arrangement is ethical where there is no collusion and the fee arrangement is fully disclosed when counsel fees are sought, though the lawyer should not arrange the clie…
May the lender's attorney accept payment from the borrower for the legal services the attorney renders to the lender?
Yes. The opinion concluded it is ethical for the borrower to pay for the lender's attorney's services to the lender, provided the borrower clearly understands the lender's attorney represents the lend…
May a county bar association adopt a plan letting clients finance legal fees through a bank that buys the attorney's installment note?
No. The opinion concluded that the bank-financed installment fee plan should be disapproved, not because it violated any particular Canon, but because it injected a third party into the lawyer-client …
May a municipal attorney let the municipality bill a buyer of municipal property a flat 'legal fee' for legal work the attorney performed only for the municipality?
The opinion concluded that where the flat $125 charge did not represent a fee the attorney fixed for services actually rendered, billing it to the purchaser as a 'legal fee' was improper, and the atto…
Can a lawyer who sued in his own name as his client's assignee keep the money collected to pay off fees the client owes him in other matters?
The opinion concluded he cannot. Suing as an accommodation assignee is not itself a violation, but taking the assigned claim or the money collected as payment of fees earned in other matters amounts t…
Can a developer's salaried attorney handle condominium closings for a flat fee without clearly telling buyers they should retain their own independent counsel?
The Committee concluded the attorney acted improperly. The flat closing fee covering 'all other usual closing costs' and the lukewarm notice that buyers could retain counsel did not amount to the full…
Do government regulations that cap attorneys' fees, like the Veterans Administration's limits on VA-guaranteed mortgage closings, conflict with the rule that lawyers may not let others fix their fees?
The Committee concluded there was no conflict. Its prior opinions barring lawyers from letting others fix their fees did not apply where fees are set or limited by federal or state law or regulations …
Can a seller's attorney accept a fee paid by the buyer, under the sale agreement, for legal services the attorney rendered only to the seller?
The Committee concluded it was proper, provided the seller's attorney fixes the fee himself under Canon 12 and it is reasonable compensation agreed with the attorney, not a fee set solely between the …
Can a lawyer keep a percentage or rebate paid by a title insurance company on the client's transaction?
Only with the client's consent after full disclosure. The Committee concluded the lawyer may keep a title-insurance rebate if the client consents after full disclosure; if the client refuses, the reba…
Can a new attorney take over a client's civil case when the prior attorney, who filed nothing, refuses to sign a substitution of attorney over an unpaid fee?
Yes. The Committee concluded the new attorney may proceed to defend the client without a substitution, because the client's right to counsel of his own choice is paramount to any fee dispute, and the …
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Legal ethics opinions from the New Jersey Supreme Court Advisory Committee on Professional Ethics 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.