Can a retainer agreement get a client to agree in advance that the lawyer may withdraw if the client fails to pay fees?

Plain-English summary

A lawyer asked whether a retainer agreement may include a provision securing the client's advance assent to the lawyer's withdrawal if the client fails to pay agreed fees and expenses on time. The committee concludes it may not, but explains what the agreement may permissibly say.

A retainer must not mislead the client about the lawyer's obligations, including the obligation to continue as counsel absent a permissible ground for withdrawing. A clause purporting to allow withdrawal on any untimely nonpayment "without more" would misstate the rules and is impermissible. Permissive withdrawal is governed by DR 2-110(C), which allows withdrawal only if it can be accomplished without material adverse effect on the client and on one of the enumerated grounds, including where the client "deliberately disregards" a fee or expense obligation (DR 2-110(C)(1)(f)) or "knowingly and freely assents" to termination (DR 2-110(C)(5)). Following N.Y. State 719, the committee holds that DR 2-110(C)(5) does not authorize advance assent to termination on a future occurrence; assent must be made knowingly, with understanding of all the facts at the time employment ends.

The committee explains that "deliberate disregard" requires more than mere failure to pay and is highly fact-sensitive: inadvertent or de minimis nonpayment is not deliberate, but a conscious, non-de-minimis failure can be, even where the client claims inability to pay. Drawing on N.Y. State 598, it notes the competing considerations (prejudice to the client, the duty to serve the needy, the lawyer's financial interest, and the tribunal's need for orderly proceedings) and that a tribunal must balance them; where court approval is required, withdrawal remains subject to it. So a retainer may advise the client of the lawyer's right to withdraw, subject to court approval where applicable, if the client deliberately disregards a payment obligation.

In practice

The opinion holds, under the former Code as it stood at the time, that a retainer cannot bind a client to advance consent to withdrawal for nonpayment, because valid assent under DR 2-110(C)(5) must be knowing and contemporaneous, but it may accurately describe the lawyer's right to withdraw for "deliberate disregard" of a payment obligation under DR 2-110(C)(1)(f), subject to court approval where applicable. The committee frames "deliberate disregard" as fact-sensitive: conscious, non-de-minimis nonpayment can qualify, while inadvertent or trivial nonpayment does not.

Common questions

Q: Can a retainer make the client agree in advance to the lawyer's withdrawal for nonpayment?

A: No. The committee concludes a retainer may not secure the client's advance assent to withdrawal, because under DR 2-110(C)(5) assent must be made knowingly and with understanding of all the facts at the time employment is terminated, not in advance.

Q: What may the retainer say about withdrawal for nonpayment?

A: The committee concludes the agreement may accurately advise the client that the lawyer may withdraw, subject to court approval where applicable, if the client "deliberately disregards" a fee or expense obligation under DR 2-110(C)(1)(f).

Q: Does any missed payment count as "deliberate disregard"?

A: No. The committee explains the standard is fact-sensitive and requires more than mere failure to pay; inadvertent or de minimis nonpayment is not deliberate, while a conscious, non-de-minimis failure can be, even where the client asserts inability to pay.

Background and rules framework

The opinion interprets DR 2-110(C) on permissive withdrawal (the analogue of ABA Model Rule 1.16(b)), in particular DR 2-110(C)(1)(f) (deliberate disregard of a fee or expense obligation) and DR 2-110(C)(5) (the client's knowing and free assent to termination), together with DR 1-102(A)(1), against the committee's prior opinions on advance assent and the "deliberate disregard" standard.

Citations and references

Rules of Professional Conduct:

• MR 1.16 (declining or terminating representation)
• Former Code DR 2-110(C)(1)(f); DR 2-110(C)(5); DR 1-102(A)(1)

Other opinions cited:

• N.Y. State 719 (1999): DR 2-110(C)(5) does not authorize advance assent to future termination
• N.Y. State 598 (1989): the competing considerations and the "deliberate disregard" standard

See also

• NY State Bar Op. 823: Joint clients who want opposite litigation strategies (withdrawal)
• NY State Bar Op. 819: Settling a court-awarded divorce fee with the client

Source

• Landing page: https://nysba.org/ethics-opinion-805/