Texas Professional Ethics Committee Ethics Opinions
Free plain-English summaries of legal ethics opinions issued by the Texas Professional Ethics Committee, with full citations and source links on every page.
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Can a Texas lawyer hire an unaffiliated 'appearance lawyer' to cover a single hearing or deposition, and what duties does each lawyer take on?
The opinion concludes that a Texas lawyer may hire an appearance lawyer for a discrete task, but the appearance lawyer represents the client (not the hiring lawyer) and owes the full duties of compete…
What ethical duties under the Texas Disciplinary Rules of Professional Conduct does a lawyer carry when using generative AI in practice?
Per the Committee, a Texas lawyer using generative AI must satisfy technological-competence duties under Rule 1.01, protect confidential client information under Rule 1.05 (which may require client co…
May a Texas lawyer offer legal services under a monthly subscription model, and how must the lawyer treat the fee in trust and on cancellation?
Per the Committee, a subscription fee model is permitted if the fee is not unconscionable under Rule 1.04(a); the unearned portion of a prepaid subscription fee must be retained in trust until the end…
When a client follows a departing Texas lawyer to a new practice, must the lawyer enter a new fee agreement, and what must the lawyer disclose about possible continuing obligations to the prior firm?
Per the Committee, the departing lawyer must enter into a new legal services agreement with the followed client; the lawyer cannot rely on the prior firm's contract as the basis for the new representa…
What employment-agreement restrictions on a Texas lawyer's departure from a law firm are impermissible under Rule 5.06(a), and what notice and file-copying obligations apply?
Per the Committee, Rule 5.06(a) bars employment-agreement provisions that impose an unreasonable minimum departure notice period (two to four weeks is ordinarily defensible), blanket prohibitions on a…
May a Texas plaintiff's personal-injury lawyer agree to personally indemnify the defendant group from medical liens and reimbursement claims as a condition of settlement, and may defense counsel insist on it?
Per the Committee, no on both: the personal indemnity violates Rule 1.08(d) (impermissible financial assistance), Rule 1.06(b)(2) (lawyer's-own-interest conflict), and Rule 2.01 (independent professio…
Can a Texas lawyer renegotiate a flat fee mid-case if the litigation turns out to be far bigger and more complex than expected?
Per the Committee, yes, but only if modifying the agreement is fair under the circumstances, and the lawyer bears the burden of proving fairness; relevant factors include the length of the lawyer-clie…
Can a 501(c)(3) nonprofit law firm directly solicit self-represented Texans to provide civil legal services at below-market flat fees?
Per the Committee, no; soliciting prospective clients who have not sought the lawyer's advice and are not members of the qualified nonprofit organization violates Rule 7.03(a) when a significant motiv…
In a personal-injury case where the client must reimburse a health insurer's subrogation claim, can a lawyer base the contingent fee on the gross recovery, or does Opinion 549's workers'-comp rule require basing it on the net?
Per the Committee, Opinion 549's bright-line rule (no contingent fee on the gross where part must go to a workers'-comp carrier) is limited to workers' compensation; in other subrogation situations, w…
Can a Texas lawyer bill a client more for a third-party expense than the lawyer actually paid, and can the firm bill clients for services from a vendor owned by one of the firm's lawyers?
Per the Committee, absent disclosure and agreement a lawyer may not mark up a third-party expense above what the lawyer paid; and billing clients for a vendor whose ownership is materially similar to …
Can a Texas lawyer sell delinquent client accounts receivable (unpaid earned fees) to a collection or factoring company for a percentage of the amount owed?
Per the Committee, only with the client's consent after consultation; selling the receivable discloses confidential information, and unlike suing to collect a fee or using a collection agency under th…
Can a Texas lawyer hire a collection agency to collect unpaid attorney's fees, and can the lawyer report a nonpaying client to a credit bureau?
Per the Committee, a lawyer may use a collection agency to collect past-due fees if five conditions are met (no longer handling the matter, fee not unconscionable, other reasonable collection efforts …
Can a Texas lawyer make a client waive civil barratry remedies, settle a barratry claim with an unrepresented client, and must the lawyer report a barratry suit against themselves?
Per the Committee, a lawyer cannot use a client waiver to escape the disciplinary rules against barratry, and including such a waiver without explaining it may be ineffective can be a misrepresentatio…
Can a court-appointed criminal defense lawyer in Texas be paid a county fee schedule that pays more if the case goes to trial than if it ends earlier?
Per the Committee, yes; a county fee schedule that pays a fixed amount keyed to how far the case progresses is not a prohibited criminal contingent fee, as long as payment does not depend on the outco…
Can a Texas lawyer check a potential client's payment history in a lawyer-shared database, set fees based on it, and later report the client's payments back to the database?
Per the Committee, yes, with the client's informed consent. Rule 1.02(b) lets the lawyer and client agree at the outset that the lawyer may check the database and adjust or end the representation, and…
Can a Texas law firm contract with a for-profit prepaid legal service company to serve its members at discounted rates, and can it take referral fees on matters it refers out?
Per the Committee, a firm may contract with a licensed for-profit legal service contract company to provide discounted services; the company's retained margin is treated as insurance premium, not shar…
Can a Texas lawyer label a fee a non-refundable retainer when it actually pays for legal services up to trial, and deposit it in the operating account?
Per the Committee, no. A true non-refundable retainer pays only to secure the lawyer's availability and preclusion of other work, and only that may go in the operating account. A payment for future se…
Can a Texas lawyer take a contractual security interest in the client's cause of action to make sure the lawyer's contingent fee gets paid?
Per the Committee, no. Rule 1.08(h) bars a lawyer from acquiring a proprietary interest in the subject matter of litigation except a contingent fee under Rule 1.04 or a lien granted by law. A contract…
If a lawyer suspects the client paid the retainer with fraudulently obtained money, can the lawyer keep the refundable unearned portion in trust instead of returning it, where no one has claimed the funds?
Per the Committee, no. With no claim asserted by anyone, Rule 1.14(b) requires the lawyer to return the refundable unearned fee to the client and account for it; the lawyer's suspicion about the funds…
Can a Texas lawyer take an assignment of a client's insurance policy proceeds to pay legal fees?
Yes, with limits. The Committee concludes an assignment for completed work is governed only by Rule 1.04; for uncompleted work it is allowed if the policy is not the subject of the matter and the proc…
Can a Texas lawyer bill a client more for a third-party expense (such as medical bills negotiated down) than the lawyer actually paid?
No, absent disclosure and agreement. The Committee concludes that recouping more than the amount actually paid, including not passing on a discount, violates Rules 1.04(c), 1.03(b), and 8.04(a)(3) unl…
Can a Texas lawyer share legal fees with, or honor a referral agreement signed by, a lawyer who was suspended from practice?
No. The Committee concludes a suspended lawyer is a non-lawyer for purposes of Rule 5.04(a), so sharing or promising to share fees with one is prohibited, and a referral agreement with a suspended law…
In a Texas DTPA case, can a lawyer use a normal contingent fee agreement even when the client ends up keeping part of the statutory attorneys' fee award?
Yes. The Committee concludes that because a DTPA attorneys' fee award belongs to the client, not the lawyer, a contingent fee that leaves the client part of that award is not improper fee-sharing with…
Can a Texas lawyer put a binding arbitration clause covering fee disputes and malpractice claims in an engagement agreement?
Yes, if the terms are not unfair to a typical client willing to arbitrate, the client has enough information to make an informed decision, and the clause does not limit the lawyer's malpractice liabil…
Can a Texas lawyer have a client agree in advance that the lawyer may charge the client's credit card for invoices unpaid after 30 days?
Yes. The Committee concludes a lawyer may charge a client's credit card for earned fees if the client consents and the client's right to challenge a disputed bill is preserved; but a disputed amount c…
Can a Texas lawyer's engagement agreement require the client to pay the lawyer's defense costs if the lawyer gets joined as a defendant in the client's case?
Yes, with conditions. The Committee concludes such a clause is permissible if it does not prospectively limit the lawyer's malpractice liability under Rule 1.08(g) and if the defense-cost obligation p…
Can a law firm bill its client a higher hourly rate for a contract or outside lawyer's work than the firm actually pays that lawyer?
It depends on whether the lawyer is 'in' the firm. The Committee concludes a firm may mark up the work of an 'other firm lawyer' (such as of counsel or a contract lawyer who is in the firm) without di…
Can a lawyer in a contingent fee case let a non-lawyer lending company fund litigation expenses in exchange for a funding fee that is a percentage of the recovery?
No. The Committee concludes the arrangement is fee sharing with a non-lawyer barred by Rule 5.04(a), because tying the lending company's funding fee to a percentage of the recovery lets the non-lawyer…
If a lawyer is appointed by a court as a receiver, can the lawyer pay part of the receiver fee to the lawyers for the parties?
No. The Committee concludes a lawyer/receiver may not pay any part of the receiver fee to the parties' lawyers, because accepting it would violate Rule 1.08(e) for those lawyers and would make the rec…
When I leave my firm, can I take a client I worked on there and switch the matter to a contingent fee, using what I learned while at the firm?
Yes, with safeguards. The Committee concludes a departing lawyer may solicit and accept a firm client on contingency for a matter the lawyer handled, but must comply with Rules 1.03, 1.04, 1.05, 1.06,…
As court-appointed defense counsel, can I give the court a detailed fee statement describing the records I reviewed, my research topics, and whom I contacted, to get paid?
Only with the defendant's informed consent. The Committee concludes the detailed statement reveals confidential information under Rule 1.05, so an appointed lawyer may submit a general description of …
Can I borrow money for case expenses from a finance company and agree to pay the lender a percentage of my contingency fee in the case?
No. The Committee concludes that agreeing to pay a finance company or other lender a percentage of the lawyer's contingency fee is sharing legal fees with a non-lawyer in violation of Rule 5.04(a), an…
In a workers' comp third-party case, can my contingent fee be based on the gross recovery even though part of it must be repaid to the comp carrier?
No. The Committee concludes a contingent fee computed on the gross third-party recovery is unconscionable under Rule 1.04(a), because the carrier is entitled to the first money out by subrogation and …
Can a Texas lawyer and an associate sign an employment agreement covering who keeps a contingent-fee client and how the fee is split when the associate leaves?
Yes, within limits. The Committee concludes such an agreement is permissible and may provide a formula for paying the departed associate a share of a later-collected contingent fee (Rule 1.04(g)), but…
Can a lawyer collecting delinquent taxes for a Texas taxing unit agree to a contingent fee where the unit keeps part of the statutory attorney-fee penalty if a collection goal isn't met?
No. The Committee concludes the arrangement violates Rule 1.04(d), which bars a contingent fee prohibited by other law: letting the taxing unit retain part of the section 33.07 penalty when the lawyer…
Can a Texas lawyer agree to defend an insurer's insureds for a fixed fee set by stage of the case?
Yes. The Committee concludes a lawyer may take a fixed fee from a liability insurer for defined stages of defending an insured, but the lawyer must still render the professional representation the rul…
Can I take a referral fee from an investment adviser for sending my client to them, paid as a percentage while the client stays invested?
The Committee concluded that a lawyer's receipt of ongoing solicitation fees from an investment adviser, paid while the lawyer's client keeps using the adviser, violates Rule 1.06(b)(2) because the la…
Can I volunteer as the court's 'attorney of the day' if I am paid only when the defendant pleads guilty that day?
The Committee concluded a lawyer may not volunteer for a court 'attorney of the day' program in which the lawyer earns a more-than-nominal flat fee only if the defendant pleads guilty that day, becaus…
If my client's lawyer prepared a defective QDRO and won't fix it after I flag it, do I have to report them to the bar?
The Committee concluded the divorce lawyer must prepare the QDRO competently and correct material defects once flagged (Rule 1.01); the employer's reviewing lawyer must report the failure under Rule 8…
Can I follow my insurance-company client's litigation and billing guidelines when I am defending the insured?
The Committee concluded that defense counsel retained by an insurer may not agree to insurer litigation or billing guidelines that direct or regulate the lawyer's independent professional judgment in …
Can my insurance-company payer require me to send my fee statements to its third-party auditor without my client's consent?
The Committee concluded that a lawyer retained by an insurer to defend an insured may not, without the insured's informed consent, submit fee statements describing the legal services rendered to the i…
Can my firm pay class-action clients a share of the court-awarded attorneys' fees we earned by objecting to a settlement on their behalf?
The Committee concluded that a law firm may not distribute to its nonlawyer clients any portion of court-awarded attorneys' fees, even as recognition of the clients' expense and inconvenience; doing s…
Can I write a fee agreement that pays me the greater of my full hourly fee or my usual contingent percentage of the recovery?
The Committee concluded that, absent very unusual circumstances, an arrangement paying the attorney the greater of a full reasonable hourly fee or a full reasonable contingent percentage appears to vi…
Can a lawyer recommend and participate in a deal where the client pays a nonlawyer investigator a contingent fee out of the recovery, in addition to the lawyer's own contingent fee?
The Committee concluded a lawyer may participate in such an arrangement if four conditions are met: the lawyer fully explains it and the fee agreement contemplates it; the investigator's contingent fe…
Can a lawyer give the Texas Workers' Compensation Commission a general description of attorney-client conferences to get a fee approved, without breaching client confidentiality?
The Committee concluded that a general description of the nature of attorney-client conferences (for example, 'discussed client's medical treatment') is confidential but not privileged information, an…
Can a Texas lawyer charge a contingent fee to collect past-due child support, and use a power of attorney and escrow account for the recovered money?
The Committee concluded a contingent fee is permissible. Comment 9's concern that contingent fees in divorce discourage reconciliation does not apply because the parties are already divorced, so a rea…
Can a law firm let clients pay legal fees by borrowing from an independent finance company that pays the firm at least 90% of the amount borrowed?
The Committee concluded the arrangement is not prohibited and is a finance arrangement, not fee-splitting, because the finance corporation neither solicits clients nor performs legal services, so reta…
Can a law firm give a corporate client fee discounts or rebates in exchange for the corporation steering its subsidiaries to hire the firm?
The Committee concluded the arrangement is impermissible. Giving a corporation reduced fees or rebates for causing its controlled businesses to use the firm is a promise of something of value to a lay…
Can an attorney represent his own spouse in a case where he is not a party but will testify as a witness for her, and can he keep court-awarded attorney's fees?
The Committee answered all questions in the affirmative, provided the spouse would suffer substantial hardship if the attorney did not represent her and the attorney gives the required notice to oppos…
Can a lawyer who bills hourly offer a free half-hour consultation coupon in a coupon book that an advertising firm sells to the public?
The Committee concluded that a free-consultation coupon in a coupon book is advertising subject to DR 2-101, and that without further disclosure (the regular rate, that more time may be billed hourly,…
Do the fee-division rules that limit splitting a fee with an outside lawyer apply when a firm shares legal fees with a lawyer who is 'of counsel' to the firm?
The Committee concluded that DR 2-107(A) does not apply to a firm's sharing of legal fees with a lawyer who is publicly designated 'of counsel' and who has a regular, continuing, and substantial relat…
Can a county bar association run a lawyer referral service just for university students, charge a small consultation fee, and let participating lawyers be hired by the students?
The Committee concluded that it is not unethical for a county bar association to operate a referral service limited to university students, to charge a reasonable consultation fee, or for a participat…
Can a lawyer charge a flat amount for a traffic-ticket case where the lawyer pays any fine out of that amount and keeps whatever is left?
The Committee concluded that an attorney may not enter into either fee arrangement, because the lawyer's net fee depends on the outcome of the case, making it a prohibited contingent fee in a criminal…
Can the lawyer who takes over a case pay the original lawyer, who was disbarred during the appeal, a share of the contingent fee or quantum meruit?
The Committee concluded that, where the original attorney was disbarred before completing a contingent fee contract, paying him on the contract or in quantum meruit would violate DR 3-102, because und…
Can a lawyer charge a non-refundable retainer, and can the lawyer always keep it?
The Committee concluded that a non-refundable retainer is not unethical per se, but a fee is not earned simply because it is labeled non-refundable; a true retainer that secures availability may be ea…
Can a Texas attorney hold a client's file or property under a retaining lien when the client refuses to pay the fees owed?
The Committee concluded that an attorney may ethically assert a common-law retaining lien on a client's file after first making demand for unpaid fees, but only if the client's legal rights are not pr…
Can a Texas lawyer put a clause in a retainer agreement charging interest on attorney's fees that go unpaid past a set date?
The Committee concluded that nothing in the Code prohibits charging interest on an unpaid fee balance, and it approved charging reasonable interest as long as the charge is reasonable, complies with c…
Can a Texas lawyer representing a party in a real estate deal take a fee that is a percentage of the title insurance premium paid by the title insurer?
The Committee concluded that a lawyer may accept a percentage of the title insurance premium only for services actually rendered to the title company; because the arrangement makes the title company a…
Must a Texas lawyer deposit advance fees and retainers into a client trust account, or can they go straight into the firm's operating account?
The Committee concluded that any advance fee or retainer the client could still get back, because it is not yet earned, belongs in part to the client and must go in the DR 9-102 trust account; only a …
Can a lawyer take a judgment for unpaid fees against his own client in the very case the lawyer is handling, and then enforce it?
The Committee concluded that a lawyer may not ethically use a judgment for his fee against his client to collect that fee in the same litigation in which he represents the client, and that vigorous en…
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Legal ethics opinions from the Texas Professional Ethics Committee 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.