Can a lawyer get a former client to release a malpractice claim while tendering disputed fee money?

Plain-English summary

The committee understood that the lawyer's fee agreement provided for a contingent fee of one-third unless there was an appeal, in which case the attorneys were to receive 40 percent. After a $160,000 settlement, the lawyer paid the client $100,000, which was two-thirds of the balance, even though there had been an appeal, and retained $10,000 to cover anticipated costs. After paying costs, $1,900 remained in trust. The lawyer told the client he would keep the $1,900 based on the 40 percent provision; the client objected. The lawyer then tendered the $1,900 to the client with a release covering malpractice as well as everything else, and the client refused to sign.

The committee reached two conclusions. Under RPC 1.8(h), the lawyer could not settle a claim for malpractice liability with a former client without first advising that person in writing that independent representation is appropriate. And, because the lawyer initially paid two-thirds of the recovery to the client without asserting the 40 percent provision, the committee concluded the lawyer had effectively abandoned that claim and should now pay the remaining balance to the client.

Currency note

This opinion was issued in 1986, before the 2006 revisions to the Washington Rules of Professional Conduct. RPC 1.8(h) on settling malpractice claims with clients was later renumbered and amended. Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific rule, deadline, or requirement mentioned here.

Common questions

Q: Can a lawyer settle a malpractice claim with a former client by tendering money with a release?

A: Not without a step first. The committee concluded that under RPC 1.8(h) the lawyer could not settle a malpractice liability claim with a former client without first advising that person in writing that independent representation is appropriate.

Q: Could the lawyer still claim the higher 40 percent fee after the appeal?

A: No. The committee concluded that by initially paying two-thirds of the recovery without asserting the 40 percent provision, the lawyer had effectively abandoned that claim.

Q: What did the committee say the lawyer should do with the disputed $1,900?

A: The committee concluded the lawyer should pay the remaining balance to the client.

Background and rules framework

The opinion interprets Washington RPC 1.8(h) as it stood in 1986, which addressed settling a claim for malpractice liability with an unrepresented client or former client (corresponding to Model Rule 1.8(h)). The committee applied it to a release covering malpractice that was tendered along with disputed fee money, and separately treated the lawyer's earlier payment without asserting the higher fee as an abandonment of that fee claim.

Citations and references

Rules of Professional Conduct:

• Washington RPC 1.8(h) (settling a malpractice claim with a client or former client), corresponding to Model Rule 1.8(h).

See also

• ABA Formal Op. 02-425: arbitration of fee disputes and malpractice claims
• ABA Formal Op. 481: a lawyer's duty to inform a client of a material error
• WSBA Ethics Op. 978: contingent fees when the court sets a reasonable attorney's fee

Source

• Landing page: https://ao.wsba.org/print.aspx?ID=100

Original opinion text

Reproduced from the official source for research purposes. The linked source is authoritative.

Advisory Opinion: 989
Year Issued: 1986
RPC(s): RPC 1.8(h)
Subject: Release by client of malpractice claim; overpayment to client constituted abandonment by lawyer to claim for greater attorney fees

The Committee understood the facts of this case to be that you had a fee agreement with your client which provided for a contingent fee of one-third unless there was an appeal, in which case the attorneys were to get 40 percent. After settlement for $160,000, you paid the client $100,000, which was two-thirds of the balance, even though there had been an appeal. You retained $10,000 to cover anticipated costs. After paying costs, you have a balance of $1900 in your trust account. You had advised the client that you would keep the $1900 based upon the 40 percent provision in the fee agreement. The client objected. You then tendered the $1900 to the client with a release that covered malpractice as well as everything else. The client refused to sign the release.

The Committee was of the opinion that under RPC 1.8(h) you could not settle a claim for malpractice liability with a former client without first advising that person in writing that independent representation is appropriate in connection therewith. The Committee was further of the opinion that based upon your actions in initially paying two-thirds of the recovery to the client without asserting the 40 percent provision, you effectively abandoned that claim and should now pay the remaining balance to the client.