Defending People

It’s enough for me that the State Bar wants to do away with flat fees. Most peo­ple who have the money to pay me a flat fee, in which I accept the risk that lit­i­ga­tion will drag on and the client accepts the risk that it won’t, could not pos­si­bly afford to deposit enough in trust to cover my hourly rate through every rea­son­ably antic­i­pable con­tin­gency of my rep­re­sen­ta­tion. For­bid­ding criminal-defense lawyers charg­ing flat fees would deprive many of effec­tive rep­re­sen­ta­tion. (By the way, Abra­ham Lin­coln was wrong: my time is not my stock in trade.)

So I’m vot­ing “no” to all of the State Bar’s ill-thought-out and unnec­es­sary amend­ments to the Texas Dis­ci­pli­nary Rules of Pro­fes­sional Con­duct, with the pos­si­ble excep­tion of Rule 1.13, for­bid­ding lawyers hav­ing sex with clients. And so, if you’re a Texas lawyer, should you. (Note that you can only vote “no” by actu­ally vot­ing “no.” The rules have changed so that a major­ity of mem­bers are not required to approve the amend­ment, but only a major­ity of vot­ing mem­bers. Once upon a time an absten­tion was a “no” vote, but no longer.)

Here are the red­lined Rules. Here is the text of the Rules. See the Com­ments? No. Me either. But there are report­edly 44,000 words of inter­pre­tive com­ments that go along with the Rules.

In case you’re not yet con­vinced, Gary Peak has help­fully com­piled addi­tional com­men­tary and given me per­mis­sion to repub­lish:

Dear Fel­low Attorneys:

I nor­mally do not get involved in things like this, but this time I feel I must.

First, these pro­posed changes are not nec­es­sary, and cer­tainly not an improve­ment over the cur­rent rules.  It is almost like the changes are being made just so we can say we changed some­thing.  If it isn’t broke, don’t mess with it.

What these changes will do is require mil­lions of dol­lars in legal fees fight­ing over what the new rules actu­ally mean, and how they dif­fer in appli­ca­tion from the cur­rent rules.

What these changes will do is encour­age griev­ances against attor­neys when there is no need, no actual wrong, and no harm.

What these changes do is infringe on each of our rights as cit­i­zens to freely con­tract with clients for our services.

We must be care­ful not to think this rule affects big firm attor­neys and not me, or that this rule affects crim­i­nal attorney’s or solo attor­neys and not me.  Each of these rules affects us all and we are bound by them.  They are all equally bad and we need to oppose them all and not try to pick and chose.

Rather than recre­ate the wheel I have attached input from sev­eral folks who have exam­ined and stud­ied the pro­posed changes much more thor­oughly than I, and share their thoughts and concerns.

I am send­ing this let­ter to my many friends and acquain­tances, whether you are pri­mar­ily in civil prac­tice, crim­i­nal prac­tice, dis­trict attor­neys, CPS coun­sel, or other.  These rules will affect us all and we need your support.

We should receive bal­lots after Jan 18 and must sub­mit our votes by Feb 17.  I believe we will be able to vote by return­ing a writ­ten bal­lot by mail or online.

Please take the time and vote “NO” as to all of the pro­posed amend­ments to the Dis­ci­pli­nary Rules.

Also, please take the time and E-mail this, or your own let­ter, to ALL other attor­neys you have on your E-mail list.

Thank you for your assistance.

Sin­cerely yours,
Gary D. Peak

INPUT FROM FOUR SOURCES WITH THEIR THOUGHTS ON THE PROPOSED AMENDMENTS

Com­ment 1.

We rec­om­mend a “No” vote on the entire ref­er­en­dum for the pro­posed amend­ments to the Dis­ci­pli­nary Rules. After review­ing the pro­pos­als over sev­eral months, we have con­cluded that the cur­rent draft is too flawed to merit sup­port. Vot­ing starts on Tues­day, Jan­u­ary 18th. Some of the rea­sons for our rec­om­men­da­tion are:

•       The pro­pos­als are seri­ously flawed, but they will dra­mat­i­cally affect Texas law practice—case-acceptance stan­dards, attorney-client con­tract forms, con­flicts of inter­est stan­dards, dis­qual­i­fi­ca­tion, fees, billing, con­fi­den­tial client infor­ma­tion, and on and on. These are crit­i­cal com­po­nents of Texas law practice.

•       Some pro­po­nents of the changes have said that lawyers need to sup­port these new rules “because we’ve been work­ing on them for 7 years.” If a meal turns out to be ined­i­ble, no one eats it sim­ply because it took a long time to cook. One rea­son for the cur­rent prob­lems in these pro­pos­als is the trou­bled draft­ing process. The State Bar com­mit­tee and the Task Force dis­agreed intensely on var­i­ous rule pro­pos­als. The cur­rent draft resulted from medi­a­tion ses­sions, and parts of the com­pro­mise ver­sion still don’t fit with one another. The Bar Board asked the Supreme Court for more time to address the con­flict of inter­est rules, but the Court refused to grant that extension.

•       The pro­posed conflict-of-interest rules will cre­ate seri­ous prob­lems for lawyers and clients. Pro­posed Rule 1.07 is an entirely new conflict-of-interest rule. Texas cur­rently has no such rule—nor does any other state. And it applies to every rep­re­sen­ta­tion of two or more clients, whether in lit­i­ga­tion or in trans­ac­tions. (Cur­rent Rule 1.07 does not apply to rep­re­sent­ing co-parties in lit­i­ga­tion.) Pro­posed Rule 1.07 requires lawyers to give clients what are in effect “Miranda warn­ings.” And some of the Miranda warn­ings make no sense. For exam­ple, if co-clients dis­agree on an issue, the required warn­ing says that they must resolve the issues them­selves “with­out the lawyer’s advice,” even if the clients want the lawyer to tell them what the con­trol­ling law is on the issue or pro­vide other sim­ple advice that they both request.

•       Worse, pro­posed Rules 1.06 and 1.07 cross-incorporate each other: you must sat­isfy both before you can rep­re­sent any mul­ti­ple clients. No state has that sys­tem. Both rules, in turn, depend on the new def­i­n­i­tional rule, Rule 1.00.

•       Pro­posed Rule 1.08 con­tains stan­dards that are incon­sis­tent with a lawyer’s fidu­ciary duties. Rule 1.08(a) would per­mit a lawyer-client busi­ness trans­ac­tion if “the lawyer rea­son­ably believes that the terms of the transactions…are fair and rea­son­able to the client.” But the fidu­ciary stan­dard requires that the trans­ac­tion be objec­tively fair and rea­son­able to the client. And the arbi­tra­tion pro­vi­sion in Rule 1.08(g) describes stan­dards that are incon­sis­tent with both Texas and ABA ethics opin­ions. Note that Texas lawyers are not being allowed to vote on the Com­ments to the Rules. Yet over two-thirds of the lan­guage in the pro­posed Rules and Com­ments is in the Com­ments (over 44,650 words of the 64,000+ words). And the Pre­am­ble says the Com­ments pro­vide the “inter­pre­tive guidance.”

•       In fact, some of the Com­ments are mud­dled. Oth­ers even mis­state Texas law. Pro­posed Com­ment 8 to Rule 1.07 says lawyers must make sev­eral “deter­mi­na­tions” before agree­ing to rep­re­sent mul­ti­ple clients in a case or mat­ter. First, a lawyer must deter­mine that “any poten­tial dif­fer­ences” among the clients are “not so seri­ous” that the clients would be “unable to agree among them­selves to a res­o­lu­tion of any mate­r­ial issue.” How can a lawyer know or deter­mine that at the out­set of rep­re­sen­ta­tion? These pro­vi­sions require unre­al­is­tic future pre­dic­tions. And if your crys­tal ball breaks or inac­cu­rately pre­dicts the future—you may get sued for breach of fidu­ciary duty.

•       Com­ment 7 to Rule 1.09 mis­states the long-standing def­i­n­i­tion of when two mat­ters are “sub­stan­tially related” as defined by Texas courts. This point is crit­i­cal in deter­min­ing conflicts-of-interest. The 20+ year Coker prece­dent, repeat­edly reaf­firmed by the Texas Supreme Court, defined “sub­stan­tially related” as whether the facts of two mat­ters are so related that they cre­ate a gen­uine risk that the con­fi­den­tial infor­ma­tion of a for­mer client will be vio­lated. Inex­plic­a­bly, Com­ment 7 declares that the test is whether the facts and issues are sim­i­lar. The Com­ment attempts to change long­stand­ing, sub­stan­tive law declared by the Texas Supreme Court.

•       Some pro­po­nents of the changes have said that Texas needs to “catch up to the ABA,” which amended the Model Rules in 2002. But on crit­i­cal rules, these pro­pos­als ignore the ABA’s Model Rules or even flout the ABA stan­dards. The fee rule adopts a pre­vi­ously dis­carded 40 year old ver­sion of the ABA Model Rule. The dual-structure, inter­con­nected con­flicts rules, pro­posed Rules 1.06 and 1.07, are noth­ing like the ABA Model Rules. This Texas-only approach makes no sense in an increas­ingly national and global econ­omy, par­tic­u­larly when lawyers increas­ingly engage in mul­ti­juris­dic­tional practice.

•       The rules would need­lessly con­fuse fed­eral court prac­tice. The Fifth Cir­cuit applies “eth­i­cal rules announced by the national pro­fes­sion.” Fed­eral courts con­sider and rec­on­cile both the Texas Rules and the ABA Model Rules. Twenty years of fed­eral case law has inter­preted how that works. If we adopt these pro­posed Texas-only stan­dards, that 20 years of fed­eral case law prece­dent is out the win­dow. Lawyers will be at risk of being dis­qual­i­fied under new, as-yet-unknown fed­eral court standards.

•       Pro­posed Rule 1.15(b) would change how lawyers han­dle client prop­erty and set­tle­ment funds. Some com­men­ta­tors believe it cre­ates strict lia­bil­ity for dis­ci­pline if you fail to dis­trib­ute funds to every­one who is “enti­tled” to the funds—even if you don’t know the per­son exists. Strict lia­bil­ity dis­ci­pline is bad for lawyers—and doesn’t help clients either.

•       The State Bar Board failed to con­duct the financial-impact analy­sis pre­scribed by its Pol­icy Man­ual. What would that cost-benefit analy­sis have shown? We believe that the costs of imple­ment­ing this new, Texas-only patch­work sys­tem of rules will far out­weigh the ben­e­fits. Just read­ing these rules and com­ments takes time: they’re 164 pages, 65,000 words. Then you need to com­pare them to the cur­rent rules, in order to know the impact on your law prac­tice. But make no mis­take. If these amend­ments pass, you will have to change your law practice—from which clients you accept, to how you con­duct conflicts-of-interest deter­mi­na­tions, to the form of your attorney-client con­tracts, to your fee and billing prac­tices, to how you han­dle con­fi­den­tial client information.

•       The pro­posed con­fi­den­tial­ity rule, Rule 1.05, presents a dif­fer­ent but obvi­ous prob­lem. Imag­ine that your client asks this com­mon ques­tion: “Is what I’m telling you right now con­fi­den­tial?” Under the cur­rent con­fi­den­tial­ity rule, the answer is usu­ally “Yes.” We now have a clear, bright line test. Under pro­posed Rule 1.05, con­fi­den­tial­ity would depend, in part, on whether the infor­ma­tion “is or becomes gen­er­ally known or is read­ily obtain­able from sources gen­er­ally avail­able to the pub­lic.” That includes the Inter­net. If infor­ma­tion hap­pens to appear on the Inter­net at any par­tic­u­lar moment—or to dis­ap­pear if a web­site shuts down—neither you nor your client may know that. But that unknown occur­rence would change your con­fi­den­tial­ity oblig­a­tions. Once again, the pro­posed rule cre­ates unnec­es­sary risks for both lawyers and clients—and the pub­lic. The pro­posed Rules and Com­ments are seri­ously flawed, but they would dra­mat­i­cally change Texas law prac­tice. Texas lawyers can and should do bet­ter than this ragged set of pro­pos­als. We owe that to our­selves, our clients, and the public.

Amon Bur­ton
Chuck Her­ring
Jim McCor­mack
For more detailed com­men­tary on the pro­posed rules, see our pre­vi­ous dis­cus­sions and analy­ses at www.TexasRulesCommentary.com.

Com­ment 2.
 
I prac­ticed law in Texas from 1988 to 2002, often rep­re­sent­ing lawyers sued for mal­prac­tice and law firms that were tar­geted for dis­qual­i­fi­ca­tion. I also served for sev­eral years on the com­mit­tee that writes the Texas Dis­ci­pli­nary Rules of Pro­fes­sional Con­duct (the “Texas Rules”). I’ve taught ethics at the Uni­ver­sity of Texas School of Law as well as the Hous­ton Law Cen­ter, and speak at Texas CLE events sev­eral times each year.

I am still licensed there, but also now prac­tice in and am a pro­fes­sor in Geor­gia. I would strongly urge Texas lawyers to vote against the pro­posed amend­ments to the Texas Rules for many rea­sons. This note is intended to explain why just the con­flict of inter­est pro­vi­sions will cre­ate sig­nif­i­cant hard­ship for Texas lawyers and their clients. Con­flicts Sys­tems are Not Enough: Dis­ci­pline for Inno­cent Conflicts

Let’s start with one of the stranger things, and one which nei­ther Texas clients nor lawyers should want: a rule that allows lawyers to be dis­ci­plined when they “should have known” that some other lawyer’s rep­re­sen­ta­tion cre­ated a con­flict. Sup­pose Bob starts to rep­re­sent Bill against Ernie, not know­ing that some­one else in his firm rep­re­sents Ernie: for what­ever rea­son, the con­flicts check misses it. But, if one lawyer affil­i­ated with a firm is dis­qual­i­fied, all are, and so Bob is dis­qual­i­fied and will have to with­draw from the mat­ter once the true facts come to light.

Right now, in Texas and in all states that I am aware of, if Bob’s inad­ver­tent con­flict arose because the firm’s con­flicts sys­tem is inad­e­quate, the part­ners who were respon­si­ble for set­ting up and run­ning the con­flict sys­tem can be disciplined.

But what about Bob (to coin a phrase)?

To my knowl­edge, no dis­ci­pli­nary pro­ceed­ing has ever been brought (in Texas or any­where) against a lawyer who rep­re­sented a client believ­ing in good faith there was no con­flict, but it turned out that there was. If you run a con­flicts check and it misses some­thing, you won’t be disciplined.

The oppo­site result can occur if these rules are adopted (and this prob­lem per­me­ates essen­tially all of the con­flict rules). While I believe the sci­en­ter require­ment was intended to “help” lawyers by elim­i­nat­ing fear of this never-been-brought dis­ci­pli­nary pro­ceed­ing against an inno­cent but con­flicted lawyer, the amend­ment would in fact do the oppo­site: Bob can be dis­ci­plined if he “rea­son­ably should” have know of the con­flict. If these rules are adopted, lawyers can­not rely upon the del­e­ga­tion of respon­si­bil­ity to part­ners to insu­late them from inno­cent con­flicts. Instead, if they should know – per­haps through tak­ing rea­son­able steps beyond the con­flict sys­tem – they are sub­ject to dis­ci­pline. Nar­rower Def­i­n­i­tion of Con­fi­den­tial­ity that Under­mines Lawyer and Client Certainty

Under the new def­i­n­i­tion of “con­fi­den­tial infor­ma­tion” in pro­posed rule 1.05, rather than being oblig­ated to not reveal and not mis­use infor­ma­tion relat­ing to the rep­re­sen­ta­tion of a client, from what­ever its source (the posi­tion that many states and courts have applied), Texas lawyers are free to mis­use or reveal infor­ma­tion learned while being paid by a client if the infor­ma­tion “is or becomes gen­er­ally known or is read­ily obtain­able from sources gen­er­ally avail­able to the pub­lic.” Tex. R. 1.05 (as proposed).

Think about that from the client’s per­spec­tive: what the client tells to the lawyer can be dis­closed or mis­used if the lawyer can put together an argu­ment that it is “gen­er­ally known.” (Whether infor­ma­tion is “gen­er­ally known” the com­ments say “depends on all the cir­cum­stances.”) As a lawyer, you will need to explain this odd duty of con­fi­den­tial­ity so that the client under­stands this new capac­ity for mis­use and betrayal. How does Texas look? How will your clients in sen­si­tive mat­ters view your loyalty?

While you may think “why should I be required to keep infor­ma­tion con­fi­den­tial if it is gen­er­ally known,” ask your­self if that really helps you. Or, does it cre­ate another trap: lawyers will believe infor­ma­tion is gen­er­ally known, and be sub­ject to dis­ci­pline (or mal­prac­tice, since the rules are often used in that con­text). Bright lines have their ben­e­fit. Texas Rules in Fed­eral Court and Mul­ti­state Litigation

Most of my time is spent in fed­eral court or mat­ters relat­ing to fed­eral agen­cies, such as the patent office. At other times, multi-state trans­ac­tions are involved. Often these cir­cum­stances raise com­plex choice of law prob­lems. If the laws are the same, though, then it doesn’t mat­ter: if Texas has the same rule as Alabama, what dif­fer­ence does choice of law analy­sis make?

But it will mat­ter, and greatly, because Texas’ pro­posed con­flict rules are very dif­fer­ent from most states’ and agen­cies’ rules. Rather than enhanc­ing and eas­ing the abil­ity of lawyers to engage in multi-state or fed­eral court rep­re­sen­ta­tions, these amend­ments will make it much more dif­fi­cult. Many things will be proper under Texas rules that are improper under essen­tially every other state’s rules, such as mis­use of “gen­er­ally known” infor­ma­tion of a cur­rent client. Mak­ing your rep­u­ta­tion turn on whether you guess choice of law prop­erly is not a good thing.

I have no doubt the Texas Rules can be improved. I have grave doubts, how­ever, that the cur­rent pro­posal improves them both in the best way pos­si­ble and with­out cre­at­ing unin­tended side effects.

I’m going to vote “no” and sug­gest you do, too.

David Hri­cik
Pro­fes­sor of Law Mer­cer Uni­ver­sity School of Law Macon, GA

Com­ment 3.

Please vote “No” on the ref­er­en­dum. Vot­ing starts Jan­u­ary 18 and runs through Feb­ru­ary 17.

We encour­age Texas lawyers to vote “No” in the upcom­ing ref­er­en­dum on the pro­posed dis­ci­pli­nary rule amend­ments. The pro­posed changes are seri­ously flawed, but they will dra­mat­i­cally affect Texas law practice—case-acceptance stan­dards, attorney-client con­tract forms, con­flict of inter­est stan­dards, dis­qual­i­fi­ca­tion from rep­re­sen­ta­tion, fees, billing, con­fi­den­tial client infor­ma­tion, and on and on. Texas lawyers and the pub­lic deserve bet­ter rules and stan­dards than these pro­pos­als pro­vide. For example:

•       The rules would impose a duty to dis­trib­ute set­tle­ment funds to every­one “enti­tled” to receive funds—whether or not you even know such per­son exists. That would cre­ate a strict lia­bil­ity dis­ci­pline stan­dard, and that’s a bad idea. By con­trast, the duty to give notice when you receive set­tle­ment funds applies only if the lawyer “knows [funds] belong to” the third per­son. That’s a bet­ter stan­dard, but then the rules per­mit knowl­edge to be “inferred from cir­cum­stances.” Those two, con­flict­ing stan­dards cre­ate undue risk for plaintiffs’lawyers.

•       The pro­posed conflict-of-interest rules would require every lawyer who rep­re­sents two or more clients in a mat­ter to give new “Miranda warn­ings” to clients. Texas cur­rently has noth­ing like this rule. Nor does any other state. For exam­ple, you’d have to warn clients that they “must be will­ing to make inde­pen­dent decisions”—without your advice—to resolve any set­tle­ment issue that might develop in the case.

•       We are not being allowed to vote on the pro­posed Com­ments to the Rules. Two-thirds of the word­ing in the pro­posed Rules and Com­ments are in the Com­ments (over 44,000 words). The Com­ments are sup­posed to pro­vide “guid­ance” con­cern­ing the “applic­a­ble stan­dard of con­duct.” But Texas lawyers don’t get to vote on them. More­over, some of the Com­ments appear to be incon­sis­tent with exist­ing Texas law.

•       Cer­tain pro­posed Com­ments would require a lawyer to make advance pre­dic­tions about client conduct—and then risk dis­ci­pline or a law­suit if the lawyer guesses wrong. For exam­ple, a lawyer would have to deter­mine before the rep­re­sen­ta­tion that the clients will be able to “agree among them­selves” on every “mate­r­ial issue.” Before the rep­re­sen­ta­tion begins, and before fil­ing suit, a lawyer may not even know what issues will be in the case. That stan­dard, and other sim­i­lar stan­dards in the Com­ments, are unre­al­is­tic. They would require lawyers to have crys­tal balls to pre­dict the future. And the con­se­quences of guess­ing wrong could be griev­ances and breach-of-fiduciary-duty lia­bil­ity claims by dis­grun­tled for­mer clients.

•       Mak­ing the sit­u­a­tion worse, pro­posed Rules 1.06 and 1.07, on con­flicts of inter­est, expressly cross-incorporate each other. Texas would be the only state in the coun­try with two gen­eral conflict-of-interest rules. Fur­ther, the informed-consent warn­ings in Rule 1.06 are dif­fer­ent from, and incon­sis­tent with, the new “Miranda warn­ings” in Rule 1.07.

•       The pro­posed rules would cause prob­lems in fed­eral court prac­tice. The Fifth Cir­cuit applies “eth­i­cal rules announced by the national pro­fes­sion.” For 20 years, to develop that stan­dard, fed­eral courts in Texas have con­sid­ered and rec­on­ciled both the Texas Rules and the ABA Model Rules. These new pro­pos­als would undo that 20 years of jurispru­dence. We’d be left with unknown stan­dards in fed­eral court—and new risks of dis­qual­i­fi­ca­tion from representation.

•       The pro­posed rules and com­ments are 164 pages long, 65,000 words. They are full of new, dif­fer­ent stan­dards. And many stan­dards are dif­fer­ent from any other state. If adopted, these rules would affect your law prac­tice in major ways: case-acceptance stan­dards, attorney-client con­tracts, con­flicts con­sent pro­ce­dures, dis­qual­i­fi­ca­tion from rep­re­sen­ta­tion, billing prac­tices, set­tle­ment dis­burse­ment pro­ce­dures, and many other prac­tice issues. These issues are too impor­tant to adopt such flawed standards.

Please vote “No” on the ref­er­en­dum. Vot­ing starts Jan­u­ary 18 and runs through Feb­ru­ary 17.    

Steve Mostyn                 Rus­sell Budd                     Steve Baron  Joe Lon­g­ley                    Joe Crews                          Lisa Blue      Mike Slack                     Mike Davis  Paul Knisely          Robby Alden                  Tom Pre­hoditch Clark Richards          Mike Kaseke                  Jim Fur­man  Dave Richards       Terry Wel­don                  Karl Bayer  Ben DuBose         John Pier­att                     Jan Soifer       Pat O’Connell          Mal­colm Green­stein       Way­lon Allen Paul Danziger            Brian Bur­ris                     Jason Panzer       Joanalys Smith               Rod de Llano                  Derek Howard     Thomas Kobelan         Logan Howard PO Box 2505 Austin Texas 78768 United States

Com­ment 4.

“I actu­ally don’t see that they’re going to require that big a change to my fee arrange­ments, even though most of what I do is flat fee work.”

You have far more faith in the SBOT, griev­ance com­mit­tees, and the courts than most of us.

There has been an effort by some for the last cou­ple of decades to use the griev­ance sys­tem to elim­i­nate flat fees in crim­i­nal cases.  This is the lat­est shot in that war.

“Gen­er­ally, it will just be a mat­ter of clearly defin­ing what things con­sti­tute “earn­ing” our fees so the client is informed.”

Not even close.  The clear require­ment of these rules is to require all money paid for work that has not yet been done to be put in trust.  Last I checked, the Bar did not look fondly on folks try­ing to con­trac­tu­ally write around ethics.  You can call it “earned” all you want, but even though it might be con­trac­tu­ally earned, it is not eth­i­cally earned until the work is done and the work is never done the moment you receive the payment.

This may also present some prac­ti­cal issues for accep­tance of credit card pay­ments.  You can­not (should not) accept a credit card pay­ment to a trust account — the charge back agree­ment does not work with a trust account and the fee assess­ment is prob­lem­atic unless you charge the fee to the client.  If you accept the credit card pay­ment in an oper­at­ing account, the money is com­min­gled until it is moved to a trust account.

“For exam­ple, say I charge some­one $2500 for a state jail felony rep­re­sen­ta­tion, includ­ing one trial. We con­tract for a flat fee with the pro­vi­sion that the hourly rate will not be less than $100 nor more than $500. It’s still a flat fee, and no refund will be required unless I work the case out with less than five hours work (not likely, since it should take at least that much time even if I get them a good plea bar­gain) and they’ll only have to pay more if I put in more than 25 hours (also not likely, since even tri­als in most state jail cases will take two days at most). Doesn’t seem to be a prob­lem to me.”

This hypo­thet­i­cal is fraught with prob­lems.  First, $2500 for a state jail trial?  Spend no more than 25 hours on such a case?  Surely, you jest on both counts. A strong case could be made that such a fee is more likely insufficient.

In any event, your sce­nario is not a flat fee and requires that we keep track of hours, which defeats one of the pri­mary advan­tages of a flat fee. I sus­pect that when I spend 40 hours on such a case and ask the client for more money, they are going to balk because I set a flat fee.  These rules are going to end up requir­ing us the refund money when cases resolve quickly but sel­dom, if ever, being able to col­lect more money when cases take longer than expected.  The pur­pose of a flat fee will be destroyed.

Plus, until you have expended the min­i­mum hours to earn the fee as defined by the fee agree­ment, even assum­ing that the con­tract could define it for eth­i­cal pur­poses, it is unearned and the new rules require it to be in a trust account.

How about a sit­u­a­tion where you set a $50,000 flat fee for a poten­tially habit­ual felony DWI case involv­ing an acci­dent and injuries that may amount to seri­ous bod­ily injury and could result in a felony mur­der or intox­i­ca­tion assault or manslaugh­ter charge.  You accept the fee and the client pays the fee with recog­ni­tion by both par­ties that it is a flat fee whether the case takes one hour or 1000 hours.  At the first set­ting or meet­ing with the pros­e­cu­tor, they offer a three year TDCJ deal, which the client jumps on and decides to take imme­di­ately.  Any­one here inter­ested in refund­ing $45,000 or more?  These new rules likely require it and cer­tainly require that the $50,000 to have been put in a trust account.  All of this is true even if the deal went from 25 years to 3 years just because it was you — some­thing that hap­pens but is near impos­si­ble to prove.

If the Bar is going to elim­i­nate flat fees then it should be done directly so there is no doubt in anyone’s mind.

These are the result of a multi year effort to “mod­ern­ize” our rules, brought about by a per­ceived need to change because they have not been changed in 20–30 years.  There have been local meet, greet and bitch ses­sions all over the state. There was a long pub­lic com­ment period. The Supreme Court has approved them and is sub­mit­ting them to the Bar for a vote.

All that is left is to vote yes or no.

I am firmly in the camp that is OPPOSED to these new rules.  They are a dis­as­ter wait­ing to hap­pen,  They do lit­tle to pro­tect the pub­lic or advance pro­fes­sion­al­ism within the bar.  Most of the changes are lit­tle more than changes for the sake of change and are not intended to scratch any prover­bial itch.

Vote early and vote often, but as Nancy Rea­gan said, “Just Say No.”

Troy

W. Troy McK­in­ney
Schnei­der & McK­in­ney, P.C.
440 Louisiana Suite 800
Hous­ton, Texas 77002
http://www.texascriminaldefenselawyers.com
http://www.houstondwiattorneys.com/
Board Cer­ti­fied in Crim­i­nal Law — Texas Board of Legal Spe­cial­iza­tion
Board Cer­ti­fied in DWI Defense, National Col­lege for DUI Defense (NCDD) NCDD Cer­ti­fi­ca­tion Pro­gram Approved by the Amer­i­can Bar Asso­ci­a­tion and Accred­ited by the Texas Board of Legal Specialization.

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This entry was posted by Mark Bennett on Wednesday, January 12th, 2011 at 9:27 pm and is filed under State Bar of Texas. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.