Contingency Fee Agreement Requirements
Cases Related to Enforceability
Contingency fee agreements for personal injury cases must meet certain criteria to be enforceable including complying with Florida bar rules of ethics. If a fee agreement does not meet these requirements, then the attorney is not entitled to a fee in an injury case.
Below is an outline with supporting case law discussing the enforceability of contingent personal injury fee agreements, including reasons why agreements have been found to be void.
REQUIREMENTS FOR AN ENFORCEABLE CONTINGENCY FEE AGREEMENT
- 4 Requirements For Enforceability: A contingent fee agreement is void as against public interest unless it meets the following requirements: (1) the agreement must be reduced to a written contract; (2) each participating attorney or law firm shall sign the contract or agree in writing to be bound by the terms of the contract with the client; (3) each attorney shall agree to assume the same legal responsibility to the client for the performance of the services in question; and (4) the client shall be furnished with a copy of the signed contract. See: Font & Nelson, PLLC v. Path Medical, LLC, App. 4 Dist., 317 So.3d 134 (2021).
- “Contingency Fee” Definition: A “contingency fee” arrangement occurs when a law firm does not bill or expect payment until and unless the contingency is achieved; such arrangements are typically contingent upon a successful outcome. See: Wright v. Guy Yudin & Foster, LLP, App. 4 Dist., 176 So.3d 368 (2015).
- Technical or Immaterial Violations: Contingent fee agreements can be enforceable even if they have technical or immaterial violations of the rule governing the enforceability of fee contracts. See: Guy Bennett Rubin, P.A. v. Guettler, App. 4 Dist., 73 So.3d 809 (2011).
VOID AND UNENFORCEABLE CONTINGENCY FEE AGREEMENTS
- Unsigned Fee Agreements: An unsigned contingent fee agreement between a law firm and a client was void as against public policy, even though negotiations towards a final agreement were memorialized in an email exchange between the law firm and the client; the client had not signed the agreement, and emails showed the client wanted to negotiate further and, therefore, had not otherwise accepted the terms of the agreement. See: Font & Nelson, PLLC v. Path Medical, LLC, App. 4 Dist., 317 So.3d 134 (2021).
- Signed Settlement Statement: A settlement statement signed by a client, upon receiving a distribution from her attorney who represented her in an action, did not cure the earlier failure by the attorney and referring attorney to comply with the rule governing contingent fees. The rule contemplates that the client’s consent must be secured at the beginning of a case, not when the case is 99.9% over. Thus, the contingent fee contract was void as against public policy. See: Katz v. Frank, Weinberg & Black, P.L., App. 4 Dist., 268 So.3d 773 (2019).
- No Ratification of Agreement: The client did not ratify a personal injury contingency attorney fee contract that his mother had signed as the client’s personal representative at a time when the client had not executed a power of attorney, had not been declared legally incompetent, and had not been appointed a legal guardian; there was no testimony, nor competent substantial evidence, that the client saw the written contingent fee agreement, nor that he signed it, as required by bar rule, and there was no evidence that client had knowledge of the details of the contingent fee agreement. Thus, the agreement was void. See: O’Malley v. Freeman, App. 4 Dist., 241 So.3d 204 (2018).
- Termination-of-Services Clause: Under Florida law, a termination-of-services clause in a contingent fee agreement, which provides for the client to pay a discharged law firm for all services rendered up through the date of termination at a prevailing hourly rate for firm members, if the client abandons or dismisses the claim, violates Florida Ethics Rule on its face and renders the contingent fee agreement unenforceable from its inception. See: In re Miami Beverly, LLC, Bkrtcy.S.D.Fla.2019, 608 B.R. 574.
- Contingency plus Quantum Meruit: A contingency fee agreement that required full payment of the attorney’s contingency fee, as well as quantum meruit compensation, in event of the attorney’s termination was void ab initio, as contrary to Florida Ethics Rule, and insufficient to support a charging lien on attorney’s behalf. See: In re Miami Beverly, LLC, Bkrtcy.S.D.Fla.2019, 608 B.R. 574.
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As a Board-Certified Civil Trial Expert for over 40 years, Alan Sackrin has extensive experience dealing with contingency-based personal injury cases. He offers a free initial consultation (over the phone or in person) to answer your questions. When you’re ready to speak with a personal injury lawyer about your case, call Alan at 945-458-8655 or send him an email through our contact page.