COMMENTARY ON LAWYERING, LANGUAGE, AND POLITICS
Tuesday, February 17, 2015
New Jersey Supreme Court modifies contingent fees, bars mail contact 30 days post accident in personal injury cases // New Jersey Law Journal
from the New Jersey Law Journal
The New Jersey Supreme Court amended the Rules Governing the Courts as of Sept. 1, 2014. Several of these amendments have an effect on the practice and procedure for handling "automobile injury" cases, including contingent fees, release of medical records, personal contact with prospective clients and uniform interrogatories.
Rule 1:21-7 sets forth the amount of the contingent fee that an attorney can charge in any matter "where a client's claim for damages is based upon the alleged tortious conduct of another." The old rule provided for a fee of 33-1/3 percent of the first $500,000; 30 percent of the next $500,000; 25 percent of the next $500,000; and 20 percent of the next $500,000. (This amounts to 27 percent of the first $2 million.) For any amounts above $2 million, the attorney is required to file an application with the court for the determination of a reasonable fee.
Under the new rule, the contingent fee will be 33-1/3 percent of the first $750,000; 30 percent of the next $750,000; 25 percent of the next $750,000; and 20 percent of the next $750,000. (This amounts to 27 percent of the first $3 million.) For any amount above $3 million, the attorney is still required to file an application with the court for the determination of a reasonable fee.
In addition, the old rule provided that, in any case where the recovery was for a minor when the contingent fee arrangement was made, the fee on any amount recovered by settlement "without trial" shall not exceed 25 percent. The new rule provides that the fee recovered by settlement "before empaneling of the jury" shall not exceed 25 percent.
Personal Contact with Prospective Clients
The Rules of Professional Conduct provide that a lawyer shall not contact or send a written communication to a prospective client for the purpose of obtaining professional employment if the communication involves "unsolicited direct contact" concerning a specific event and the contact has "pecuniary gain as a significant motive." R.P.C. 7.3.
There are three exceptions to the rule. A lawyer may engage in an unsolicited direct contact with a prospective client if:
(1)The lawyer has "a family, close personal, or prior professional relationship with the recipient"; or
(2)More than 30 days have elapsed after "a specific mass-disaster event"; or
(3)The letter bears the word "ADVERTISEMENT" prominently displayed on the outside envelope and at the top of the first page of text; a notice at the bottom of the last page of text that "the selection of an attorney is an important decision" and that "you should give this matter careful thought" before making your choice of attorney; and an additional notice at the bottom of the last page of text that the recipient may report to the Committee or Attorney Advertising "if the letter is inaccurate or misleading."
The new rule provides several additional requirements. First, the prohibition on contact now refers to any written, "electronic or other forms" of communication. Second, the lawyer may send a letter to a prospective client only by "regular mail."
Third, the envelope shall contain "nothing other than the lawyer's name, firm, return address and ADVERTISEMENT prominently displayed." Fourth, the letter shall contain the party's name in the salutation and begin by advising the recipient that the letter is to be disregarded "if a lawyer has already been retained." Fifth, the name and address of "the attorney responsible for the content of the letter" shall be included in the notice to the recipient that inaccurate or misleading letters shall be reported to the Committee on Attorney Advertising.■