Hello and welcome to this Ethics Alert which will discuss the recent opinion of the Supreme Court of Florida which adopted Bar Rules which define retainer, flat fee and advance fees and clarifying deposit of fees. The opinion is In Re: Amendments to Rules Regulating The Florida Bar 4-1.5—Fees and Costs for Legal Services, No. SC14-2112 (September 17, 2015) and the opinion is HERE: The amendments will become effective on October 1, 2015.
The opinion adopted amendments filed by The Florida Bar adding subdivision (2) to Florida Bar Rule 4-1.5, which defines the terms retainer, flat fee and advance fee. The amendment also adds language to the Comment under “Terms of payment” stating that nonrefundable flat fees and nonrefundable retainers should not be deposited into the lawyer’s trust account; however, advance fees must be held in trust until earned. The Comment also states that nonrefundable fees can still be excessive.
The amendment also moves the language in the Comment regarding contingent fees in criminal and domestic relations cases under the header “Prohibited contingent fees.”
Bottom line: these amendments to Rule 4-1.6 resulted from recommendations made by the ABA Ethics Commission 20/20. As I pointed out in a previous Ethics Alert, the current amendments were drafted after an earlier attempt by The Florida Bar to place definitions in the Comment to Rule 4-1.5 was rejected by the Florida Supreme Court in an opinion stating that any definitions should be in the rule.