Do I Pay Two Lawyers If I Switch?

Why people worry about paying twice

A contingency fee agreement says the lawyer gets a percentage of whatever you recover. If you sign a second agreement with a new firm for a similar percentage, it is fair to wonder whether both firms will take their cut.

In practice, that is rarely how it ends. Courts in all three states where we practice have dealt with this problem for decades. The usual result is one fee, divided between the lawyers based on the work each did. California’s Supreme Court, in Fracasse v. Brent, specifically pointed to the risk of “double contingent fees” as a reason to limit what a fired lawyer can collect.

No statute promises that a client will never pay two fees, though. What protects you is how courts apply these rules and what your new firm agrees to in writing.

How the old lawyer gets paid in California

Under Fracasse, a client can discharge a lawyer at any time, with or without cause. A discharged contingency lawyer can recover only the reasonable value of the services provided, often called quantum meruit, and that claim arises only if the client eventually recovers. If you lose, the old lawyer gets nothing from you.

When the total contingency fee is not enough to pay every lawyer’s reasonable value, Spires v. American Bus Lines says the fee is divided among them so the client is not forced to pay twice. And under Carroll v. Interstate Brands, a former lawyer who wants to enforce a lien has to bring a separate action against the client to establish it. Disputed money stays in trust under rule 1.15(c)(2) while the lawyers sort it out.

How the old lawyer gets paid in Texas

Texas works differently, and it is fair to say so. The key question is whether you had good cause to fire the lawyer.

• Without good cause: under Mandell & Wright v. Thomas, the lawyer can claim the fee in the contract. Hoover Slovacek v. Walton limits that claim through the rule against unconscionable fees, and held that a clause charging the full fee on discharge was unconscionable.
• With good cause: under Rocha v. Ahmad, the lawyer cannot collect the contract fee and is limited to the reasonable value of the work done. Good cause means the lawyer did not act as an ordinarily skilled lawyer would, such as long delays, poor communication or months of inaction.

Texas also has no general statute giving lawyers a lien on a client’s recovery, according to Ethics Opinion 610. Lawyers rely on contract terms and a common-law lien on the file instead.

Because the reason matters, our Texas-licensed attorneys, Joyce Ondich and John Efstathiou, review why you want to switch before we take a Texas case. Our promise below applies once we do.

How the old lawyer gets paid in Washington

Under Ross v. Scannell, a contingency lawyer discharged before substantially finishing the work is paid the reasonable value of the services, not the contract percentage. Washington’s statutory attorney lien under RCW 60.40.010 is limited to the value of the services or the agreed amount. Disputed funds stay in trust under RPC 1.15A(g), and the undisputed part must be paid promptly.

What Beverly Law promises about your fee

Here is our rule. When you switch to Beverly Law, your fee stays the same. Whatever your former lawyer is owed for their work comes out of our fee. It is never added to what you pay. We deal with the old firm’s fee claim directly so you do not have to argue with them.

A simple example, with made-up numbers: say your agreement with us is one-third and the case recovers $90,000. The total attorney fee is $30,000. If the old firm is owed $8,000 for its work, that $8,000 comes out of the $30,000. Your fee is still $30,000 total.

Costs are a separate item, and we want to be honest about them. Money the old firm spent on your case, such as filing fees, medical records or expert reviews, is normally repaid from the recovery, as costs are on any case. Those costs do not disappear when you switch. If there is no recovery, you owe us no fees and no costs.

If you have already signed a release and the case has settled, this promise cannot help, because the claim is generally over and we cannot take the case.

Check your fee agreement

Pull out the contract you signed with your current lawyer. Look for the percentage, how costs are handled, and anything about what happens if you end the relationship.

In California, Business and Professions Code § 6147 sets out what a contingency fee contract must include. If it does not comply, the client can void it, and the lawyer is then limited to a reasonable fee. Texas Rule 1.04(d) and Washington RPC 1.5(c) both require contingency fee agreements to be in writing.

If you paid an upfront retainer, which is uncommon in injury cases, ask for any unearned part back. California rule 1.16(e)(2) requires a refund of unearned fees, and Texas Rule 1.16 covers refunds when the representation ends.

If the lawyers cannot agree on the split

Most fee splits between firms are worked out without a fight. When they are not, there are formal paths. California offers fee arbitration under Business and Professions Code § 6201. The State Bar of Texas explains options on its fee disagreements page. In Washington, the WSBA refers fee disputes to dispute resolution centers.

With Beverly Law, that dispute is between the firms. It does not change your fee. To compare this with standard injury fees, see how much a car accident lawyer costs, read our full guide to switching lawyers, or learn what happens to your old lawyer’s lien.

Sources

1. Fracasse v. Brent (1972) 6 Cal.3d 784 (scocal.stanford.edu)
2. Spires v. American Bus Lines (1984) 158 Cal.App.3d 211 (hallapproved.com)
3. Carroll v. Interstate Brands Corp. (2002) 99 Cal.App.4th 1168 (Justia)
4. California Rules of Professional Conduct (State Bar of California, PDF)
5. Mandell & Wright v. Thomas, 441 S.W.2d 841 (Tex. 1969) (CourtListener)
6. Hoover Slovacek LLP v. Walton, 206 S.W.3d 557 (Tex. 2006) (CourtListener)
7. Rocha v. Ahmad, 676 S.W.2d 149 (Tex. App. San Antonio 1984) (CourtListener)
8. Texas Professional Ethics Committee Opinion 610
9. Ross v. Scannell, 97 Wn.2d 598 (1982) (CourtListener)
10. RCW 60.40.010
11. Wash. RPC 1.15A
12. Cal. Bus. & Prof. Code § 6147
13. Tex. Disciplinary R. Prof. Conduct 1.04 (fees)
14. Wash. RPC 1.5
15. Tex. Disciplinary R. Prof. Conduct 1.16 (declining or terminating representation)
16. Cal. Bus. & Prof. Code § 6201 (mandatory fee arbitration)
17. State Bar of Texas: Resolving fee disagreements
18. Washington State Bar Association: Concerns about a lawyer