Informal Opinion Number: 20020031
Rules: 4 dash–1.8
Client-Lawyer Relationship
Conflict of Interest: Prohibited Transactions
Subject: Conflict of Interest - Prohibited Transactions (see also Business Transaction with Client); Fees - Generally
Summary: payment of costs and expenses in contingent fee cases when lawyer fails to go forward with claim
QUESTION: Attorney has a contingent fee contract with a client. Is the client responsible for costs and expenses in the event that Attorney decides to discontinue prosecution of the claim? Is there a requirement that the client is responsible for expenses in this instance?
ANSWER: Rule 4 dash–1.8(e)(1) allows Attorney to provide financial assistance to a client by advancing court costs and expenses. That rule also allows Attorney to make the client’s obligation to repay Attorney contingent on the outcome. If discontinuing the prosecution means that the case never results in a settlement or judgment, it would not be necessary for Attorney to require the client to repay Attorney.
Informal Opinions are ethics advisory opinions issued by the Office of Legal Ethics Counsel to members of the Bar about Rule 4 (Rules of Professional Conduct), Rule 5 (Complaints and Proceedings Thereon), and Rule 6 (Fees to Practice Law) pursuant to Missouri Supreme Court Rule 5.30(c). Written summaries of select Informal Opinions are published for informational purposes as determined by the Advisory Committee of the Supreme Court of Missouri pursuant to Rule 5.30(c). Informal opinion summaries are advisory in nature and are not binding. These opinions are published as an educational service and do not constitute legal advice.
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