Informal Opinion Number: 2018-12

Adoption Date: 2018

Rules: 4-1.8; 4-1.15
Client-Lawyer Relationship
Conflict of Interest: Prohibited Transactions
Safekeeping Property
Subject: Fees - Third Party Payee
Summary: third party payment of fees

Question: May Attorney accept payment of a client’s fee from someone other than the client? If so, to whom should Attorney refund any unearned fee at the termination of representation?
Answer: Attorney must not accept compensation for representing a client from someone other than the client (including a co-client or indemnitor) unless Attorney complies with Rule 4-1.8(f). The client must give informed consent, the arrangement must not interfere with Attorney’s independence of professional judgment or with the client-lawyer relationship, and the client’s confidential information must be protected as required by Rule 4-1.6. In obtaining the client’s informed consent, Attorney should discuss with the client all information that will allow the client to make an informed decision, including, but not limited to: to whom any necessary refund should be issued at the termination of representation; that Attorney will follow the procedure in Rule 4-1.15(e) and Comment [8] for the handling of disputed funds if both the client and the third-party payer claim an interest in the funds; and the possible impact on the representation if the payer demands a return of the funds before the scope of the representation is concluded. If the fee arrangement creates a conflict of interest for Attorney, Attorney must comply with Rule 4-1.7(b). It should be noted that not all conflicts of interest are consentable. See Rule 4-1.8, Comments [11] and [12].

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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