Rule 1.5. FEES

FEES

(a)

A lawyer shall not make an agreement for, charge, or collect an

unreasonable fee or an unreasonable amount for expenses. A fee or

charge for expenses is unreasonable when, after a review of the facts,

a lawyer of ordinary prudence would be left with a definite and firm

conviction that the fee or expense is in excess of a reasonable fee or

expense. The factors to be considered in determining the

reasonableness of a fee include the following:

(1)

the time and labor required, the novelty and difficulty of the

questions involved, and the skill requisite to perform the legal

service properly;

(2)

the likelihood that the acceptance of the particular

employment will preclude other employment by the lawyer;

(3)

the range of fees customarily charged in the locality for similar

legal services;

(4)

the responsibility assumed, the amount involved and the

results obtained;

(5)

the time limitations imposed by the client or by the

circumstances;

(6)

the nature and length of the professional relationship with the

client;

(7)

the experience, reputation, and ability of the lawyer or lawyers

performing the services;

(8)

whether the fee is fixed or contingent;

(9)

whether the client has given informed consent as to the fee

arrangement;

(10) whether the fee agreement is in writing; and

(11) any other risks allocated by the fee agreement or potential

benefits of the fee agreement, judged as of the time the fee

agreement was made.

(b)

The scope of the representation and the basis or rate of the fee

and expenses for which the client will be responsible shall be

communicated to the client, preferably in writing, before or within a

reasonable time after commencing the representation, except when

the lawyer will charge a regularly represented client on the same

basis or rate. Any changes in the basis or rate of the fee or expenses

shall also be communicated to the client.

rate of the fee

and expenses for which the client will be responsible shall be

communicated to the client, preferably in writing, before or within a

reasonable time after commencing the representation, except when

the lawyer will charge a regularly represented client on the same

basis or rate. Any changes in the basis or rate of the fee or expenses

shall also be communicated to the client.

(c)

A fee may be contingent on the outcome of the matter for which

the service is rendered, except in a matter in which a contingent fee

is prohibited by paragraph (d) or other law. A contingent fee

agreement shall be in a writing signed by the client and shall state

the method by which the fee is to be determined, including the

percentage or percentages that shall accrue to the lawyer in the

event of settlement, trial or appeal; litigation and other expenses to

be deducted from the recovery; and whether such expenses are to be

deducted before or after the contingent fee is calculated. The

agreement must clearly notify the client of any expenses for which

the client will be liable whether or not the client is the prevailing

party. Upon conclusion of a contingent fee matter, the lawyer shall

provide the client with a written statement stating the outcome of

the matter and, if there is a recovery, showing the remittance to the

client and the method of its determination. A general form of

Contingent Fee Agreement is attached to the comments to this rule.

t will be liable whether or not the client is the prevailing

party. Upon conclusion of a contingent fee matter, the lawyer shall

provide the client with a written statement stating the outcome of

the matter and, if there is a recovery, showing the remittance to the

client and the method of its determination. A general form of

Contingent Fee Agreement is attached to the comments to this rule.

(d)

A lawyer shall not enter into an arrangement for, charge, or

collect:

(1)

a contingent fee in any initial action for divorce, annulment,

judicial separation, paternity or parentage, parental rights and

responsibilities,

emancipation,

grandparent

visitation,

guardianship, or child support, or in any post-judgment

proceeding to modify, alter, or amend an order arising from

these actions; or

(2)

a contingent fee for representing a defendant in a criminal

case; or

(3)

any fee to administer an estate in probate, the amount of which

is based on a percentage of the value of the estate.

(e)

A lawyer shall not divide a fee for legal services with another

lawyer who is not a partner in or associate of the lawyer’s law firm or

office unless:

(1)

after full disclosure, the client consents to the employment of

the other lawyer and to the terms for the division of the fees,

confirmed in writing; and

(2)

the total fee of the lawyers does not exceed reasonable

compensation for all legal services they rendered to the client.

(f)

A lawyer may accept payment by credit card for legal services

previously rendered, or for an advance payment of fees or

nonrefundable fee otherwise permitted by these rules.

(g)

A lawyer practicing in this State shall submit, upon the request of

the client, the resolution of any fee dispute in accordance with the

Supreme Judicial Court’s rules governing fee arbitration.

o the client.

(f)

A lawyer may accept payment by credit card for legal services

previously rendered, or for an advance payment of fees or

nonrefundable fee otherwise permitted by these rules.

(g)

A lawyer practicing in this State shall submit, upon the request of

the client, the resolution of any fee dispute in accordance with the

Supreme Judicial Court’s rules governing fee arbitration.

(h)

A lawyer may enter into an agreement for a client to pay a

nonrefundable fee that is earned before any legal services are

rendered. The amount of such an earned fee must be reasonable, like

any fee, in light of all relevant circumstances. A lawyer cannot accept

a nonrefundable fee, or characterize a fee as nonrefundable, unless

the lawyer complies with the following conditions:

(1)

The lawyer confirms to the client in writing before or within a

reasonable time after commencing representation (a) that the

funds will not be refundable and (b) the scope of availability

and/or services the client is entitled to receive in exchange for

the nonrefundable fee;

(2)

A lawyer shall not solicit or make any agreement with a client

that prospectively waives the client’s right to challenge the

reasonableness of a nonrefundable fee, except that a lawyer

can enter into an agreement with a client that resolves an

existing dispute over the reasonableness of a nonrefundable

fee, if the client is separately represented or if the lawyer

advises the client in writing of the desirability of seeking

independent counsel and the client is given a reasonable

opportunity to seek such independent counsel.

ess of a nonrefundable fee, except that a lawyer

can enter into an agreement with a client that resolves an

existing dispute over the reasonableness of a nonrefundable

fee, if the client is separately represented or if the lawyer

advises the client in writing of the desirability of seeking

independent counsel and the client is given a reasonable

opportunity to seek such independent counsel.

(3)

Where it accurately reflects the terms of the parties’

agreement, and where such an arrangement is reasonable

under all of the relevant circumstances and otherwise complies

with this Rule, a fee agreement may describe a fee as

“nonrefundable,”

“earned

on

receipt,”

a

“guaranteed

minimum,” or other similar description indicating that the

funds will be deemed earned regardless whether the client

terminates the representation.

(i)

A nonrefundable fee that complies with the requirements of

(h)(1)-(2) above constitutes property of the lawyer that should not

be commingled with client funds in the lawyer’s trust account. Any

funds received in advance of rendering services that do not meet the

requirements of (h)(1)-(3) constitute an advance that must be

deposited in the lawyer’s trust account in accordance with Rule

1.15(b)(1) until such funds are earned by rendering services.

(j)

For definitions of “advance,” “retainer,” and “nonrefundable fee”

as used in this Rule, see the definitions in Rule 1.0.

COMMENT

Reasonableness of Fees and Expenses

[1]

Paragraph (a) requires that lawyers charge fees that are

reasonable under the circumstances. The factors specified in (1) through (10)

are not exclusive. Nor will each factor be relevant in each instance. Paragraph

.

(j)

For definitions of “advance,” “retainer,” and “nonrefundable fee”

as used in this Rule, see the definitions in Rule 1.0.

COMMENT

Reasonableness of Fees and Expenses

[1]

Paragraph (a) requires that lawyers charge fees that are

reasonable under the circumstances. The factors specified in (1) through (10)

are not exclusive. Nor will each factor be relevant in each instance. Paragraph

(a) also requires that expenses for which the client will be charged must be

reasonable. A lawyer may seek reimbursement for the cost of services

performed in-house, such as copying, or for other expenses incurred in-house,

such as telephone charges, either by charging a reasonable amount to which

the client has agreed in advance or by charging an amount that reasonably

reflects the cost incurred by the lawyer.

Basis or Rate of Fee

[2]

When the lawyer has regularly represented a client, she or he

ordinarily will have evolved an understanding concerning the basis or rate of

the fee and the expenses for which the client will be responsible. In a new

client-lawyer relationship, however, an understanding as to fees and expenses

must be promptly established. Generally, it is desirable to furnish the client

with at least a simple memorandum or copy of the lawyer’s customary fee

arrangements that states the general nature of the legal services to be

provided, the basis, rate or total amount of the fee and whether and to what

extent the client will be responsible for any costs, expenses or disbursements

in the course of the representation. A written statement concerning the terms

of the engagement reduces the possibility of misunderstanding.

he lawyer’s customary fee

arrangements that states the general nature of the legal services to be

provided, the basis, rate or total amount of the fee and whether and to what

extent the client will be responsible for any costs, expenses or disbursements

in the course of the representation. A written statement concerning the terms

of the engagement reduces the possibility of misunderstanding.

[3]

Contingent fees, like any other fees, are subject to the

reasonableness standard of paragraph (a) of this Rule. In determining

whether a particular contingent fee is reasonable, or whether it is reasonable

to charge any form of contingent fee, a lawyer must consider the factors that

are relevant under the circumstances. Applicable law may impose limitations

on contingent fees, such as a ceiling on the percentage allowable, or may

require a lawyer to offer clients an alternative basis for the fee. Applicable

law also may apply to situations other than a contingent fee, for example,

government regulations regarding fees in certain tax matters.

Terms of Payment

[4]

A lawyer may require advance payment of a fee, but is obliged to

return any unearned portion. See Rule 1.16(d). A lawyer may accept property

in payment for services, such as an ownership interest in an enterprise,

providing this does not involve acquisition of a proprietary interest in the

cause of action or subject matter of the litigation contrary to Rule 1.8 (i).

However, a fee paid in property instead of money may be subject to the

requirements of Rule 1.8(a) because such fees often have the essential

qualities of a business transaction with the client.

[5]

An agreement may not be made whose terms might induce the

lawyer improperly to curtail services for the client or perform them in a way

contrary to the client’s interest. For example, a lawyer should not enter into

n property instead of money may be subject to the

requirements of Rule 1.8(a) because such fees often have the essential

qualities of a business transaction with the client.

[5]

An agreement may not be made whose terms might induce the

lawyer improperly to curtail services for the client or perform them in a way

contrary to the client’s interest. For example, a lawyer should not enter into

an agreement whereby services are to be provided only up to a stated amount

when it is foreseeable that more extensive services probably will be required,

unless the situation is adequately explained to the client. Otherwise, the client

might have to bargain for further assistance in the midst of a proceeding or

transaction. However, it is proper to define the extent of services in light of

the client’s ability to pay. A lawyer should not exploit a fee arrangement

based primarily on hourly charges by using wasteful procedures.

Prohibited Contingent Fees

[6]

Paragraph (d) prohibits a lawyer from charging a contingent fee

in a domestic relations matter when payment is contingent upon the securing

of a divorce or upon the amount of alimony or support or property settlement

to be obtained. This provision does not preclude a contract for a contingent

fee for legal representation in connection with the recovery of post-judgment

balances due under support, alimony or other financial orders because such

contracts do not implicate the same policy concerns. Paragraph (d) further

prohibits a lawyer from charging a fee to administer a probate estate when

payment is based upon a percentage of the value of the estate.

a contract for a contingent

fee for legal representation in connection with the recovery of post-judgment

balances due under support, alimony or other financial orders because such

contracts do not implicate the same policy concerns. Paragraph (d) further

prohibits a lawyer from charging a fee to administer a probate estate when

payment is based upon a percentage of the value of the estate.

Division of Fee

[7]

A division of fee is a single billing to a client covering the fee of

two or more lawyers who are not in the same firm. A division of fee facilitates

association of more than one lawyer in a matter in which neither alone could

serve the client as well, and most often is used when the fee is contingent and

the division is between a referring lawyer and a trial specialist. Paragraph (e)

permits the lawyers to divide a fee subject to certain conditions. The client

must consent to the employment of the other lawyer and to the terms for the

division of the fees, after full disclosure, which disclosure must be confirmed

in writing. In addition, the total fee must be reasonable. Contingent fee

agreements must be in a writing signed by the client and must otherwise

comply with paragraph (c) of this Rule. A lawyer should only refer a matter to

a lawyer whom the referring lawyer reasonably believes is competent to

handle the matter. See Rule 1.1.

[8]

Paragraph (e) does not prohibit or regulate division of fees to be

received in the future for work done when lawyers were previously

associated in a law firm, nor does paragraph (e) prohibit payment to a former

partner or associate pursuant to a separation or retirement agreement.

Paragraph (e) further does not address the issue of the fee division when a

lawyer is terminated before the matter is completed, and new counsel is

engaged.

vision of fees to be

received in the future for work done when lawyers were previously

associated in a law firm, nor does paragraph (e) prohibit payment to a former

partner or associate pursuant to a separation or retirement agreement.

Paragraph (e) further does not address the issue of the fee division when a

lawyer is terminated before the matter is completed, and new counsel is

engaged.

Disputes over Fees

[9] A mandatory fee arbitration procedure has been established for

resolution of fee disputes. Lawyers must conscientiously comply with the

procedure set forth in Maine Bar Rule 9. This Rule prescribes a procedure for

determining a lawyer’s fee, for example, in representation of an executor or

administrator, a class or a person entitled to a reasonable fee as part of the

measure of damages. The lawyer entitled to such a fee and a lawyer

representing another party concerned with the fee shall comply with the

prescribed procedure.