Ethics Committee Formal Opinion #1990-91/5
Fees: Fixed Fee for Insurance Defense Work
January 28, 1991
A fixed fee with an insurance company is unlikely to be “clearly excessive.” (Rule 1.5).
An insured’s consent to a lawyer’s fee agreement with an insurance company is not required or is implicitly given under the terms of the insurance policy. (Rule 1.8(f)).
An attorney, no matter what the fee arrangement, is duty bound to act with diligence in his or her representation of the client. (Rule 1.3(a)).
A lawyer shall not represent a client if the representation of the client may be materially limited by the lawyer’s own interests. (Rule 1.7(b).
A fee must be reasonable. (Rule 1.5).
Performance must be reasonably prompt and diligent. (Rule 1.3).
A lawyer has an obligation to keep his or her client reasonably informed regarding the status of the client’s legal matter and to promptly comply with reasonable requests for information. (Rule 1.4(a)).
- May an attorney enter into an agreement with an insurance company pursuant to which the attorney will undertake the defense of a number of insureds upon payment by the company to the attorney of a fixed fee per case?
- Is such an agreement a violation of Professional Conduct Rules 1.5, 1.7, or 1.8?
- Is the consent of the insured required in a fixed fee agreement between the insurance company and counsel?