Despite having a written contingency fee contract with your lawyer, you can fire him at any time. However, depending on your reasons for firing him, you may still owe him a fee. In most jurisdiction, though not all, if you do owe him a fee, it will be based not on your contingency fee contract, but rather on quantum meruit (meaning “how much is merited”). Depending on when you fire your lawyer during the litigation, this can range from a relatively small sum up to the entire percentage you agreed to in the contingency fee contract (in a few jurisdictions it can even exceed the contracted amount). If you hire a new lawyer after firing the old, there are circumstances under which you could wind up paying a double attorney fee. So, before you fire your lawyer, consider the odds of having to pay him a fee, how much that fee might be, and how this will affect your overall recovery in the case.
Don’t Fire Your Lawyer Unless You Have To
Firing your lawyer should not be a decision made in haste, or in the heat of the moment. It should be a last resort, because it can often create more problems than it solves. Over the years, I’ve received numerous phone calls from plaintiffs who wanted to fire their current lawyers, and the vast majority had one thing in common — they had not had a face-to-face meeting with their current lawyers to address the issues which caused them to want to part ways. Almost all personal injury plaintiffs at one time or another have doubts about their lawyers. Often this arises from a failure by the lawyer to effectively communicate with the client.
Your lawyer may be doing everything he should as far as your lawsuit is concerned, but if he fails to return phone calls or fails to explain why your lawsuit is taking so long, he can leave you with the impression that he doesn’t care about your case or isn’t pursuing it diligently. If you need reassurance that your lawyer is moving your case along as he should, it is often helpful to schedule a phone conference (so there’s no chance you won’t get called back) or a sit-down meeting to discuss how your case is progressing (or why your case is being held up). Most lawyers prioritize working client files over keeping their clients informed about said work (which is often viewed by lawyers as “hand holding”). Based primarily on a few “problem” clients over the years who expect a law school education every time they call for a status update, many lawyers procrastinate when it comes to contacting their clients for fear of being trapped on the phone forever. So, if it seems like your lawyer is ducking you, it’s probably due to the sins of a former long-winded client (unless you also happen to be one of those long-winded clients). If you have a heart-to-heart with your lawyer and show him that you value his time, this will usually fix communication problems.
Of course, not every problem with your lawyer is a mere lack of communication. If your lawyer seems unprepared, such as at depositions or mediation, this is a legitimate cause for concern. If your lawyer talked tough at the beginning of your case, but now that it appears that you may have to go to trial he’s ready to fold like a cheap suit for an unreasonably low settlement offer, this is also a huge problem. These issues are usually something that can’t be fixed, so it is best to start looking for a new lawyer as soon as they arise.
If you are thinking of firing your lawyer, I strongly encourage you to have at least one face-to-face meeting with your lawyer to air your concerns before firing him. If your lawyer cannot alleviate your concerns during this meeting, then by all means try to find another lawyer. Just know that firing your lawyer carries with it a lot of headaches.
If You Fire Your Lawyer, It May Be Harder to Find a New One
Finding a new lawyer after you’ve fired (or are ready to fire) your old one will likely be more difficult than hiring a lawyer from scratch. Lawyers are wary of clients who’ve fired another lawyer. You could be an unreasonable “problem client”, or you could have an abrasive personality. You’ll likely be less trusting than a client who never had a prior issue with his or her lawyer. Even if the potential new lawyer blames the old lawyer for the firing, he may be reluctant to take a case that may have already been screwed up by that lawyer. Finally, the potential new lawyer may have concerns about you owing the old lawyer a fee. Your new lawyer could be faced with two equally distasteful options:
- Agree to take a smaller fee to offset the amount you may old the old lawyer; or
- Take a full fee, and risk you not being willing to settle because of the amount you’ll have to pay to both lawyers.
This brings us to the million dollar question: Do you have to pay your old lawyer a fee, and, if so, how much?
Do I Owe a Fee to the Lawyer I Fired?
If you fire your lawyer without good cause (e.g., you have no complaint with your current firm, but you just decided that you’d rather have your son-in-law’s law firm take the case) you will definitely owe the discharged lawyer a fee. Whether this fee will be the full amount of the contingency fee contract, or quantum meruit, will vary from state to state. The majority of states hold that an attorney who is discharged before the contingency in the contract takes place (a monetary recovery), even without good cause, is only entitled to quantum meruit (and of course, because we lawyers need to make things overly complicated, the issue of how this quantum meruit amount is determined varies from state to state, and even from case to case within the same state — more on this later).
If you fire your lawyer with good cause, the majority of states will not allow the fired attorney to recover any fee. In a minority of states, most notably Texas, an attorney who is discharged even for good cause may recover a fee — in these jurisdictions, only when the attorney’s actions rise to the level of outright misconduct (usually a serious ethics violation), will the attorney be denied any fee.
What is “Good Cause” for Firing a Lawyer?
Anything that constitutes a serious ethics violation would easily qualify as “good cause” to fire your lawyer. For example, if your lawyer has a conflict of interest (e.g., he’s representing both the passenger and driver of a car in an automobile accident case against a third party, and it becomes apparent that the passenger should also sue the driver of the vehicle in which he was riding), if your lawyer asks you to lie (or even commit perjury) about your claim, or if your lawyer advises you to defraud your medical lienholders (e.g., lie to your health insurer about what injuries are related to the case), these would most likely be sufficient grounds to deny the fired lawyer a fee in every jurisdiction.
Unfortunately (for purposes of simplifying this article — fortunately for real world clients), clients rarely fire their lawyers for offenses so egregious. More often, a perceived lack of diligence by the lawyer (not moving your case forward as quickly as possible), a difference of opinion over the value of the case, or a lack of communication by the lawyer with the client for a significant amount of time will be the “good cause” for the lawyer’s discharge cited by the client. Whether these actions, or inactions, rise to the level of good cause sufficient to completely deny a fired lawyer any fee (in the majority of jurisdictions which don’t require misconduct) will need to be determined on a case-by-case basis. This uncertainty about whether you will owe your old lawyer a fee is the main reason I encourage people to try to work it out with their lawyers before firing them. Neither you nor your former lawyer want to have to litigate the fee issue. It is a lot of extra work which neither of you need, which is why these disputes are usually compromised in all but the most contentious cases — this ironically creates the lack of caselaw which could help to remove the uncertainty for future lawyers and clients.
How is Quantum Meruit Determined?
If you owe the fired attorney a fee based on quantum meruit, get ready for more uncertainty. Most judges will apply a “totality of the circumstances” standard in determining what a fair fee is under quantum meruit. It could be a fee based on the average hourly rate of lawyers with similar skill and experience as the fired lawyer and the time expended by the fired lawyer. States are divided as to whether this amount is capped by the contingency fee percentage in the original contract, so in theory, some states will allow a discharged lawyer to recover more under quantum meruit than he would have received if he took the originally contracted percentage of the ultimate recovery — yikes!
Quantum meruit could be also be based on the percentage of the work done by the old lawyer relative to the amount done by a subsequent lawyer. Of course, this presumes that you’re in a jurisdiction which will limit the total fees for both the fired lawyer and the subsequent lawyer to the percentage stated in the contract signed by the original lawyer. Not all do. In theory, some will allow both the new lawyer and the fired lawyer to recover their full contingency fee percentages, or let the fired lawyer recover an amount in quantum meruit which is roughly equivalent, leaving the client with a meager percentage of the total recovery.
Just know that if it’s likely that the fired lawyer will be entitled to quantum meruit fees, the court which decides such fees has an enormous amount of discretion in determining what amount is “fair”. You and your former lawyer will really be at the judge’s mercy.
Protect Yourself When Hiring a New Lawyer
Aside from doing a better job screening your new lawyer than you did your last, you must be absolutely clear with the new lawyer how his fee will be determined in light of the fact that you may owe your old lawyer a fee. The best deal for you would be if your new lawyer agrees to limit his fees to the percentage stated in the contract with the initial lawyer, minus the fees that you must pay to the old lawyer. With this type of arrangement, you are no worse off (at least as far as fees are concerned) than you were with the original lawyer.
Not all lawyers will agree to this, especially if the old lawyer may have a large fee claim (or a claim to a full fee, as a lawyer in a state like Texas could). It would be in your best interests to discuss the possible fee arrangements with a new lawyer before terminating your old one so that you can weigh the pros and cons of firing the old lawyer more effectively.
It may be that you could come to some kind of compromise with the new lawyer, whereby your new lawyer agrees to limit his fees to the lesser of (1) the original contracted percentage, minus your old lawyer’s fees and (2) a fixed percentage of the total value of the case, such as 20%. This way, your new lawyer would be guaranteed at least a 20% fee, and you would be guaranteed that you would pay no more than the old attorney’s fee + 20%. It’s not an ideal arrangement for either side (and may not be allowed in jurisdictions which limit the total fee for all lawyers to the amount of the original contract), but agreements under which neither party is happy tend to be the most fair to both sides.
When to Fire Your Lawyer — Better Sooner Than Later
If you have made the decision to fire your lawyer, it is better to act upon it sooner rather than later. Allowing the soon-to-be-fired lawyer to continue to work on your case will only drive up the amount of fees to which he may be entitled after you fire him. Of course, I still recommend trying to work it out with him first, and checking with possible new lawyers to see what fee arrangement you face before telling your lawyer he’s fired. However, you need to pursue these two steps quickly and diligently once you start leaning towards firing your lawyer.
In other words, don’t be hasty in making the decision to fire your lawyer, but once that decision has been made, don’t wait to pull the trigger.
Liens the Fired Lawyer May Assert
There are two liens which are available to a discharged lawyer who believes that he is entitled to a fee: the charging lien and the retaining lien. In most jurisdictions, a charging lien can only be asserted if the lawyer filed a lawsuit on your behalf (if you fired him pre-suit, this lien won’t apply). The charging lien is usually asserted by your former lawyer by filing a Notice of Charging Lien with the court in the active lawsuit. The purpose of the Notice is to inform all of the parties to the lawsuit that the lawyer is claiming a right to some part of any settlement or judgment you may obtain.
If you settle or win your case, and the defendant pays you without honoring the charging lien, he may be liable to the former attorney for the full fee he ignored. For this reason, most defendants will want an assurance that the charging lien is dealt with (either paid or invalidated) before you get paid. They may pay the amount in dispute into the court (this is called interpleader), which will then disburse the funds (to either you, your lawyer, or divided among both) when the fee dispute is resolved. In some cases, the defendant may accept an agreement by your current attorney to hold the disputed funds in his trust account until the fee issue is resolved. Either way, the charging lien is an effective way for your former lawyer to ensure that you don’t spend the amount you may owe him before he can pursue his claim. This lien only applies to proceeds from the lawsuit. The lawyer cannot file a charging lien against any of your other assets.
A retaining lien allows your former lawyer to hold onto your case file (and refuse to give it to you or your new lawyer) unless and until an agreement is reached regarding his fees, and in many cases, costs. Even in cases where you may not owe your old lawyer a fee, you may still owe him his costs which must be either paid or guaranteed before he must release your file. Depending on the jurisdiction and the language of your fee contract, you may not have to pay his costs before receiving your file, if the costs, like his fees were part of the contingency (e.g. “no costs owed unless you win”). You will still likely need to pay them if you make a recovery.
Even if your former lawyer doesn’t assert any liens, he may still pursue his fee against you by way of a lawsuit. So if you know that your old lawyer expects a fee, don’t feel safe in ignoring his claim just because he didn’t assert any liens.
So Should I Fire My Lawyer or Not?
Only you can decide if your lawyer’s conduct warrants having to deal with the potential fee issues which will arise should you fire him. If this article gave you pause as to your decision to fire your lawyer, good. Fee disputes are a messy area of law, and the rules for resolving them vary widely from state to state. Even in states where the law is clear, issues regarding the amount of quantum meruit compensation to be awarded remain largely a matter for judges to decide on a case-by-case basis.
Before giving your lawyer the “Donald Trump” treatment, talk to a few prospective new lawyers to see how they feel about your odds of having to pay your old lawyer a fee, and what kind of deal you can expect from them if you will owe the old lawyer a fee. Try to nail down as many moving parts in this uncertain area of law before firing your lawyer.