Contingency Fee Regulations Sought
Washington
A prominent legal reform group has filed a petition with the Federal Trade Commission asking it to require lawyers to provide clients with detailed information before entering into contingency fee arrangements.
The Washington Legal Foundation, based here, asked the FTC to declare it an "unfair trade practice" for a lawyer to enter into a contingency fee arrangement without disclosing that:
The client has a three-business-day cooling off period to reconsider and rescind the arrangement.
The size of the fee is subject to negotiation.
There are potential adverse consequences of litigation, including counterclaims and payment of out-of-pocket expenses by the attorneys.
WLF is also asking that lawyers explain to clients the approximate chance for a recovery and the likely amount.
WLF said that FTC action is needed because most citizens lack the experience and information necessary to safeguard their own interests, evaluate the potential merit of their claims, and assess the work and skill needed by the attorney to pursue the claim.
However, the Washington-based Association of Trial Lawyers of America says that contingency fees are already regulated. Courts always possess the power to review fees in personal injury cases and all jurisdictions have fee dispute procedures, ATLA says.
Reproduced from National Underwriter Property & Casualty/Risk & Benefits Management Edition, September 10, 2001. Copyright 2001 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.
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