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March 1, 2014
Board eyes confidentiality, nonrefundable fees issues

Lawyers would be allowed to reveal some confidential client information when a lawyer is changing a law firm or law firms are merging if the revealed information will not harm the client, under a rule amendment pending before the Board of Governors.

Another pending change would clarify that nonrefundable fees are considered earned on receipt and must not be placed in lawyers’ trust accounts.

The board got its first look at those and other proposed rule amendments at its January meeting in Tallahassee, and is scheduled to vote on them at its March 28 meeting.

The change to Rule 4-1.6 would add subsection (c)(6) to provide for the limited disclosure of information “to detect and resolve conflicts of interest between lawyers in different firms arising from the lawyer’s change of employment or from changes in the composition or ownership of a firm, but only if the revealed information would not compromise the attorney-client privilege or otherwise prejudice the client.”

It would also add subsection (e) to provide that, “A lawyer must make reasonable efforts to prevent the inadvertent or unauthorized disclosure of, or unauthorized access to, information relating to the representation of a client.”

New language in Rule 4-1.5, on fees and costs for legal services, provides a definition for retainers, flat fees, and advance fees. Language also is being added to the rule comment to provide, “A nonrefundable retainer or nonrefundable flat fee is the property of the lawyer and should not be held in trust. If a client gives the lawyer a negotiable instrument that represents both an advance on costs plus either a nonrefundable retainer or a nonrefundable flat fee, the entire amount should be deposited into the lawyer’s trust account, then the portion representing the earned nonrefundable retainer or nonrefundable flat fee should be withdrawn within a reasonable time. An advance fee must be held in trust until it is earned. Nonrefundable fees are, as all fees, subject to the prohibition against excessive fees.”

The amendments to Rule 4-1.6 stemmed from recommendations from the ABA Ethics Commission 20/20. The amendments to Rule 4-1.5 came from an earlier attempt by the Bar to amend the rule comment and a direction from the Supreme Court that the changes should be in the rule, not the comment.

Those and other proposed rules changes were in an official notice in the February 15 News.

One of those alterations changes slightly the requirement in Rule 1-3.3 for Bar members to provide the Bar with a valid email address. The current rule requires that email address “if the member has one.” That language would be struck in the revision and instead leaves the requirement for the email address, but allows the Bar to waive that requirement “if the Bar members have been excused by the court from e-service or the Bar members demonstrate that the Bar member has no email account and lacks Internet service at the Bar member’s office.”

[Revised: 12-30-2017]