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By: Greg Fayard
Sometimes clients don’t pay their attorneys’ fees. Should the unpaid lawyer sue his or her client for owed legal fees? While the lawyer certainly has the right to file suit, a lawsuit against a client can trigger a cross-claim for legal malpractice or breach of fiduciary duty. If you don’t want a lawsuit with your client, it is better to not file a lawsuit against your client. If, however, you have no choice (e.g., the amount is significant and the client is ignoring your collection efforts), make sure you file it after the statute of limitations has run on a legal malpractice claim. In California, wait more than one-year after you ended your representation or performed any legal work for the now delinquent former client. Better yet, before you decide to bring a claim for fees, conduct an analysis of any tolling provisions in the legal malpractice statute, such as when the delinquent client knew or should have known of any facts that could support a malpractice claim, or when the delinquent client suffered an “actual injury.”
Some lawyers prefer the slightly less formal process of resolving fee disputes through fee arbitration available through county bar associations, or the State Bar.
Regardless of the forum, before bringing a claim for fees, whether in fee arbitration or in court, double check your insurance policy to verify that a cross-claim for legal malpractice is a covered claim. Lastly, ask yourself, is paying your deductible and possible higher insurance premiums in future years worth filing a fee claim? More often than not, the answer is “no.”
If you have any questions or would like more information, please contact Greg Fayard at email@example.com, or any other member of our Lawyers Professional Liability Practice Group, a list of which can be found at stage.fmglaw.com.