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Contingency Fee Agreement Permitted Only If Fee Is Reasonable

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MARCH 31, 2003 VOLUME 10, NUMBER 39

Contingency fee agreements are common in personal injury cases and many other types of litigation. In some kinds of lawsuits (for example, divorce or criminal cases) contingency fee arrangements are banned as being against public policy. Are contingency fees permissible in probate cases, and particularly will contests? According to a recent Louisiana case, the answer is yes—but only if the fees calculated on a contingency basis are “reasonable.”

After Betty Kinchen Bankston died in 2000 her heirs found a document that appeared to be her last will. Local attorney Keith Rowe, representing one of the estate’s beneficiaries, filed the will with the probate court and secured initial orders recognizing its validity. Then, as he was required by state probate law to do, he gave notice to the persons who would take Ms. Bankston’s estate if the will was not valid.

About two-thirds of those heirs (thirty-four individuals in all) hired attorney Joseph Simpson to challenge the document as a forgery. Their fee agreement provided that Mr. Simpson would receive one-third of their share of the estate if he was successful. Mr. Simpson then filed a challenge to the will.

After reviewing the evidence, Mr. Rowe (the lawyer who originally filed the probate proceeding) and his client agreed that the will was invalid. They withdrew their request for probate.

As it turned out, Ms. Bankston’s estate was worth over $2,400,000, and Mr. Simpson’s percentage fee was about $600,000. One of his clients objected that the fee was excessive and should not be allowed.

Mr. Simpson pointed out that he had a validly executed fee agreement, and argued that he was entitled to the whole fee. The trial judge ordered distribution of the entire contingency fee to Mr. Simpson’s law firm.

The Louisiana Court of Appeal disagreed. The appellate judges agreed that there is no prohibition against contingency fee agreements in probate cases, but noted that any lawyer’s fee is subject to a requirement that it be “reasonable.” In this case, the judges pointed out, Mr. Simpson’s billing records indicated that he performed no more than thirty hours of work, and he even limited his risk by including a provision that he could dismiss the challenge if a handwriting expert did not support the will challenge. On top of all that, Mr. Rowe’s firm had done most of the work involved in administering the estate. The appellate court directed the trial court to determine a reasonable fee for Mr. Simpson.

What elements will determine the “reasonableness” of Mr. Simpson’s fee when the case returns to the trial court? The law on attorneys’ fees is fairly clear. The judge will be looking for the total amount of time spent by Mr. Simpson and his firm, the necessity for the work that was done, the prevailing rate for attorneys’ work in the community and in the type of case involved, the complexity of the case, the experience and reputation of Mr. Simpson and other relevant factors. After reviewing all of that, the judge might approve the fee as requested, or reduce it. Succession of Bankston, February 14, 2003.

Robert B. Fleming

Attorney

Robert Fleming is a Fellow of both the American College of Trust and Estate Counsel and the National Academy of Elder Law Attorneys. He has been certified as a Specialist in Estate and Trust Law by the State Bar of Arizona‘s Board of Legal Specialization, and he is also a Certified Elder Law Attorney by the National Elder Law Foundation. Robert has a long history of involvement in local, state and national organizations. He is most proud of his instrumental involvement in the Special Needs Alliance, the premier national organization for lawyers dealing with special needs trusts and planning.

Robert has two adult children, two young grandchildren and a wife of over fifty years. He is devoted to all of them. He is also very fond of Rosalind Franklin (his office companion corgi), and his homebound cat Muninn. He just likes people, their pets and their stories.

Elizabeth N.R. Friman

Attorney

Elizabeth Noble Rollings Friman is a principal and licensed fiduciary at Fleming & Curti, PLC. Elizabeth enjoys estate planning and helping families navigate trust and probate administrations. She is passionate about the fiduciary work that she performs as a trustee, personal representative, guardian, and conservator. Elizabeth works with CPAs, financial professionals, case managers, and medical providers to tailor solutions to complex family challenges. Elizabeth is often called upon to serve as a neutral party so that families can avoid protracted legal conflict. Elizabeth relies on the expertise of her team at Fleming & Curti, and as the Firm approaches its third decade, she is proud of the culture of care and consideration that the Firm embodies. Finding workable solutions to sensitive and complex family challenges is something that Elizabeth and the Fleming & Curti team do well.

Amy F. Matheson

Attorney

Amy Farrell Matheson has worked as an attorney at Fleming & Curti since 2006. A member of the Southern Arizona Estate Planning Council, she is primarily responsible for estate planning and probate matters.

Amy graduated from Wellesley College with a double major in political science and English. She is an honors graduate of Suffolk University Law School and has been admitted to practice in Arizona, Massachusetts, New York, and the District of Columbia.

Prior to joining Fleming & Curti, Amy worked for American Public Television in Boston, and with the international trade group at White & Case, LLP, in Washington, D.C.

Amy’s husband, Tom, is an astronomer at NOIRLab and the Head of Time Domain Services, whose main project is ANTARES. Sadly, this does not involve actual time travel. Amy’s twin daughters are high school students; Finn, her Irish Red and White Setter, remains a puppy at heart.

Famous people's wills

Matthew M. Mansour

Attorney

Matthew is a law clerk who recently earned his law degree from the University of Arizona James E. Rogers College of Law. His undergraduate degree is in psychology from the University of California, Santa Barbara. Matthew has had a passion for advocacy in the Tucson community since his time as a law student representative in the Workers’ Rights Clinic. He also has worked in both the Pima County Attorney’s Office and the Pima County Public Defender’s Office. He enjoys playing basketball, caring for his cat, and listening to audiobooks narrated by the authors.