MARYLAND STATE BAR ASSOCIATION, INC.
COMMITTEE ON ETHICS
ETHICS DOCKET NO. 1995-03
Advertising contingency fees and changes in amount of fee
Your letter inquires whether or not a proposed change in the percentage you currently charge in your contingency fee arrangements with your clients would result in any ethical problems. Specifically, you indicate that, in the past, you have promoted a twenty-five percent (25%) contingent fee arrangement in the media and further indicate that you will shortly discontinue that promotion, both in print and TV advertisements and begin charging thirty-three and one third percent (33 1/3%). You seem to be concerned that new clients may still rely on the promotion at the twenty-five percent rate as previously advertised.
Initially, it appears that your concerns may be based on contract law considerations involving acceptance and revocation rendering legal opinions, you must obviously comply with the appropriated legal considerations.
You indicate that you had researched Maryland Rule of Professional Conduct 7.2. It is the opinions of this Committee that, as long as you follow those Rules, beginning at 7.1, et. seq., involving Advertising, and also Rule 1.5 concerning the reasonableness of fees, you should not encounter any ethical problems on the point raised in your inquiry. The Committee points out that Rule 1.5(c) requires: ""The terms of a contingent fee agreement shall be communicated to the client in writing.: Obviously, the percentage rates set forth in your current executed fee agreements would be applicable at whatever rate is set forth therein. Thus, any future contingent fee agreement could be negotiated at the higher thirty-three and one third percent rate, assuming that the timing of the initiation of the new rate is not limited by any requirements of contract law. Again, you would have to determine the latter aspect.