1.5:230 FEES ON TERMINATION [SEE ALSO SECTION]

• Jurisdiction: Arizona

1.5:230 Fees on Termination [see also Section 1.16:600]

Although there are no Arizona authorities directly on point, it seems to be assumed that a lawyer is entitled to receive those fees which have been earned up to the date the relationship is terminated. This is an easy standard to apply where the fee arrangement with the client provides for an hourly rate. Issues arise, however, where the engagement was being carried out on either a fixed-fee or contingency-fee basis.

In the case of contingent-fee engagements, a client who enters into a contingency-fee agreement with an attorney may settle, compromise, or release the client's claims on any terms the client finds acceptable, without the attorney's consent, and even against the attorney's advice. Richfield Oil Corp. v. LaPrade, 56 Ariz. 100, 105 P.2d 1115 (1940). Moreover:

Our law does not bind a person to one attorney merely because he has entered into a contingent fee relationship. If the client in the exercise of this power discharges the attorney under a contingent fee contract before his lien arises, that attorney generally has a remedy only against the client for the value of his services.

State Farm Mutual Ins. Co. v. St. Joseph's Hosp., 107 Ariz. 498, 502, 489 P.2d 837, 841 (1971) (citing Walker v. Wright, 28 Ariz. 235, 236 P. 710 (1925)).

In Arizona Ethics Opinion No. 84-12, the Committee declined to address the question of whether an attorney who accepts a case on a contingent-fee basis may charge the client an hourly fee if the...