1.5:310 EXCESSIVE FEES

• Jurisdiction: Arizona

1.5:310 Excessive Fees

The overarching requirement of ER 1.5(a) is that: "A lawyer shall not make an agreement for, charge or collect an unreasonable fee or an unreasonable amount for expenses." This requirement applies whether the fee is a fixed fee, a contingency fee, or a fee based on an hourly rate. In re Swartz, 141 Ariz. 266, 686 P.2d 1236 (1984); ABC Supply, Inc. v. Edwards, 191 Ariz. 48, 952 P.2d 286 (App. 1997). Cases where a lawyer's fee has been found to be "excessive" roughly divide into three categories: (1) cases where the lawyer's fee, whether or not embodied in a written fee agreement, exceeds what can be considered "reasonable" by application of the criteria set forth in ER 1.5(a); (2) cases where a lawyer charges a client more than the client has agreed to pay, or has included in billings to clients elements or charges for which the client has not agreed to be responsible; and (3) cases in which the lawyer has accepted a lump-sum advance retainer or fixed-fee advance payment for an engagement and has not performed or completed the task for which the lawyer was engaged.

With respect to the first category of cases, ER 1.5(a)(1) through (8) identify the following factors that are to be considered in gauging the reasonableness of a lawyer's fee:

(1) the time and labor required, the novelty and difficulty of the questions involved, and the skill required to perform the legal service properly;

(2) the likelihood, if apparent to the client, that the acceptance of the particular employment will preclude other employment by the lawyer;

(3) the fee customarily charged in the locality for similar legal services;

(4) the amount involved and the results obtained;

(5) the time limitations imposed by the client or by the circumstances;

(6) the nature and length of the professional relationship with the client;

(7) the experience, reputation...