ATTORNEYS FEES MUST BE REASONABLE

• Jurisdiction: Washington

§3.4 ATTORNEYS FEES MUST BE REASONABLE

"A lawyer shall not make an agreement for, charge, or collect an unreasonable fee or an unreasonable amount for expenses." RPC 1.5(a)

(1) Reasonableness issues and disputes

An essential element of a claim for attorney fees is that fees be reasonable. The basic rule is that, "[a] lawyer shall not make an agreement for, charge, or collect an unreasonable fee or an unreasonable amount for expenses." RPC 1.5(a). The reasonableness requirements of RPC 1.5 apply whether the fee is being paid by the client or by a third party. Scott Fetzer Co. v. Weeks, 122 Wn.2d 141, 859 P.2d 1210 (1993).

Retainers and flat fees subject to the special rules in RPC 1.5(f) are also subject to the reasonableness requirement in RPC 1.5(a). RPC 1.5 cmt. 10. The same is true for contingent fees:

Contingent fees, like any other fees, are subject to the reasonableness standard of paragraph (a) of this Rule. In determining whether a particular contingent fee is reasonable, or whether it is reasonable to charge any form of contingent fee, a lawyer must consider the factors that are relevant under the circumstances.

RPC 1.5 cmt. 3.

The question of the reasonableness of a fee can arise in a variety of situations requiring a review and determination of the amount of fees by a court, including

(1)	as a defense to an action brought by a lawyer for the payment of fees;
(2)	a reasonableness determination under a statute such as RCW 4.24.005 for tort claims and RCW 7.70.070 for health care injuries;
(3)	a review of contingent fees by the court in the settlements of claims for incompetents or minors. (SPR 98.16W);
(4)	quantum meruit recovery of fees where the terms of a fee agreement have not been completed or the agreement is invalid;
(5)	disputes between attorneys in fee-sharing cases or arising out of compensation arrangements between lawyers; and

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(6) third-party or fee-shifting attorney fee claims by a prevailing party under a contract, statute, or common-law rule. A common situation is a request for attorney fees after a trial de novo from a mandatory arbitration.

(2) What's reasonable?

An attorney fee agreement with a client is the beginning point, not the final word, on what fees can be charged and recovered by a lawyer. RPC 1.5(a) lists nine categories of factors used to determine the reasonableness of fees:

The elements to be considered in determining the reasonableness of a fee include

(1)	the time and labor required, the novelty and difficulty of the questions involved, and the skill requisite 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, and ability of the lawyer or lawyers performing the services;
(8)	whether the fee is fixed or contingent; and
(9)	the terms of the fee agreement between the lawyer and the client, including whether the fee agreement or confirming writing demonstrates that the client had received a reasonable and fair disclosure of material elements of the fee agreement and of the lawyer's billing practices.

RCW 4.24.005 and RCW 7.70.070 contain almost identical lists of factors to be considered in determining the reasonableness of a fee in tort cases.

Whether a fee is reasonable may be subject to reexamination throughout the representation as circumstances change. Cotton v. Kronenberg, 111 Wn. App. 258, 44 P.3d 878 (2002), review denied, 148 Wn.2d 1011 (2003). A fee reasonable at the time that the fee agreement was entered into and when the work was done can become unreasonable with the passage of time. For example, in Holmes v. Loveless, 122 Wn. App. 470, 94 P.3d 338 (2004), attorneys who worked on the creation of

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a shopping center entity had a fee arrangement composed of a reduced hourly rate...