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New Jersey Court Shoots Down Legal Malpractice Claim Asserted As A Defense to A Fee Claim

One question which comes up frequently is whether a client can sue his former lawyer for legal malpractice based on what the client believes is an inflated legal bill.

A legal fee dispute is essentially a breach of contract case filed by the lawyer against the former client. Here the specific complaint was that the lawyer did not explain that, under the fee agreement, the lawyer was not required to refund any portion of the client’s deposit.

“Plaintiff next argues defendants breached a fiduciary duty to plaintiff by failing to properly advise him as to the non-refundable aspect of the retainer agreement. “In entering a contract at the outset of a representation, the lawyer must explain the basis and rate of the fee . . . and advise the client of such matters as conflicts of interest, the scope of the representation, and the contract’s implications for the client. . . .” Restatement (Third) of the Law Governing Lawyers § 18 cmt. d (Am. Law Inst. 2000). RPC 1.4(c) states, “A lawyer shall explain a matter to the extent reasonably necessary to permit the client to make informed decisions regarding the representation.”

The RPCs require an explanation “to the extent reasonably necessary to permit the client to make informed decisions regarding the representation.” RPC 1.4(c). As a former attorney, plaintiff was clearly capable of understanding the non-refundable nature of the agreement and the implications of such an agreement. Therefore, defendants did not violate RPC 1.4(c). Furthermore, even if defendants did violate RPC 1.4(c), such a violation does not automatically constitute malpractice. See Baxt, 155 N.J. at 198-200. Accordingly, we conclude defendants did not breach any fiduciary duty to plaintiff by failing to explain the retainer agreement.

Because defendants did not breach any fiduciary duty to plaintiff, and the record contains no evidence of any negligent representation of plaintiff, defendants did not commit malpractice. Accordingly, we find the trial court properly dismissed plaintiff’s malpractice and breach of fiduciary duty claims.”

The court viewed this as a fee dispute, not a claim that the lawyer’s work was negligent. Therefore, it dismissed the counterclaim for legal malpractice and breach of fiduciary duty. A link to the opinion is here:

https://scholar.google.com/scholar_case?case=2388808018773965246&q=legal+malpractice&hl=en&scisbd=2&as_sdt=400006&as_ylo=2018