Dunn Seeks Retroactive Board Approval for AB 888 and AB1515

Two last minute additions to the agenda of the Board Operations Committee of the the California State Bar Board of Trustees seek Board approval of AB 1515 (Gonzalez), which would require California lawyers to place advanced fees into trust, and AB 852 (Dickinson) which would allow the State Bar to obtain a civil fine against those engaged in the unauthorized practice law.

Except that these bills have already been introduced under State Bar sponsorship.  These requests from Executive Director Dunn seem to seek the retroactive blessing of the Trustees for actions already undertaken by the Executive Director.

The May 6 request from Mr. Dunn to the Board Committee on Operations and Board of Trustees regarding AB 1515 couches this legislation in terms of addressing the increase in the payouts from the Client Security Fund.  It  cites to an “ambiguity” in California law concerning the status of advanced unearned fees under Rule of Professional Conduct 4-100(A), citing to Baranowski v. State Bar and ABA Model Rule 1.15(c), followed in 30 other states.

But what is doesn’t cite is the work of the Commission on the Revision of the Rules of Professional Conduct.  That Commission, after some study, declined to recommend a version of Model Rule 1.15(c).  The Commission citing the impact that rule change would have on the access to justice, as well as the California Supreme Court’s reluctance to adopt such a rule when presented with the opportunity.

Moreover, “proposed new language” if added, would greatly change the fee practices of many attorneys, including criminal defense attorneys, who are accustomed to charging fixed fees in advance:

Proposed additional language would provide that any fee paid in advance as the set amount of the fee for specified legal services (whether paid as a “fixed” fee, a “flat” fee,
or under any other label) is “earned” only when the attorney has performed and completed the legal services agreed to be provided in exchange for that fee, but allow that fee to be withdrawn in stages, provided the agreement with the client specifies each stage and sets the amount of the advance fee for each stage

Mr. Dunn’s argument for AB 852 principally addresses a constituency of one:  the Governor, who vetoed its last iteration.  It AB 852 makes the following changes to address the Governor’s concerns: gives the Attorney General and local prosecutors a right of first refusal; requires matters to involve injury or likelihood of imminent harm to clients or the
public; and eliminates the award of attorney’s fees to the State Bar.  Mr. Dunn also state that there is no known opposition, although its progenitor was adamantly opposed by CALDA, the association representing California legal document preparers (who, unlike California lawyers, to have a real trade association to protect their interests.)



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