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New form approved for fee disputes with clients

Attorneys who encounter a fee dispute with a client should be aware that the State Bar has come out with an updated version of the Notice of Client’s Right to Fee Arbitration form.

Attorneys may begin using the form now and are required to use it after July 1.

The new form, approved by the State Bar Board of Trustees on March 7, incorporates a handful of changes, including clarifying who can request fee arbitration and making it clear that more than one bar association may have jurisdiction to hear a fee dispute. The new version also contains the State Bar seal, a change made to ensure lawyers are providing clients with the correct form.  

Business and Professions Code § 6201(a) requires that lawyers send the notice to their clients before or at the time of initiating a lawsuit, or other action to collect fees. Attorneys are legally required to use the State Bar’s form – not their own version put on their firm’s letterhead.

Mandatory fee arbitration is designed to reduce the number of fee disputes that end up in court. The vast majority of fee disputes handled that way are resolved without filing an action in Superior Court, saving the courts valuable time and money, said Doug Hull, director of the State Bar’s Mandatory Fee Arbitration Program.

Rae Lamothe, chair of the Committee on Mandatory Fee Arbitration, said the modifications to the form, though minor, resolve some issues and concerns that had been brought to the committee’s attention.  

“There were just things that kept coming up over and over,” she said.

The most substantive of the changes is that the form now spells out that a third party who pays attorney fees on behalf of someone else is also entitled to request fee arbitration, Lamothe said.

“It wasn’t as direct as it could be,” she said.

In addition, the form not only identifies a local bar association’s fee arbitration program where the request for arbitration may be filed, but also recommends checking the State Bar’s website to see what other programs might be available to the client.

Although attorneys may use the old version of the form until July 1, they are encouraged begin using the new form and to update any fee arbitration information on their websites. The new form is available here.