State Bar of South Dakota

Ethics Opinion 92-10

December 7, 1992

FACTS

You undertook to represent a plaintiff in a personal injury action. The action had already been commenced by an attorney under a contingent fee plus costs arrangement. During the course of the action, the attorney who commenced the action was suspended from practice by the South Dakota Supreme Court. Your arrangement with the client is a contingent fee plus costs arrangement as well. You posed two questions to this committee: 

1) Is the attorney who commenced the case and is under suspension and not in good standing with the State Bar of South Dakota entitled to collect any fee when the matter is finally resolved; 

2) If the attorney is entitled to collect a fee, is the fee to be the percentage stated in the contingent fee agreement or must it be based upon a quantum meruit basis, or is the attorney to be reimbursed only for the costs advanced. 

OPINION

In response to your first question, it is the opinion of the Committee that the suspended attorney is entitled to a fee when the matter is finally resolved. In Ethics Opinion 90-8, this Committee ruled that a disbarred attorney was entitled to and could be paid those fees earned on cases prior to disbarment despite the prohibition against sharing fees with non-lawyers contained within Rule 5.4(a). If a disbarred attorney is entitled to those fees earned prior to disbarment, then clearly a suspended lawyer is entitled to those fees earned prior to suspension. 

In response to your second question, it is the opinion of the Committee that the fee is to be that fee which the lawyer earned prior to the suspension. Such fee should be based on a quantum meruit recovery for the actually work done before the suspension. The lawyer would also be entitled to reimbursement for any costs advanced. 

Michael S. McKnight
Chair, Ethics Committee

Supplement to Ethics Opinion 92-10

March 8, 1993

Thank you for your letter dated January 25, 1993 concerning Ethics Opinion 92-10. In that opinion you pointed out to this Committee two South Dakota Supreme Court cases involving issues similar to that addressed in Ethics Opinion 92-10. See, Egan v. Waggoner, 170 NW 142 (SD 1918); Davenport v. Waggoner, 207 NW 972 (SD 1926). Neither of these cases was cited in Ethics Opinion 92-10. This Committee does not have the authority to overrule Supreme Court precedent. Upon review of Egan and Davenport by this Committee, it is still the opinion of this Committee that the response given in Ethics Opinion 92-10 represents the modern view on this issue under the Rules of Professional Conduct as adopted in South Dakota. Since the Egan and Davenport cases were decided, the State Bar of South Dakota and the South Dakota Supreme Court have adopted and repealed the Code of Professional Responsibility and adopted and approved of the Rules of Professional Conduct. It is the opinion of this Committee that Ethics Opinion 92-10 represents the modern view under the Rules and that Ethics Opinion 92-10 was correctly decided by this Committee.

Michael S. McKnight
Chair, Ethics Committee