From the hearsay department: a serious heads up about non-fundable retainers

We know that hearsay is generally inadmissible subject to a significant and growing number of exceptions.  What follows is not one of them.  On the other hand this is not a court, at least not a court of law.  We are also aware that in matters relating to legal ethics, whether or not one is subject to the rules of evidence, facts and evidence matter, nuance matters, asking questions and listening matter IF one wants to be fair and to try to get things right.  We do.  So, we wish to be clear that this post is not about anyone we know of.  We know no names, have no evidence, no facts, nothing.  Except a bit of hearsay.

We have heard that some lawyers are collecting non-fundable retainers as if all that mattered was the client’s signature on a retainer agreement that carefully spells out the entire fee or significant portion of it is non-refundable.  For lawyers who collect non-refundable retainers secure in the belief that freedom of contract is all that matters, we recommend for their immediate attention Informal Opinion 00-12, Non-Refundable Retainers.

It is true that ethics committee opinions are non-binding.  But, even though we are not the gambling sort, we bet that the Office of Chief Disciplinary Counsel and Statewide Grievance Committee would likely take a keen interest if, for example, a lawyer charged a $2,500 “non-refundable” retainer on a Title 19 case, did little or no work during the spend down period and then refused to refund any of the fee after the client died unexpectedly.