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Legal Ethics

Mass. Lawyer Loses License for a Year for Charging $93.8K Contingent Fee, Absent a Contingency

Posted Nov 21, 2011 5:03 PM CDT
By Martha Neil

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A Massachusetts lawyer has lost his license for a year and a day, pursuant to a stipulated agreement, for charging an elderly woman a contingency fee of nearly $94,000 in a situation in which there was no contingency.

John S. Tara was acting as a special administrator for the estate of an elderly man when he discovered by making a phone call, that an 86-year-old female friend of the decedent was the beneficiary of an annuity of nearly $200,000, explains a summary of an opinion (PDF) by the Supreme Judicial Court of Suffolk County. However, instead of simply informing the woman, who expected to receive a substantial amount from the estate and asked about an annuity, that she was the beneficiary, Tara met with her and got her to agree to a one-third contingency fee without disclosing all of the relevant information.

His client later disputed the $93,758.02 contingent fee Tara deducted before sending her a check for $187,797.61. He refunded $60,000 of the $93,758.02 to her to settle the dispute after she retained counsel.

Her son, however, further pursued the complaint against Tara after his mother died, obtaining an additional $41,158.02 in reimbursement of the remaining contingent fee charge, plus his legal costs for collecting it, the summary recounts.

"By entering into an agreement for, charging, and collecting a contingent fee for filing a claim for an annuity when there was no contingency, the respondent charged a clearly excessive fee in violation of Mass. R. Prof. C. 1.5(a)," it states. "By failing to explain to his client in advance of entering into the contingent-fee agreement that he had already discovered the existence of the annuity for which she was a beneficiary, the respondent failed to explain a matter to the extent necessary to permit the client to make informed decisions regarding the representation in violation of Mass. R. Prof. C. 1.4(b).

"By concealing from his client that he was already aware of the existence of the annuity naming her as a beneficiary before entering into the contingent-fee agreement, the respondent engaged in conduct involving dishonesty, fraud, deceit, or misrepresentation, in violation of Mass. R. Prof. C. 8.4(c)," the summary continues.

Aggravating this situation was the fact that Tara is a seasoned practitioner who was admitted in 1970 and had "a selfish motive for the misconduct."

A phone message left for Tara by the ABA Journal did not receive an immediate response.

Hat tip: Legal Profession Blog.

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