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Attorney reprimanded for charging unreasonable fees

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The Indiana Supreme Court has publicly reprimanded a Hamilton County attorney for violating Indiana Professional Conduct Rule 1.5(a) by making agreements for and charging unreasonable fees.

The justices released a per curiam opinion Feb. 11, In the Matter of Heather McClure O'Farrell, No. 29S00-0902-DI-76, in which the majority chose the discipline based on Heather McClure O'Farrell’s lack of prior disciplinary history and her cooperation with the Disciplinary Commission. Chief Justice Randall T. Shepard and Justice Robert Rucker joined in a dissent to the sanction. Because O'Farrell’s lawyer indicated that she is unrepentant, the dissenting justices believe a period of suspension without automatic reinstatement should have been instituted to protect clients.

McClure & O’Farrell, where O'Farrell practices, uses an “Hourly Fee Contract” or a “Flat Fee Contract” most of the time when it represents a party in a family law matter. Both contracts contain a provision for a nonrefundable “engagement fee.” The Disciplinary Commission alleged that O'Farrell improperly charged two clients these nonrefundable engagement fees and didn’t refund unearned fees after the representations ended.

The justices examined the various types of fee arrangements and the nonrefundability of fees. O'Farrell argued that the nonrefundable fees she charged the two clients were justified because by representing these clients, the law firm couldn’t represent opposing parties and it required time that the firm could have otherwise devoted to other representations. But this would be true anytime an attorney is engaged by a client, the opinion said.

They determined that the fees at issue are flat fees for work to be performed. O'Farrell failed to tell her clients that the flat fee could be refundable upon the failure to perform the agreed legal services; instead, she told her clients the fee was nonrefundable even if the client-attorney relationship ended before the completion of the attorney’s representation.

“The presence of this contract provision, even if unenforceable, could chill the right of a client to terminate Respondent's services, believing the Law Firm would be entitled to keep the entire flat fee regardless of how much or how little work was done and the client would have to pay another attorney to finish the task. We conclude that Respondent violated Rule 1.5(a) by including an improper nonrefundability provision in her flat fee agreements,” said the opinion.

They also found she violated the rule by charging and collecting flat fees that were nonrefundable, regardless of the circumstances.

“The Court is mindful of the legitimate concern of attorneys that they will go through the initial steps of opening a case and beginning work for a new client, only to have that client discharge them and demand a refund of the entire initial payment as unearned. The solution, however, is not allowing attorneys to charge flat or advance fees upfront that are wholly nonrefundable regardless of the amount of services rendered,” wrote the justices.

They decided based on the record they weren’t able to hold that some amount of the flat fee must be returned in all cases in which the attorney-client relationship ends before the work contracted for is completed. They also were unable to determine how much, if anything, O'Farrell should have refunded to the two clients, so they found the Disciplinary Commission didn’t meets its burden of proof that she violated Rule 1.16(d).

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  • Cooperation
    I cooperated fully by producing my entire files. Many of the allegations are false, and many of the Defamatory Commission's legal conclusions would qualify as extremist hack positions. They stole my law license by fraud and should be held accountable.
  • Consistent
    If I recall, Tony Zirkle did not cooperate in the disciplinary process.
  • consistent or not?
    is this consistent with the punishment laid on Tony Zirkle or was he punished more severely? And why?

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  1. Where may I find an attorney working Pro Bono? Many issues with divorce, my Disability, distribution of IRA's, property, money's and pressured into agreement by my attorney. Leaving me far less than 5% of all after 15 years of marriage. No money to appeal, disabled living on disability income. Attorney's decision brought forward to judge, no evidence ever to finalize divorce. Just 2 weeks ago. Please help.

  2. For the record no one could answer the equal protection / substantive due process challenge I issued in the first post below. The lawless and accountable only to power bureaucrats never did either. All who interface with the Indiana law examiners or JLAP be warned.

  3. Hi there I really need help with getting my old divorce case back into court - I am still paying support on a 24 year old who has not been in school since age 16 - now living independent. My visitation with my 14 year old has never been modified; however, when convenient for her I can have him... I am paying past balance from over due support, yet earn several thousand dollars less. I would contact my original attorney but he basically molest me multiple times in Indy when I would visit.. Todd Woodmansee - I had just came out and had know idea what to do... I have heard he no longer practices. Please help1

  4. Yes diversity is so very important. With justice Rucker off ... the court is too white. Still too male. No Hispanic justice. No LGBT justice. And there are other checkboxes missing as well. This will not do. I say hold the seat until a physically handicapped Black Lesbian of Hispanic heritage and eastern religious creed with bipolar issues can be located. Perhaps an international search, with a preference for third world candidates, is indicated. A non English speaker would surely increase our diversity quotient!!!

  5. First, I want to thank Justice Rucker for his many years of public service, not just at the appellate court level for over 25 years, but also when he served the people of Lake County as a Deputy Prosecutor, City Attorney for Gary, IN, and in private practice in a smaller, highly diverse community with a history of serious economic challenges, ethnic tensions, and recently publicized but apparently long-standing environmental health risks to some of its poorest residents. Congratulations for having the dedication & courage to practice law in areas many in our state might have considered too dangerous or too poor at different points in time. It was also courageous to step into a prominent and highly visible position of public service & respect in the early 1990's, remaining in a position that left you open to state-wide public scrutiny (without any glitches) for over 25 years. Yes, Hoosiers of all backgrounds can take pride in your many years of public service. But people of color who watched your ascent to the highest levels of state government no doubt felt even more as you transcended some real & perhaps some perceived social, economic, academic and professional barriers. You were living proof that, with hard work, dedication & a spirit of public service, a person who shared their same skin tone or came from the same county they grew up in could achieve great success. At the same time, perhaps unknowingly, you helped fellow members of the judiciary, court staff, litigants and the public better understand that differences that are only skin-deep neither define nor limit a person's character, abilities or prospects in life. You also helped others appreciate that people of different races & backgrounds can live and work together peacefully & productively for the greater good of all. Those are truths that didn't have to be written down in court opinions. Anyone paying attention could see that truth lived out every day you devoted to public service. I believe you have been a "trailblazer" in Indiana's legal community and its judiciary. I also embrace your belief that society's needs can be better served when people in positions of governmental power reflect the many complexions of the population that they serve. Whether through greater understanding across the existing racial spectrum or through the removal of some real and some perceived color-based, hope-crushing barriers to life opportunities & success, movement toward a more reflective representation of the population being governed will lead to greater and uninterrupted respect for laws designed to protect all peoples' rights to life, liberty & the pursuit of happiness. Thanks again for a job well-done & for the inevitable positive impact your service has had - and will continue to have - on countless Hoosiers of all backgrounds & colors.

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