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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. Just an aside, but regardless of the outcome, I 'm proud of Judge William Hughes. He was the original magistrate on the Home place issue. He ruled for Home Place, and was primaried by Brainard for it. Their tool Poindexter failed to unseat Hughes, who won support for his honesty and courage throughout the county, and he was reelected Judge of Hamilton County's Superior Court. You can still stand for something and survive. Thanks, Judge Hughes!

  2. CCHP's real accomplishment is the 2015 law signed by Gov Pence that basically outlaws any annexation that is forced where a 65% majority of landowners in the affected area disagree. Regardless of whether HP wins or loses, the citizens of Indiana will not have another fiasco like this. The law Gov Pence signed is a direct result of this malgovernance.

  3. I gave tempparry guardship to a friend of my granddaughter in 2012. I went to prison. I had custody. My daughter went to prison to. We are out. My daughter gave me custody but can get her back. She was not order to give me custody . but now we want granddaughter back from friend. She's 14 now. What rights do we have

  4. This sure is not what most who value good governance consider the Rule of Law to entail: "In a letter dated March 2, which Brizzi forwarded to IBJ, the commission dismissed the grievance “on grounds that there is not reasonable cause to believe that you are guilty of misconduct.”" Yet two month later reasonable cause does exist? (Or is the commission forging ahead, the need for reasonable belief be damned? -- A seeming violation of the Rules of Profession Ethics on the part of the commission) Could the rule of law theory cause one to believe that an explanation is in order? Could it be that Hoosier attorneys live under Imperial Law (which is also a t-word that rhymes with infamy) in which the Platonic guardians can do no wrong and never owe the plebeian class any explanation for their powerful actions. (Might makes it right?) Could this be a case of politics directing the commission, as celebrated IU Mauer Professor (the late) Patrick Baude warned was happening 20 years ago in his controversial (whisteblowing) ethics lecture on a quite similar topic: http://www.repository.law.indiana.edu/cgi/viewcontent.cgi?article=1498&context=ilj

  5. I have a case presently pending cert review before the SCOTUS that reveals just how Indiana regulates the bar. I have been denied licensure for life for holding the wrong views and questioning the grand inquisitors as to their duties as to state and federal constitutional due process. True story: https://www.scribd.com/doc/299040839/2016Petitionforcert-to-SCOTUS Shorter, Amici brief serving to frame issue as misuse of govt licensure: https://www.scribd.com/doc/312841269/Thomas-More-Society-Amicus-Brown-v-Ind-Bd-of-Law-Examiners

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