The ABA Standing Committee on Ethics and Professional Responsibility has issued ABA Formal Ethics Opinion 523 titled “Engagement Agreements Allowing a Lawyer to Withdraw When the Client Fails Substantially to Fulfill an Obligation Regarding the Lawyer’s Services.”
The opinion’s summary:
“Rule 1.16(b)(5) of the ABA Model Rules of Professional Conduct permits a lawyer to withdraw from a representation, or to seek the tribunal’s permission to do so, when “the client fails substantially to fulfill an obligation to the lawyer regarding the lawyer’s services and has been given reasonable warning that the lawyer will withdraw unless the obligation is fulfilled.” This provision is ordinarily invoked when a client fails to fulfill an obligation regarding payment of legal fees and expenses. The engagement agreement may memorialize additional obligations of the client, both obligations that are otherwise implicit such as the client’s truthful cooperation with the representation, and further obligations insofar as they are not forbidden by the Rules, other law (including court rules), or public policy. A client’s persistent failure to fulfill obligations regarding the lawyer’s services, including obligations unrelated to payment of fees and expenses, may constitute a basis for withdrawal if the procedural requirements of Rule 1.16(b)(5) are met. Further, the lawyer’s engagement agreement may put the client on notice of permissible grounds for withdrawal under Rule 1.16(a) and (b), including the client’s failure to fulfill obligations regarding the lawyer’s services. However, the engagement agreement may not expand on the grounds for withdrawal set forth in Rule 1.16 or purport to alter or amend the grounds for withdrawal or the process for withdrawal required by the Rule.”
The ABA is being coy. Traditionally, because, you know, we lawyers are professionals and are not in it for the money but rather for the good of society, lawyers aren’t automatically allowed to drop deadbeat clients because they have stopped paying. It is not unusual for a judge to refuse to allow an attorney to withdraw for that reason, and there is another Catch 22: the confidentiality rules in most states forbid a lawyer from telling a judge that a client isn’t paying his or her legal bills, or can’t.
One coded message that some jurisdictions wink at is “Your honor, I request to withdraw because Mr. Green is unavailable at this time.” Of course, coded violations of confidentiality are still violations. Now the American Bar Association is saying that “the client’s failure to fulfill obligations regarding the lawyer’s services” makes dropping that client reasonable and ethical. This is supposed to be a profession. But for most lawyers out there, it’s all about the money.
The ABA’s pronouncements aren’t binding on anyone, remember.
The full opinion here.
Ethics Alarms 
I am not sure that there is any controversy with this ABA ethics opinion. Lawyers should have the right to terminate and/or withdraw from representation when clients don’t pay their bills. Where is it written that lawyers are not allowed to say, “well, this client owes me $20,000 in fees but I have to keep representing them until the end of time”? I suggest requiring a lawyer to continue representation for free is probably not in that client’s best interests anyway. I am working on a case where the lawyer sought to withdraw because his client disputed his credit card charges and the credit card company canceled payment of his fees pending the fee dispute. Should he have been required to continue representing that client when he realized that the client intended to stiff him for his legal services?
jvb
“This is supposed to be a profession. But for most lawyers out there, it’s all about the money.”
I’m an accountant, so not familiar with legal ethics other than confidentiality. Back in the day when I was working and rubbing elbows with local attorneys, I didn’t know a single person who was only practicing for love of the law – they were hard-working, often family men and women who needed a paycheck. I am not certain how it is unethical to terminate a client who cannot or will not pay the professional fee. Every hour spent on that account is one less billable hour, one less hour spent with family, another hour you’ll never get back. What am I missing?
It’s a profession. You take on a client, and you stick with him or her through rain and shine. That’s the model. Zealous representation doesn’t make any mention of working harder for your best paying clients. It’s considered unethical to dump a poorer client to take on a richer one. If you need a particular expert to win a case and its strains your budget and the client can’t afford her, tough. This is why lawyers have to fulfill pro bono minimums. Lawyers need to be reminded that their job is about making the law work, not getting rich.