RC Question 25 Explanation
DISCUSSION: If you read the full sentence, this limit on lawyers’ fees is to prevent lawyers from “eroding just compensation to clients” and to prevent lawyers from “gaining disproportionately”.
That means the commission is worried that lawyers would take more than they deserve, and leave clients with too little.
___________
- “Monetary value” is a hard thing to pin down. Suppose the lawyer and client expected to received $1,000,000, and the lawyer was to get 20% of the award. So they valued the lawyer’s work at $200,000.
But then the judge awards $2,000,000. The lawyer got more than the “monetary value” of their services, but the client isn’t unhappy: they got more money!
So this isn’t exactly the situation the commission is trying to avoid. - CORRECT. This is better than A. Legal awards are unpredictable. “Gaining disproportionately” means gaining in a greater proportion than you should. And proportion means “percent”. So the commission doesn’t want lawyers’ earnings to be too large a percent of the total award. Which is what this answer means (“portion” also equals percent).
- This is a trap. The issue isn’t what a client considers unfair: clients can be irrational. Instead, the commission is likely speaking of a more neutral view of what’s proportionate. (i.e. What would reasonable outside observers think?)
- In any contingency arrangement, the lawyer gets more if they win. So, this answer isn’t what the commission was trying to prevent: their proposal is a contingency proposal, so the lawyer would get more if they win.
- Judge and jury intentions are never mentioned, so this can’t be the right answer.
I think the reasoning for A is wrong. The difficulty is not pinning down monetary value because in the contingency fee structure, the monetary value of the lawyer’s services have to be pinned down as the structure is regular fee + extra % of regular fee. The issue is option A does not account for risk. The point of the extra % is to account for risk and option A only talks about the regular fee (monetary value). Option B correctly accounts for both professional services and risk.
Ah, but the lawyer’s payment has a monetary value and the services rendered have a monetary value. The idea of judicial supervision of legal agreement’s is that a lawyer might provide say $50,000 in value but receive $500,000 in payments.
An uplift arrangement could still pay the lawyer more than they are “worth”, but in such a case the client wins too, and the LRCWA isn’t concerned about a situation where both the client and the lawyers get a lot.
What uplift agreements prevent is the lawyer getting too much of the total award. We agree that’s what B does. I hope this clarifies what I meant by saying that the money paid to a lawyer can be greater value than the actual services rendered.
I have a question why answer choice E is not correct, as the passage mentions “just compensation of the plaintiff is not eroded”. I assumed that the “just” compensation meant that the award should not go against what was decided by the courts. Is answer choice B better in the sense that the passage as a whole describes the type of risk that the lawyer has to assume? Thanks in advance.