Ethics in resolving attorney fees, Part II

A few months ago, I wrote about the ethics involved in settling attorney’s fees with Claimant attorneys.  There is a lot of pressure to close cases, and sometimes a Claimant attorney will want to carve up a settlement to include a large side fee for benefits that were not obtained. 

In Lanza v. Damien Carpentry, I noted the First DCA is going to give the Judges of Compensation Claims latitude to determine whether Carrier paid fees are warranted.  In Lanza, the E/C refused to divide up the settlement so that Claimant attorney would receive a fee above the statutory guidelines for unobtained benefits.  Claimant attorney tried to back out of the settlement, but the JCC and the First DCA enforced the agreement.  At the time, I wrote:

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Ethics in resolving attorney fees within settlements

Many E/C’s do not consider ethics when negotiating a washout settlement with a Claimant attorney.  The goal is to get the claim over with, right?  And, the ethics of determining what is a fair fee to Claimant’s attorney is not of the E/C’s concern, right.  Wrong.

When offering a settlement lump sum to Claimant, and when an attorney fee under s. 440.34(3) is owed or alleged, the E/C is putting Claimant’s attorney in an ethical bind.  The E/C is essentially pitting the Claimant against her attorney, forcing the attorney into an ethical quandary: to carve a fee out of Claimant’s settlement monies.

When I negotiate a settlement and a fee is owed to Claimant attorney, I negotiate the two terms seperately.  In fact, almost all Claimant attorneys I deal with insist on negotiating the fee separately from the washout. 

But, when a Claimant attorney seeks a fee to be cut out of a washout settlement, and absolutely no benefits were obtained, or even paid for by the E/C, well that is plain old unethical.  Even if the E/C just wants to get the claim over with.

Last week, the First DCA responds to this last scenario, but not in ethical terms.