New York Lawyers Can Charge Interest on Client Expenses

New York attorneys working on a contingency fee basis can charge a reasonable interest rate on unpaid funds advanced to a client, a recent New York State Bar Association ethics opinion advised.

The bar’s ethics committee noted that it addressed this issue in 2000 but “recent changes in the law concerning contingency fee cases have sowed some confusion about our prior opinions on a lawyer’s ability to charge interest on disbursements.”

The confusion “stems from the laws allowing a lawyer to fund disbursements rather than seeking immediate reimbursement from the client,” the Jan. 17 opinion said.

Clients have become increasingly ...