SECTIONS 6146-6149.5 - California Statutes

BUSINESS AND PROFESSIONS CODE

SECTION 6146-6149.5

6146. (a) An attorney shall not contract for or collect a
contingency fee for representing any person seeking damages in
connection with an action for injury or damage against a health care
provider based upon such person's alleged professional negligence in
excess of the following limits:
(1) Forty percent of the first fifty thousand dollars ($50,000)
recovered.
(2) Thirty-three and one-third percent of the next fifty thousand
dollars ($50,000) recovered.
(3) Twenty-five percent of the next five hundred thousand dollars
($500,000) recovered.
(4) Fifteen percent of any amount on which the recovery exceeds
six hundred thousand dollars ($600,000).
The limitations shall apply regardless of whether the recovery is
by settlement, arbitration, or judgment, or whether the person for
whom the recovery is made is a responsible adult, an infant, or a
person of unsound mind.
(b) If periodic payments are awarded to the plaintiff pursuant to
Section 667.7 of the Code of Civil Procedure, the court shall place a
total value on these payments based upon the projected life
expectancy of the plaintiff and include this amount in computing the
total award from which attorney's fees are calculated under this
section.
(c) For purposes of this section:
(1) "Recovered" means the net sum recovered after deducting any
disbursements or costs incurred in connection with prosecution or
settlement of the claim. Costs of medical care incurred by the
plaintiff and the attorney's office-overhead costs or charges are not
deductible disbursements or costs for such purpose.
(2) "Health care provider" means any person licensed or certified
pursuant to Division 2 (commencing with Section 500), or licensed
pursuant to the Osteopathic Initiative Act, or the Chiropractic
Initiative Act, or licensed pursuant to Chapter 2.5 (commencing with
Section 1440) of Division 2 of the Health and Safety Code; and any
clinic, health dispensary, or health facility, licensed pursuant to
Division 2 (commencing with Section 1200) of the Health and Safety
Code. "Health care provider" includes the legal representatives of a
health care provider.
(3) "Professional negligence" is a negligent act or omission to
act by a health care provider in the rendering of professional
services, which act or omission is the proximate cause of a personal
injury or wrongful death, provided that the services are within the
scope of services for which the provider is licensed and which are
not within any restriction imposed by the licensing agency or
licensed hospital.

6147. (a) An attorney who contracts to represent a client on a
contingency fee basis shall, at the time the contract is entered
into, provide a duplicate copy of the contract, signed by both the
attorney and the client, or the client's guardian or representative,
to the plaintiff, or to the client's guardian or representative. The
contract shall be in writing and shall include, but is not limited
to, all of the following:
(1) A statement of the contingency fee rate that the client and
attorney have agreed upon.
(2) A statement as to how disbursements and costs incurred in
connection with the prosecution or settlement of the claim will
affect the contingency fee and the client's recovery.
(3) A statement as to what extent, if any, the client could be
required to pay any compensation to the attorney for related matters
that arise out of their relationship not covered by their contingency
fee contract. This may include any amounts collected for the
plaintiff by the attorney.
(4) Unless the claim is subject to the provisions of Section 6146,
a statement that the fee is not set by law but is negotiable between
attorney and client.
(5) If the claim is subject to the provisions of Section 6146, a
statement that the rates set forth in that section are the maximum
limits for the contingency fee agreement, and that the attorney and
client may negotiate a lower rate.
(b) Failure to comply with any provision of this section renders
the agreement voidable at the option of the plaintiff, and the
attorney shall thereupon be entitled to collect a reasonable fee.
(c) This section shall not apply to contingency fee contracts for
the recovery of workers' compensation benefits.
(d) This section shall become operative on January 1, 2000.

6147.5. (a) Sections 6147 and 6148 shall not apply to contingency
fee contracts for the recovery of claims between merchants as defined
in Section 2104 of the Commercial Code, arising from the sale or
lease of goods or services rendered, or money loaned for use, in the
conduct of a business or profession if the merchant contracting for
legal services employs 10 or more individuals.
(b) (1) In the instances in which no written contract for legal
services exists as permitted by subdivision (a), an attorney shall
not contract for or collect a contingency fee in excess of the
following limits:
(A) Twenty percent of the first three hundred dollars ($300)
collected.
(B) Eighteen percent of the next one thousand seven hundred
dollars ($1,700) collected.
(C) Thirteen percent of sums collected in excess of two thousand
dollars ($2,000).
(2) However, the following minimum charges may be charged and
collected:
(A) Twenty-five dollars ($25) in collections of seventy-five
dollars ($75) to one hundred twenty-five dollars ($125).
(B) Thirty-three and one-third percent of collections less than
seventy-five dollars ($75).

6148. (a) In any case not coming within Section 6147 in which it is
reasonably foreseeable that total expense to a client, including
attorney fees, will exceed one thousand dollars ($1,000), the
contract for services in the case shall be in writing. At the time
the contract is entered into, the attorney shall provide a duplicate
copy of the contract signed by both the attorney and the client, or
the client's guardian or representative, to the client or to the
client's guardian or representative. The written contract shall
contain all of the following:
(1) Any basis of compensation including, but not limited to,
hourly rates, statutory fees or flat fees, and other standard rates,
fees, and charges applicable to the case.
(2) The general nature of the legal services to be provided to the
client.
(3) The respective responsibilities of the attorney and the client
as to the performance of the contract.
(b) All bills rendered by an attorney to a client shall clearly
state the basis thereof. Bills for the fee portion of the bill shall
include the amount, rate, basis for calculation, or other method of
determination of the attorney's fees and costs. Bills for the cost
and expense portion of the bill shall clearly identify the costs and
expenses incurred and the amount of the costs and expenses. Upon
request by the client, the attorney shall provide a bill to the
client no later than 10 days following the request unless the
attorney has provided a bill to the client within 31 days prior to
the request, in which case the attorney may provide a bill to the
client no later than 31 days following the date the most recent bill
was provided. The client is entitled to make similar requests at
intervals of no less than 30 days following the initial request. In
providing responses to client requests for billing information, the
attorney may use billing data that is currently effective on the date
of the request, or, if any fees or costs to that date cannot be
accurately determined, they shall be described and estimated.
(c) Failure to comply with any provision of this section renders
the agreement voidable at the option of the client, and the attorney
shall, upon the agreement being voided, be entitled to collect a
reasonable fee.
(d) This section shall not apply to any of the following:
(1) Services rendered in an emergency to avoid foreseeable
prejudice to the rights or interests of the client or where a writing
is otherwise impractical.
(2) An arrangement as to the fee implied by the fact that the
attorney's services are of the same general kind as previously
rendered to and paid for by the client.
(3) If the client knowingly states in writing, after full
disclosure of this section, that a writing concerning fees is not
required.
(4) If the client is a corporation.
(e) This section applies prospectively only to fee agreements
following its operative date.
(f) This section shall become operative on January 1, 2000.

6149. A written fee contract shall be deemed to be a confidential
communication within the meaning of subdivision (e) of Section 6068
and of Section 952 of the Evidence Code.

6149.5. (a) Upon the payment of one hundred dollars ($100) or more
in settlement of any third-party liability claim the insurer shall
provide written notice to the claimant if both of the following
apply:
(1) The claimant is a natural person.
(2) The payment is delivered to the claimant's lawyer or other
representative by draft, check, or otherwise.
(b) For purposes of this section, "written notice" includes
providing to the claimant a copy of the cover letter sent to the
claimant's attorney or other representative that accompanied the
settlement payment.
(c) This section shall not create any cause of action for any
person against the insurer based upon the insurer's failure to
provide the notice to a claimant required by this section. This
section shall not create a defense for any party to any cause of
action based upon the insurer's failure to provide this notice.