Compensating the lawyer/personal representative
By Sylvia Stevens
often serve as personal representatives of the estates of their former
clients or on request of a probate court in other estates.1 Despite the
prevalence of this practice, there appears to be significant confusion
about how a lawyer/personal representative should be compensated. Some
of the confusion may result from the all-too-common mischaracterization
of the lawyer's role. Perhaps because lawyers are accustomed to acting
in a representative capacity for a client, lawyers serving as personal
representatives occasionally refer to themselves as the personal representative
and 'the lawyer for the personal representative' or 'the
lawyer for the estate.'
acting as personal representative is not a 'lawyer for' anyone,
and particularly not for the estate or its beneficiaries. A more accurate
characterization is that the lawyer/personal representative is acting
pro se in carrying out the duties and responsibilities of the fiduciary
role of personal representative.
113 endows a personal representative with specific powers and responsibilities,
and provides for compensation based primarily on the value of assets under
administration, ORS 116.173. A personal representative is authorized in
ORS 114.403(18) to employ 'qualified persons' including attorneys
to assist in administration of the estate. In the final accounting, the
personal representative may be reimbursed from the funds of the estate
for the 'reasonable fees' of qualified persons employed by the
personal representative. ORS 116.183. In determining the reasonable fees
of attorneys, the court is required consider a variety of factors essentially
identical to those set out in DR 2-106 and in UTCR 5.080.
do not offer guidance about how a lawyer/personal representative should
be compensated. Is compensation limited to the statutory personal representative's
fee? Should compensation be based on the lawyer's customary hourly rate
for legal services? Can the lawyer receive both the personal representative
fee and legal fees?
have not addressed this question directly and only a handful of cases
exist in other jurisdictions. They are, however, instructive.
As a general
rule, pro se litigants are not entitled to attorney fees under
statutes that allow such awards to prevailing parties, on the premise
that such statutes serve to indemnify litigants for the cost of retaining
legal counsel and a pro se litigant needs no indemnification. See,
e.g., Parquit Corp. v. Ross, 273 Or. 900, 543 P.2d 1070 (1975) (language
of ORS 20.096 does not indicate legislative intent to reimburse a prevailing
party who has not 'incurred' attorney fees), and Gill v.
SAIF Corp. 314 Or. 719, 842 P.2d 402 (1992)(former public employees
not entitled to indemnification in absence of evidence they spent any
of their own money in defense of legal claims); cf. West v. French,
51 Or.App. 143, 625 P.2d 144 (1981) (award of attorney fees to tenant
represented by Legal Aid was consistent with purpose of fee provision
to encourage speedy resolution of landlord-tenant disputes).
generally do not create exceptions to this general rule for a pro se litigant
who happens to be a lawyer. In Bischoff v. Bischoff & Strooband,
P.C., 121 Or.App. 529, 855 P.2d 1133 (1993), the court denied attorney
fees to an injured attorney who prosecuted his own workers' compensation
claim on the ground that the statute allowed payment only for legal services
performed 'by an attorney on behalf of and at the request of a claimant.'
The court found nothing in the statute to suggest that the legislature
intended to treat pro se attorneys differently from other pro
se claimants. See also, Swenson & Seztke, Chtd. v. Henning,
116 Idaho 199, 774 P.2d 909 (1989) (law firm, acting through one of its
members, not entitled to attorney fees in suit against former client,
notwithstanding that a pro se lawyer's lost opportunity costs may
be more readily quantifiable than those of a nonlawyer pro se litigant).
this general inability of a lawyer acting pro se to recover attorney
fees as a prevailing party in litigation, courts appear willing to apply
a slightly different analysis when evaluating requests by lawyer/personal
representatives for compensation for professional services. In Sherman
v. Hagness, 195 Wis.2d 225, 536 N.W.2d 133 (1995), the lawyer/personal
representative made application under a statute that allowed the court
to award him the executor's commissions or attorney fees, or both if the
so directed in the decedent's will. He asked for $100 an hour for all
services provided to the estate, without distinguishing services performed
as a lawyer from services as a personal representative. The court acknowledged
that it might be more efficient and less expensive to have a lawyer act
as personal representative, but held that the statute did not authorize
a lawyer serving in both capacities to be compensated at the lawyer's
usual billing rate for all services. At the same time, the statute was
clearly intended to modify the prior rule that limited a lawyer/personal
representative's compensation to the executor's commission even if he
performed duties that he could have hired another lawyer to perform. Concluding
that compensation for legal services should be limited to those of a 'strictly
professional character,' the court affirmed the trial court's allowance
of executor's commission for services as a personal representative and
$100 an hour for legal services.
result was obtained in Estate of Boyle, 1995 WL 716768 (Del. Ch.
1995). There, too, the lawyer/personal representative requested compensation
based on his hourly fee for legal services. The court noted that the usual
occupation of a court-appointed fiduciary does not generally provide the
standard for compensation except where the fiduciary carries out the duties
of someone in his profession and carefully documents when he acts as a
fiduciary and when he acts as a professional. In other words, 'a
lawyer…or other professional person who serves in a fiduciary capacity
is to be compensated on the basis of the capacity served in, not on the
basis of qualification for other forms of work.' Id. at 1.
The court also noted 'the majority rule' that, absent a contrary
statutory provision, a personal representative is not entitled to extra
compensation for his services as an attorney. Turning to the lawyer/personal
representative's petition for fees, the court identified some document
drafting that 'arguably required the assistance of an attorney,'
but that the majority of the services did not require the special training
and skills of an attorney. The lawyer/personal representative's fees were
cases are certainly not binding on the courts in Oregon.2 However, they
offer some useful guidance. No Oregon statute addresses compensation of
a personal representative who happens to be a lawyer so, arguably, the
'majority rule' cited in Boyle might apply. Under that
rule, compensation would be limited to the personal representative's statutory
fee, with nothing 'extra' for services as an attorney. On the
other hand, nothing in Oregon's statutory scheme prohibits a court from
the more balanced approach taken in Sherman and Boyle that
divides the compensation according to the nature of the work performed.
What is clearly not permitted is compensation for all services at the
lawyer/personal representative's hourly rate for legal services. A lawyer
who petitions for such a fee for services as a personal representative
risks violating DR 2-106, which prohibits a lawyer from charging or collecting
a fee that is 'clearly excessive.' See, e.g., In re Conduct
of Potts, 301 Or. 57, 718 P.2d 1363 (1986), in which a lawyer was
found to have charged an excessive fee in a probate case where his role
was primarily that of 'messenger and public relations man' between
the personal representative and the co-counsel law firm, and where there
was no evidence that he was exercising legal skill on the client's behalf.
Call the bar at (503) 620-0222 in the Portland metropolitan area or toll-free statewide at (800) 452 8260 and speak with Sylvia Stevens, assistant general counsel, ext. 359, or George Riemer, general counsel, ext. 405. They can also be contacted by e-mail at firstname.lastname@example.org or email@example.com.
ABOUT THE AUTHOR
Sylvia Stevens is assistant general counsel and MCLE administrator of the Oregon State Bar. She can be reached at (503) 620-0222 or (800) 452-8260, ext. 359, or sstevens@ osbar.org.