Family Law

Family Law News 2017, Issue 3, Volume 39, No. 3

Arbitration Clauses In Family Law Attorney Fee Agreement

Daniel J. Horwitz, Esq.

Daniel J. Horwitz practices collection law in San Diego, with a focus on assisting family law attorneys. He has served as an arbitrator with the San Diego County Bar Association for over 25 years and has participated as an attorney or arbitrator in over 500 fee disputes. Mr. Horwitz received the 2002 "Outstanding Bar Arbitration Panelist" award and currently serves on the Lawyer Referral and Information panel. He has extensive experience consulting on lawyer fee retainer agreements and has served as an expert witness and consultant on collection issues, including assisting the Southern Poverty Law Center, and on the Fair Debt Collection Practices Acts.

There are two separate arbitration systems to consider when drafting a retainer agreement and collecting a fee. The first is the client’s absolute right to nonbinding mandatory fee arbitration under Business and Professions Code section 6200 et seq. Fee arbitration is mandatory for the lawyer if the client requests it. Dispute types are limited to fee disputes and the arbitrations are conducted through the state or local Bar Associations. Volunteer arbitrators are selected by area bar associations. The San Diego County Bar Association charges a 5% fee with a minimum fee of $75 and a maximum of $5,000 for up to three hours of arbitration time. If the amount in controversy exceeds $25,000, a panel of three arbitrators is appointed, including two lawyer arbitrators and a volunteer lay arbitrator, usually from the general business community. These arbitrations are only binding if both parties agree to binding arbitration after the fee dispute has arisen.1

If either party has declined to agree to binding arbitration, the parties have thirty days from the mailing of the arbitration decision by the facilitating bar association to challenge or otherwise reject the award and request a de novo hearing. If no party takes the necessary action to seek a trial de novo, the award automatically becomes final and enforceable.

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