Taking on the lawyers

The Supreme Court has outlawed contingency fee agreements between lawyers and clients in criminal cases, in which fees for a lawyer’s service depends on a favorable result. That kind of payment arrangement, which hinges on winning a criminal case, is being banned for the first time since the Korean government was established in 1948.

In a unanimous ruling on Thursday, the Supreme Court said fees contingent on a favorable result in an investigation or trial can damage the integrity of the social order.

The ruling could deal a major blow to lawyers who retired from public service as judges or senior prosecutors. Their jobs relied on a high success rate, and success was usually a function of them using their connections in the prosecution and on the bench.

The ban on contingency fees could help end unethical and corrupt practices in the judiciary. Few countries allow contingency fees in criminal cases. Countries like the United States, Germany, France and Britain ban conditional legal payment in criminal litigations. Japan allows it but it doesn’t cause much controversy because criminal cases are mostly handled by state-appointed attorneys.

Contingency fees almost force lawyers to lobby judges or prosecutors. Litigation goes to lawyers who have connections to prosecutors or judges. Some lawyers demand contingency fees citing their good connections, and that has led in Korea to a general spike in legal fees. In the case ruled on by the Supreme Court, the plaintiff paid a lawyer 100 million won ($85,486) in advance to get his father off a theft charge. The amount was exorbitant compared with the usual 10 million won retainer. The plaintiff said he paid the money so the lawyer could lobby on his behalf. Contingency fees therefore fan abuses and can dent confidence in the judicial system. In the past, legislators have sought to ban the practice but failed to pass a law.

The ruling should help prevent judges from practicing private law after retirement. The revolving-door problem in our judiciary won’t end as long as lawyers with experience on the highest courts can earn high fees as soon as they put out their own shingle or join a fancy firm

Various side effects from the ban should also be considered. The ban will be meaningless if retainers soar instead. Because there are no clear guidelines on lawyers’ fees, clients cannot help but pay any amount of a retainer demanded by the lawyers. The court and lawyers’ association must draw up clear regulations on legal service fees.

JoongAng Ilbo, July 25, Page 26.