| |
|
|
A BILL TO BE ENTITLED
|
|
|
AN ACT
|
|
|
relating to voidability of contracts procured through barratry and |
|
|
liability arising from conduct constituting barratry; providing a |
|
|
civil penalty. |
|
|
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
|
|
SECTION 1. Section 82.065, Government Code, is amended to |
|
|
read as follows: |
|
|
Sec. 82.065. [CONTINGENT FEE] CONTRACT FOR LEGAL SERVICES. |
|
|
(a) A contingent fee contract for legal services must be in |
|
|
writing and signed by the attorney and client. |
|
|
(b) Any [A contingent fee] contract for legal services is |
|
|
voidable by the client if it is procured as a result of conduct |
|
|
violating the laws of this state or the Texas Disciplinary Rules of |
|
|
Professional Conduct of the State Bar of Texas regarding barratry |
|
|
by attorneys or other persons. |
|
|
(c) A lawyer who was paid or owed fees or expenses under a |
|
|
contract that is voided may recover in quantum meruit if the client |
|
|
does not prove the lawyer committed barratry or had actual |
|
|
knowledge, prior to undertaking the representation, that the |
|
|
contract was procured as a result of barratry by another person. |
|
|
SECTION 2. Subchapter C, Chapter 82, Government Code, is |
|
|
amended by adding Section 82.067 to read as follows: |
|
|
Sec. 82.067. CIVIL LIABILITY FOR PROHIBITED BARRATRY. |
|
|
(a) A client may bring an action to void any contract for legal |
|
|
services that was procured as a result of conduct violating the laws |
|
|
of this state or the Texas Disciplinary Rules of Professional |
|
|
Conduct of the State Bar of Texas regarding barratry by attorneys or |
|
|
other persons. |
|
|
(b) A client who prevails in an action under Subsection (a) |
|
|
shall recover from any person who committed barratry: |
|
|
(1) all fees and expenses paid to that person under any |
|
|
contract that is voided; |
|
|
(2) actual damages caused by the prohibited conduct; |
|
|
and |
|
|
(3) reasonable and necessary attorney's fees. |
|
|
(c) A person who was solicited by conduct violating the laws |
|
|
of this state or the Texas Disciplinary Rules of Professional |
|
|
Conduct of the State Bar of Texas regarding barratry by attorneys or |
|
|
other persons, but who did not enter into a contract as a result of |
|
|
that conduct, may file a civil action against any person who |
|
|
committed barratry. |
|
|
(d) A person who prevails in an action under Subsection (c) |
|
|
shall recover from each person who engaged in barratry: |
|
|
(1) a civil penalty of $5,000; |
|
|
(2) actual damages caused by the prohibited conduct; |
|
|
and |
|
|
(3) reasonable and necessary attorney's fees. |
|
|
(e) This section shall be liberally construed and applied to |
|
|
promote its underlying purposes, which are to protect those in need |
|
|
of legal services against unethical, unlawful solicitation and to |
|
|
provide efficient and economical procedures to secure such |
|
|
protection. |
|
|
(f) The provisions of this subchapter are not exclusive. |
|
|
The remedies provided in this subchapter are in addition to any |
|
|
other procedures or remedies provided in any other law; provided, |
|
|
however, that no recovery shall be permitted under both this |
|
|
subchapter and another law of both damages and penalties for the |
|
|
same act or practice. |
|
|
SECTION 3. (a) Section 82.065, Government Code, as amended |
|
|
by this Act, applies only to a contract entered into on or after the |
|
|
effective date of this Act. A contract entered into before the |
|
|
effective date of this Act is governed by the law in effect |
|
|
immediately before the effective date of this Act, and that law is |
|
|
continued in effect for that purpose. |
|
|
(b) Section 82.067, Government Code, as added by this Act, |
|
|
does not apply to prohibited conduct, as defined by that section, |
|
|
that occurred before the effective date of this Act. Prohibited |
|
|
conduct that occurred before the effective date of this Act is |
|
|
governed by the law that applied to the conduct immediately before |
|
|
the effective date of this Act, and that law is continued in effect |
|
|
for that purpose. |
|
|
SECTION 4. This Act takes effect September 1, 2011. |