Third Party Payor Agreement

Finally, both agreements, unless another outcome is negotiated, should provide that, if the payer pays a retention, all remaining funds at the end of the case will be returned to the payer and not to the client. n. a person who is not a party to a contract or transaction but is involved (for example. B a buyer of one of the parties who participated in the signing of the agreement or who made a rejected offer). As a general rule, the third party has no legal right to do so, unless the contract has been entered into in favour of the third party. Actual or potential conflicts of interest resulting from dual representation must be treated in the usual way, If the payer is also a customer, see MPR 1.7, but even if the payer is not a client, you need to check whether the financial agreement – that is, the fact that the payer pays the client`s legal fees – creates itself a dynamic that prevents your assiduous representation or that affects the exercise of your independent professional judgment. That could be the case, for example. B, when the payer shows a financial interest to minimize expenses. It would be considered in your agreement with the payer that the fact that the payer is required to pay the legal fees of the client himself does not make a client`s payer and that the payer will not have the right to hire the lawyer in cases where the lawyer represents the client. Parties to the proceedings sometimes agree to represent a client whose legal fees are paid by a third party, whom an employer pays to defend an employee or friend, a family member or a partner who pays another`s costs. Whether this third party (the “payer”) is your client himself, the attention paid to the following issues will help avoid ethical issues and reduce the chances of getting an unpaid bill. If you want to impose the payer`s obligation to pay for his services to the customer, you should also have a written agreement with the payer. As mentioned above, it is preferable to strengthen the different statuses of the payer and the customer, it is preferable that it be a separate agreement in which the payer agrees to pay for the services provided to the customer.

The extent of your client representation and the extent of what the payer is willing to pay may or may not be the same, and it is important to have a clear understanding of both from the start. MPR 1.2 allows you to limit your representation of the client, provided the restriction is appropriate in the circumstances and the client has given informed consent. If your agreement with the client is tacitly or unclear as to a limitation of the scope of your representation, this scope is determined by taking into account what the client would reasonably have expected in the circumstances. Conversations you had with the payer about the extent of the payer`s payment obligations that the customer was unfamiliar with would not be taken into account. Carefully crafted agreements with the client and the payer reduce the likelihood that you will be forced to offer the client a wider range of legal services that the payer is willing to pay for. A third party beneficiary is a person for whom a contract is created, although that person is foreign to the agreement and the consideration. Such a person may, as a general rule, take legal action to enforce the contract or undertaking made to his or her advantage. A third-party action is another name of the Impleader procedure device used in a civil action by a defendant who intends to take legal action against a third party, who is ultimately liable for all or part of the damage that may be attributed to the applicant.