On the background of severe controversy in society caused by proposed changes in the Bar Act, “Popov and Partners” raised the unpopular in the guild question: “Do lawyers’ fees have to remain fixed with a certain minimum amount”.

“Popov & Partners” was invited to participate in a working group formed by the Bulgarian Ministry of Justice in relation to the preparations of changes in the Civil Procedure Code (CPC) and on 19/02/2015 the law office lodged a standpoint concerning the draft. In this document, representatives of the law office state their reasons about the disputable idea of allowing the court in case of disproportionate lawyers’ fee to award a sum even lower than the minimum amount of lawyers’ fees (set in Ordinance 1 on the minimum lawyers’ fees). The imperative provision of art. 36 of the Bar Act declares the principle of retribution of lawyers’ labour and explicitly defines the way a lawyer’s remuneration is formed – not less than what is set by the Ordinance.

The proposed change on the one hand will place two different regulations in contradiction and on the other hand will put the users of legal services in an unfavorable position – in case that the court decreases the awarded fees below the amount of the minimum amount which has already been paid, the gap will be to the account of the client, who is obliged to pay the lawyer’s fee even before the lawsuit is initiated. So the client becomes a victim – he is punished for hiring a lawyer for a case that the court considers as less complicated.

The change of the regulation will not be to detriment of lawyers, who in any case receive their remuneration in advance, but the situation looked from the side of legal services users is different. The existence of prescriptive fixed minimum amounts of lawyers’ fees favours only a party of the guild, but in fact, fixed prices damage the interest of the clients by depriving them from the opportunity to freely negotiate the price for the needed services, in compliance with the quality, volume and the rules of free competition.

According to the experts from “Popov & Partners”, by eliminating the legal requirements on prices of lawyer’s labour, first of all a contradiction between the proposed correction of the text of CPC and the existing regulations will be evaded, and secondly the current compel towards clients will be avoided – they will no longer be forced to pay the established minimum if their case is easy, typical or characterized with a low material interest. In addition to these considerations, the experts emphasize that such regulation seriously violates competition in the legal services market, which competition would mostly be in favour of consumers but also in favour of the guild. A strengthened competition will lead to the logical result of better legal services. Professionals do not need such “protective” mechanisms, aimed to secure them with a certain “minimum” or with a “guaranteed market”. Similar is the decision of the Commission for Protection of Competition on the occasion of such practices in other guilds: http://www.cpc.bg/ViewResult.aspx?type=Article&id=4996 .

On behalf of “Popov & Partners”, Emiliyan Arnaudov continues his participation in the working group formed by the Ministry of Justice. The initial draft of the discussed changes in CPC may be found at the website of the Ministry: http://www.justice.government.bg/Files/ZID_GPK_635427442873719314.docx