retainer

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“We have previously held that it is unethical for a lawyer to enter into a fee contract providing for a nonrefundable advance fee unless the advance fee constitutes a general retainer. See Iowa Supreme Ct. Bd. of Prof’l Ethics & Conduct v. Apland, 577 N.W.2d 50, 58 (Iowa 1998). Thus, contracts providing for nonrefundable ‘flat’ fees are void as well as unethical. Id.; see Iowa Code of Prof’l Responsibility DR 2-106(A). All advance fee payments other than general retainer fees are refundable, despite contractual language to the contrary, and must be placed in a client trust account. Apland, 577 N.W.2d at 55-56. Furthermore, these fees may not be withdrawn until earned. See id. at 56. A lawyer misappropriates client funds in violation of DR 1-102(A)(3), (4), (5), and (6) when special retainers and flat fees paid in advance are treated as money belonging to the lawyer and not maintained in a trust account until the fee has been earned. See id. at 55-56.” J. Cady, Iowa Supreme Court Board of Professional Ethics and Conduct v. Frerichs, 671 N.W.2d 470, 475 (Iowa, 2003).