A conservation tax is a payment intended to compensate a lawyer for his obligation to provide certain services and to forego other employment opportunities. Ineligible beneficiaries are not, of course, unethical, but should be used with caution. Such agreements raise at least three potential problems: it may be useful to review decisions from other jurisdictions to define a uniform rule for Texas practitioners. A decision in New York clearly established that it is inappropriate for a lawyer to incriminate a non-refundable retainer in domestic relations matters. Volkell v. Volkell, ABA/BNA Lawyers Manual on Professional Conduct; New York Supreme Court, queens County, published 7-12-84. The court found that a non-refundable retainer was contrary to public policy because it prevented a quick reconciliation and deprived the client of the right to change lawyers without being fined. If the “conservation tax” is indeed a down payment for the benefits to be provided, the amount of the fee should relate to the services to be provided. If this is not the case, the levy may be considered excessive. For example, an agreement that is in fact a prepayment could provide: “Responsibility for the provision of legal services is accepted and work begins when the lawyer receives the “pre-guard” against fees and expenses.” Kazen, supra 40.03F (2), at 40-58.
In such a case, when the client discharges the lawyer, the portion of the tax that was not earned was refunded. See ABA Comm. on Professional Ethics, Informal Op. 988 (1967) (a non-refundable retainer should only be retained if it is won). However, the unique experience of a lawyer required to review a particular case can be seen as a factor in assessing the adequacy of the royalty. The Texas Supreme Court, Comm. on Interpretation of the Code of Professional Responsibility, in its Opinion Op. 391, issued in 1978, stipulates that a lawyer may deposit non-refundable conservation fees into a general operating account because the lawyer “won” the tax as soon as it was received.