House Bill 1546
By: Representative Carpenter of the 4th
A BILL TO BE ENTITLED
AN ACT
To amend Chapter 80 of Title 36 of the Official Code of Georgia Annotated, relating to
general provisions applicable to counties, municipal corporations, and other governmental
entities, so as to provide for requirements for local authorities retaining legal services on a
contingent fee basis; to provide for review and approval of contracts by the Attorney
General; to provide for restrictions on such contracts; to provide for definitions; to provide
for related matters; to provide for an effective date; to repeal conflicting laws; and for other
purposes.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:
SECTION 1.
Chapter 80 of Title 36 of the Official Code of Georgia Annotated, relating to general
provisions applicable to counties, municipal corporations, and other governmental entities,
is amended by adding a new Code section to read as follows:
<ins>"36-80-32.
(a) As used in this Code section, the term 'local authority' means a county, municipal
corporation, local political subdivision, or other local governmental entity; provided,
however, that such term does not include a state authority.
</ins>
<ins>(b) The governing body of any local authority which is authorized to file and pursue civil
actions may enter into an agreement with a private attorney or law firm to represent the
local authority on a contingent fee basis only if the governing body:
(1) Determines that the litigation to be pursued on a contingent fee basis is in the best
interest of the local authority and alternatives to a contingency fee are not efficient or
feasible. Such determination shall be documented in writing after considering the
following factors:
(A) Whether there is a substantial need for the legal services that are the subject of the
contingent fee contract;
(B) Whether there exists sufficient legal and financial resources within the local
authority to handle the matter;
(C) The time and labor required, the novelty and complexity of the questions involved,
and the skill required to perform the legal services properly; and
(D) Whether the legal services can be reasonably obtained from attorneys under a
contract providing for an hourly rate or flat fee payment structure;
(2) Requests proposals for retaining outside counsel, unless the local authority makes a
written finding indicating that the circumstances do not allow for a request for proposals
and that such a request would prejudice the local authority; and
(3) After complying with the provisions of paragraphs (1) and (2) of this subsection,
approves the contract after considering:
(A) The reasons for pursuing the matter that is the subject of the legal services for
which the attorney or law firm would be retained and the desired outcome of pursuing
the matter;
(B) The qualifications, experience, and competence of the attorney or law firm selected
by the governing body of the local authority;
</ins>
<ins>(C) The nature of any relationship between the local authority, governing body or
members of the governing body, and the attorney or law firm that is a party to the
contract; and
(D) Whether the percentage contingent fee in the contract could result in the attorney
or law firm that is a party to the contract collecting a fee that is not justified by the
amount of work or risk involved or otherwise excessive and thereby reduce the public's
recovery.
(c) A contingent fee contract for legal services between a local authority and an attorney
or law firm shall provide that decisions regarding the resolution of the case shall be
reserved exclusively to the local authority and shall not be delegated to outside counsel.
(d) Before a contingent fee contract for legal services approved by a local authority
pursuant to paragraph (3) of subsection (b) of this Code section shall be effective and
enforceable, the local authority shall obtain approval of the contract by the Attorney
General. The local authority shall provide to the Attorney General:
(1) A description of the legal matter that is the subject of the proposed contract;
(2) A copy of the findings made pursuant to paragraph (1) of subsection (b) of this Code
section;
(3) A copy of the request for proposals for outside counsel or finding that circumstances
do not allow such a request as provided by paragraph (2) of subsection (b) of this Code
section;
(4) A copy of the proposed contract; and
(5) The agenda, minutes, or other documentation of the open public meeting at which the
local authority approved the contract.
(e) Within 45 days after the Attorney General's receipt of the information described in
subsection (d) of this Code section, the Attorney General shall:
(1) Approve the contract;
</ins>
<ins>(2) Decline to approve the contract because one or more requirements of this Code
section were not fulfilled; or
(3) Decline to approve the contract for one or more of the following reasons:
(A) The legal matter that is the subject of the contract presents one or more questions
of law or fact that are in common with a matter the state has already addressed or is
pursuing; or
(B) The legal matter involves claims or issues that are more appropriately within the
scope of state enforcement and the pursuit of the matter independently by the local
authority could lead to inconsistent legal outcomes or undermine the state's unified
position.
(f) If the Attorney General declines to approve the contract pursuant to subsection (e) of
this Code section, the Attorney General shall provide notice to the local authority in writing
with a detailed explanation of the reason or reasons for refusing to approve the contract.
If the Attorney General fails to do so within 45 days after receipt of the information
described in subsection (d) of this Code section, such contract shall be deemed approved.
(g) The provisions of this Code section shall not apply to:
(1) Legal services involving collection of unpaid debts, sale of property, services related
to bonds, recoupment of costs, or deductibles from an at-fault party's insurance policy;
or
(2) Any matter in which the amount in controversy is less than $100,000.00.
(h) Nothing in this Code section shall be construed to provide a local authority with
authority to bring actions to file and prosecute civil recoveries where not authorized by law
or to permit retention of outside counsel on a contingent fee basis when prohibited by
public policy."
</ins>
SECTION 2.
This Act shall become effective upon its approval by the Governor or upon its becoming law
without such approval, and shall apply to contracts entered into on or after that date.
SECTION 3.
All laws and parts of laws in conflict with this Act are repealed.