On 25 September 2014, the German Federal Court of Justice (file reference: 4 StR 586/13) confirmed that a lawyer may commit fraud if he does not inform his client about a more favorable fee. In detail: A German lawyer agreed in the representation of a litigious probate matter to a contingency fee. The contingency fee deviated from the statutory fee schedule, the so called RVG. The lawyer failed to inform his client that the contingency fee was higher than the fee calculated according to the fee schedule. The Federal Court of Justice held the lawyer had an obligation to inform the client about this. The failure to inform the client constitutes criminal fraud according to Sec. 263 German Criminal Code. One of Germany’s most prominent experts in lawyers matters (Römermann in BetriebsBerater 2014, 2707) criticized the judgment. Römerman stated fatalistically that in the future lawyers have to be aware that violations of ethical obligations could be construed as criminal fraud.
Stephan Spehl is a dispute resolution partner in Baker & McKenzie's Munich office. For more than 25 years Stephan has been representing numerous clients in complex commercial disputes before state courts, and in ad hoc or institutional arbitration proceedings. He was party-appointed arbitrator in various ad-hoc proceedings. He also focuses his practice on compliance and internal investigations. He is the co-editor of the book "Coporate Internal Investigations", an overview of 13 jurisdictions.