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Discussion

Statement : The Bar Council of India derives its rule-making power from Section 49(1)(c) of the Advocates Act, 1961, which authorises it to frame rules governing professional conduct and etiquette to be observed by advocates. Rule 20 framed thereunder categorically bars an advocate from stipulating for, or receiving, any fee whose quantum is dependent upon the outcome of litigation, or from entering into any arrangement to share in its proceeds. An advocate who contravenes this Rule is liable to be proceeded against under Section 35 of the Act.
Conclusion I : An advocate may lawfully enter into an outcome-linked fee arrangement so long as the client's written consent is obtained prior to the engagement.
Conclusion II : An advocate who violates the prohibition on contingency-based fees may face disciplinary action under the Advocates Act, 1961.

In the context of the above Statement and Conclusions, which one of the following is correct ?

  • A.Neither Conclusion I nor II follows
  • B.Both Conclusions I and II follow
  • C.Only Conclusion II follows
  • D.Only Conclusion I follows

Answer: C

Only Conclusion II follows.

The Statement says Rule 20 of the Bar Council of India Rules categorically bars an advocate from stipulating for a fee contingent on the result of litigation or agreeing to share in its proceeds, and that a contravention exposes the advocate to proceedings under Section 35 of the Advocates Act, the section on punishment for professional or other misconduct. Conclusion II restates that consequence, so it follows.

Conclusion I contradicts the Statement. The bar is absolute and the Rule makes no exception for a client's written consent, so the client cannot waive it. That rules out 'both follow' and 'only Conclusion I', and 'neither follows' fails because Conclusion II is stated in the premise itself.

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