The below answer is pulled from a 2012 The Florida Bar News article titled “How to handle lawyer-client fee disputes” written by Jeffrey M. Hazen, Assistant Ethics Counsel. The full article can be accessed here:
To summarize the article, when a lawyer and client are involved in a fee dispute, the lawyer should consider whether or not a conflict of interest exists in continuing the representation. If such a conflict exists under Rule 4-1.7 and cannot be waived, the lawyer must withdraw from representation. Sample Disengagement Letters can be found in the PRI Administrative Forms Handbook. A lawyer should not bring suit against a current client for unpaid fees as this would involve a violation of the conflict rule. Additionally, Rule 5-1.1 requires the lawyer to hold in trust funds that are in dispute between the lawyer and client while taking measures to resolve the dispute. The lawyer must resolve the dispute before disbursing the funds. A lawyer may assert a retaining lien on the case file over unpaid fees, but there are several exceptions to this right that the lawyer must be aware of. Additionally, funds held in trust by the lawyer for a specific purpose must be held in trust and applied only to that purpose. Further, a lawyer may use a reputable collection agency in attempting to collect a delinquent fee, provided the lawyer otherwise complies with the Rules of Professional Conduct. The Better Business Bureau maintains a list of certified collection agencies. Finally, a lawyer may not file, or threaten to file, a Form 1099-C in order to induce a client to pay a delinquent fee.