Title: Shimko v. Lobe

State: ohio

Issuer: Ohio Supreme Court

Document:

[Cite as Shimko v. Lobe, 103 Ohio St.3d 59, 2004-Ohio-4202.] 
 
 
SHIMKO, APPELLANT, v. LOBE ET AL., APPELLEES, ET AL. 
[Cite as Shimko v. Lobe, 103 Ohio St.3d 59, 2004-Ohio-4202.] 
Attorneys—Mandatory arbitration of fee disputes between attorneys—Right to 
jury trial not violated—Award is final, binding, and unappealable. 
(No. 2003-1017 — Submitted April 28, 2004, at the Clermont County Session — 
Decided August 25, 2004.) 
APPEAL from the Court of Appeals for Franklin County, No. 02AP-872, 152 Ohio 
App.3d 742, 2003-Ohio-2200. 
_______________ 
SYLLABUS OF THE COURT 
1.  An arbitration award rendered pursuant to DR 2-107(B) is final, binding upon 
the parties, and unappealable. 
2.  DR 2-107(B) does not infringe upon the right of trial by jury as guaranteed by 
Section 5, Article I of the Ohio Constitution. 
_______________ 
 
ALICE ROBIE RESNICK, J. 
{¶ 1} This is an appeal from a judgment upholding the constitutionality 
of DR 2-107(B), which requires that disputes over the division of fees between 
lawyers who are not in the same firm be resolved in accordance with mediation or 
arbitration proceedings provided by a local bar association or, when necessary, by 
the Ohio State Bar Association. 
{¶ 2} The cause emanates from a dispute between plaintiff-appellant, 
Timothy A. Shimko, and defendant-appellee Thomas G. Lobe, both of whom are 
admitted to practice law in Ohio.  The dispute centers on the terms of an oral 
agreement with regard to the division of legal fees for litigation in California. 
SUPREME COURT OF OHIO 
2 
{¶ 3} On September 19, 1995, Lobe wrote to defendant-appellee 
Cleveland Bar Association (“CBA”), requesting that the dispute be “set down for 
mandatory and binding Arbitration.”  Lobe’s request was made pursuant to the 
Bylaws and Rules of the Division of Fees Mediation and Arbitration Committee, 
which were adopted by the CBA’s Board of Trustees on September 25, 1992, to 
implement DR 2-107(B).  Under the committee’s bylaws, “any decision rendered 
by a sole arbitrator or an arbitration panel is final and binding.” 
{¶ 4} In a letter dated September 29, 1995, Shimko opposed Lobe’s 
request for arbitration on the grounds that Lobe had failed to allege sufficient facts 
to invoke the committee’s jurisdiction.  On December 8, 1995, the committee’s 
secretary notified the parties that the committee was accepting jurisdiction and 
recommended that Lobe file the requisite petition.  Lobe then submitted a formal 
petition for arbitration. 
{¶ 5} Shimko commenced this action in 1996 by filing the first of two 
complaints for declaratory judgment in the Franklin County Court of Common 
Pleas against Lobe, CBA, and defendant-appellee Ohio State Bar Association 
(“OSBA”) (case No. 96CVH02-1206).  In that complaint, Shimko sought a 
declaration that DR 2-107(B) violates several provisions of the Ohio and United 
States Constitutions and, therefore, is invalid and unenforceable.  Finding that 
“[t]he practice of law is a privilege granted by the Supreme Court to those persons 
* * * who agree to be bound by the rules of the profession” and that the 
“regulation of * * * fee disputes is a proper function of the Court in its 
superintendence of the Bar,” the trial court held that DR 2-107(B) “does not 
violate the Plaintiff’s rights existing under the Constitutions of the State of Ohio 
and the United States.” 
{¶ 6} The court of appeals affirmed the trial court’s judgment, except to 
the extent that it had decided the issue of whether DR 2-107(B) deprives Shimko 
January Term, 2004 
3 
of his right to a jury trial as guaranteed by Section 5, Article I of the Ohio 
Constitution without having made a factual determination of reasonableness.  
Espousing the proposition that “ ‘[n]o one has an absolute right to practice law, 
and the State may impose reasonable conditions and limitations upon those who 
wish to exercise that privilege,’ ” the majority of the court of appeals framed the 
determinative inquiry under Section 5, Article I in terms of whether DR 2-107(B) 
“is reasonable and, therefore, appellant should be bound by it.”  Shimko v. Lobe 
(1997), 124 Ohio App.3d 336, 347, 706 N.E.2d 354, quoting Kelley Drye & 
Warren v. Murray Industries, Inc. (D.N.J.1985), 623 F.Supp. 522, 527.  The 
appellate court believed, however, that it needed a “factual basis to assess the 
reasonableness of this rule” and, in accordance with that belief, remanded the 
cause to the trial court “for a hearing to determine the reasonableness of the rule in 
* * * eliminating appellant’s right to a jury trial.”  Id. at 347-348, 706 N.E.2d 354. 
{¶ 7} On February 20, 1998, Shimko’s cross-appeal to this court was 
dismissed for failure of prosecution.  (1998), 81 Ohio St.3d 1450, 690 N.E.2d 
545.  On April 1, 1998, this court refused to accept appellees’ discretionary 
appeal.  (1998), 81 Ohio St.3d 1502, 691 N.E.2d 1061.  Shimko then dismissed 
his original action pursuant to Civ.R. 41(A). 
{¶ 8} Shimko refiled his complaint on April 5, 1999.  The second 
complaint (case No. 99CVH04-2793) essentially duplicated the first, with the 
addition of two new claims not involved in this appeal. 
{¶ 9} On April 17 and 18, 2000, an evidentiary hearing was held before a 
magistrate in accordance with the earlier mandate from the court of appeals to 
determine the reasonableness of DR 2-107(B).  In a decision filed September 13, 
2000, the magistrate concluded that “DR 2-107(B) is a reasonable restriction on 
the practice of law, and therefore constitutional.”  In so doing, the magistrate 
found that in compelling arbitration of fee disputes between lawyers, the rule 
SUPREME COURT OF OHIO 
4 
serves to prevent the erosion of public confidence in the legal profession, 
particularly by “avoiding what many perceive as the tawdry spectacle of lawyers 
fighting over the carcass of a fee” and “helps to preserve the confidentiality of 
attorney-client communication and to preserve privileges.” 
{¶ 10} In a decision dated August 13, 2001, the trial court adopted the 
magistrate’s decision over Shimko’s objections, with one minor modification as to 
a finding of fact. 
{¶ 11} On Shimko’s appeal, the court of appeals affirmed all aspects of 
the trial court’s various rulings, concluding that “[b]ased on the evidence 
presented at the [April 17, 2000] hearing * * * the compulsory arbitration and 
mediation provision of [DR 2-107(B)] is a reasonable restriction on those who 
practice law in Ohio.”  152 Ohio App.3d 742, 2003-Ohio-2200, 790 N.E.2d 335, ¶ 
32. Moreover, the court of appeals found that “attorneys admitted to the practice 
of law in Ohio, including [Shimko], agree to have a ‘dispute between lawyers 
arising under this rule’ submitted to mediation or arbitration.  By doing so, they 
have waived the right to a jury trial in [cases involving such] fee disputes.”  Id. 
The court also held that by providing for mediation or arbitration through bar 
associations, “[t]he Supreme Court has not unlawfully delegated judicial authority 
to resolve [such] fee disputes,” since the lawyer’s consent upon admission “to be 
bound [by] the Code of Professional Responsibility, including DR 2-107(B)’s 
provisions * * * gives the mediators or arbitrators their authority to resolve the fee 
disputes.” 
{¶ 12} The cause is now before this court pursuant to the acceptance of a 
discretionary appeal. 
{¶ 13} In this appeal, Shimko proposes that DR 2-107(B) is 
unconstitutional for two reasons:  (1) it denies attorneys the right to a jury trial as 
January Term, 2004 
5 
guaranteed by Section 5, Article I of the Ohio Constitution, and (2) it creates or 
delegates the power to create tribunals unauthorized by law. 
{¶ 14} For the reasons that follow, we reject both these propositions and 
hold that DR 2-107(B) is a lawful exercise of this court’s inherent and plenary 
power to regulate, control, and define the practice of law in Ohio. 
I 
RIGHT OF TRIAL BY JURY 
{¶ 15} Beginning with the adoption of Supreme Court Rule XXVI in 
February 1875, see 24 Ohio St. V, and culminating in the adoption of Section 
2(B)(1)(g), Article IV of the Ohio Constitution in 1968, it has been methodically 
and firmly established that the power and responsibility to admit and discipline 
persons admitted to the practice of law, to promulgate and enforce professional 
standards and rules of conduct, and to otherwise broadly regulate, control, and 
define the procedure and practice of law in Ohio rests inherently, originally, and 
exclusively in the Supreme Court of Ohio.  See Smith v. Kates (1976), 46 Ohio 
St.2d 263, 265-266, 75 O.O.2d 318, 348 N.E.2d 320; Mahoning Cty. Bar Assn. v. 
Franko (1958), 168 Ohio St. 17, 5 O.O.2d 282, 151 N.E.2d 17; Cleveland Bar 
Assn. v. Pleasant (1958), 167 Ohio St. 325, 4 O.O.2d 433, 148 N.E.2d 493; In re 
McBride (1956), 164 Ohio St. 419, 58 O.O. 242, 132 N.E.2d 113; Judd v. City 
Trust & Sav. Bank (1937), 133 Ohio St. 81, 10 O.O. 95, 12 N.E.2d 288, paragraph 
one of the syllabus; In re Thatcher (1909), 80 Ohio St. 492, 89 N.E. 39; Swisher, 
Professional Responsibility in Ohio (1981) 1.15-1.35. 
{¶ 16} In exercising its supervisory responsibility over the bar, this court 
has sought to maintain the integrity of the legal profession and preserve the public 
confidence in the judicial system.  See, e.g., EC 1-1, 9-1, and 9-6.  See, also, 
Franko, supra, 168 Ohio St. at 23, 5 O.O.2d 282, 151 N.E.2d 17; In re 
Disbarment of Thatcher (1910), 83 Ohio St. 246, 249, 93 N.E. 895.  Thus, while 
SUPREME COURT OF OHIO 
6 
recognizing that “[t]he legal profession cannot remain a viable force in fulfilling 
its role in our society unless its members receive adequate compensation for 
services rendered,” EC 2-15, the Code of Professional Responsibility contains a 
broad range of rules that limit the attorney’s pursuit of legal fees.  See, e.g., DR 2-
101(E)(1) and (2) (specifying allowable and binding advertisement with regard to 
fees), DR 2-103 (general prohibition and exceptions concerning payment of 
referral fee), DR 2-106(A) and (B) (precluding lawyers from collecting an illegal 
or clearly excessive fee and providing standards for determining when a fee is 
clearly excessive), DR 2-106(C) (prohibiting contingent fees in criminal cases), 
DR 2-110(A)(3) (requiring a lawyer, upon withdrawing from employment, to 
refund any fees that were paid in advance), DR 3-102(A) (prohibiting a lawyer 
from sharing legal fees with a nonlawyer), DR 5-103(A) (prohibiting acquisition 
of proprietary interest in litigation, except a lien to secure payment of fees and a 
contingency fee in civil cases), and DR 5-107(A) (precluding a lawyer from 
accepting third-party compensation without the client’s consent after full 
disclosure). 
{¶ 17} To this end, DR 2-107 provides: 
{¶ 18} “(A) Division of fees by lawyers who are not in the same firm may 
be made only with the prior consent of the client and if all of the following apply: 
{¶ 19} “(1) The division is in proportion to the services performed by each 
lawyer or, if by written agreement with the client, all lawyers assume 
responsibility for the representation; 
{¶ 20} “(2) The terms of the division and the identity of all lawyers 
sharing in the fee are disclosed in writing to the client; 
{¶ 21} “(3) The total fee is reasonable. 
{¶ 22} “(B) In cases of dispute between lawyers arising under this rule, 
fees shall be divided in accordance with mediation or arbitration provided by a 
January Term, 2004 
7 
local bar association.  Disputes that cannot be resolved by a local bar association 
shall be referred to the Ohio State Bar Association for mediation or arbitration.” 
{¶ 23} Gov.Bar R. IV(1) provides: 
{¶ 24} “The Code of Professional Responsibility, as adopted by this Court 
on October 5, 1970 and set forth in 23 Ohio State 2d Reports, as amended, shall 
be binding upon all persons admitted to practice law in Ohio.  The willful breach 
of the Code shall be punished by reprimand, suspension, disbarment, or probation 
as provided in Gov.Bar R.V.”  See, also, Gov.Bar R. I(8)(A) (requiring each 
applicant, upon admission to the bar, to take an oath to “abide by the Code of 
Professional Responsibility”). 
{¶ 25} The court of appeals expressed some doubt, however, as to the 
finality of an arbitration award rendered pursuant to DR 2-107(B).  In its 1997 
decision, the court of appeals timorously noted, “Although the rule itself does not 
state that arbitration before the Ohio State Bar Association is either ‘final’ or 
‘binding,’ the Ohio State Bar Association DR 2-107 Attorney’s Fee Division 
Dispute Resolution Plan, adopted by the Council of Delegates on November 9, 
1991, expressly states that such arbitration is ‘binding.’ ”  Shimko, supra, 124 
Ohio App.3d at 346, 706 N.E.2d 354, fn. 4. 
{¶ 26} Considering that DR 2-107(B) explicitly requires division of fees 
“in accordance with mediation or arbitration,” that “[t]he Disciplinary Rules, 
unlike the Ethical Considerations, are mandatory in character” (Preface to Code of 
Professional Responsibility), and that the salient purpose of the rule is to prevent 
litigation of disputes between lawyers over the division of fees, it is clear that DR 
2-107(B) cannot and was not intended to be interpreted otherwise.  Lest there be 
any further uncertainty, we hold that an arbitration award rendered pursuant to DR 
2-107(B) is final, binding upon the parties, and unappealable.  In this way, the 
burden of withstanding constitutional scrutiny under Section 5, Article I will fall 
SUPREME COURT OF OHIO 
8 
upon the rule itself, as adopted by this court, rather than being foisted upon the 
implementing plans or bylaws of a particular bar association. 
{¶ 27} Shimko correctly asserts that the court’s power to regulate the bar 
“is not absolute and [that] it must be contained by, and act congruently with, the 
very constitution that provides for its existence.”  This court may no more 
disregard or infringe upon the constitutional rights of our citizens in the exercise 
of its regulatory functions than may any other branch of government.  As we 
explained in Christensen v. Bd. of Commrs. on Grievances & Discipline (1991), 
61 Ohio St.3d 534, 537, 575 N.E.2d 790, “Rules adopted by this court in an 
administrative capacity must comply with the state and federal constitutions like 
any other rules and may be tested in any court of competent jurisdiction.” 
{¶ 28} In particular, the court does not enjoy any special exemption from 
compliance with Section 5, Article I of the Ohio Constitution, which ensures that 
“[t]he right of trial by jury shall be inviolate * * *.”  We have consistently 
recognized that Section 5, Article I does not merely extol a procedural privilege, 
but secures a sacred and fundamental right, anchored in the founding of our nation 
and state and basic to the institution of American democracy, that may not be 
invaded or violated by legislative act or judicial order or decree.  See, e.g., Sorrell 
v. Thevenir (1994), 69 Ohio St.3d 415, 421, 633 N.E.2d 504; Morris v. Savoy 
(1991), 61 Ohio St.3d 684, 701, 702-703, 576 N.E.2d 765 (A.W. Sweeney, J., 
concurring in part and dissenting in part); Miller v. Wikel Mfg. Co., Inc. (1989), 46 
Ohio St.3d 76, 81, 545 N.E.2d 76 (Douglas, J., concurring in part and dissenting 
in part). 
{¶ 29} But the right of trial by jury under Section 5, Article I is still a 
qualified right.  “It was not * * * the intention of the framers of that clause * * * 
to guarantee the right of trial by jury in all controversies.  That guaranty only 
preserves the right of trial by jury in cases where under the principles of the 
January Term, 2004 
9 
common law it existed previously to the adoption of the [Ohio] Constitution.  The 
right of trial by jury has uniformly been recognized and enforced in this state in 
actions for money, where the claim is an ordinary debt * * *.”  Belding v. State ex 
rel. Heifner (1929), 121 Ohio St. 393, 396-397, 169 N.E. 301.  See, also, Sorrell, 
supra, 69 Ohio St.3d at 421, 633 N.E.2d 504; Kneisley v. Lattimer-Stevens Co. 
(1988), 40 Ohio St.3d 354, 356, 533 N.E.2d 743.  The right, where it exists, may 
also be waived.  “Section 5 of Article I of the Ohio Constitution does not prevent 
a court from giving effect to a waiver of a jury trial by a party who has a right to a 
jury trial.”  Cassidy v. Glossip (1967), 12 Ohio St.2d 17, 41 O.O.2d 153, 231 
N.E.2d 64, paragraph one of the syllabus.  See, also, Bonewitz v. Bonewitz (1893), 
50 Ohio St. 373, 34 N.E. 332, paragraph one of the syllabus (“A party may waive 
his right to a jury trial by acts, as well as by words”). 
{¶ 30} This court has never considered the constitutionality of DR 2-
107(B).  The rule was challenged on several constitutional grounds in State ex rel. 
Lawrence v. Marks (1995), 74 Ohio St.3d 1207, 655 N.E.2d 1308, and the 
concurring justices in that case opined that “a legitimate question arises [under 
Section 5, Article I] whether this court, by rule or otherwise, can force parties in 
an attorney-fee dispute to arbitrate when the result of a true arbitration is an award 
which is final and nonappealable and the parties have not previously agreed to 
arbitrate.”  Id. at 1208, 655 N.E.2d 1308 (Douglas, J., concurring).  However, the 
majority of the court refrained from commenting on the merits in that action, 
which was unanimously dismissed upon motion for lack of jurisdiction. 
{¶ 31} As far as we can ascertain, no other court has considered the 
constitutional validity of a disciplinary or other court rule compelling arbitration 
of fee disputes between attorneys.  However, several courts have been confronted 
with a variety of constitutional objections to court rules that require arbitration of 
SUPREME COURT OF OHIO 
10 
attorney-client fee disputes at the client’s option.  In each case, the rule was 
upheld against all challenges, including those based upon the right to a jury trial. 
{¶ 32} In re LiVolsi (1981), 85 N.J. 576, 428 A.2d 1268, involved a 
number of challenges to N.J.R. 1:20A, which was adopted by the New Jersey 
Supreme Court as a mechanism for resolving fee disputes between attorneys and 
their clients.  The rule establishes fee-arbitration committees and provides that a 
committee must arbitrate a dispute upon the request of a client, whether the 
attorney consents or not, and that the committee’s determination is binding on the 
parties and unappealable.  In finding the promulgation of N.J.R. 1:20A to be 
within the scope of its constitutional power, the Supreme Court of New Jersey 
explained: 
{¶ 33} “The heart of the constitutional provisions concerning the judicial 
system was the concentration of responsibility for its proper functioning in the 
Supreme Court and Chief Justice.  Such responsibility requires appropriate power 
over courts, judges, practice and procedure, and lawyers.  Responsibility for an 
adversarial judicial system requires responsibility for the adversaries, and control 
over both. 
{¶ 34} “In exercising this responsibility, one of the many goals this Court 
has sought to achieve has been maintaining public confidence in the judicial 
system. * * * 
{¶ 35} “Given the critical importance of the constitutional power of this 
Court over the practice of law, and its pervasiveness, starting with admission, 
ending with disbarment, and covering everything in between, we have no doubt 
that the power extends to every aspect of fee agreements between lawyers and 
clients.”  Id., 85 N.J. at 585, 428 A.2d 1268. 
{¶ 36} The court went on to reject the claim that N.J.R. 1:20A 
unconstitutionally denies attorneys the right to trial by jury “on the two grounds 
January Term, 2004 
11 
that in New Jersey attorneys never had an absolute right to trial by jury in fee 
dispute cases and that recognizing a jury right in such cases would undermine our 
constitutional authority to regulate the Bar.”  Id. at 587, 428 A.2d 1268. 
{¶ 37} After In re LiVolsi was decided, the New Jersey rule was twice 
challenged and upheld in federal court under the jury-trial clause of the Seventh 
Amendment to the United States Constitution.  In Kelley Drye & Warren v. 
Murray Indus., Inc. (D.N.J.1985), 623 F.Supp. 522, 526-527, and again in 
Guralnick v. Supreme Court of New Jersey (D.N.J.1990), 747 F.Supp. 1109, 
1116, affirmed (C.A.3, 1992), 961 F.2d 209, it was held that state courts may, 
consistent with the Seventh Amendment, require persons wishing to exercise the 
privilege of practicing law to waive or forfeit their right to a jury trial if the client 
elects to arbitrate a fee dispute. 
{¶ 38} In Anderson v. Elliott (Me.1989), 555 A.2d 1042, the Supreme 
Judicial Court of Maine held that certain Maine Bar Rules promulgated by the 
court in 1978 do not infringe upon an attorney’s right to trial by jury under the 
Maine Constitution.  The court explained that “Rule 9 establishes a mechanism 
for binding arbitration of attorney-client fee disputes under the jurisdiction of the 
Board of Overseers of the Bar, and Rule 3.3(c) obligates an attorney to submit any 
fee dispute to Rule 9 arbitration at the client’s request.”  Id. at 1043. 
{¶ 39} At the outset of its analysis, the Maine Supreme Court recognized: 
{¶ 40} “Maine Bar Rule 9 enables a client to prevent his attorney from 
having their fee dispute heard by a jury, but that by itself does not violate the 
constitutional guarantee of the right to a civil jury trial, Me.Const. art. I, § 20.  
Elliott’s thesis that a suit to recover a contingent fee is just like any other suit for 
money damages for breach of contract — in other words, that the attorney-client 
relationship is just like any other contractual arrangement — ignores the 
uniqueness of the attorney’s relation to the court and to the client.”  Id. at 1047. 
SUPREME COURT OF OHIO 
12 
{¶ 41} Upon taking the oath of office, the court explained, “the attorney 
enters into a regulated profession and becomes an officer of the court subject to 
the court’s inherent power,” which necessarily includes the imposition of “ 
‘certain standards peculiarly applicable to attorneys * * * to assure fairness and 
efficiency of court procedures and adjudications and to foster public confidence in 
such fairness and efficiency.’ ”  Id., 555 A.2d at 1048, quoting In re Dineen 
(Me.1977), 380 A.2d 603, 604.  Thus, continued the court, “an attorney-client fee 
dispute is no ordinary contractual controversy.  Members of the public as a 
practical matter have access to the courts only through their attorneys, and that 
access is impaired by collateral controversies over legal charges.”  Id. at 1049.  
See, also, Nodvin v. State Bar of Georgia (2001), 273 Ga. 559, 561, 544 S.E.2d 
142 (recognizing the “unique * * * importance” of public confidence in the 
judicial system as justification for mandatory arbitration of attorney-client fee 
disputes). 
{¶ 42} One of Shimko’s principal contentions is that LiVolsi and 
Anderson are distinguishable because they involve attorney-client fee disputes 
rather than disputes between attorneys.  According to Shimko, “the nature of the 
relationship between the attorney and client was critical to each of those courts.”  
In particular, Shimko contends that because “the attorney occupies a fiduciary 
relationship, with a position of superiority over the client * * *, the Supreme 
Courts of Maine and New Jersey felt it was reasonable for attorneys to submit to 
non-jury adjudications for fee disputes.”  On the other hand, the argument 
continues, attorneys like Shimko and Lobe need no special protection from one 
another, as they stand “on equal footing and at arms-length, and neither would be 
hindered or put to a disadvantage by taking the dispute to court.”  We disagree. 
{¶ 43} Shimko’s argument is built on the erroneous premise that the 
constitutional validity of the nonjury dispute-resolution mechanisms at issue in 
January Term, 2004 
13 
LiVolsi and Anderson was necessarily dependent upon concerns peculiar to the 
attorney-client relationship.  However, a close reading reveals that the critical 
support for the constitutionality of the compulsory arbitration schemes in those 
cases was ultimately found to lie not in the fiduciary character of the attorney-
client relationship or the attorney’s position of dominance over the client, but in 
the relations existing between the bench and bar, that is, in the recognition that 
lawyers are officers of the court and essential to the primary judicial function of 
administering justice.  The essential power to control or regulate the fee 
arrangement between attorney and client is not derived from the attorney’s 
position in relation to the client, but from the attorney’s position in relation to the 
court and the justice system.  Moreover, Shimko forgets that the courts in LiVolsi 
and Anderson did not purport to exercise any authority or control over the client.  
It was the attorney who was held in those cases to have entered a regulated 
profession and who was subjected to professional standards designed to preserve 
public confidence in the judicial system.  In fact, the very rules at issue in LiVolsi 
and Anderson are expressly designed to operate at the client’s option, thus 
disclaiming any ability or desire on the court’s part to compel the client to 
arbitrate a fee dispute.  And because those decisions reflect the court’s broad 
power to regulate the professional activities of its officers, they are indeed 
significant to the matter at hand. 
{¶ 44} Shimko also maintains that “[s]tatutes and rules that interfere with 
the right to a trial by jury are subject to the highest level of judicial scrutiny” and 
that DR 2-107(B) is not “necessary to promote a compelling governmental 
interest.”  According to Shimko, the rationale advanced to support the rule, which 
Shimko states to be that “citizens will gain confidence in the legal system by not 
viewing lawyers litigat[ing] over legal fees,” does not rise to the level of a 
compelling state interest.  In any event, Shimko argues, no evidence was 
SUPREME COURT OF OHIO 
14 
presented to suggest that the public is overly concerned with or affected by such 
litigation. 
{¶ 45} Appellees argue, however, that these particular questions were 
resolved by the court of appeals in its 1997 decision, which became “the law of 
the case” upon this court’s dismissal of Shimko’s cross-appeal on February 20, 
1998.  Thus, appellees contend that Shimko should be precluded from relitigating 
the applicability of a reasonableness standard and, correlatively, that this court 
should limit its review to whether sufficient evidence was presented at the hearing 
on remand to support the finding that DR 2-107(B) is a reasonable restriction on 
the practice of law. 
{¶ 46} We cannot agree with appellees that the “law of the case doctrine” 
has any applicability in this case.  “The doctrine is considered to be a rule of 
practice rather than a binding rule of substantive law and will not be applied so as 
to achieve unjust results.”  Nolan v. Nolan (1984), 11 Ohio St.3d 1, 3, 11 OBR 1, 
462 N.E.2d 410.  This court would be remiss in its supervisory responsibility over 
the bar if it were to apply the doctrine under the present circumstances.  On the 
one hand, adherence to the doctrine in this appeal could result in this court’s 
upholding an unconstitutional rule on account of being forced by the law of the 
case to apply the wrong analytic standard.  On the other hand, it could result in 
this court’s rendering a decision implying that these particular constitutional 
objections to DR 2-107(B) might be valid, only to postpone their resolution 
because a doctrine that we have chosen to apply prevents us from considering 
them. 
{¶ 47} Having determined to address Shimko’s contention that DR 2-
107(B) fails to withstand strict scrutiny, we now reject it.  In the first place, DR 2-
107(B) does not implicate the right of trial by jury, because that right does not 
exist in cases of fee disputes between attorneys.  Prior to 1802, the attorney’s 
January Term, 2004 
15 
ability to recover a fee for legal services was regulated entirely by statute and 
rested for its authority upon the will of the legislature.  Indeed, compensation for 
advocacy has never been treated as an ordinary debt or contractual right, but has 
since antiquity been regulated by the prevailing governmental authority possessing 
the power to control the practice of law. 
{¶ 48} Both at Rome and in the ecclesiastical courts of England, “[t]he 
advocate * * * had no legal claim to a fee.”  Roscoe Pound, The Lawyer from 
Antiquity to Modern Times (1953) 68.  Advocacy was considered “a service 
gratuitously rendered for its own sake, for which the advocate might honorably 
accept a fair honorarium, voluntarily bestowed on him as a gift, but for which no 
bargain as to compensation and nothing in the way of hire was permissible.”  Id. 
at 54-55.  On those rare occasions when fees were allowed, they were granted and 
strictly regulated by the prevailing governmental authority.  Id. at 51-53. 
{¶ 49} In colonial America, fees were strictly regulated by statute.  Thus, 
Pound recounts: 
{¶ 50} “In 1642-3, an Act for the Better Regulation of Attorneys forbade 
pleading causes for another without license from the court where one pleads * * *.  
Fees (in tobacco) were fixed very low with a heavy penalty for taking more.  A 
licensed attorney was forbidden to refuse retainer unless already retained on the 
other side of the same controversy. * * * In 1657-58 it was enacted that no 
attorney and no other person should plead in any court or give counsel in any 
cause or controversy for any kind of reward or profit directly or indirectly, under 
penalty for every breach.  However, fees were allowed and fixed by an Act of 
1680, but no one was to practice in the General Court (formerly called Quarter 
Court) unless licensed by the Governor. * * * [S]tatutory regulation of fees [in 
Virginia] went on until 1849 * * *.”  Id. at 136-138.  Also, “[i]n Maryland in 1725 
SUPREME COURT OF OHIO 
16 
there was a statute regulating fees strictly and allowing planters to pay in tobacco 
or in currency at a fixed rate.”  (Footnotes omitted.)  Id. at 168. 
{¶ 51} In the Northwest Territory, attorneys were permitted to charge and 
collect fees for their services, but that entitlement was derived from territorial 
legislation.  On August 1, 1792, the territorial legislature passed “An ACT to 
regulate the admission of Attorneys.”  Pease Ed., Laws of the Northwest Territory 
(Ill.State Bar Assn.Reprint, 1925) 88.  The Act of 1792 set forth qualifications for 
admission, required a successful applicant to take an oath of office, and provided 
that in no “cause shall fees for more than one attorney be taxed or allowed.” 
{¶ 52} The 1792 Act was repealed in 1795, id. at 255, 257, and replaced 
on October 29, 1799, with “An ACT regulating the admission and practice of 
attorneys and counsellors at law.”  Id. at 340.  The Act of 1799 was considerably 
more structured and comprehensive than its predecessor and, as Swisher explains, 
“formed the model for succeeding legislation which was to govern the practice of 
law completely for the next century and more, and to govern at least some aspects 
of the practice of law into the second half of the 20th century.”  Swisher, at 1.5. 
{¶ 53} The 1799 Act provided that no person shall be permitted to 
practice as an attorney at law in the territorial courts without having previously 
obtained a license from the governor, “which license * * * shall authorize him * * 
* to demand, take and receive all such fees as are or hereafter may be established 
for any service which he shall or may do as an attorney at law in said territory.”  
Act of 1799, Section 1.  The Act also entitled the attorney, upon licensure, “to ask 
for and receive, or prosecute for or recover, all such fees as now are or hereafter 
may be allowed, by law, for services actually performed in his office, as attorney 
at law.”  Section 4.  The Act further provided that every attorney “receiving 
money for the use of his client, and refusing to pay the same when demanded, may 
be proceeded against, in a summary way, on motion” and that any money or 
January Term, 2004 
17 
property received by an unlicensed person “as a fee or compensation for [legal] 
services rendered * * * may be recovered back, with costs of suit.”  Act of 1799, 
Sections 6 and 12. 
{¶ 54} When the power over the practice of law was found to lie 
inherently in the judicial branch of government, this court firmly established that 
no person has a right to practice law, but that the practice of law is an 
extraordinary privilege bestowed by this court upon one who meets the 
qualifications for admission and continues to maintain the standard of ethical 
conduct as prescribed by the rules of the court.  See Franko, supra, 168 Ohio St. at 
22-24, 5 O.O.2d 282, 151 N.E.2d 17; In re McBride, supra, 164 Ohio St. at 426, 
58 O.O. 242, 132 N.E.2d 113; In re Thatcher, supra, 80 Ohio St. at 653-655, 89 
N.E. 39.  See, also, In re Thatcher (N.D.Ohio 1911), 190 F. 969, 974-975.  As one 
court stated, “The power to promulgate and enforce rules of conduct is a necessary 
incident to the power to admit; if that were not true, then the courts would have no 
control over their own officers, and the practice of the law would cease to be a 
profession and become purely a competitive enterprise.”  In re Dombey 
(C.P.1954), 68 Ohio Law Abs. 36, 45, 1954 WL 8029. 
{¶ 55} Thus, virtually all aspects of the practice of law in general, and 
remuneration in particular, have always been considered to lie within the 
regulatory jurisdiction of the granting or admitting authority and to be distinct 
from other types of contractual arrangements.  In fact, Shimko objects only to 
subsection B of DR 2-107.  He does not deny this court’s power to promulgate 
DR 2-107(A); that is, he does not dispute that the court has sole authority to 
determine whether and under what circumstances lawyers may properly divide 
fees with other lawyers in the first instance.  But since this court has the inherent 
power to create or deny that right to its officers, it may provide for a procedure of 
enforcement that does not include a jury trial.  See, e.g., Hoops v. United Tel. Co. 
SUPREME COURT OF OHIO 
18 
(1990), 50 Ohio St.3d 97, 100, 553 N.E.2d 252.  See, also, Pleasant, supra, 167 
Ohio St. at 335, 4 O.O.2d 433, 148 N.E.2d 493. 
{¶ 56} In any event, even if we agreed with Shimko that DR 2-107(B) 
must be subjected to “the highest level of judicial scrutiny,” we would still 
conclude that it is supported by “a compelling governmental interest.” 
{¶ 57} In Goldfarb v. Virginia State Bar (1975), 421 U.S. 773, 792, 95 
S.Ct. 2004, 44 L.Ed.2d 572, the United States Supreme Court recognized that “the 
States have a compelling interest in the practice of professions within their 
boundaries, and that as part of their power to protect the public health, safety, and 
other valid interests they have broad power to establish standards for licensing 
practitioners and regulating the practice of professions.  * * * The interest of the 
States in regulating lawyers is especially great since lawyers are essential to the 
primary governmental function of administering justice, and have historically 
been ‘officers of the courts.’ ” 
{¶ 58} In Disciplinary Counsel v. Gardner, 99 Ohio St.3d 416, 2003-
Ohio-4048, 793 N.E.2d 425, this court held that the Free Speech Clause of the 
Ohio Constitution, Section II, Article I, although broader than the federal 
Constitution in protecting certain false statements, does not forbid the imposition 
of discipline on an attorney for violating DR 8-102(B) by falsely accusing an 
appellate panel of judicial impropriety during a pending court proceeding.  In that 
case, the court adopted an objective standard to determine whether a lawyer’s 
statement about a judicial officer was made with knowledge or reckless disregard 
of its falsity, rather than the subjective “actual malice” standard applicable in 
defamation cases under New York Times Co. v. Sullivan (1964), 376 U.S. 254, 84 
S.Ct. 710, 11 L.Ed.2d 686.  In so doing, we explained that DR 8-102(B) is 
designed “to preserve public confidence in the fairness and impartiality of our 
system of justice” and specifically concluded that “the state’s compelling interest 
January Term, 2004 
19 
in preserving public confidence in the judiciary supports applying a standard in 
disciplinary proceedings different from that applicable in defamation cases.”  
(Emphasis added.)  Id., 99 Ohio St.3d 416, 2003-Ohio-4048, 793 N.E.2d 425, at ¶ 
29 and 31. 
{¶ 59} DR 2-107(B) is also designed to preserve public confidence in our 
system of justice.  As stated above, the rule is one of various Disciplinary Rules 
designed to allow for remuneration of legal services without compromising the 
integrity of the legal profession.  But its goal is not to hide from the public that fee 
disputes do occasionally arise between lawyers.  Public confidence in the judicial 
system is not enhanced by withholding the truth.  Nor are fee disputes between 
lawyers a source of embarrassment for the profession, as honest and legitimate 
disputes over division of fees arise in any profession or service industry that 
charges fees.  However, when the judicial machinery is used to resolve a simple 
fee dispute between lawyers, and when clients, perhaps exhausted by litigation, 
are once again summoned to court in a public battle between their attorneys, 
compelled to publicly reveal the terms of their fee arrangement and other secrets 
and confidences, then this court’s failure to remedy that situation with a dignified 
and expedient dispute-resolution mechanism would directly reflect upon its ability 
to control the conduct of its officers, and the public confidence in the judiciary 
would most assuredly be affected. 
{¶ 60} Contrary to Shimko’s assertions (and to those of appellees and the 
court of appeals), identification and appraisal of the goals of DR 2-107(B) are not 
evidentiary questions.  It is axiomatic that the constitutionality of administrative 
rules and regulations is a question of law.  Otherwise, the facial validity of any 
particular rule “could be decided differently from case to case depending on the 
testimony of expert witnesses.  A particular [rule] might then be found [invalid] in 
one case only to be applied in another pursuant to differing panels of experts.”  
SUPREME COURT OF OHIO 
20 
Pinchot v. Charter One Bank F.S.B., 99 Ohio St.3d 390, 2003-Ohio-4122, 792 
N.E.2d 1105, at ¶ 39 (in considering the legal issue of federal preemption of state 
statutes). 
{¶ 61} Accordingly, we affirm the judgment of the court of appeals 
insofar as it bears on this issue. 
II 
CREATION OF UNAUTHORIZED TRIBUNALS 
{¶ 62} It is somewhat difficult to decipher and fairly characterize 
Shimko’s arguments in support of his second proposition of law.  He seems to 
argue in the first instance that a bar association has no authority under DR 2-
107(B) to “order” an attorney to arbitrate a fee dispute “before a body created by 
the bar association.”  Shimko describes this “body” as “a separate tribunal in the 
form of the arbitration panel of a local bar association.” 
{¶ 63} The CBA, however, did not order Shimko to arbitrate his fee 
dispute with Lobe; the “order” (or requirement) to arbitrate emanates from DR 2-
107(B).  The CBA has merely accepted jurisdiction of a dispute that arose under 
the rule.  Moreover, we fail to understand how the arbitration panel that will 
eventually be selected to determine the dispute between Shimko and Lobe 
constitutes an entity distinct from the CBA, since that panel will consist of 
members of the bar (and particularly members of the CBA).  In any event, 
providing the arbitral machinery for determining a fee dispute between attorneys 
from different firms is precisely what DR 2-107(B) authorizes the CBA to do. 
{¶ 64} Shimko also argues that “DR 2-107(B) is an unreasonable 
restriction on the right to a trial by jury because the Supreme Court of Ohio does 
not have the authority to create a tribunal for the purpose of exercising judicial 
power to hear and determine actions such as the dispute between Mr. Shimko and 
Mr. Lobe.”  Shimko then cites State ex rel. Ramey v. Davis (1929), 119 Ohio St. 
January Term, 2004 
21 
596, 165 N.E. 298, paragraph three of the syllabus, and S. Euclid v. Jemison 
(1986), 28 Ohio St.3d 157, 163, 28 OBR 250, 503 N.E.2d 136, for the proposition 
that “only the General Assembly may create courts inferior to the Courts of 
Appeals of this State and determine their subject matter jurisdiction.” 
{¶ 65} However, Ramey and Jemison have nothing whatsoever to do with 
arbitration or rules of court, and DR 2-107(B) does not create courts or any other 
tribunal.  The “judicial” power that is being exercised under DR 2-107(B) is 
administrative, not adjudicative.  The rule does not create any adjudicative body 
but instead requires officers of the court to arbitrate their fee disputes.  Thus, we 
agree with the court of appeals that Shimko’s obligation as a practicing Ohio 
lawyer to abide by the Code of Professional Responsibility “gives the mediators or 
arbitrators their authority to resolve the fee disputes.”  152 Ohio App.3d 742, 
2003-Ohio-2200, 790 N.E.2d 335, ¶ 39. 
{¶ 66} The judgment of the court of appeals is, therefore, affirmed as to 
this issue. 
III 
CONCLUSION 
{¶ 67} Based on the foregoing, we hold that DR 2-107(B) does not 
infringe upon the right of trial by jury as guaranteed by Section 5, Article I of the 
Ohio Constitution. 
{¶ 68} Accordingly, the judgment of the court of appeals is affirmed. 
Judgment affirmed. 
 
MOYER, C.J., F.E. SWEENEY, LUNDBERG STRATTON, O’CONNOR and 
O’DONNELL, JJ., concur. 
 
PFEIFER, J., dissents. 
_______________ 
 
PFEIFER, J., dissenting. 
SUPREME COURT OF OHIO 
22 
 
Nothing in DR 2-107(B) makes fee-dispute arbitrations final, binding on 
the parties, or unappealable.  Thus, the rule as written does not raise any 
constitutional problems.  We should leave it as written and apply it as written. 
_______________ 
 
Timothy A. Shimko & Associates Co., L.P.A., Timothy A. Shimko and 
David A. Welling, for appellant. 
 
Jones Day, Fordham E. Huffman and J. Todd Kennard, for appellee 
Cleveland Bar Association. 
 
Eugene P. Whetzel, for appellee Ohio State Bar Association. 
__________________