ISBA Professional Conduct Advisory Opinion

Opinion Number: Opinion No. 90-18
Opinion Date: January 1990

Reasonableness of referral fee

Digest

Where a referring lawyer and a receiving lawyer comply with the Rules governing referral fees, the Rules do not regulate the division of the fee between the referring lawyer and the receiving lawyer.

Facts

An attorney refers a personal injury case to a personal injury lawyer. The referring lawyer and the receiving lawyer agree to split the contingent fee equally. The principal service rendered by the referring lawyer is referring the case, however, the referring lawyer agrees to assume the same responsibility for the matter as if he were a partner in the receiving lawyer's firm. There is a written contingent fee agreement with the client and the client consents in writing to the division of the fee between the lawyers. The total fee to the client is reasonable and not increased by virtue of the referral fee.

Question

Where two lawyers comply with the rules of conduct for paying a referral fee, and the referring lawyer assumes the appropriate responsibility for the matter but otherwise renders no other service, is it a violation of the Rules for the referring lawyer to receive fifty percent of the fee? Under these circumstances is it a violation of the rules for the referring lawyer to receive one third of the fee?

Opinion

Assuming the lawyers have complied with Rules 1.5 (f) and (g)(1) and (2) which require, among other things, that the client consent in a writing which discloses the division of the fee, the basis on which it will be made, and the responsibility to be assumed by the referring lawyer, the Rules of Professional Conduct impose no restrictions on the way such reasonable fee may be divided between the lawyers.

References

  • Rule 1.5(f), (g)(1) and (2)

Professional Conduct Advisory Opinions are provided by the ISBA as an educational service to the public and the legal profession and are not intended as legal advice. The opinions are not binding on the courts or disciplinary agencies, but they are often considered by them in assessing lawyer conduct.