Can a lawyer accept title work from a lender that, as a standing practice, tells all borrowers it will accept title certificates only from that one lawyer?

Plain-English summary

A lending institution that made loans secured by deeds of trust advised all borrowers that it would accept title certificates only from a single specified lawyer. This was its uniform, long-standing practice; the specified lawyer knew of it; and the borrower paid the lawyer's fee. The inquiry asked whether it was ethical for the lawyer to accept employment under those facts.

The opinion concluded that a lawyer is not ethically prohibited from accepting employment that results from advice and recommendation from friends, relatives, business associates, or satisfied clients (EC 2-8). But where a lending institution, over an extended period, advises all borrowers that it will accept title certificates only from a specified lawyer, when other qualified lawyers are readily available, and the lawyer knows of this practice, it is unethical for the lawyer to accept employment resulting from such a lender requirement (DR 2-103(D)).

Currency note

This opinion was issued in 1977 under North Carolina's former Code of Professional Responsibility (the DR/EC framework), before the State Bar replaced the Code with the Rules of Professional Conduct (adopted 1985) and before the 2003 revisions to those Rules. The provision it applied (DR 2-103(D) on obtaining employment through recommendation) corresponds to today's Model Rule 7.2 on advertising and referral arrangements. Subsequent rule amendments or later opinions may have changed the analysis. Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific rule, deadline, or requirement mentioned here.

Common questions

Q: Can a lawyer accept work a lender steers to him exclusively?

A: Not where the lender requires all borrowers to use only that lawyer. The opinion concluded it is unethical to accept employment resulting from such a requirement when other qualified lawyers are available and the lawyer knows of the practice (DR 2-103(D)).

Q: Is accepting recommended work generally improper?

A: No. The opinion concluded a lawyer may accept employment recommended by friends, relatives, business associates, or satisfied clients (EC 2-8); the problem is the lender's exclusive requirement.

Q: Does the lawyer's knowledge of the practice matter?

A: Yes. The opinion concluded the lawyer's knowledge of the lender's long-standing exclusive-referral practice is part of what makes accepting the resulting employment unethical.

Background and rules framework

The opinion applied the former North Carolina DR 2-103(D) on obtaining professional employment through recommendation (corresponding to today's Model Rule 7.2), balanced against EC 2-8 permitting recommendations from friends and satisfied clients. The analysis turned on the lender's exclusive steering of all borrowers to one lawyer where other qualified lawyers were available.

Citations and references

Rules of Professional Conduct:

• North Carolina DR 2-103(D); EC 2-8 (Code of Professional Responsibility; obtaining employment through recommendation)
• MR 7.2 (advertising; recommendation of a lawyer)

See also

• NC Ethics Op. CPR 104: getting on a lender's approved-attorney list
• NC Ethics Op. RPC 10: for-profit lawyer referral service

Source

• Landing page: https://www.ncbar.gov/for-lawyers/ethics-and-governing-rules/ethics-opinions/opinions/cpr-108/

Original opinion text

Reproduced from the official source for research purposes. The linked source is authoritative.

Inquiry:

A lending institution lends money secured by deeds of trust on real estate and advises all borrowers that it will accept title certificates only from a single specified lawyer. This is the uniform practice of the lending institution. It has continued for a long time, and the lawyer specified by the lending institution is aware of the practice. The borrower pays the lawyer's fee. Is it ethical for the lawyer to accept employment under the facts stated?

Opinion:

A lawyer is not ethically prohibited from accepting employment as the result of advice and recommendation from friends, relatives, business associates, or satisfied clients (EC 2-8), but where a lending institution over an extended period of time advises all borrowers that it will accept title certificates only from a specified lawyer, when other qualified lawyers are readily available, and the lawyer knows of this practice, it is unethical for him to accept employment as a result of such requirement by the lender. DR 2-103(D).