New York City Bar Ethics Opinions
Free plain-English summaries of legal ethics opinions issued by the New York City Bar, with full citations and source links on every page.
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Can a New York lawyer invest in or do business with an alternative business structure (ABS) law firm that operates legally in a state like Arizona or Utah that allows nonlawyer ownership?
A New York lawyer may hold a passive financial interest in a lawful out-of-state ABS and may enter an arm's-length fee-sharing arrangement with one, as long as the ABS and the New York firm stay legal…
Can a New York lawyer review or sign a client's litigation funding agreement, and what are the lawyer's duties on fee sharing, conflicts, confidentiality, and control of the case?
Client-directed litigation funding does not violate Rule 5.4 because the funder is repaid from the client's recovery, not the lawyer's fee. A lawyer reviewing such an agreement must watch for conflict…
Can a New York lawyer enter an ongoing co-counsel and fee-sharing relationship with an out-of-state law firm that has nonlawyer owners?
Yes. A New York lawyer may keep an ongoing relationship with an alternative business structure (ABS) firm to regularly co-counsel and share fees without violating Rule 5.4, so long as the lawyer is no…
Can a New York lawyer take litigation funding where the lawyer's repayment to the funder is tied to the legal fees the lawyer collects?
No. Under Rule 5.4(a), a lawyer may not enter a financing agreement with a litigation funder (a non-lawyer) where the lawyer's future payments to the funder are contingent on the lawyer's receipt of l…
Can a lawyer pay a bar association referral service a fee when that service will share it with another bar association's referral service?
Yes. The opinion concludes a lawyer may pay a referral fee to a bar association's qualified lawyer referral service even when that service shares part of the fee with a second bar association referral…
Can a New York lawyer split a legal fee with a law firm in DC or abroad where nonlawyers have an ownership or management interest?
Yes. Although Rule 5.4 bars New York lawyers from sharing fees with nonlawyers or practicing in nonlawyer-owned firms, the opinion concludes a New York lawyer may divide a fee under Rule 1.5(g) with a…
Can a lawyer hired as local counsel limit how much responsibility they take on for the case?
Yes, but only through an agreement that limits the scope of representation under Rule 1.2(c). The opinion concludes the "local counsel" label alone does not narrow a lawyer's duties; any limit must be…
Can a law firm use a professional employer organization (PEO) to handle payroll and HR for its staff?
Yes. The opinion concludes a New York firm may use a PEO so long as the PEO does not interfere with the lawyers' independent judgment or supervision of staff, does not access client confidential infor…
Can a lawyer take a cut of a non-legal company's fees for reviewing forms the company prepares for its customers?
The opinion does not flatly forbid it but concludes the arrangement implicates as many as 21 rules and the proposed percentage-of-fee structure raises substantial concerns: it has the indicia of imper…
How do the advertising, fee-sharing, and confidentiality rules apply to a law firm's website, online services, and email?
The opinion concluded a firm need not file its website with disciplinary authorities but should keep a copy about a year; may not pay its internet provider a share of fees earned; may not offer online…
Can a firm call a non-exclusive per diem lawyer an 'associate' or 'of counsel'?
Not 'associate'; 'of counsel' depends on the relationship. The opinion concluded a lawyer engaged on a non-exclusive, per diem basis cannot be called an 'associate,' and may be called 'of counsel' onl…
What are a lawyer's duties when supervising paralegals and other nonlawyer staff who deal with clients and the public, and how may those staff be paid?
The opinion concluded a lawyer must effectively supervise nonlawyer employees, not aid the unauthorized practice of law, ensure client confidences are kept and the public is not misled about nonlawyer…
Can a bank charge borrowers a fee for its in-house lawyer's closing work, and can that lawyer also be an officer, director, or shareholder of the bank?
The opinion concluded a bank may charge borrowers a fixed fee for its in-house counsel's services only up to the actual cost (any profit would be improper fee-sharing and a misrepresentation), and a l…
Can a retired lawyer assign unpaid client accounts receivable to other lawyers for collection?
The opinion concluded a retired lawyer may assign fully earned accounts receivable to other lawyers if the clients are told, client confidences are protected, the fees were reasonable, the assigning l…
Can a law firm pay a temporary-lawyer placement agency a fee tied to the temporary lawyer's hours or pay, and what must the firm tell the client?
The opinion concluded, modifying its earlier view, that an agency's fee (even one calculated from the temporary lawyer's time or compensation) is payment for non-legal placement services, not a legal-…
Can a for-profit agency place temporary lawyers with law firms, and how must the agency, the firm, and the temporary lawyer structure the arrangement to satisfy the ethics rules?
The opinion concluded that the agency as proposed was improper because its fee structure and operation would assist the unauthorized practice of law and risk fee-splitting, but that a temporary-lawyer…
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Legal ethics opinions from the New York City Bar interpret the rules of professional conduct for working lawyers, in response to inquiries from members and committees. They are not binding like court discipline decisions, but courts and discipline boards treat formal opinions as substantial guidance on how the rules apply. Every opinion above has a plain-English question and short answer, plus a link to the original source on the bar's site.