Can I pay a referral fee to the lawyer who sent me the case if he did no work on it and there's no written fee-sharing agreement with the client?

Plain-English summary

The inquiring attorney asked whether a referral fee could be paid to a referring attorney who did no legal work on the case, where there was no written agreement with the client regarding a referral fee.

The panel applied Rule 1.5, which requires an attorney's fee to be reasonable, and specifically Rule 1.5(e), which governs the division of a fee between lawyers not in the same firm. Under that rule, a fee division is permitted only if the division is in proportion to the services each lawyer performed, or, by written agreement with the client, each lawyer assumes joint responsibility for the representation; the client is advised of and does not object to the participation of all the lawyers; and the total fee is reasonable. The panel noted the comment's explanation that a fee may be divided either by proportion of services rendered or by written agreement with the client under which all lawyers assume responsibility.

Applying the rule to the facts, the panel found no indication that the referring attorney had performed any services, no written agreement with the client, and no joint responsibility for the representation. It concluded that any portion of the fee paid to the referring attorney would constitute a violation of Rule 1.5(e).

Currency note

This opinion was issued in 1995, after the Rhode Island Supreme Court adopted the Model Rules of Professional Conduct effective November 15, 1988, and it applies Rule 1.5(e) as originally adopted. The Rhode Island Supreme Court later revised the Rules of Professional Conduct in 2007 as part of the nationwide Ethics 2000 process, which adjusted the fee-division provisions. 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 Treat this page as historical context, not current guidance.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 mentioned here.

Common questions

Q: Can a lawyer pay a pure referral fee for sending a case?

A: On these facts, no. The opinion concluded that paying the referring attorney any portion of the fee would violate Rule 1.5(e) where that attorney did no work, there was no written client agreement, and no lawyer assumed joint responsibility.

Q: What are the two ways a fee may be divided between firms?

A: The opinion explained that under Rule 1.5(e), the division must be in proportion to the services each lawyer performed, or, by written agreement with the client, each lawyer assumes joint responsibility for the representation, with the client advised and the total fee reasonable.

Q: Would a written agreement have changed the result?

A: The opinion identified the absence of a written agreement and joint responsibility as among the reasons the payment was improper, which indicates a compliant division requires meeting Rule 1.5(e)'s conditions.

Background and rules framework

The opinion applied Rhode Island Rule of Professional Conduct 1.5 (Model Rule 1.5), which requires a reasonable fee, and Rule 1.5(e), which conditions any division of a fee between lawyers in different firms on proportionality to services or a written client agreement under which the lawyers assume joint responsibility, client notice without objection, and a reasonable total fee. The panel read these conditions as cumulative, so failing any of them makes the payment improper.

Citations and references

Rules of Professional Conduct:

• Model Rule 1.5 / RI RPC 1.5(e) (fees; division of a fee between lawyers not in the same firm)

See also

• RI EAP Op. 97-16: Sharing a referral fee requires joint responsibility in writing
• RI EAP Op. 95-03: Percentage referral fee for a nonprofit bar service

Source

• Landing page: https://www.courts.ri.gov/attorney-resources/Pages/Ethics-Advisory-Panel-default.aspx
• Original PDF: https://www.courts.ri.gov/Opinions/EAP%2095-15.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain; the linked PDF is authoritative.

FINAL

ETHICS ADVISORY PANEL
OPINION # 95-15, REQUEST # 574
Issued March 23, 1995

The inquiring attorney asks if a referral fee may be paid to a referring attorney who did not perform any legal work on the case and where there was no written agreement with the client regarding a referral fee.

Rule 1.5 entitled "Fees" states that an attorney's fee shall be reasonable. More specifically, Rule 1.5(e) addresses the division of a fee between attorneys. The Rule states:

(e) A division of a fee between lawyers who are not in the same firm may be made only if:

(1) the division is in proportion to the services performed by each lawyer or, by written agreement with the client, each lawyer assumes joint responsibility for the representation;

(2) the client is advised of and does not object to the participation of all the lawyers involved; and

(3) the total fee is reasonable.

The comments to Rule 1.5(e) state that the Rule permits attorneys to divide a fee either based upon the proportion of services rendered or by written agreement with the client, if all lawyers assume responsibility for the representation.

Based upon the facts provided by the inquiring attorney, a division of the fee between attorneys not in the same firm may be made if the division is in proportion to work performed by each attorney or by a written agreement with the client and each attorney assumes joint responsibility for the representation of the client. In addition, the total fee must be reasonable.

In this case there is no indication of any services having been performed by the referring attorney, no written agreement with the client, and no joint responsibility for the representation. Therefore, any portion of the fee paid to the referring attorney would constitute a violation of Rule 1.5(e).