Ethics Hotline & Opinions

ETHICS DOCKET NO. 1988-81

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MARYLAND STATE BAR ASSOCIATION, INC.

COMMITTEE ON ETHICS

ETHICS DOCKET NO. 1988-81

Fees: Division of Fee With Attorney Suspended From The Practice of Law


According to your inquiry, Lawyer A referred to you some personal injury cases with respect to which Lawyer A had done a considerable amount of work. As a result, an arrangement was made whereby Lawyer A would share in any fee realized from these cases. The cases were ultimately settled, but prior to settlement, Lawyer A was indefinitely suspended from the practice of law. The question raised by your inquiry is whether you can ethically remit to Lawyer A the previously-agreed upon referral fee.

A similar inquiry was the subject of Ethics Docket 84-101, which is not published in the two volume series ""Opinions on Ethics"" published by the Maryland State Bar Association. Accordingly, I am enclosing herewith a copy of the Opinion in Ethics Docket 84-101. Although the earlier Opinion construed the Disciplinary Rules which were replaced on January 1, 1987, by the Rules of Professional Conduct, the Committee believes that the earlier Opinion is still applicable.

Thus, as in the earlier Opinion, we assume, even though you do not state, that the fee sharing arrangement between you and Lawyer A complies with Rule 1.5 (the successor to DR 2-107), in that the division of the fee is in proportion to the services rendered by each lawyer or, by written agreement with the client, each lawyer assumes joint responsibility for the representation; furthermore, the client has no objection to the arrangement, and, finally, the total fee must be reasonable.

Assuming compliance with Rule 1.5, the next issue is whether honoring the fee arrangement with a suspended lawyer violates Rule 5.4(a), which prohibits sharing legal fees with a non-lawyer (Rule 5.4 is the successor to former DR 3-102). In Ethics Docket 84-101, this Committee opined that the payment of a share of legal fees earned by a law firm on cases referred to it by an attorney who was disbarred subsequent to the referral, did not violate the provision regarding sharing legal fees with a non-lawyer because it did not contribute to the unauthorized practice of law. The earlier Opinion went on, however, to provide that a division of legal fees with the disbarred lawyer would be unethical as to any case referred to the law firm by the disbarred lawyer subsequent to his disbarment. As we understand the facts set forth in your letter, no cases were referred to your firm subsequent to Lawyer A's indefinite suspension. Accordingly, you may honor your agreement with Lawyer A with respect to his fees relating to his pre-suspension referrals without violating the ethical rules.

 

This opinion, 88-81 makes references to opinion 84-101.
Other References:
Rules 1.5(e), 5.4(a)
DR 2-107; DR 3-102


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