Can a Florida lawyer keep a title insurance premium rebate check when the lawyer only ordered and forwarded the policy for a client?

Plain-English summary

A Florida attorney was retained by an out-of-state client (himself a lawyer) in connection with the purchase of Florida real estate. The Florida attorney gave advice but the transaction closed in the other state. The Florida attorney did order and procure title insurance, and the title company's agent then issued him a check, payable to the attorney, representing the premium amount after underwriting. The attorney asked how to dispose of the check, given that he rendered no service on the title policy beyond ordering and forwarding it.

The committee unanimously concluded that the check should be forwarded to the out-of-state client. It reasoned that the attorney's duty was to obtain the title insurance at the lowest applicable premium, so any rebate received was a saving that should be passed on to the client. The committee cited DR 5-107(A), which bars accepting from anyone other than the client anything of value related to the representation except with the client's consent after full disclosure, and observed that it would be unconscionable to retain the check where no service (such as a title opinion) was rendered.

Currency note

This opinion was issued in 1970, before The Florida Bar's adoption of the 2006 revisions to the Rules of Professional Conduct. It applied the former Code of Professional Responsibility (DR 5-107(A)); the subject matter (a lawyer accepting value from a third party in connection with a representation) is now addressed by Rule 4-1.8(f). Treat this page as historical context, not current guidance. Verify against the current rules before relying on any specific requirement mentioned here.

Common questions

Q: If a title company sends the lawyer a premium rebate, who gets it?

A: Under this opinion, the client. The committee held the saving should be passed on to the client because the lawyer rendered no legal service on the policy itself.

Q: Why couldn't the lawyer keep the rebate as a fee?

A: The opinion reasoned that ordering and forwarding the policy was not a legal service that earned compensation, and that DR 5-107(A) bars taking value from a third party related to the representation without the client's informed consent.

Background and rules framework

The opinion applied DR 5-107(A) of the former Code of Professional Responsibility, which prohibited a lawyer from accepting compensation or anything of value related to the representation from someone other than the client without the client's consent after full disclosure. That subject is now addressed by Rule 4-1.8(f); the Model Rule analogue is Rule 1.8(f).

Citations and references

Rules of Professional Conduct:

• DR 5-107(A) [Code of Professional Responsibility; third-party value now addressed by Rule 4-1.8(f)]

See also

No sibling opinions yet indexed.

Source

• Landing page: https://www.floridabar.org/etopinions/etopinion-70-49/
• Original PDF: https://www-media.floridabar.org/uploads/2017/04/FL-Bar-Ethics-Op-70-49-1.pdf

Original opinion text

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

FLORIDA BAR ETHICS OPINION
OPINION 70-49
December 7, 1970
Advisory ethics opinions are not binding.
When an attorney merely orders and then forwards title insurance for a client, the attorney is not entitled to retain a rebate check on the premium paid because no legal service has been rendered.
CPR: DR 5-107(A)
Chairman Massey stated the opinion of the committee:
A member of The Florida Bar was retained by an out-of-state resident in connection with the purchase of Florida real estate. Since the client was an attorney, the Florida attorney rendered advice and assistance but the transaction was closed in the other state. The Florida attorney did, however, order and procure title insurance, after which the title insuring company's agent issued the Florida attorney a check to the order of the attorney representing the premium after underwriting. The inquiry asks advice on the disposition of the check as the Florida attorney rendered no service in respect to the title policy other than ordering and forwarding the same.
The Committee unanimously concludes the check should be forwarded to the out-of-state client. It was the duty of the Florida attorney to obtain the title insurance at the lowest applicable premium and where a rebate is received, the saving should be passed on to the client. See C.P.R. DR 5-107(A), wherein the prohibition exists of accepting from one, other than the attorney's client, anything of value related to his representation except with consent of the client after full disclosure. In the instant case, it would be unconscionable to retain the check as service (an opinion on the title or the like) was not rendered in the first instance.