Can a lawyer who refers a personal injury case away because of a conflict still collect the 25% referral fee?

Plain-English summary

The committee was asked whether a lawyer who refers a personal injury case to another lawyer because of a conflict of interest may receive the 25% referral fee permitted by Rule 4-1.5(F)(4)(d). The answer was no: it is impermissible for a lawyer who refers a case because of a conflict to receive any part of the fee for legal services performed, or to be performed, after the conflict emerged.

Relying on Opinions 67-21 and 73-2, the committee explained that a lawyer who cannot ethically accept employment in the first instance because of a conflict cannot ethically share in the fee, and a firm precluded by conflict rules from participating or sharing responsibility is likewise precluded from sharing the fee; the only compensation is the reasonable value of services rendered before the conflict emerged. Although those opinions were issued when referral fees as such were prohibited and fee divisions were allowed only in proportion to services performed and responsibility assumed, the relaxation of the rule against fee divisions does not change the result in conflict-referral situations.

The committee set out Rule 4-1.5(F)(4)(d), which permits a referring lawyer (the lawyer assuming secondary responsibility) to be paid up to 25% in a personal injury case, subject to the requirements of paragraph (G). Because a lawyer obligated to decline employment from the outset is proscribed from performing any services, assuming responsibility, or consulting with the client, that lawyer fails both of the paragraph (G) tests, so the result is the same as in Opinion 67-21.

Currency note

This opinion was issued in 1989, before The Florida Bar's adoption of the 2006 revisions to the Rules of Professional Conduct. 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 Treat this page as historical context, not current guidance.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 who refers a case because of a conflict take the 25% referral fee?

A: No. The opinion concluded that a lawyer who refers a personal injury case because of a conflict may not receive any part of the fee for services performed or to be performed after the conflict emerged.

Q: Can the referring lawyer be paid anything?

A: The opinion concluded that a lawyer who performed some services before the conflict required withdrawal may receive only reasonable compensation for the services actually performed before the conflict emerged; a lawyer obligated to decline from the outset may receive nothing.

Q: Why does the conflict defeat the referral fee?

A: The opinion explained that a referral fee under paragraph (G) requires either proportionate services or an agreement to assume joint responsibility and be available for consultation, and a lawyer barred by conflict from the start can do neither, failing both tests.

Background and rules framework

The opinion interprets Rule 4-1.5(F)(4)(d) and Rule 4-1.5(G) (Model Rule 1.5), governing the division of fees and the personal-injury referral fee, applied where a conflict of interest (Model Rule 1.7) requires the referral. The committee relied on the principle that a lawyer barred by conflict cannot assume responsibility or perform services and so cannot meet the conditions for a fee share.

Citations and references

Rules of Professional Conduct:

• Fla. Rule 4-1.5(F)(4)(d) / Model Rule 1.5 (personal-injury referral fee)
• Fla. Rule 4-1.5(G) / Model Rule 1.5 (division of fees between lawyers not in the same firm)
• Model Rule 1.7 (conflicts of interest)

Other opinions cited:

• Fla. Ethics Ops. 67-21, 73-2

See also

• FL Bar Ethics Op. 90-3: Referral Fee to a Later-Suspended Attorney
• FL Bar Ethics Op. 90-8: Dividing a Fee With an Out-of-State Attorney
• FL Bar Ethics Op. 94-7: Of-Counsel Fee Division Rules

Source

• Landing page: https://www.floridabar.org/etopinions/etopinion-89-1/
• Original PDF: https://www-media.floridabar.org/uploads/2017/04/FL-Bar-Ethics-Op-89-1-1.pdf

Original opinion text

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

FLORIDA BAR ETHICS OPINION
OPINION 89-1
March 1, 1989
Advisory ethics opinions are not binding.

Attorney who refers personal injury case to another lawyer because of conflict of interests may not take 25 percent referral fee authorized by fee rule.

RPC: 4-1.5(F)(4)(d); 4-1.5(G)
Opinions: 67-21, 73-2

The Committee has been asked whether a lawyer who refers a personal injury case to another lawyer because of a conflict of interests can ethically receive or be paid a 25 percent referral fee pursuant to Rule 4-1.5(F)(4)(d). The answer is no; it is impermissible for a lawyer who refers a case because of a conflict to receive any part of the fee for legal services performed, or to be performed, after the emergence of the conflict.

In Opinion 67-21 this Committee concluded that a lawyer who cannot ethically accept employment in the first instance because of a conflict cannot ethically participate in a division of the fee. In Opinion 73-2 this Committee similarly stated that a law firm precluded by conflict rules from participating in the representation or sharing responsibility for it likewise is precluded from sharing in the fee; the only compensation the referring firm can ethically receive is for the reasonable value of services rendered to the client before the conflict emerged.

Both of the cited opinions were issued at a time when referral fees as such were strictly prohibited. The ethics rules at the time permitted a division of fees between lawyers not in the same firm only in proportion to services performed and responsibility assumed. The rule against fee divisions has since been relaxed, but the results remain the same in conflict referral situations.

Currently Rule 4-1.5(F)(4)(d) of the Rules Regulating The Florida Bar expressly permits a referring lawyer (or "the lawyer assuming secondary responsibility for the legal services") to be paid up to 25 percent of the fee in a personal injury case. This fee division is subject to the additional requirements set forth in paragraph (G) of the rule. Paragraph (G), which applies to all fee divisions between lawyers not in the same firm, regardless of the type of matter, provides that

. . . a division of fee between lawyers who are not in the same firm may be made only if the total fee is reasonable and:

(1) The division is in proportion to the services performed by each lawyer; or

(2) By written agreement with the client:

(a) Each lawyer assumes joint legal responsibility for the representation and agrees to be available for consultation with the client[.]

It is clear that a lawyer who performs some legal services for a client before the conflict requiring withdrawal emerges is permitted to receive only reasonable compensation for services actually performed before emergence of the conflict, as in Opinion 73-2. A lawyer who is obligated to decline employment in the first instance because of a conflict cannot ethically receive any portion of the fee. The reason is apparent: from the outset the lawyer is ethically proscribed from performing any legal services in the matter, and the lawyer cannot ethically assume any responsibility for the representation or consult with the client or the client's attorney. Thus a lawyer who is obligated to refuse employment in the first instance fails both of the Rule 4-1.5(G) tests. The result is the same as in Opinion 67-21.