Can an attorney pay a referral fee to the lawyer-co-executor who hired him as the attorney for the estate?
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This page answers the general question as of 1992. Ezel answers yours: whether it's allowed on your facts, under the current Massachusetts Rules of Professional Conduct, with citations.
Plain-English summary
A lawyer who was co-executor of an estate hired the inquiring attorney as "the attorney for the estate." The co-executor was not going to perform any legal services, and the attorney asked whether he could pay him a forwarding fee. The committee answered no, distinguishing the ordinary referral fee, which it had said in Opinion 76-3 is permitted between lawyers in Massachusetts (which omitted the Model Code's "in proportion to services" requirement) so long as the total fee is reasonable and the client is told.
The committee held this was not an ordinary referral situation. A forwarding fee describes one lawyer remitting part of a fee to another lawyer who referred a client's matter. Here the co-executor who "sent" the case was the client himself, and a court-appointed fiduciary who did not need to be a lawyer to hold that position. In hiring the inquirer, he was acting in the lay capacity of a fiduciary hiring a lawyer, not as a lawyer referring a matter, so paying him a share of the fee would violate DR 3-102(A)'s bar on sharing fees with a non-lawyer, the same as paying a referral fee to a corporation's president who happened to be a lawyer.
The committee gave a second reason drawn from Opinion 76-3: an executor is appointed by the court and owes a fiduciary duty to select counsel on ability, not on willingness to pay a forwarding fee, and the fee would go to a fiduciary already separately compensated from court-supervised funds. Paying it would compromise the relationships among the estate, its fiduciary, and its attorney, constituting conduct prejudicial to the administration of justice under DR 1-102(A)(5). The committee added that, in any event, no such fee could be paid without full disclosure to the other co-executor (whom the attorney also represented) and the probate court's approval.
Currency note
This opinion was issued in 1992, before Massachusetts's adoption of the 2015 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 Treat this page as historical context, not current guidance.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: Are referral fees between lawyers allowed in Massachusetts?
A: The committee noted that under Opinion 76-3 an ordinary referral fee between lawyers is not prohibited, so long as the total fee is reasonable and full disclosure is made to the client, because the SJC omitted the "in proportion to services" requirement.
Q: Why couldn't the attorney pay the co-executor a forwarding fee?
A: Because the co-executor hired the attorney in his lay capacity as a fiduciary, not as a lawyer referring a matter; paying him a share of the fee would be a prohibited fee split with a non-lawyer under DR 3-102(A).
Q: Would court approval make the payment permissible?
A: No. The committee found the payment improper on its own terms, and added that in any event no such fee could be paid without disclosure to the other co-executor and the probate court's approval.
Background and rules framework
The opinion applied DR 3-102(A) (a lawyer shall not share legal fees with a non-lawyer), corresponding to Model Rule 5.4(a), and DR 1-102(A)(5) (conduct prejudicial to the administration of justice), corresponding to Model Rule 8.4(d). It also discussed the Massachusetts referral-fee rule (DR 2-107), corresponding to Model Rule 1.5(e).
Citations and references
Rules of Professional Conduct:
- Model Rule 5.4(a) / DR 3-102(A) (sharing fees with a non-lawyer)
- Model Rule 8.4(d) / DR 1-102(A)(5) (conduct prejudicial to the administration of justice)
- Model Rule 1.5(e) / DR 2-107 (division of fees between lawyers)
Other opinions cited:
- MBA Opinion 76-3 (referral fees permitted between lawyers; forwarding fee to a court-appointed receiver disapproved)
See also
- MA Bar Ethics Op. 97-6: Donating pro bono fees to a referring non-profit
- MA Bar Ethics Op. 97-2: Paying businesses to solicit employees
Source
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