May a lawyer collect a bar referral service's fee from the client and pay the service's own fee without violating the fee-sharing rule?

Plain-English summary

A bar association's lawyer referral service (LRS) asked whether it could adopt a rule under which the client receives a free half-hour initial consultation, agrees to pay the LRS a $15 service fee collected and forwarded by the panel member, and, if the client retains the panel member, the panel member contributes $15 to help fund the LRS. The inquiry pointed to Bar Rule 3.3(e). The Commission read the rule to mean the client pays the LRS for a referral and consultation (which the panel member provides at no extra charge), and the panel member pays the LRS a fee if a retainer results.

The Commission concluded neither fee violates Rule 3.3(e) or any other Bar Rule. Rule 3.3(e) bars a lawyer from sharing legal fees with a non-lawyer, but collecting the first fee is not sharing a legal fee, because the fee is not the panel member's to share; it is an administrative fee charged by the referral service, which the lawyer merely collects on the service's behalf (assuming an incorporated bar association is a non-lawyer for these purposes).

On the second fee, the Commission concluded Rule 3.9(f)(2) governs, not Rule 3.3(e). Rule 3.9(f)(2) expressly permits a lawyer to pay the usual and reasonable fees or dues charged by a lawyer referral service operated, sponsored, or approved by a bar association, while barring other compensation for recommending the lawyer. The express permission to keep such services self-supporting would be meaningless if those fees were prohibited by the fee-splitting ban, so the second fee is permissible. The Commission added that the service should reconsider describing the half-hour consultation as "free" given the administrative fee charged to the client, citing Rule 3.9(a) and (b).

Currency note

This opinion was issued in 1989, before Maine's replacement of the former Maine Bar Rules with the Maine Rules of Professional Conduct (effective August 1, 2009). 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 Treat this page as historical context, not current guidance.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 collect a referral service's fee from the client without it being prohibited fee-splitting?

A: The opinion concluded yes. The fee is the referral service's administrative fee, not the lawyer's legal fee, so collecting and forwarding it is not sharing a legal fee with a non-lawyer.

Q: Can a lawyer pay a fee to a bar-operated referral service for a retained client?

A: The opinion concluded yes. Rule 3.9(f)(2) expressly permits paying the usual and reasonable fees of a referral service operated, sponsored, or approved by a bar association.

Q: Why doesn't the fee-splitting rule bar paying the referral service?

A: The opinion concluded Rule 3.9(f)(2) governs that fee, and its express permission to keep referral services self-supporting would be meaningless if the fee-splitting ban in Rule 3.3(e) prohibited the very fees it allows.

Q: Was there any problem with calling the consultation "free"?

A: The opinion recommended the service reconsider describing the half-hour consultation as "free" in light of the administrative fee charged to the client, citing the advertising rule (Rule 3.9(a) and (b)).

Background and rules framework

The opinion interprets Maine Bar Rule 3.3(e) (no sharing of legal fees with a non-lawyer) and Rule 3.9(f)(2) (a lawyer may pay the usual and reasonable fees of a bar-operated, sponsored, or approved referral service). These correspond to ABA Model Rule 5.4 (professional independence; fee-sharing with non-lawyers) and Model Rule 7.2 (paying for referrals, including the not-for-profit and qualified referral-service exception).

Citations and references

Rules of Professional Conduct:

• Model Rule 5.4 (sharing fees with non-lawyers); Model Rule 7.2 (paying a referral service)
• Maine Bar Rule 3.3(e), 3.9(f)(2), 3.9(a), 3.9(b)

See also

• Maine Ethics Op. 133: Lawyer Referral Service Fee Remittances
• Maine Ethics Op. 124: Accepting Referrals From a Paralegal Advisor

Source

• Landing page: https://mebaroverseers.org/attorney_services/opinion.html?id=91493

Original opinion text

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

Issued by the Professional Ethics Commission

Date Issued: September 6, 1989

Question

The Commission has been asked whether a lawyer referral service operated by a bar association may adopt a rule in substance as follows:

"Client will receive a free initial consultation of one-half hour. Client agrees to pay the LRS a service fee of $15.00 which will be collected and forwarded to the LRS by the panel member. In addition, if the client retains the panel member, he/she agrees to contribute $15.00 to help fund the LRS."

The inquiring attorney especially invites our attention to Bar Rule 3.3(e). We assume that the phrase "he/she" in the third sentence refers to the panel member. Thus, the client would pay LRS for a referral and an initial consultation, which the panel member would provide without an additional charge to the client. If a retainer resulted, the panel member would also pay LRS a fee.

Opinion

We conclude that the required fees would not violate Rule 3.3(e) or any other Bar Rule. Rule 3.3(e) prohibits a lawyer from sharing legal fees with a non-lawyer, subject to exceptions not material here. Collection of the first fee by the panel member is not the sharing of a legal fee with a non-lawyer, assuming as we do that an incorporated bar association is a non-lawyer for all relevant purposes under the Bar Rules, since the fee is not the panel member's to share. The first fee is an administrative fee charged by the referral service, not the lawyer. The lawyer is merely collecting that fee for the referral service. The proposed rule, to which the panel member presumably agrees, provides that the LRS is entitled to this fee.

With respect to the second fee, Bar Rule 3.9(f)(2) expressly permits a lawyer to pay the "usual and reasonable fees or dues charged by a lawyer referral service operated, sponsored, or approved by a bar association" while prohibiting all forms of compensation to other persons or organizations for recommending the lawyer's employment by a client. Notwithstanding the inquiring attorney's reference to Rule 3.3(e), the Commission is of the opinion that this part of the question is governed by Rule 3.9(f)(2). The express permission given by Rule 3.9(f)(2) to continue a common method of making lawyer referral services self-supporting would be meaningless if the fees it expressly permits were prohibited by the ban on fee splitting in Rule 3.3(e).[1] Based on the language of the proposed rule, the Commission assumes that the second fee would not be charged to the client. The Commission concludes that the second fee is permissible under Rule 3.9(f)(2).

Footnote

[1] The Commission recommends that the referral service modify the description of the first half-hour consultation as "free" in light of the administrative fee charged to the client. See Bar Rule 3.9(a) and (b).