Can an out-of-state law firm pay 'runners' to recommend the firm to injured railroad workers in another state?

Plain-English summary

The committee was asked whether the Rules of Professional Conduct are violated when an out-of-state law firm pays "runners" to recommend the firm to injured railroad workers. It answered yes.

The committee applied Rule 7.2(c), which bars a lawyer from giving anything of value for recommending the lawyer's services, except the reasonable cost of permitted advertising and the usual charges of a not-for-profit referral service. It also pointed to Rule 5.3(c), under which a lawyer is responsible for a nonlawyer's conduct that would violate the rules if the lawyer orders or ratifies it or, as a supervising partner, fails to take reasonable remedial action. The committee added that using such a runner may violate section 37-61-201, MCA, on the unauthorized practice of law where the lawyer is not licensed in Montana, and referenced its Opinion 860723 on possible violation of section 37-61-408(2), MCA, regarding payments to third persons for case referrals.

Deferring to the Commission on Unauthorized Practice on that last point, the committee concluded that if an attorney practicing in Montana pays a nonlawyer for referring cases, the conduct is prohibited by the rules, and that an out-of-state firm soliciting business from Montanans for Montana cases is governed by the Rules of Professional Conduct as adopted in Montana.

Currency note

This opinion was issued in 1993, before the State Bar of Montana's adoption of the 2004 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 Treat this page as historical context, not current guidance.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 firm pay nonlawyer runners to bring in cases?

A: No. The opinion concludes paying a nonlawyer for recommending the lawyer's services violates Rule 7.2(c).

Q: Is the firm responsible for what its runners do?

A: The opinion applies Rule 5.3(c), making a lawyer responsible for a nonlawyer's rule-violating conduct that the lawyer orders, ratifies, or, as supervisor, fails to remedy.

Q: Do Montana's rules reach an out-of-state firm soliciting Montana cases?

A: Yes. The opinion concludes an out-of-state firm soliciting business from Montanans for Montana cases is governed by Montana's Rules of Professional Conduct.

Background and rules framework

The opinion interprets Montana Rule of Professional Conduct 7.2(c) (paying for recommendations; Model Rule 7.2), Rule 5.3 (responsibility for nonlawyer assistants; Model Rule 5.3), and Rule 5.5 (unauthorized practice; Model Rule 5.5), together with the Montana statutes on unauthorized practice (section 37-61-201, MCA) and payments for referrals (section 37-61-408(2), MCA).

Citations and references

Rules of Professional Conduct:

• Mont. R. Prof. Cond. 7.2(c) (paying for recommendations) / Model Rule 7.2
• Mont. R. Prof. Cond. 5.3 (nonlawyer assistants) / Model Rule 5.3
• Mont. R. Prof. Cond. 5.5 (unauthorized practice) / Model Rule 5.5

Statutes:

• Mont. Code Ann. section 37-61-201 (unauthorized practice of law)
• Mont. Code Ann. section 37-61-408(2) (payments for referral of cases)

Other opinions cited:

• State Bar of Montana Op. 860723: payments to third persons for referral of cases

See also

• State Bar of Montana Ethics Op. 890317: Adjuster-Referral Conflict
• State Bar of Montana Ethics Op. 960227: Impermissible Referral Service

Source

• Landing page: https://www.montanabar.org/For-Attorneys/State-Bar-Resources/Ethics-Opinions
• Original PDF: https://www.montanabar.org/Portals/MONTANA/930927.pdf

Original opinion text

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

Ethics Opinion
QUESTION PRESENTED: Is there a violation of the Rules of Professional Conduct when an out-of-state law firm pays "runners" to recommend such firms to injured railroad workers?

ANSWER: Yes.

Rule 5.3(c) provides:

With respect to a nonlawyer employed or retained by or associated with a lawyer, a lawyer shall be responsible for the conduct of such person that would be a violation of the rules of professional conduct if engaged in by a lawyer if:
(1) the lawyer orders or, with the knowledge of the specific conduct, ratifies the conduct involved; or
(2) the lawyer is a partner in the law firm in which the person is employed, or has direct supervisory authority over the person, and knows of the conduct at a time when its consequences can be avoided or mitigated but fails to take reasonable remedial action.

Rule 7.2(c) provides:

A lawyer shall not give anything of value to a person for recommending the lawyer's services, except that a lawyer may pay the reasonable cost of advertising or written communication permitted by this rule and may pay the usual charges of a not-for-profit lawyer referral service or other legal service organization.

In addition, it appears to this Committee that the use of such a "runner" may very well be violative of Sec. 37-61-201 MCA relating to the unauthorized practice of law when the lawyer involved is not licensed to practice in Montana. See also our Opinion 860723 regarding the possible violation of MCA 37-61-408(2) as it relates to payments to third persons for referral of cases; and Annot., Modern Status of Law Regarding Solicitation of Business By or For Attorney, 5 A.L.R. 4th 866 (1981) at 891.

While this Committee defers to the Commission on Unauthorized Practice as to the last point, it is our opinion that if an attorney practicing law in Montana pays a non-lawyer for referring cases to such attorney, such conduct is prohibited by the Rules of Professional Conduct. It is also our opinion that an out-of-state law firm soliciting business from people in Montana for cases arising in Montana is governed by the Rules of Professional Conduct as adopted in Montana. Cf. Rule 5.5, Rules of Professional Conduct.

THIS OPINION IS ADVISORY ONLY