NYSBA 2021-02-24

Can a law firm pay a former lawyer their agreed share of fees on cases they worked on after that lawyer leaves to take public office?

Short answer: Yes, subject to any governing law. The opinion concludes that paying a departed lawyer a fee share for work performed at the firm is a permitted separation-agreement payment under Rule 1.5(h), not a regulated fee division under Rule 1.5(g), even though the lawyer now holds public office.

Disclaimer: Advisory only. Not binding precedent.

About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official ethics opinion. The original opinion (linked at the bottom of this page) is the authoritative source for any reliance.

NYSBA Ethics Opinion 1218: Sharing Legal Fees with a Former Associate

Short answer: The opinion concludes that, unless some other law prohibits it, a firm may pay a lawyer who left for non-judicial public office their agreed share of fees on matters the lawyer worked on at the firm, because that payment falls under the separation-agreement provision of Rule 1.5(h) rather than the fee-division rule for unaffiliated lawyers in Rule 1.5(g).

Disclaimer: This is an advisory ethics opinion. Advisory opinions are not binding; they interpret the New York State Bar Association's view of New York's Rules of Professional Conduct and are persuasive authority. This summary is for research purposes only and is not legal advice. Verify current rules before acting on any specific guidance.

About this page: The plain-English summary and Q&A below were written by Ezel based on the official opinion. We do not reproduce the opinion text on this page; follow the linked source for the official text, which controls.

Plain-English summary

The inquirer's firm handles primarily contingent-fee personal-injury matters and has agreements setting what each lawyer is paid on a matter when it resolves. A firm lawyer was elected to a non-judicial public office in New York and resigned to take it. Before leaving, the lawyer had worked on particular cases, some already resolved and at least one whose resolution is now imminent. Still a member of the bar, the former lawyer asked to be paid a share of the fees from those cases to the same extent and percentage as if still at the firm. The inquirer asked the committee to assume the firm is obligated to pay under its arrangements, and asked only whether the payment would violate the Rules.

The opinion answers yes, the payment is permitted, with an express caveat: the committee offers no view on whether the public official may receive the fees consistent with any laws, regulations, or ethics codes governing the office, which are questions of law beyond its jurisdiction. It notes Rule 1.11(f)(3) allows some public officials outside income provided it is not meant to influence their official actions, but again leaves the legal question aside and assumes no legal impediment and no improper purpose.

On the Rules, the operative provision is Rule 1.5(h), which says Rule 1.5(g) (which regulates dividing a fee with a lawyer not associated in the firm) does not prohibit paying a lawyer formerly associated in the firm pursuant to a separation agreement. Comment [8] confirms paragraph (g) does not regulate the future division of fees for work done while the lawyers were associated. The committee treats the firm's arrangement as a "separation agreement" within Rule 1.5(h); nothing in the rule requires a writing, and the lawyer appears to have left expecting the firm to honor its prior agreement to compensate per its standard practice. Absent any circumstance requiring client consent (none here), nothing in the Rules bars paying the departed lawyer the share earned for services to the firm's client, in the same amount as if still affiliated.

In practice

Under this opinion, a New York firm may pay a former lawyer their agreed share of fees for work the lawyer performed at the firm before departing, treating it as a Rule 1.5(h) separation-agreement payment rather than a Rule 1.5(g) division with an unaffiliated lawyer, and a writing is not required. Per the opinion, this holds even though the lawyer has since taken non-judicial public office, but the committee expressly does not decide whether the official's receipt of the fees is permitted under the laws or ethics codes governing the office, which are questions of law outside its jurisdiction.

Common questions

Q: Does Rule 1.5(g)'s fee-division rule apply when paying a departed lawyer for prior firm work?

A: No. Per the opinion, Rule 1.5(h) makes Rule 1.5(g) inapplicable to payments to a formerly associated lawyer under a separation agreement, and Comment [8] confirms paragraph (g) does not regulate dividing fees for work done while the lawyers were associated.

Q: Does the separation agreement have to be in writing?

A: No. Per the opinion, nothing in Rule 1.5(h) requires a writing; an oral or implied arrangement that the firm would compensate per its standard practice can qualify.

Q: Does the lawyer now holding public office change the answer under the Rules?

A: No, as to the Rules. Per the opinion, the payment is permitted under the Rules, but the committee does not decide whether the official may receive the fees under the separate laws and ethics codes governing the public office.

Background and rules framework

The opinion interprets Rule 1.5(g) (dividing a fee with a lawyer not associated in the same firm) and Rule 1.5(h) with Comment [8] (payments to a formerly associated lawyer under a separation or retirement agreement), and references Rule 1.11(f) (lawyers in public office). These correspond to ABA Model Rules 1.5 and 1.11.

Citations and references

Rules of Professional Conduct:

New York Rules of Professional Conduct 1.5(g), 1.5(h) and Cmt. [8], 1.11(f) and (f)(3)
ABA Model Rules 1.5, 1.11 (analogues)

Other opinions cited:

N.Y. State 1169 ¶ 10 (2019): Rule 1.11(f) governs lawyers in public office

Source

Landing page: https://nysba.org/ethics-opinion-1218/