Can a lawyer who is on a nonprofit's referral list and receives referrals from it make a charitable donation to that organization?

Plain-English summary

The committee was asked whether a lawyer may donate to a nonprofit organization that gives prospective clients a referral list of attorneys working in the organization's field, where the donating lawyer is on the list, has received referrals in the past, and expects more. It started from the premise that supporting referral systems is generally consistent with Canon 2's duty to make legal services available, citing EC 2-1, EC 2-15, and N.Y. State 651 (1993).

The tension came from DR 2-103(B), which bars a lawyer from compensating or giving anything of value to a person or organization to recommend or obtain employment, or as a reward for a recommendation that results in employment, except for the organizations listed in DR 2-103(D). Those qualifying organizations include legal aid and public defender offices, military assistance offices, bar-association referral services, and certain bona fide membership organizations. The committee noted that the inquiring lawyer's organization was not a DR 2-103(D) entity, and that a donation by a listed attorney who had received referrals could be viewed as something of value given in exchange for them.

The committee nonetheless concluded the donation should be permitted, because the Code contains no specific prohibition and the organization served a salutary purpose, so long as the donation is clearly intended to be charitable and is not pursuant to a tacit arrangement of compensation for referrals. It cited contrasting authorities, including In re Fisher (payment to a referral-service director was an unlawful attempt to influence the service) and out-of-state opinions treating periodic contributions tied to referrals as improper. It closed with EC 9-6's duty to avoid even the appearance of impropriety, reasoning that a donation made with genuine charitable intent should not create that appearance.

Currency note

This opinion was issued in 1997, under New York's former Code of Professional Responsibility, which New York replaced with the Rules of Professional Conduct in 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 Treat this page as historical context, not current guidance.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: Is donating to a referral organization a prohibited payment for referrals?

A: The opinion concluded it can be, since DR 2-103(B) bars giving anything of value for recommendations, but a genuinely charitable donation to a non-qualifying nonprofit is permitted if it is not tied to the referrals.

Q: What separates a permissible donation from an improper one?

A: The opinion turned on intent and arrangement: the donation must be clearly charitable and not made pursuant to a tacit understanding that it compensates the organization for sending clients.

Q: Does it matter that the organization is not a bar-sponsored referral service?

A: The opinion noted the organization was not one of the DR 2-103(D) entities, which is why the analysis turned on whether the donation was charitable rather than compensation.

Background and rules framework

The opinion interpreted DR 2-103(B) (paying for recommendations) and DR 2-103(D) (qualifying referral organizations) of New York's former Code, with reference to EC 9-6's appearance-of-impropriety duty. The Model Rule analogue is Rule 7.2 (communications and payments for recommendations, which generally bars giving anything of value for a referral subject to exceptions). New York replaced the Code with the Rules of Professional Conduct in 2009; the DR numbers cited here are historical.

Citations and references

Rules of Professional Conduct:

• MR 7.2 (communications about services; payment for recommendations)
• NY DR 2-103(B), (D); EC 9-6

Cases:

• In re Fisher, 174 A.D.2d 236 (1st Dep't 1992), payment to a referral-service director

Other opinions cited:

• N.Y. State 651 (1993): contributing to a nonprofit referral service's administrative expenses
• Illinois Op. 827 (1983); Ohio Op. 91-19: periodic contributions tied to referrals

See also

• NY State Bar Op. 741: Referrals and solicitation arrangements
• NY State Bar Op. 739: Lawyer referral service fees in domestic relations
• NY State Bar Op. 727: Accounting-firm referral for shared contingent fees

Source

• Landing page: https://nysba.org/opinion-691/