I have a fee-division agreement with another lawyer who was later suspended from practice. Can the agreement still be carried out, and how are the fees split?
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This page answers the general question as of 1991. Ezel answers yours: whether it's allowed on your facts, under the current rules of professional conduct in your state, with citations.
Plain-English summary
The inquiring attorney asked about a referral agreement between the attorney and another attorney who was suspended from the practice of law after the agreement was entered into.
The panel advised that the fee-division contract cannot be carried out after the date of the other attorney's suspension, because an attorney cannot work on cases once suspended. The fees should be divided according to the fair value of services rendered before the suspension. Both attorneys should try to reach agreement on the reasonable value of services performed before the suspension and on the division of fees; if that fails, a court may have to make the determination.
The panel added that the suspended attorney is entitled to a share of the fees, as long as the fee is calculated according to the work performed before suspension. There is no need for an escrow account to separate the fees, but they should be kept in a client fund account, and normally maintained time and work records should be kept to support the actions taken with respect to fees.
Currency note
This opinion was issued in 1991, after the Rhode Island Supreme Court adopted the Model Rules of Professional Conduct effective November 15, 1988. The Rhode Island Supreme Court later revised the Rules of Professional Conduct in 2007 as part of the nationwide Ethics 2000 process, which renumbered and amended several provisions, including the fee rules. 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 Treat this page as historical context, not current guidance.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 mentioned here.
Common questions
Q: Can the fee-division agreement still be carried out after my co-counsel was suspended?
A: Per the opinion, no. The contract cannot be carried out after the date of the suspension, because an attorney cannot work on cases once suspended.
Q: How are the fees divided?
A: Per the opinion, according to the fair value of services rendered before the suspension. The attorneys should try to agree on that reasonable value; if they cannot, a court may have to determine it.
Q: Is the suspended attorney entitled to anything?
A: Per the opinion, yes. The suspended attorney is entitled to a share of the fees, as long as it is calculated according to the work performed before the suspension.
Q: Do I need a separate escrow account for the fees?
A: Per the opinion, no. There is no need for a separate escrow account, but the fees should be kept in a client fund account, with normally maintained time and work records kept to support the actions taken.
Background and rules framework
The opinion cites no numbered Rule of Professional Conduct. The panel resolved the inquiry on two general principles: a suspended attorney cannot continue to work on cases, so a fee-division agreement predicated on shared future work ends at the date of suspension; and the suspended attorney remains entitled to compensation measured by the fair value of services actually rendered before suspension. The panel treated the funds as client funds to be safeguarded in a client fund account, supported by ordinary time and work records.
Citations and references
Rules of Professional Conduct:
- None cited. The panel resolved the inquiry on the general principles that a suspended attorney cannot work on cases and is entitled only to the fair value of pre-suspension services.
Statutes:
- None cited.
Cases:
- None cited.
Other opinions cited:
- None cited.
See also
- RI EAP Op. 91-56: A Discharged Contingency Lawyer's Quantum Meruit Recovery
- RI EAP Op. 91-35: A Departing Associate's Withdrawal and Responsibility for Firm Clients
- RI EAP Op. 97-16: Sharing a Referral Fee Requires a Joint-Responsibility Writing
Source
- Landing page: https://www.courts.ri.gov/attorney-resources/Pages/Ethics-Advisory-Panel-default.aspx
- Original PDF: https://www.courts.ri.gov/Opinions/EAP%2091-71.pdf
Original opinion text
Best-effort transcription from a scanned PDF. Minor errors may remain; the linked PDF is authoritative.
Digest of Ethics Advisory Panel
Opinion #91-71
Issued October 29, 1991
An attorney seeks Panel advice about a referral agreement between the attorney and another attorney who was suspended from the practice of law after the agreement was entered into. The Panel advises that:
The fee division contract cannot be carried out after the date of the other attorney's suspension since an attorney cannot work on cases once he is suspended.
The fees should be divided according to the fair value of services rendered before suspension.
Both attorneys should try to reach agreement on the reasonable value of services prior to the suspension and division of fees and if that fails, then a court may have to make the determination.
The suspended attorney is entitled to his/her share of the fees, as long as the fee is calculated according to the work performed before suspension.
There is no need for an escrow account to separate the fees, but they should be kept in a client fund account.
Normally maintained time and work records should be kept to support actions taken in respect to fees.
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