Can I compensate another law firm for the time it spent on a legal malpractice case, where that firm was a third-party defendant that paid into the settlement?

Plain-English summary

The inquiring attorney asked whether he or she may share fees with another law firm regarding a legal malpractice case. The other law firm, as a third-party defendant in the malpractice case, had contributed a sum certain to the settlement, and the client executed a general release of that law firm in consideration of its settlement payment.

The Panel set out Rule 1.5 ("Fees"), which sets forth the criteria for determining the reasonableness of a fee. The Panel noted it had opined in numerous opinions that an attorney is entitled to be paid quantum meruit, the fair value of services rendered before the former attorney's termination of representation, citing Ethics Advisory Panel General Opinion #4 (issued May 23, 1991).

Applying that reasoning, the Panel opined that it does not believe compensating the other law firm for the time expended in this matter would violate the Rules of Professional Conduct.

Currency note

This opinion was issued in 1994 (Opinion 94-67, issued September 28, 1994), after the Rhode Island Supreme Court adopted the Model Rules of Professional Conduct effective November 15, 1988, and it applies Rule 1.5 as originally adopted. The Rhode Island Supreme Court later revised the Rules of Professional Conduct in 2007 as part of the nationwide Ethics 2000 process, which amended Rule 1.5. 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 Treat this page as historical context, not current guidance.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 I pay another firm for the time it spent on the case?

A: The Panel opined that compensating the other law firm for the time expended in the matter would not violate the Rules of Professional Conduct.

Q: What theory supports paying the other firm?

A: The Panel relied on quantum meruit, the fair value of services rendered, which it has recognized in numerous opinions, citing General Opinion #4 (1991).

Background and rules framework

The opinion interprets Rhode Island Rule of Professional Conduct 1.5 (fees), the analog of Model Rule 1.5, which sets the criteria for a reasonable fee. The Panel applied its established view that an attorney is entitled to quantum meruit compensation for services rendered, and extended that to compensating another firm for its time on the matter.

Citations and references

Rules of Professional Conduct:

• MR 1.5 / RI RPC 1.5 (fees; reasonableness and quantum meruit compensation)

Other opinions cited:

• RI EAP General Opinion #4 (issued May 23, 1991): an attorney is entitled to quantum meruit for services rendered before termination

See also

• RI EAP Opinion 94-51: dividing a fee with a lawyer outside the firm under Rule 1.5(e)
• RI EAP Opinion 94-63: a retainer is a refundable fee advance under Rule 1.5

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%2094-67.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain; the linked PDF is authoritative.

ETHICS ADVISORY PANEL
OPINION #94-67 REQUEST #538
Issued September 28, 1994

The inquiring attorney asks whether he/she may share fees with another law firm regarding a legal malpractice case. The law firm, as a third-party defendant in the malpractice case, contributed a sum certain to the settlement of the case. The client executed a general release of the law firm in consideration of the law firm's settlement payment.

Rule 1.5 entitled "Fees" sets forth the criteria to be considered when determining the reasonableness of a fee. The Panel has opined in numerous opinions that an attorney is entitled to be paid quantum meruit, the fair value of services rendered before the former attorney's termination of representation. See, Ethics Advisory Panel General Opinion #4, Issued May 23, 1991. The Panel does not believe that compensating the other law firm for the time expended in this matter would violate the Rules of Professional Conduct.