Can a lawyer pay a referral fee to another lawyer who refers a case but does no work on it?

Plain-English summary

The inquiry concerned sharing fees with lawyers who refer cases to other lawyers but otherwise do not participate in the case. The committee noted that RPC 1.5(e)(2) permits the division of fees between lawyers on grounds other than the proportion of services each lawyer provides.

The committee laid out three requirements for such a division. First, there must be a written agreement with the client. Second, each lawyer must assume joint responsibility for the representation. Third, the total fee must be reasonable. The committee added that the reasonableness requirement means the fee paid by the client must be no greater than it would have been had only one lawyer been involved.

Currency note

This opinion was issued in 1987, before the 2006 revisions to the Washington Rules of Professional Conduct. The fee-division rule then numbered RPC 1.5(e)(2) corresponds to Model Rule 1.5(e) and was later amended. Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific requirement mentioned here.

Common questions

Q: Can a referring lawyer be paid a share of the fee without working on the case?

A: Per the opinion, yes. The committee noted that RPC 1.5(e)(2) permits dividing fees between lawyers on grounds other than the proportion of services provided, subject to the rule's conditions.

Q: What conditions did the committee say apply to a pure referral fee?

A: Three: a written agreement with the client, each lawyer's assumption of joint responsibility for the representation, and a total fee that is reasonable.

Q: How did the committee describe the reasonableness limit?

A: The committee stated it would require that the fee paid by the client be no greater than had there been only one lawyer involved.

Background and rules framework

The opinion applies Washington RPC 1.5(e)(2), the rule allowing division of a fee between lawyers who are not in the same firm on a basis other than work performed, corresponding to Model Rule 1.5(e). The committee identified the rule's three conditions (written client agreement, joint responsibility, and a reasonable total fee) and read the reasonableness condition to cap the client's total fee at what a single lawyer would have charged.

Citations and references

Rules of Professional Conduct:

• Washington RPC 1.5(e)(2) (division of fees between lawyers not in the same firm), corresponding to Model Rule 1.5(e).

See also

• WSBA Ethics Op. 941: whether lawyers in different firms must satisfy every requirement of RPC 1.5(e)(2)
• WSBA Ethics Op. 961: a percentage-of-estate probate fee divided with another lawyer
• WSBA Ethics Op. 971: fee division in a proposed juvenile-court appointment system
• WSBA Ethics Op. 1039: billing a contract lawyer's time at a higher rate than the contract lawyer is paid

Source

• Landing page: https://ao.wsba.org/print.aspx?ID=183

Original opinion text

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

Advisory Opinion: 1072
Year Issued: 1987
RPC(s): RPC 1.5(e)(2)
Subject: Division of fees; referral fee

The Committee considered your inquiry concerning the sharing of fees with lawyers who refer cases to other lawyers, but who otherwise do not participate in the case. The Committee noted that RPC 1.5(e)(2) does permit the division of fees between lawyers based upon grounds other than the proportion of services provided by each lawyer. The first requirement is that if such a fee splitting were to be undertaken, there be a written agreement with the client. Secondly, each lawyer must assume joint responsibility for the representation. Thirdly, the total fee must be reasonable. The Committee noted that this would require that the fee paid by the client be no greater than had there been only the one lawyer involved.