Can one law firm be designated 'of counsel' to another law firm on its letterhead, and how do the fee-splitting rules apply?

Plain-English summary

The inquirer asked whether his firm, Law Firm Y, could enter into an "of counsel" relationship with Law Firm X under which Law Firm X would be designated "of counsel" on Law Firm Y's letterhead, and described a fee-sharing arrangement between the two firms as part of that relationship.

The committee said the purported "of counsel" relationship is not allowed under the Rules of Professional Conduct. It had previously opined that a law firm may not be designated "of counsel" to another firm, citing Informal Opinion Nos. 841 (1984) and 1343 (1990). Quoting its Formal Opinion 178 (1984), the committee said the "of counsel" designation is limited to individual attorneys: to be listed as "of counsel," the lawyer must be an active member of the Washington State Bar Association and have a close, that is, regular and frequent, continuing relationship with the lawyer or firm, for example a retired or semi-retired former partner who remains available for consultation and advice.

Because the inquiry was premised on Law Firm X being designated "of counsel," the committee said it expressed no opinion on the proposed fee-sharing relationship between the two firms. It noted, however, the fee-splitting requirements of RPC 1.5, to help the inquirer determine whether Law Firm Y could properly engage in a fee-splitting arrangement with Law Firm X.

Currency note

This opinion was issued in 2003, before the Washington State Bar Association's adoption of the 2006 revisions to the Rules of Professional Conduct, which revised the firm-name and 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 Treat this page as historical context, not current guidance.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, deadline, or requirement mentioned here.

In practice

Under the Washington rules as they stood at the time of the opinion, the committee treated a firm-to-firm "of counsel" designation as impermissible: per the opinion, "of counsel" status is reserved for individual lawyers who are active WSBA members with a close, regular, and continuing relationship with the firm. Because the of-counsel premise failed, the committee did not reach the fee-sharing arrangement, instead directing the inquirer to the fee-splitting requirements of RPC 1.5.

Common questions

Q: Can a law firm be listed as "of counsel" to another firm?

A: No. The committee said a law firm may not be designated "of counsel" to another firm; the designation is limited to individual attorneys.

Q: What does it take for an individual lawyer to be "of counsel"?

A: Quoting Formal Opinion 178, the committee said the lawyer must be an active WSBA member with a close, regular, and frequent continuing relationship with the firm, giving the example of a retired or semi-retired former partner who remains available for consultation and advice.

Q: Did the committee approve the firms' fee-sharing arrangement?

A: No. Because the inquiry was premised on a firm-to-firm "of counsel" designation, the committee expressed no opinion on the fee-sharing relationship, but pointed the inquirer to the fee-splitting requirements of RPC 1.5.

Background and rules framework

The opinion concerns the "of counsel" designation and fee splitting. The "of counsel" standard the committee applied comes from its own prior opinions, principally Formal Opinion 178 (1984), and reflects the firm-name and letterhead concerns addressed by RPC 7.5 (corresponding to Model Rule 7.5). The committee pointed to RPC 1.5 (corresponding to Model Rule 1.5), which governs fees and the requirements for dividing fees, without applying it because the of-counsel premise failed. Rule numbers reflect Washington's pre-2006 numbering.

Citations and references

Rules of Professional Conduct:

• Model Rule 1.5 / Washington RPC 1.5 (fees; division of fees)
• Model Rule 7.5 / Washington RPC 7.5 (firm names and letterhead, including "of counsel" designation)

Other opinions cited:

• WSBA Formal Opinion 178 (1984) ("of counsel" limited to individual lawyers with a close, continuing relationship)
• WSBA Informal Opinion No. 841 (1984) and No. 1343 (1990) (a firm may not be "of counsel" to another firm)

See also

• WSBA Ethics Op. 1053: Departed Lawyer on Letterhead
• WSBA Ethics Op. 1072: Referral Fees Between Lawyers
• WSBA Ethics Op. 1039: Contract Lawyer Markup

Source

• Landing page: https://ao.wsba.org/print.aspx?ID=1263

Original opinion text

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

Advisory Opinion: 2019
Year Issued: 2003
RPC(s): RPC 1.5, FO 178, IO 841, IO 1343
Subject: "of counsel", fee splitting

The inquirer asks whether his law firm, Law Firm Y, may enter into an “of counsel” relationship with Law Firm X whereby Law Firm X would be designated as “of counsel” on the Law Firm Y’s letterhead. In addition, the inquirer provided a description of a fee sharing relationship between Law Firm X and Law firm Y as part of the “of counsel” relationship. The inquirer asks whether this “of counsel” relationship is permissible under the rules of professional conduct.

The purported “of counsel” relationship is not allowed under the Rules of Professional conduct. This committee has previously opined that a law firm may not be designated as “of counsel” to another law firm. See Informal Opinion Nos. 841 (1984) and 1343 (1990). “Of counsel” designation is limited to individual attorneys: To be listed as “of counsel”, the lawyer must be an active member of the Washington State Bar Association and have a close, i.e. regular and frequent, continuing relationship with the lawyer or law firm, for example, the relationship of a retired or semi-retired former partner who remains available to the firm for consultation and advice. Formal Opinion 178 (1984) (emphasis added).

In addition, because the inquiry is premised on Law Firm X being designated as “of counsel”, this committee does not express any opinion regarding the proposed fee sharing relationship between Law Firm X and Law Firm Y. The committee, however, would highlight for the inquirer the fee splitting requirements of RPC 1.5 to help the inquirer determine whether Law firm Y may properly engage in a fee splitting arrangement with Law Firm X.