Sharing fees with lawyers at other firms? ABA ethics opinion offers guidance on safeguarding them
A lawyer who receives earned fees that must be shared with a lawyer from another law firm must take steps to appropriately safeguard the funds, according to an ABA ethics opinion released on Wednesday.
The lawyer who receives the fees should hold the funds in an account separate from his or her own property, promptly notify the other lawyer, promptly forward the agreed portion to the other lawyer, and provide an accounting if the other lawyer requests it, according to Formal Opinion 475. The opinion, summarized in this press release, was issued by the ABA Standing Committee on Ethics and Professional Responsibility.
The opinion cites sections of Rule 1.5 of the ABA Model Rules of Professional Conduct, which allows the division of fees between lawyers from different firms if the division if proportionate to the work done by each lawyer or both lawyers assume joint responsibility for the representation. Other requirements also apply, including that the client agree to the arrangement.
The model rule refers to lawyer duties regarding funds belonging to clients and “third persons.” The lawyer in the outside firm who has an interest in the fees is a third person for purposes of the rule, the opinion says.
