LEO: Attorney - Recommendation of LE Op. 1068
Attorney - Recommendation of Employment.
April 11, 1988
You advise that Attorney A sued Mortgage Banker B as a private consumer.
The suit involved a refinancing dispute between A, as a private individual,
and B. A represented himself Prior to trial, B offered to settle with A by
paying all of A's out-of-pocket expenses if A would permit dismissal of
the other claimed damages. B also offered that in addition to monetary
payment, B would refer to A ten potential clients when, as often happens,
potential clients ask B for the name of an attorney who would represent
them during mortgage transactions. A would set his own fee and would make
no payments to B. Further, B regularly recommends lawyers upon request by
You wish to know whether or not it is ethical for A to accept any clients
referred by B. You also wish to know what disclosure, if any, must be made
by A to potential clients concerning the relationship between A and B.
Disciplinary Rule 2-103(D) states that "a lawyer shall not compensate or
give anything of value to a person or organization to recommend or secure
his employment by a client or as a reward for having made a recommendation
resulting in his employment by a client, except that he may pay for public
communications permitted by DR:2-101 and the usual and reasonable fees
or dues charged by a lawyer referral service and any qualified legal
services plan or contract of legal services insurance as authorized by law,
provided that such communication of the service or plan are in accordance
with the standards of DR:2-101 or DR:2-103, as appropriate." In the
situation described in your letter, it appears that A would be giving
something of value (dismissal of the other claimed damages) in exchange
for B's recommendation of A to potential clients.
The Committee opines that it would be improper for A to accept the
clients referred by B.
Committee Opinion April 11, 1988