Ohio Board Advisory Opinion Op 92-001

The Supreme Court of Ohio
BOARD OF COMMISSIONERS ON GRIEVANCES AND DISCIPLINE
41 SOUTH HIGH STREET-SUITE 3370, COLUMBUS, OH 43215-6105
(614) 644-5800 FAX: (614) 644-5804
OFFICE OF SECRETARY
OPINION 92-1
Issued February 14, 1992
[CPR Opinion-provides advice under the Ohio Code of Professional Responsibility which is superseded by the Ohio
Rules of Professional Conduct, eff. 2/1/2007.]
[Not current-subsequent rule amendments to DR 2-103, eff. July 1, 1996.]
SYLLABUS: A bar association through its lawyer referral service assists the legal profession in
fulfilling its duty to make legal counsel available to the public. Since Disciplinary Rule 2-103 (C)
(1) expressly allows a lawyer to request referrals from a lawyer referral service operated,
sponsored, or approved by a bar association and to pay the fees incident thereto, it is not unethical
for a bar association to require a lawyer to pay to the association a percentage of the legal fees
earned from clients referred if needed to support this service to the public. The permissive
language of Disciplinary Rule 2-103 (C) (1) persuades the Board to view such payments as usual
and reasonable fees or dues under Disciplinary Rule 2-103 (B). However, such an arrangement is
approved only when several conditions are met. The participating attorney must not raise rates to
cover the amount paid to the service. The funds should be used to cover administrative costs of
operating the service and for educating the public on the availability of legal services.
The requirement that a lawyer who accepts referrals must, if the client desires, submit any fee
dispute to arbitration by the appropriate fee dispute committee of the bar association does not
interfere with the attorney's independent professional judgment in behalf of the client, and in
addition, this requirement promotes the spirit of Ethical Consideration 2-22.
The requirement that a lawyer accepting referrals from a bar association's lawyer referral service
must co-counsel on referred matters only with other attorney members of the referral panel is
improper because it allows persons other than the client to influence, direct or regulate an attorney's
professional judgment in rendering legal services in violation of Disciplinary Rule 5-107 (B) and
interferes with an attorney's independent professional judgment in behalf of the client as prohibited
by Disciplinary Rules 2-103 (C) (2) (b) and (D).

Op. 92-1 2
OPINION: Three related questions are addressed in this opinion.
1. May a bar association require a lawyer to pay to the bar association a percentage
of the legal fee that the lawyer earns from a client referred by the bar
association's lawyer referral service?
2. May a bar association require the lawyer accepting referrals from the bar
association's lawyer referral service to submit, if the client desires, any fee
dispute to arbitration by the appropriate fee dispute committee of the bar
association?
3. May a bar association require the lawyer accepting referrals from the bar
association's lawyer referral service to co-counsel on referred matters with only
other attorney members of the referral panel?
Initially, the Board notes that the Code of Professional Responsibility governs "the standards of
professional conduct expected of lawyers in their relationships with the public, with the legal
system, and with the legal profession." Therefore, the Code's primary concern is with the conduct
of lawyers. Although the questions are phrased by the requester as to what the bar association may
require of a lawyer, the questions are answered by a consideration of what the Code permits a
lawyer to do.
Question 1
Lawyers are encouraged to make legal services available to the public. See Code of Professional
Responsibility, Canon 2, EC 2-1, 2-14, and 2-24. A bar association through its lawyer referral
service provides a valuable contribution to society by assisting the legal profession in making legal
services more accessible to the public. This common aspirational goal creates a special relationship
between lawyers and bar associations.

Op. 92-1 3
The disciplinary rules governing the referral relationship between lawyers and bar associations are
set forth below as exceptions to the Code's general prohibitions regarding referrals.
DR 2-103(B) A lawyer shall not compensate or give any thing 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 the usual and reasonable fees or dues charged by any of the
organizations listed in DR 2-103 (D). [Organizations listed in DR 2-103 (D) are as
follows: (D) (1), a legal aid office or public defender office; (D) (2), a military legal
assistance office; (D) (3), a lawyer referral service operated, sponsored, or
approved by a bar association; (D) (4) any bona fide organization that
recommends, furnishes or pays for legal services to its members or beneficiaries and
which meets conditions set forth in the Code.] (Emphasis added).
DR 2-103(C) A lawyer shall not request a person or organization to recommend or
promote the use of his services or those of his partner or associate, or any other
lawyer affiliated with him or his firm, as a private practitioner, except that:
(1) He may request referrals from a lawyer referral service
operated, sponsored, or approved by a bar-association and may
pay its fees incident thereto. (Emphasis added).
DR 2-104 (A) A lawyer who has given unsolicited advice to a layman that he
should obtain counsel or take legal action shall not accept employment resulting
from that advice, except that:
(2) A lawyer may accept employment that results from his
participation in activities designed to educate laymen to recognize
legal problems, to make intelligent selection of counsel, or to utilize
available legal services if such activities are conducted or
sponsored by any of the offices or organizations enumerated in
DR 2-103 (D) (1) through (5) [sic] to the extent and under the
conditions prescribed therein. (Emphasis added).

Op. 92-1 4
There is no guidance within Ohio's Code of Professional Responsibility as to meaning of “usual
and reasonable fees or dues" as used in Disciplinary Rule 2-103 (B). Nor, is there a description of
what constitutes "fees incident thereto" as used in Disciplinary Rule 2-103 (C) (1).
The American Bar Association has twice expressed the view that a bar association's referral panel
may require members of a lawyer referral panel to help finance the service by either a flat charge or
a percentage of fees collected. ABA, Committee on Professional Ethics and Grievances, Formal
Op. 291 (1956), ABA, Committee on Ethics and Professional Responsibility, Informal Op. 1076
(1968). In both opinions it was stated that
[t]he financing of the plan should be under the control of the association setting it
up. Registrants may be required to contribute to the expense of operating it by a
reasonable registration charge, or by a reasonable percentage of fees collected by
them. The latter arrangement would not, in the opinion of the Committee[s],
constitute a violation of Canon 34 [Former Canon 34 stated that “[n]o division of
fees for legal services is proper, except with another lawyer, based upon a division
of service or responsibility."]
Id.
These ABA opinions precede the Model Code and provide limited guidance on the issue. Even so,
they are often cited by ethics committees to support advice that payment to an approved lawyer
referral service of a reasonable percentage of the fees earned is permissible if related to the
expenses of the service and if the attorney does not raise rates to cover the amount paid to the
service. Tennessee Sup.Ct, Bd. of Professional Responsibility, Formal Op. 88-F-115 (1988).
Formal Op. 88-F-115 (a) (1989), State Bar of Wisconsin, Formal Op. E-88-8 (1988), Kentucky Bar
Ass'n, Op. E-288 (1984), State Bar of California, Formal Op. 1983-70 (1983), and Chicago Bar
Ass'n, Op. 87-1 (undated) (The Chicago opinion did not raise the issue of an attorney raising rates
to cover amounts paid to the service. The Chicago committee advised that “reasonable limits must
be placed on percentages applicable to matters handled on a contingent fee basis.”) An opinion
issued by the Illinois Bar Association, Opinion 506 (1975), advising that such a payment to a
referral service of fees earned from clients referred was an improper division of fees, has been
suspended.

Op. 92-1 5
More recently, the ABA, in its Statement of Standards and Practices for a Lawyer Referral and
Information Service (1985), has given continued approval to lawyer referral services requiring
lawyers to pay to the service fees computed on a percentage basis or otherwise (Rule 8.1) but has
expanded its guidelines as to the referral service's use of the proceeds to include support of
activities or programs in the public interest (Rule 8.3).
The Board acknowledges that there are administrative costs of operating an efficient lawyer referral
service. Since the bar association assists the legal profession in fulfilling its duty to make legal
services available to the public, the bar has a professional interest in the ongoing success of a bar
association's lawyer referral service. Therefore, it may be "usual and reasonable" within the
meaning of Disciplinary Rule 2-103 (B) for a bar association to require a lawyer to pay to the
association a percentage of fees earned from clients referred, if needed to support this service to the
public.
Nevertheless, there remains a concern whether payment to a bar association of a percentage of a
legal fee that the lawyer earns from a client referred by the lawyer referral service constitutes an
improper division of fees under the Code. For purposes of analysis the disciplinary rules governing
the division of fees are set forth below.
DR 2-107 (A) Division of fees by lawyers who are not in the same firm may be
made only with the prior consent of the client and if all of the following apply:
(1) The division is in proportion to the services performed by each
lawyer or, if be written agreement with the client, all lawyers
assume responsibility for the representation;
(2) The terms of the division and the identity of all lawyers sharing
in the fee are disclosed in writing to the client;
3) The total fee is reasonable.
[DR 2-107 (B) and (C) omitted]

Op. 92-1 6
DR 3-102 (A) A lawyer or law firm shall not share legal fees with a non-lawyer,
except that:
(1) An agreement by a lawyer with his firm, partner, or associate
may provide for the payment of money, over a reasonable period
of time after his death, to his estate or to one or more specified
persons.
(2) A lawyer who undertakes to complete unfinished legal business
of a deceased lawyer may pay to the estate of the deceased
lawyer that proportion of the total compensation which fairly
represents the services rendered by the deceased lawyer.
(3) A lawyer or law firm may include non-lawyer employees in a
retirement plan, even though the plan is based in whole or in part
on a profit-sharing arrangement.
Neither rule cited above seems applicable to a bar association. Disciplinary Rule 2-107 by its
language applies to division of fees by lawyers not in the same firm. As defined within the
Definitions Section of the Code, “‘[l]aw firm includes a professional legal corporation or a legal
clinic.” Although most of its members are lawyers, a bar association as an organization is not a
lawyer, a law firm, a professional legal corporation, or a legal clinic. Further, the rule cannot be
applied as it places conditions on the division of fees which a bar association could not undertake,
for example, performing legal services for a client or assuming responsibility for representation of a
client.
If, on the other hand, bar associations are viewed as non-lawyers, it would be improper under
Disciplinary Rule 3-102 for a lawyer to divide a legal fee with a bar association, since they are not
listed as an exception within the rule. However, this application of the rule to bar associations
seems inconsistent with Disciplinary Rule 2-103 (C) which permits lawyers to request referrals and
to pay the fees incident thereto. Such application contradicts the Code's consistent encouragement
to a lawyer to make legal services available to the public and to cooperate with a lawyer referral
service operated, sponsored, or approved by a bar association. DR 2-103 (B), 2-103 (C) (1), 2-103
(D), 2-104 (A) (2), EC 2-1, 2-14, 2-24.
The policy behind fee-splitting is to prevent potential dangers to clients. These dangers can occur
through improper referral based on financial motives rather than a client's best interest and through
referrals that result in an attorney increasing the cost of legal services to the client in an effort to
recoup the money paid to the referral service.

Op. 92 -1 7
In Ohio there are no cases addressing the propriety of a bar association requiring a lawyer to pay it
a percentage of legal fees earned from clients referred. A California Court of Appeal, affirming a
summary judgment requiring plaintiffs to pay a bar association a one-third forwarding fee arising
from legal business which originated with the bar association's lawyer reference service, did not
find such arrangement to offend the public policy underlying the canons on fee-splitting and lay
interposition. Emmons, Williams, Mires & Leech v. State Bar of California, 6 Cal. App. 3d 565,
573-75 86 Cal Rptr. 367 (Cal. Ct. App. 1970).
The Emmons court recited the dangers of discredited fee-splitting between a lawyer and a layman:
the danger of competitive solicitation; the possibility of control by the layperson interested in his or
her own profit rather than the client's fate; facilitation of the lay intermediary's tendency to select
the most generous, not the most competent, attorney; and the presence of a party demanding
allegiance the lawyer owes the client. Id. at 573-74. The court did not find these dangers or
disadvantages to characterize the bar association's lawyer reference service. The court
acknowledged that the bar association sought fulfillment of public and professional objectives, not
individual profit and that it had a legitimate, non-profit interest in making legal services more
readily available to the public. Id. at 574.
This Board agrees that the dangers of fee splitting cited above do not characterize a referral service
operated, sponsored, or approved by a bar association. The Board reaches this conclusion only
when certain conditions are met. There must be an affirmative showing that participating lawyers
do not raise their attorney fee rates to cover the amount paid to the referral service. Moreover, the
funds generated must be used to cover the administrative costs of operating the service and for
educating the public on the availability of legal services.
The Board acknowledges that a bar association through its lawyer referral service assists the legal
profession in fulfilling its duty to make legal counsel available to the public. The Board advises
that since Disciplinary Rule 2-103 (C) (1) expressly allows a lawyer to request referrals from a
lawyer referral service operated, sponsored, or approved by a bar association and to pay the fees
incident thereto, it is not unethical for a bar association to require a lawyer to pay to the association
a percentage of the legal fees earned from clients referred if needed to support this service to the
public. The permissive language of Disciplinary Rule 2-103 (C) (1) persuades the Board to view
such payments as usual and reasonable fees or dues under Disciplinary Rule 2-103 (B). However,
since the Code disapproves of lawyers sharing legal fees with non-lawyers and restricts the division
of fees among lawyers, it would assist the profession for bar associations to seek clarification as to
its position through rule amendment.

Op. 92-1 8
Questions 2 and 3
These two questions are discussed together, because both raise similar ethical concerns with regard
to potential interference with a lawyer's professional judgment. Disciplinary Rule 5-107(B)
requires that “[a] lawyer shall not permit a person who recommend, employs, or pays him to render
legal services for another to direct or regulate his professional judgment in rendering such legal
services." Ethical Considerations 5-21, 5-22, and 5-23 caution attorneys to avoid being influenced
by others than clients. Disciplinary Rules 2-103 (C) (2) and 2-103 (D), set forth below, also require
that there be no interference with professional judgment.
DR 2-103 (C) (2) [A lawyer] may cooperate with the legal service activities of any
of the offices or organizations enumerated in DR 2-103 (D) (1) through (4) and may
perform legal services for those to whom he was recommended by it to do such
work if:
(a) The person to whom the recommendation is made is a member or
beneficiary of such office or organization; and
(b) The lawyer remains free to exercise his independent
professional judgment on behalf of his client. (Emphasis added).
DR 2-103 (D) A lawyer shall not knowingly assist a person or organization that
furnishes or pays for legal services to others to promote the use of his services or
those of his partner or associate or any other lawyer affiliated with him or his firm
except as permitted in DR 2-101 (B). However, this does not prohibit a lawyer or
his partner or associate or any other lawyer affiliated with him or his firm from
being recommended, employed or paid by, or cooperating with, assisting and
providing legal services for, one of the following offices or organizations that
promote the use of his services or those of his partner or associate or any other
lawyer affiliated with him or his firm if there is no interference with the exercise
of independent professional judgment in behalf of his client: . . . [a] lawyer
referral service operated, sponsored, or approved by a bar association is an
organization listed in DR 2-103 (D) (3). (Emphasis added).

Op. 92-1 9
The purpose of requiring a lawyer who accepts referrals to submit any fee dispute to arbitration by
the appropriate fee dispute committee of the bar association, if the client desires, is to honor the
client's wishes to mediate such a dispute. This is in keeping with the aspiration of Ethical
Consideration 2-22 that "[a] lawyer should be zealous in his efforts to avoid controversies over fees
with clients and should attempt to resolve amicably any differences on the subject. He should not
sue a client for a fee unless necessary to prevent fraud or gross imposition by the client."
Although the attorney is required to proceed in a certain manner with regard to fee dispute, there is
no attempt to influence how the attorney handles a legal matter in behalf of a client. Therefore, it is
the opinion of the Board that the requirement that a lawyer who accepts referrals must, if the client
desires, submit any fee dispute to arbitration by the appropriate fee dispute committee of the bar
association does not interfere with the attorney's independent professional judgment in behalf of the
client, and in addition, this requirement promotes the spirit of Ethical Consideration 2-22.
In contrast, the requirement that a lawyer accepting such referrals co-counsel only with other
attorney members of the referral panel does interfere with the attorney's independent professional
judgment in behalf of the client. This requirement forces the attorney to proceed in a certain
manner with regard to a legal matter. It also makes the right of an attorney to participate in a bar
association's referral service dependent upon an agreement to relinquish part of the attorney's
independent professional judgment in behalf of his or her client.
This requirement has no foundation in advancing a client's interests nor does it promote the spirit of
any ethical consideration. In fact, it attempts to require attorneys to do what Ethical Consideration
5-13 advises them not to do: “A lawyer should not maintain membership in or be influenced by any
organization of employees that undertakes to prescribe, direct, or suggest when or how he should
fulfill his professional obligations to a person or organization that employs him as a lawyer.” In
addition, this requirement conflicts with the prohibitions of Disciplinary Rule 5-107 (B), 2-103 (C)
(2) (b) and 2-103 (D) regarding interference with a lawyer's independent professional judgment.

Op. 92-1 10
Therefore, it is the Board's opinion that the requirement that a lawyer accepting referrals from a bar
association's lawyer referral service must co-counsel on referred matters with only other attorney
members of the referral panel is improper. It is improper because it allows persons other that the
client to influence, direct or regulate an attorney's professional judgment in rendering legal services
in violation of Disciplinary Rule 5-107 (B) and interferes with an attorney's independent
professional judgment in behalf of the client as prohibited by Disciplinary Rules 2-103 (C) (2) (b)
and 2-103 (D).
Advisory Opinions of the Board of Commissioners on Grievances and Discipline are
informal, nonbinding opinions in response to prospective or hypothetical questions regarding
the application of the Supreme Court Rules for the Government of the Bar of Ohio, the
Supreme Court Rules for the Government of the Judiciary, the Code of Professional
Responsibility, the Code of Judicial Conduct, and the Attorney's Oath of Office.