Rule 5.4 Professional Independence of a Lawyer
Law Firms and Associations
Rule Text
(a) A lawyer or law firm shall not share legal fees with a nonlawyer, except that: (1) an agreement by a lawyer with the lawyer's firm or firm members may provide for the payment of money, over a reasonable period of time after the lawyer's death, to the lawyer's estate or to one or more specified persons. (2) a lawyer who purchases the practice of a deceased, disabled, or disappeared lawyer may, pursuant to the provisions of Rule 1.17, pay to the estate or other representative of that lawyer the agreed-upon purchase price. (3) a lawyer or law firm may include nonlawyer employees in a compensation or retirement plan, even though the plan is based in whole or in part on a profit-sharing arrangement. (4) a lawyer may share legal fees awarded by a tribunal with a nonprofit organization that employed, retained or recommended employment of the lawyer in the matter; and (5) a lawyer may pay the usual charges of a bar- operated not-for-profit lawyer referral service, including fees calculated as a percentage of legal fees received by the lawyer from a referral.
(b) A lawyer shall not form a partnership with a nonlawyer if any of the activities of the partnership consist of the practice of law.
(c) A lawyer shall not permit a person who recommends, employs, or pays the lawyer to render legal services for another to direct or regulate the lawyer's professional judgment in rendering such legal services.
(d) A lawyer shall not practice with or in the form of a professional corporation or association authorized to practice law for a profit, if: (1) a nonlawyer owns any interest therein, except that a fiduciary representative of the estate of a lawyer may hold the stock or interest of the lawyer for a reasonable time during administration; (2) a nonlawyer is a corporate director or officer thereof or occupies the position of similar responsibility in any form of association other than a corporation, except as authorized by law; or (3) a nonlawyer has the right to direct or control the professional judgment of a lawyer.
(e) A lawyer shall not refer a client to a nonlawyer with the understanding that the lawyer will receive a fee, commission or anything of value in exchange for the referral, but a lawyer may accept gifts in the ordinary course of social or business hospitality.
Amendment history: Adopted 01/01/05. Amended 01/01/13: Paragraph (a)(5) added. Amended 02/01/22: Phrase “court-awarded” deleted from paragraph (a)(4). Phrase “awarded by a tribunal” added to paragraph (a)(4). Amended 03/01/22: Phrase “sponsored or” deleted from paragraph (a)(5).