Thursday, January 10, 2013

Referral Fee For Thee But Not For Me

The New Jersey Supreme Court has imposed a censure of an attorney who paid referral fees to other attorneys in 131 workers' compensation cases.

The "forwarding" fees consisted of a one-third share of the attorney fee awards in the cases. The payment did not reflect or compensate work done by the referring attorney.

The misconduct was discovered during a random audit by the Office of Attorney Ethics.

The Disciplinary Review Board noted that the attorney had one prior brush with the disciplinary system in over thirty years of practice. The Board also noted that the attorney was unaware that such payments were unethical but found his ignorance did not excuse the misconduct.

The Board distinguished as more serious disciplinary cases where referral fees were paid to non-lawyers.

New Jersey has Rule 1:39-6(d), which permits certified specialists to pay referral fees to other attorneys but prohibits the practice for every other non-certified attorney.

Does anyone know how and why New Jersey adopted the rule that creates this distinction?

I can't say it makes much sense to me. (Mike Frisch)

Bar Discipline & Process | Permalink

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One bizarre aspect of this reprimand is that the fee division is of absolutely no consequence to the clients. Workers Compensation fees in New Jersey are awarded by the Judge of Compensation, who must approve every settlement on the record with the client present and consenting.

Posted by: George Conk | Jan 11, 2013 8:56:31 PM

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