Generally speaking, a lawyer is not permitted to share legal fees with a nonlawyer.(See, e.g.,
Georgia Rule of Professional Conduct 5.4(a)Georgia Rule of Professional Conduct 5.4(a); ABA Model Rule 5.4(a); NY Rule of Professional Conduct 5.4(a)).
There are, however, exceptions to that rule. For example,
- certain payments to a lawyer’s estate or a specific person for some period of time after the lawyer’s death;
- payments made in connection with the purchase of a deceased, disabled, or disappeared lawyer’s practice; and
- payments to nonlawyer employees as compensation pursuant to a profit-sharing plan.
If a lawyer does enter into an improper fee-splitting agreement with a nonlawyer, the underlying fee agreement with the client could then be put into jeopardy.
One Georgia case held that an unethical fee-sharing agreement with a nonlawyer voids an otherwise standard and lawful contingent fee agreement with a client, because it is inextricably entwined with the void referral fee agreement that violates public policy. In that case, the Court refused to enforce an attorney lien filed by the law firm.