The Ethics of an Of Counsel Relationship: Conflicts, Fees, and the Title

The of counsel title looks informal, but the relationship behind it carries real ethical weight. An of counsel lawyer is treated, for most purposes, as part of the firm, and that has consequences for conflicts, fees, the use of the title, and malpractice exposure. Getting these wrong can create problems for both the lawyer and the firm.

This is general information, not legal advice, and the rules vary by state, so confirm your own jurisdiction's rules before you act. For the arrangement itself, see our overview of what "of counsel" means. Here is what the ethics rules ask of you.

Are an Of Counsel Lawyer's Conflicts Imputed to the Firm?

Generally yes, and this is the single most important consequence to understand. Because an of counsel lawyer is usually considered part of the firm, ABA Model Rule 1.10 generally imputes that lawyer's conflicts to the firm, and the firm's conflicts to the lawyer.

The practical effect is that your current and former clients and the firm's have to be checked against each other before you affiliate and on an ongoing basis after. A conflict that would disqualify you can disqualify the whole firm, and the reverse is true as well. Run conflict checks in both directions, and keep them current, because this is where of counsel relationships most often go wrong.

Can You Use the Of Counsel Title Freely?

No. The title may only describe a genuine, close, continuing relationship with the firm. Using it to dress up an occasional or purely referral arrangement can be false or misleading, which ABA Model Rule 7.1 prohibits.

ABA Formal Opinion 90-357 is the foundational authority here. It recognizes of counsel as a continuing relationship that is not that of a partner or associate, and it is the reason the title cannot be applied to a one-off or a relationship that does not actually exist. If you hold yourself out as of counsel, the affiliation behind the label has to be real.

How Do Fees Work in an Of Counsel Relationship?

Fees inside the relationship are generally treated as within one firm, not as a cross-firm split. Because an of counsel lawyer is usually considered part of the firm, the fee-division rule that governs splits between separate firms does not apply the same way to compensation paid within the of counsel relationship.

That changes when you share fees with lawyers outside the firm. Those splits follow the normal fee-division rules under Model Rule 1.5 and its state versions, which vary, so see our guide to attorney fee splitting for the details where you practice. Throughout, Model Rule 5.4 still protects your professional independence, so the arrangement cannot let anyone interfere with your judgment on a client's matter.

What About Malpractice and Liability?

Plan for shared exposure. Because of counsel is treated as part of the firm, the firm may bear responsibility for the of counsel lawyer's work, and the of counsel lawyer may be exposed to the firm's. That is not a reason to avoid the arrangement, but it is a reason to get the coverage right.

Confirm in writing whose malpractice insurance covers your work for the firm and that the policy actually reaches an of counsel role. Do not assume you are covered by the firm's policy, or that your own carrier knows about the affiliation. Clarity here prevents an unpleasant surprise if a claim ever arrives.

Who Runs the Conflict Check, and When?

Both sides, before the relationship starts and continuously afterward. Setting up an of counsel affiliation should begin with reconciling your client list against the firm's, because a single overlap can disqualify everyone involved.

The duty does not end at signing. New clients arrive on both sides over time, so the firm's intake process has to account for your clients and yours for the firm's. Build that into how new matters are screened, or a conflict will eventually slip through.

What If a Conflict Surfaces After You Affiliate?

You deal with it under the normal conflict rules, which may mean declining a matter, withdrawing, or seeking informed consent where that is permitted. The imputation does not create a special exception; it just means the conflict belongs to everyone in the firm, not only to you.

That is why the up-front mapping matters so much. The cost of discovering a disqualifying conflict after the firm has taken on a matter is far higher than the cost of catching it during intake, so the screening has to be real and ongoing.

Does Your Professional Independence Still Apply?

Fully. However you are compensated, no fee or affiliation arrangement can let anyone interfere with your independent judgment on a client's matter, which is the core of Model Rule 5.4. Of counsel does not dilute that duty.

In practice, that means the firm's financial interest in a matter cannot drive the advice you give a client, and the arrangement cannot put a non-lawyer or an outside interest in control of your professional decisions. The affiliation changes your conflicts and your compensation, not your obligation to the client.

How Should You Document the Ethical Terms?

In the written of counsel agreement, explicitly. The same document that sets your compensation and scope should state how conflicts are handled, how the title may be used, and whose malpractice coverage applies. These are not afterthoughts; they are the terms most likely to cause trouble.

A clear agreement also protects the client, because it forces both the lawyer and the firm to confront the hard questions before a matter is on the line. If the ethical terms are vague, that is a sign the relationship is not yet ready to be called of counsel.

Can You Be Of Counsel to More Than One Firm?

Sometimes, but every added affiliation multiplies your conflicts. Each of counsel relationship generally imputes conflicts both ways, so being of counsel to two firms means all three sets of client lists, yours and both firms', have to be reconciled.

That is manageable for some lawyers and unworkable for others, depending on practice areas and client bases. If you are considering multiple affiliations, map the conflicts first, because the arrangement only works if the combined client lists can coexist. Where formal affiliation gets too tangled, referring and co-counseling with other attorneys lets you collaborate without importing their conflicts. Join Overture for free to work with other lawyers while keeping your independence and your conflict list your own.