Attorney Referral Fees in Idaho - A Complete Guide
How to Ethically Share Fees With Other Idaho Attorneys
Idaho allows attorneys to use a referral fee when the division is based on each attorney’s share of the work or when attorneys assume joint responsibility. All attorneys must be competent to handle the case.
Idaho Rule
Idaho Rules of Professional Conduct Rule 1.5(e) lays out when and how attorneys may divide fees. It provides:
A division of a fee between lawyers who are not in the same firm may be made only if:
- (1) the division is in proportion to the services performed by each lawyer or each lawyer assumes joint responsibility for the representation;
- (2) the client agrees to the arrangement, including the share each lawyer will receive, and the agreement is confirmed in writing; and
- (4) the total fee is reasonable.
As part of the informing the client of the division, attorneys must disclose, in writing, each party’s expected share.
Reasonable Fees
A division of fees must meet the requirements of IRPC Rule 1.5(a), which sets out how to determine whether a fee is reasonable. It provides:
A lawyer shall not make an agreement for, charge, or collect an unreasonable fee or an unreasonable amount for expenses. The factors to be considered in determining the reasonableness of a fee include the following:
- (1) the time and labor required, the novelty and difficulty of the questions involved, and the skill requisite to perform the legal service properly;
- (2) the likelihood, if apparent to the client, that the acceptance of the particular employment will preclude other employment by the lawyer;
- (3) the fee customarily charged in the locality for similar legal services;
- (4) the amount involved and the results obtained;
- (5) the time limitations imposed by the client or by the circumstances;
- (6) the nature and length of the professional relationship with the client;
- (7) the experience, reputation, and ability of the lawyer or lawyers performing the services; and
- (8) whether the fee is fixed or contingent.
The listed factors are not exclusive. What defines reasonable is a case-by-case determination based on each case’s circumstances.
Competency
One additional requirement for a division of fees is competency. This requirement can be found not in Rule 1.5 itself but in the accompanying commentary. IRPC Rule 1.1 states:
A lawyer shall provide competent representation to a client. Competent representation requires the legal knowledge, skill, thoroughness and preparation reasonably necessary for the representation.
Competency can be either due to an attorney having the current knowledge, skills, and experience to represent the client or the ability to gain the needed knowledge and skills.
The comment to Rule 1.1 explains how competency relates to an attorney referral. A referring attorney should believe not only that the other attorney is competent but also will contribute to representing the client. Attorneys should consider the following factors ahead of referring a client to another attorney:
- The other attorney’s circumstances, including their education, experience and reputation
- The type of services the other attorney will provide
- In the jurisdiction in which the services will be performed, the relevant protections and ethics rules, especially as they relate to confidential information
The comment also indicates that the attorneys should make sure everyone understands the extent of each attorney’s responsibilities. While not required, attorneys may wish to include a division of work in the written agreement to minimize misunderstanding.
Conclusion
Attorneys in Idaho may divide fees either based on work performed or by assuming joint responsibility. All agreements must be made and confirmed in writing.
