Attorney Referral Fees in Mississippi - A Complete Guide

How to Ethically Share Fees With Other Mississippi Attorneys

Mississippi allows attorneys to use referral fees as part of their practice when they either base the division on services performed or assume joint responsibility.

Mississippi Rule

Mississippi Rules of Professional Conduct Rule 1.5(e) lists the requirements for a division of fees. It states:

A division of 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, by written agreement with the client, each lawyer assumes joint responsibility for the representation;
• (2) the client is advised of and does not object to the participation of all the lawyers involved; and
• (3) the total fee is reasonable.

The commentary mentions that attorneys are not required to disclose to the client the share each attorney is to receive.

While a written agreement is only required when the division is based on joint responsibility, attorneys should consider a written agreement for any division of fees. A written agreement can provide proof that the client agreed to both the division and the involvement of all attorneys.

Reasonable Fees

MRPC Rule 1.5(a) provides guidance on how to determine what constitutes a reasonable fee. It states:

A lawyer’s fee shall be reasonable. 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.

Unlike other jurisdictions that have adopted the ABA Model Rules, Mississippi has not adopted the accompanying comment. The ABA commentary states that these factors are non-exclusive. The terminology for the MRPC defines reasonable as “the conduct of a reasonably prudent and competent lawyer.”

Joint Responsibility

When attorneys choose to use joint responsibility as the basis for a division of fees, they should factor in the requirements of MRPC Rule 5.1. The Rule 1.5 Comment states that joint responsibility includes the obligations listed in Rule 5.1.

MRPC Rule 5.1 provides:

• (a) A partner in a law firm, and a lawyer who individually or together with other lawyers possesses comparable managerial authority in a law firm, shall make reasonable efforts to ensure that the firm has in effect measures giving reasonable assurance that all lawyers in the firm conform to the rules of professional conduct.
• (b) A lawyer having direct supervisory authority over another lawyer shall make reasonable efforts to ensure that the other lawyer conforms to the rules of professional conduct.
• (c) A lawyer shall be responsible for another lawyer’s violation of the rules of professional conduct if:
  • (1) the lawyer orders or, with knowledge of the specific conduct, ratifies the conduct involved; or
  • (2) the lawyer is a partner in the law firm or has comparable managerial authority in which the other lawyer practices, or has direct supervisory authority over the other lawyer, and knows of the conduct at a time when its consequences can be avoided or mitigated but fails to take reasonable remedial action.

In comparison to jurisdictions with similar rules, Mississippi provides attorneys with less guidance on how to view joint responsibility for the purposes of a fee division. The Rule 1.5 Comment does not explicitly state that a division of fees enters lawyers into a partnership for the purposes of Rule 5.1.

Understanding how other jurisdictions have defined joint responsibility, while not binding in Mississippi, may provide useful guidance. Some jurisdictions have found that a division of fees requires the referring attorney to believe the other attorney is competent to handle the case. Another view is that, when joint responsibility is used as the basis for a division, attorneys enter into the equivalent of a partnership.

Deceased Partner

Ethics Opinion No. 81, originally issued in 1983 and amended in 2013, answers the question of division of fees when one attorney dies in the middle of representation. The Committee found that sharing a fee with an attorney’s estate did create an exception to the general rule against sharing fees with non-attorneys.

The opinion closes with stating that fees should be based on a quantum meruit basis. When attorneys agreed to base the division on work completed, the fees should only include what services the deceased attorney actually performed.

Conclusion

Attorneys in Mississippi may use referral fees when they base a division on work completed or assume joint responsibility. Even when not required, attorneys should consider obtaining written agreement for all divisions of fees.