Short answer. New York lets a lawyer divide a fee for legal services with another lawyer who is not associated in the same law firm only if the division is in proportion to the services performed by each lawyer or, by a writing given to the client, each lawyer assumes joint responsibility for the representation; the client agrees to employment of the other lawyer after a full disclosure that a division of fees will be made, including the share each lawyer will receive, and the client’s agreement is confirmed in writing; and the total fee is not excessive (Rule 1.5(g) of the New York Rules of Professional Conduct). The rule states no percentage limit on either lawyer’s share. A lawyer may pay referral fees to another lawyer only as Rule 1.5(g) permits (Rule 7.2(a)(2)).
Sources read October 3, 2026; checked against LegalFlare’s research October 28, 2026. The words of Rules 1.5(g), 5.4(a)(1)–(3), 7.2(a) and 8.5(b) are as printed in the court system’s compilation of the New York Rules of Professional Conduct (22 NYCRR Part 1200, dated January 1, 2017) on nycourts.gov; Rule 5.4(a)(4) and Rule 7.3 are as printed in the New York State Bar Association’s compilation as amended through July 1, 2026; both fetched October 3, 2026. Judiciary Law sections are from nysenate.gov, fetched October 3, 2026. This page is general information, not legal advice. See the disclaimer.
New York’s referral fee rules at a glance
| Question | New York’s answer | Source |
|---|---|---|
| Governing rule | Rule 1.5(g), New York Rules of Professional Conduct (22 NYCRR Part 1200) | 22 NYCRR Part 1200, Rule 1.5(g) |
| Written client consent | Required in every division: the client agrees to employment of the other lawyer after a full disclosure that a division of fees will be made, including the share each lawyer will receive, and the client’s agreement is confirmed in writing; a division based on joint responsibility also needs that assumption made by a writing given to the client | Rule 1.5(g)(1)–(2) |
| Notice to the client | Full disclosure that a division of fees will be made, including the share each lawyer will receive, before the client agrees to employment of the other lawyer | Rule 1.5(g)(2) |
| Proportion to services or joint responsibility | Required, one or the other: the division is in proportion to the services performed by each lawyer or, by a writing given to the client, each lawyer assumes joint responsibility for the representation | Rule 1.5(g)(1) |
| Reasonable total fee | Required: the total fee is not excessive | Rule 1.5(g)(3) |
| Cap on the secondary lawyer’s share | None stated in Rule 1.5(g) | Rule 1.5(g) |
| Statutes | No New York statute governs fee division between lawyers (none found in our search of October 3, 2026); Judiciary Law § 491(1), which makes it unlawful for any person to divide with or receive from an attorney any part of a fee as an inducement for, or in consideration of, placing a claim in the attorney’s hands, does not apply to an agreement between attorneys and counsellors-at-law to divide between themselves the compensation to be received; §§ 479, 481, 482 and 495 address solicitation and the practice of law by corporations | Judiciary Law § 491 |
What Rule 1.5(g) says
Rule 1.5(g) of the New York Rules of Professional Conduct governs the division of a fee for legal services between lawyers who are not associated in the same law firm. Its words, as printed in the court system’s compilation dated January 1, 2017 (22 NYCRR Part 1200, Rule 1.5(g)):
(g) A lawyer shall not divide a fee for legal services with another lawyer who is not associated in the same law firm unless:
(1) the division is in proportion to the services performed by each lawyer or, by a writing given to the client, each lawyer assumes joint responsibility for the representation;
(2) the client agrees to employment of the other lawyer after a full disclosure that a division of fees will be made, including the share each lawyer will receive, and the client’s agreement is confirmed in writing; and
(3) the total fee is not excessive.
Our research holds these words with no effective date, so this page gives none.
What Rule 1.5(g) does not reach. New York decisions and opinions have held these arrangements outside Rule 1.5(g):
- Sale of a law practice. In Keneally, Lynch & Bak, LLP v Salvi (2021), the Appellate Division, Second Department held that the price term of an agreement selling a law practice, with its goodwill, in exchange for a share of monthly revenues is not an illegal fee-splitting agreement in violation of Rule 1.5(g), because Rule 1.17, on the sale of a law practice, provides a specific exception to the rule; in 2024 it held that ruling law of the case.
- Separation agreements with a departing lawyer. In Matter of William Mattar, P.C. v Hall (2021), the Appellate Division, Fourth Department held that a firm’s employment agreement dividing contingency fees on cases a departing lawyer took with him did not violate Rule 1.5(g), because Rule 1.5(h) provides that Rule 1.5(g) does not prohibit payment to a lawyer formerly associated in a firm under a separation or retirement agreement. NYSBA Opinion 1218 (2021) concluded that a firm may pay a lawyer who left to take non-judicial public office the share of fees on matters he worked on that he would have received had he stayed, unless law governing the official prohibits it, because Rule 1.5(h) allows payment to a formerly associated lawyer under a separation agreement, so Rule 1.5(g) does not govern the payment.
- Per diem lawyers. NYSBA Opinion 1113 (2017) concluded that Rule 1.5(g) does not apply where a hiring lawyer pays a per diem lawyer on an hourly or fixed-fee basis that reflects the fair value of the work and is similar to what the lawyer would pay an employee.
- A deceased lawyer’s estate. NYSBA Opinion 1128 (2017) concluded that Rule 1.5(g) governs only division of fees among lawyers, so it does not apply to sharing with a deceased lawyer’s estate; Rule 5.4(a) governs that.
What the client must agree to in writing
Every division with a lawyer not associated in the same law firm needs the client’s agreement to employment of the other lawyer, after a full disclosure that a division of fees will be made, including the share each lawyer will receive, with the client’s agreement confirmed in writing (Rule 1.5(g)(2)). Where the division rests on joint responsibility rather than proportion to services, each lawyer’s assumption of joint responsibility must be made by a writing given to the client (Rule 1.5(g)(1)).
In Matter of Colleluori (2018), the Appellate Division, Second Department publicly censured a lawyer who paid $14,000 of a client’s $35,000 criminal retainer to another lawyer who was neither his partner nor his employee, without telling the client and without the client’s written consent; it sustained the charge that he divided a fee with a lawyer not associated with his firm without disclosing the division to the client and without the client’s written agreement, in violation of Rule 1.5(g). NYSBA Opinion 1244 (2022) read Rule 1.5(g) to require the client’s written consent disclosing both the referring lawyer’s joint responsibility and share of the fee.
What must be disclosed to the client
The client must receive a full disclosure that a division of fees will be made, including the share each lawyer will receive, before agreeing to employment of the other lawyer (Rule 1.5(g)(2)).
In Matter of Goldberg (2018), the Appellate Division, First Department, on a joint motion for discipline by consent, publicly censured a lawyer for failing to disclose to two clients that he was sharing legal fees with another lawyer. The charges cited both former Code DR 2-107(a)(1) and (2) and Rules 1.5(g)(1) and (2), with Rule 8.4(h); the decision does not say which conduct fell under the former Code and which under the Rules.
Proportionality or joint responsibility
One or the other is required: the division must be in proportion to the services performed by each lawyer or, by a writing given to the client, each lawyer must assume joint responsibility for the representation (Rule 1.5(g)(1)). The total fee must not be excessive (Rule 1.5(g)(3)).
NYSBA Opinion 1201 (2020) concluded that Rule 1.5(g) is disjunctive, so a fixed-formula division may rest on joint responsibility rather than proportion of services; that merely forwarding a client is not a basis for sharing the fee; and that joint responsibility means financial and ethical responsibility akin to a supervising partner’s duty under Rule 5.1(a). Opinion 1244 (2022) concluded that a retired lawyer may receive a referral fee only if the retiree keeps joint responsibility for the referred matter: retirement does not end that responsibility if the lawyer wants to share the fee, and successor counsel’s own engagement letter with the client does not displace it. Opinion 1160 (2019) reasoned that cultivating client relationships is not “services performed”.
In Ginarte, O’Dwyer, Gonzalez, Gallardo & Winograd, LLP v Law Offs. of Rex E. Zachofsky, PLLC (2019), the Appellate Division, First Department paraphrased Rule 1.5(g)(1) with “and” between proportion to services and joint responsibility. The rule’s words say “or”.
Enforcing a fee-sharing agreement between lawyers. In Wolfe & Yukelson, PLLC v Davis, Saperstein & Salomon, P.C. (2017), the Appellate Division, Second Department affirmed a judgment enforcing a written fee-sharing agreement between two law firms: in fee-sharing disputes between lawyers, courts will not inquire into the precise worth of each party’s services as long as the lawyer seeking a share contributed some work, labor or service toward earning the fee, and a firm bound by the same Rules that freely agreed to and benefited from the agreement cannot argue that it must be voided on ethical grounds, particularly where nothing indicates the client was deceived or misled. The finding that the defendant had itself violated Rule 1.5(g) was the trial court’s; the Appellate Division affirmed on another ground. In Matter of Quigley (Hayes) (2019), the Appellate Division, Third Department, assuming without deciding that two Texas firms had not met Rule 1.5(g)’s prerequisites, held that a violation did not make their contingency fee agreement unenforceable: the rule has no express voiding provision, the client signed an unambiguous retainer naming both firms and stating the fee, so she was not deceived or misled, and the firms provided significant and effective services.
Referring a case out of New York, or into it
New York’s choice-of-law rule, Rule 8.5(b), says which jurisdiction’s rules of professional conduct apply when New York exercises its disciplinary authority (22 NYCRR Part 1200, Rule 8.5(b)). Our research holds its words with no effective date, so this page gives none:
(b) In any exercise of the disciplinary authority of this state, the rules of professional conduct to be applied shall be as follows:
(1) For conduct in connection with a proceeding in a court before which a lawyer has been admitted to practice (either generally or for purposes of that proceeding), the rules to be applied shall be the rules of the jurisdiction in which the court sits, unless the rules of the court provide otherwise; and
(2) For any other conduct:
(i) If the lawyer is licensed to practice only in this state, the rules to be applied shall be the rules of this state, and
(ii) If the lawyer is licensed to practice in this state and another jurisdiction, the rules to be applied shall be the rules of the admitting jurisdiction in which the lawyer principally practices; provided, however, that if particular conduct clearly has its predominant effect in another jurisdiction in which the lawyer is licensed to practice, the rules of that jurisdiction shall be applied to that conduct.
A lawyer licensed only in New York. NYSBA Opinion 1291 (2026) concluded that a New York lawyer may hold a financial interest in an Alternative Business Structure lawfully practicing in Arizona and may receive lead-counsel and referral fees from it, but that under Rule 5.4(a)(4) the division must comply with Rule 1.5(g), and that Rules 5.4(a)(4) and 1.5(g) apply both to the lawyer paying and to the lawyer receiving the share. Because the inquirer was licensed only in New York and the work would be performed in New York, Rule 8.5(b)(2)(i) made the New York Rules apply.
A lawyer licensed in New York and elsewhere. Opinion 1291 also read Rule 8.5(b)(2)(ii) to apply, for a lawyer admitted in New York and elsewhere, the rules of the jurisdiction where the lawyer principally practices unless particular conduct clearly has its predominant effect in another admitting jurisdiction. NYSBA Opinion 1166 (2019) concluded that a New York lawyer admitted in several jurisdictions must decide which jurisdiction’s rules apply activity by activity, since where the lawyer principally practices and where conduct has its predominant effect are fact-specific. Opinions 1041 (2014) and 1234 (2021), which also read Rule 8.5(b)(2)(ii), were issued before Rule 5.4(a)(4) took effect on November 10, 2025; their holdings are in the table below.
Conduct in another state. In Matter of Kaufman (2017), the Appellate Division, Third Department censured a New York-admitted lawyer practicing in Florida as reciprocal discipline after the Supreme Court of Florida publicly reprimanded him, on his consent, for failing to communicate with clients and improperly sharing legal fees with nonattorneys under Florida’s rules; it rejected his defense that the Florida conduct would not be misconduct in New York, citing Rules 1.4(b), 5.4(a) and 7.2(a) as examples.
A lawyer admitted only in another state. NYSBA Opinion 1160 (2019) concluded that a New York lawyer may not affiliate and share fees with a lawyer who lives in New York but is admitted only in another state (and in New York federal courts) and whose role is to bring in clients, if the solicitation, fee sharing and other services would as a matter of law be the unauthorized practice of law; it reasoned that the Rule 1.5(g) exception requires the client’s consent confirmed in writing and a division either in proportion to services or with joint responsibility assumed in a writing to the client, and that cultivating client relationships is not “services performed”.
We hold no New York court decision construing Rule 8.5(b) (searched October 3, 2026).
Paying for referrals, and nonlawyers
- Payment for referrals. “A lawyer shall not compensate or give anything of value to a person or organization to recommend or obtain employment by a client, or as a reward for having made a recommendation resulting in employment by a client, except that:” [(1)] “a lawyer or law firm may refer clients to a nonlegal professional or nonlegal professional service firm pursuant to a contractual relationship with such nonlegal professional or nonlegal professional service firm to provide legal and other professional services on a systematic and continuing basis as permitted by Rule 5.8, provided however that such referral shall not otherwise include any monetary or other tangible consideration or reward for such, or the sharing of legal fees; and” [(2)] “a lawyer may pay the usual and reasonable fees or dues charged by a qualified legal assistance organization or referral fees to another lawyer as permitted by Rule 1.5(g).” (Rule 7.2(a); the paragraph labels in square brackets are added here.) NYSBA Opinion 1279 (2025) stated that the only exceptions to Rule 7.2(a) appear in Rules 1.5(g) and 5.8. Courts have disciplined lawyers for paying others for client referrals in violation of Rule 7.2(a) (Matter of Kulcsar (2014), whose findings also rested on the former Code; Matter of Tarter (2017)); see the cases below.
- Nonlawyers. “A lawyer or law firm shall not share legal fees with a nonlawyer, except that:” an agreement by a lawyer with the lawyer’s firm or another lawyer associated in the firm may provide for the payment of money, over a reasonable period of time after the lawyer’s death, to the lawyer’s estate or to one or more specified persons (Rule 5.4(a)(1)); a lawyer who undertakes to complete unfinished legal business of a deceased lawyer may pay to the estate of the deceased lawyer that portion of the total compensation that fairly represents the services rendered by the deceased lawyer (Rule 5.4(a)(2)); and a lawyer or law firm may compensate a nonlawyer employee or include a nonlawyer employee in a retirement plan based in whole or in part on a profit-sharing arrangement (Rule 5.4(a)(3)). Our research holds these words with no effective date. Rule 5.4(a)(4), in force since November 10, 2025, adds: “A lawyer or law firm may divide a fee with another lawyer or law firm that has nonlawyer owners or nonlawyer supervisors provided that:” nonlawyer ownership of law firms is permitted in the jurisdiction whose professional conduct rules govern the other lawyer’s conduct ((a)(4)(i)); the lawyer who divides the fee does not permit any nonlawyer to interfere with the lawyer’s independent professional judgment or with the client lawyer relationship ((a)(4)(ii)); and the division of fees with the other lawyer complies with Rule 1.5(g) ((a)(4)(iii)). NYSBA Opinions 1041, 1234 and 1246 and NYC Bar Formal Opinion 2018-5 applied Rule 5.4(a) before paragraph (a)(4) was added.
- Solicitation. Rule 7.3, in force in its rewritten form since June 1, 2026, says a lawyer “shall not solicit professional employment by live person-to-person contact when a significant motive for the lawyer’s doing so is the lawyer’s or law firm’s pecuniary gain, unless the contact is with a:” lawyer; a person who has a family, close personal, or prior business or professional relationship with the lawyer or law firm; or a person who routinely uses for business purposes the type of legal services offered by the lawyer (Rule 7.3(b)(1)–(3)). A lawyer also shall not solicit professional employment, even when not otherwise prohibited by paragraph (a), if the target of the solicitation has made known to the lawyer a desire not to be solicited by the lawyer, or the solicitation involves coercion, duress or harassment (Rule 7.3(c)(1)–(2)). The Rule 7.3 in force before June 1, 2026 was different, and some of its paragraph numbers now name different rules; this page states the former Rule only as former law (see What our research did not find).
- Statutes. Judiciary Law § 491(1):
- It shall be unlawful for any person, partnership, corporation, or association to divide with or receive from, or to agree to divide with or receive from, any attorney-at-law or group of attorneys-at-law, whether practicing in this state or elsewhere, either before or after action brought, any portion of any fee or compensation, charged or received by such attorney-at-law or any valuable consideration or reward, as an inducement for placing, or in consideration of having placed, in the hands of such attorney-at-law, or in the hands of another person, a claim or demand of any kind for the purpose of collecting such claim, or bringing an action thereon, or of representing claimant in the pursuit of any civil remedy for the recovery thereof. But this section does not apply to an agreement between attorneys and counsellors-at-law to divide between themselves the compensation to be received.
A person violating the section is guilty of a misdemeanor (§ 491(2)). Judiciary Law § 495 bars a corporation or voluntary association from practicing law, furnishing attorneys, or soliciting claims to represent persons (§ 495(1), (2)), with exceptions including organizations that offer prepaid legal services (§ 495(7)). Judiciary Law §§ 479, 481 and 482 make it unlawful to solicit legal business or retainers on behalf of an attorney, for persons employed by or attached to a hospital, sanitarium, police department, prison or court, or authorized to furnish bail bonds, to aid an attorney’s solicitation, and for an attorney to employ a person to solicit. These sections are from nysenate.gov with no effective dates held, so this page gives none.
New York cases
We state what each decision held, in the words of our research. Later treatment of these decisions has not been searched, so do not read this list as a statement that each one remains good law. Lung, Kulcsar and Goldberg rested partly on the former Code of Professional Responsibility, for conduct that began before the Rules took effect.
| Case | Citation | Year | What it held |
|---|---|---|---|
| Matter of Lung | 112 A.D.3d 148; 973 N.Y.S.2d 564 | 2013 | Appellate Division, Second Department publicly censured a lawyer who referred a motor vehicle accident client to a personal injury firm, received a share of that firm’s fee, and paid the nonlawyer who had referred the client to him about 10% of his share. The Court found the payments were compensation for the referral and sustained both charges: compensating a nonlawyer for recommending a client, and sharing a legal fee with a nonlawyer. The conduct ran from 2005 to 2009, so the charges rested on former Code DR 2-103(b) and DR 3-102(a) together with Rules 7.3(b) and 5.4(a). The Rule 7.3 the Court cited was rewritten effective June 1, 2026, and that wording is no longer in force. |
| Matter of Kulcsar | 123 A.D.3d 251; 995 N.Y.S.2d 56 | 2014 | Appellate Division, First Department disbarred a lawyer as reciprocal discipline after the U.S. District Court for the Southern District of New York, applying New York law, found that he paid others for client referrals, including 156 deposits totaling $19,360 into the commissary accounts of at least 44 inmates, and offered to reduce a fee in exchange for referrals, in violation of Rule 7.2(a). The Court counted paying inmates (a vulnerable class of client) for referrals among the misconduct showing his unfitness, alongside conversion of client funds and urging a witness to testify falsely. The conduct ran from 2004 to 2010, so the findings rested on former Code DR 2-103(b) as well as Rule 7.2(a). |
| Wolfe & Yukelson, PLLC v Davis, Saperstein & Salomon, P.C. | 2017 NY Slip Op 05997; 153 AD3d 585 | 2017 | Appellate Division, Second Department affirmed a $208,257.94 judgment enforcing a written fee-sharing agreement between two law firms. In fee-sharing disputes between lawyers, courts will not inquire into the precise worth of each party’s services as long as the lawyer seeking a share contributed some work, labor or service toward earning the fee, and the plaintiff firm had. A firm bound by the same Rules that freely agreed to and benefited from the agreement cannot argue that it must be voided on ethical grounds, particularly where nothing indicates the client was deceived or misled. The finding that the defendant had itself violated Rule 1.5(g), and so could not void the agreement, was the trial court’s; the Appellate Division affirmed on another ground and did not itself find a violation. |
| Matter of Kaufman | 2017 NY Slip Op 07030; 154 AD3d 1049 | 2017 | Appellate Division, Third Department censured a New York-admitted lawyer practicing in Florida as reciprocal discipline after the Supreme Court of Florida publicly reprimanded him, on his consent, for failing to communicate with clients and improperly sharing legal fees with nonattorneys under Florida’s rules. The Court rejected his defense that the Florida conduct would not be misconduct in New York, citing Rules 1.4(b), 5.4(a) and 7.2(a) as examples. |
| Matter of Tarter | 2017 NY Slip Op 08498; 156 AD3d 157 | 2017 | Appellate Division, First Department disbarred a lawyer who took advance fees from distressed homeowners for mass joinder mortgage litigation, did no meaningful work, and split the fees with the nonattorney mortgage brokers who referred the clients to him, paying them through two sham entities. On his admissions the Court sustained charges including Rule 5.4(a) (sharing legal fees with a nonlawyer) and Rule 7.2(a) (compensating a nonlawyer to recommend or obtain employment by a client). |
| Matter of Colleluori | 2018 NY Slip Op 05588; 164 AD3d 88 | 2018 | Appellate Division, Second Department publicly censured a lawyer who paid $14,000 of a client’s $35,000 criminal retainer to another lawyer who was neither his partner nor his employee, without telling the client and without the client’s written consent. The Court sustained the charge that he divided a fee with a lawyer not associated with his firm without disclosing the division to the client and without the client’s written agreement, in violation of Rule 1.5(g). |
| Matter of Goldberg | 2018 NY Slip Op 06507; 166 AD3d 58 | 2018 | Appellate Division, First Department, on a joint motion for discipline by consent, publicly censured a lawyer for failing to disclose to two clients that he was sharing legal fees with another lawyer, former Assembly Speaker Sheldon Silver; the Court described the admitted misconduct as limited to violations of the fee-sharing rules. The charges cited both former Code DR 2-107(a)(1) and (2) and Rules 1.5(g)(1) and (2), with Rule 8.4(h); the decision does not say which conduct fell under the former Code and which under the Rules. |
| Ginarte, O’Dwyer, Gonzalez, Gallardo & Winograd, LLP v Law Offs. of Rex E. Zachofsky, PLLC | 2019 NY Slip Op 01728; 170 AD3d 494 | 2019 | Appellate Division, First Department held that a firm’s breach-of-contract claim on a fee-sharing arrangement for workers’ compensation cases it referred to another firm could not be resolved as a matter of law, given the referring firm’s affidavit that it took part in the cases through staff translations, arranging appointments and other tasks, and it affirmed the denial of the defendants’ motion for partial summary judgment. The Court paraphrased Rule 1.5(g)(1) with “and” between proportion to services and joint responsibility; the rule’s words say “or”. |
| Matter of Quigley (Hayes) | 2019 NY Slip Op 03433; 172 AD3d 1516 | 2019 | Appellate Division, Third Department reversed a Surrogate’s Court ruling that a 33.3% contingency fee for two Texas law firms in a wrongful death matter was void because the firms had not met Rule 1.5(g)’s prerequisites for dividing a fee with a lawyer not associated in the same firm. Assuming without deciding that there was a violation, the Court held it did not make the agreement unenforceable: the rule has no express voiding provision, the client signed an unambiguous retainer naming both firms and stating the fee so she was not deceived or misled, and the firms provided significant and effective services. It approved the fee. The finding of a Rule 1.5(g) violation was the Surrogate’s Court’s, not the Appellate Division’s. |
| Keneally, Lynch & Bak, LLP v Salvi | 2021 NY Slip Op 00425; 190 AD3d 961 | 2021 | Appellate Division, Second Department held that the price term of an agreement selling a law practice, with its goodwill, in exchange for a share of monthly revenues is not an illegal fee-splitting agreement in violation of Rule 1.5(g), because Rule 1.17, on the sale of a law practice, provides a specific exception to the rule against dividing a fee with a lawyer not associated in the same firm. It upheld the agreement’s covenant not to compete. |
| Matter of Sallaway | 2021 NY Slip Op 01686; 194 AD3d 42 | 2021 | Appellate Division, Fourth Department, on a joint motion for discipline by consent, suspended for two years a lawyer who took criminal matters through National Legal Professional Associates, an out-of-state entity, let it negotiate his legal fee, and received part of his fee from it. His admissions established violations including Rule 5.4(a) (sharing legal fees with a non-lawyer) and Rule 5.5(b) (aiding the unauthorized practice of law); the Court noted that a federal court had earlier found that entity engaged in the unauthorized practice of law. |
| Matter of William Mattar, P.C. v Hall | 2021 NY Slip Op 06477; 199 AD3d 1416 | 2021 | Appellate Division, Fourth Department held that a firm’s employment agreement dividing contingency fees on cases a departing lawyer took with him did not violate Rule 1.5(g), because Rule 1.5(h) provides that Rule 1.5(g) does not prohibit payment to a lawyer formerly associated in a firm under a separation or retirement agreement. The agreement was an employment or separation agreement, not a fee-splitting agreement under Rule 1.5(g), and the Court ordered the fees divided according to its terms. |
| Keneally, Lynch & Bak, LLP v Salvi | 2024 NY Slip Op 05336; 231 AD3d 1137 | 2024 | Appellate Division, Second Department held that its 2021 ruling in the same case, that the price term of an agreement selling a law practice for a share of monthly revenues is not an illegal fee-splitting agreement in violation of Rule 1.5(g), is law of the case, and it ordered the seller’s affirmative defenses, including illegal fee splitting, dismissed. |
| Khan v Garg | 2025 NY Slip Op 02038; 237 AD3d 475 | 2025 | Appellate Division, First Department declined to disqualify a lawyer in the legal department of a company 99% owned by a nonlawyer, who represented that owner. Rule 5.4 does not broadly bar representing clients outside the law firm’s corporate structure, and nothing showed that the lawyer or the company received any legal fees from the representation or practiced law for profit, as required to implicate Rule 5.4(a) and (d). |
New York ethics opinions
All are opinions of the New York State Bar Association Committee on Professional Ethics except Formal Opinion 2018-5, which is from the Committee on Professional Ethics of the Association of the Bar of the City of New York. As with the cases, later treatment of these opinions has not been searched. Fifteen of them carry no issue date in our research; their years come from the opinions’ own text. Opinions that applied Rule 7.3 as worded before its June 1, 2026 rewrite say so. NYSBA Opinions 1041 (2014), 1234 (2021) and 1246 (2022) and NYC Bar Formal Opinion 2018-5 discuss Rule 5.4(a) before paragraph (a)(4) took effect on November 10, 2025; their rows say so.
| Opinion | Year | What it said |
|---|---|---|
| NYSBA Opinion 897 | 2011 | A lawyer may market legal services on a “deal of the day” or “group coupon” website that keeps a percentage of the coupon receipts as its compensation. Because the website has no individual contact with buyers beyond collecting payment and does not refer a potential client to a particular lawyer, but carries the lawyer’s advertising message for a fee, the committee concluded that, assuming the amount retained is a reasonable payment for that form of advertising, there is no violation of Rule 7.2(a). It cautioned that different arrangements could mean the lawyer is paying for a referral in violation of Rule 7.2. |
| NYSBA Opinion 979 | 2013 | Lawyer-mediators who are not associated in a firm may place joint advertisements, keep a website and a single phone number listing each member by name, experience and biography, and share the group’s operating costs. Because prospective clients choose a member themselves and callers are not given a lawyer’s name, the committee concluded the members would be paying for joint advertising, not making payments for referrals prohibited by Rule 7.2(a). In a footnote it noted that paying the group’s costs as a percentage of fees earned on work brought in through the group could raise issues under Rule 1.5(g) and Rule 5.4(a), but it did not reach those issues. |
| NYSBA Opinion 1041 | 2014 | A New York lawyer who practices principally in the U.K. may practice there with an Alternative Business Structure that has nonlawyer owners or supervisors, provided that is permitted under that country’s laws and the predominant effect of the lawyer’s practice is not in New York. It reasoned that New York’s prohibitions on sharing legal fees with nonlawyers (Rule 5.4(a)) and on nonlawyer owners apply even to an entity located in another jurisdiction unless, under the choice-of-law rule in Rule 8.5(b), that jurisdiction’s rules govern the lawyer’s conduct. Under Rule 8.5(b)(2)(ii), a lawyer whose lawful activities abroad would be the practice of law in New York is treated as licensed to practice there, and the result turns on where the lawyer principally practices and where the conduct has its predominant effect, which are questions of fact. It was issued before Rule 5.4(a)(4) took effect. |
| NYSBA Opinion 1113 | 2017 | A lawyer may pay a flat fee to participate in a nonlawyer-owned online directory through which lawyers find and hire per diem lawyers. Rule 7.2(a) applies to such a lawyer-to-lawyer service, but the committee concluded a listing fee does not violate it where the service is a directory that does not recommend or select lawyers, rather than a referral service. It also concluded that Rule 1.5(g) does not apply where a hiring lawyer pays a per diem lawyer on an hourly or fixed-fee basis that reflects the fair value of the work and is similar to what the lawyer would pay an employee. |
| NYSBA Opinion 1116 | 2017 | A law firm may pay a nonlawyer foreign migration agent (FMA) that refers clients a fixed fee for document gathering, translation and client-liaison services; assuming the FMA’s fees are unrelated to the lawyer’s fees and the lawyer has not reduced its own fee to cover them, this is not sharing legal fees with a nonlawyer under Rule 5.4(a). The committee concluded that as long as hiring the FMA is not an express or implied condition of the referral and its compensation does not exceed the reasonable value of its services, the lawyer does not appear to be paying a prohibited referral fee, though choosing the FMA over a provider the lawyer believes is better may reflect compensation for the referral. It also required that the relationship be non-exclusive, that the client give informed consent to the lawyer’s conflict, and that the FMA’s role and compensation be disclosed to the client. |
| NYSBA Opinion 1121 | 2017 | In-house counsel who receives, as attorney of record, the attorney-fee portion of a no-fault arbitration award won by the employer corporation may sign it over to the corporation without violating Rule 5.4(a)’s prohibition on fee sharing, because under the Insurance Law the claimant, not the attorney, is entitled to the fee award. On whether this aids the unauthorized practice of law, the committee said that is a legal question beyond its jurisdiction, and it noted Judiciary Law § 495(2) and (5) for the inquirer to consider without deciding how they apply. |
| NYSBA Opinion 1128 | 2017 | A lawyer who completes a deceased lawyer’s unfinished matters may, under Rule 5.4(a)(2), pay the estate the portion of the total compensation that fairly represents the services the deceased lawyer rendered (or a quantum meruit amount at any time); where the deceased lawyer rendered no services, a payment to the estate would be an improper referral fee under Rule 7.2(a) and fee sharing with a nonlawyer in violation of Rule 5.4(a). Rule 1.5(g) does not apply to sharing with the estate, because it governs only division of fees among lawyers. If the matter is instead referred to a third lawyer, the two lawyers may divide the fee if they comply with Rule 1.5(g), including client agreement after disclosure of each lawyer’s share, confirmed in writing, and a division in proportion to services or with joint responsibility assumed in a writing given to the client; a division that complies with Rule 1.5(g) is not an improper referral fee under Rule 7.2(a). |
| NYSBA Opinion 1131 | 2017 | A lawyer may pay a for-profit lead-generation website a fixed monthly fee or a per-lead fee that does not vary with retention or the legal fee, without violating Rule 7.2(a), if the service selects the lawyer by transparent, mechanical methods not based on an analysis of the potential client’s problem or the lawyer’s qualifications, does not explicitly or implicitly recommend any lawyer, and its website complies with Rule 7.1. It saw no issue under Rules 1.5(g) and 5.4 where the lawyer pays a fixed sum unrelated to retention or to the legal fee, and overruled Opinion 902 to the extent it prohibited such a marketing fee. Applying Rule 7.3(b) as worded before the June 1, 2026 rewrite, it concluded that a lawyer’s phone call to a lead who specifically requested or consented to it is not a solicitation. |
| NYSBA Opinion 1132 | 2017 | A lawyer may not pay Avvo’s then-current marketing fee to participate in Avvo Legal Services, because Avvo’s advertising of its lawyer ratings, its statements that participating lawyers are highly qualified, and its satisfaction guarantee state or imply that Avvo recommends those lawyers, so the fee is an improper payment for a recommendation in violation of Rule 7.2(a). The committee noted that a marketing fee paid solely for advertising does not violate Rule 7.2(a), and it did not decide whether the fee was a reasonable payment for advertising or whether it amounted to sharing fees with a nonlawyer. |
| NYSBA Opinion 1159 | 2018 | After the death of a law firm’s sole owner and the firm’s dissolution, a former associate may share legal fees from the firm’s matters with the deceased lawyer’s estate only as Rule 5.4(a) permits or as a court orders, because the estate is not a lawyer. The Rule 5.4(a)(1) exception did not apply because the deceased lawyer made no agreement for payments to the estate. Rule 5.4(a)(2) allows payment of the portion of the fee that fairly represents services the deceased lawyer rendered before death, but not fees in matters undertaken after death. |
| NYSBA Opinion 1160 | 2019 | A New York lawyer may not affiliate and share fees with a lawyer who lives in New York but is admitted only in another state (and in New York federal courts) and whose role is to bring in clients, if the solicitation, fee sharing and other services would as a matter of law be the unauthorized practice of law. The committee reasoned that the Rule 1.5(g) exception requires the client’s consent confirmed in writing and a division either in proportion to services or with joint responsibility assumed in a writing to the client, that cultivating client relationships is not “services performed,” and that the arrangement would therefore violate Rule 7.2(a) unless the affiliation itself were permissible. It cautioned that the proposal may also be improper solicitation under former Rule 7.3(i), which applied Rule 7.3 to out-of-state lawyers soliciting New York residents; it applied Rule 7.3 as worded before the June 1, 2026 rewrite. |
| NYSBA Opinion 1162 | 2019 | A lawyer who forms an R&D tax credit business whose services are subject to the Rules may not pay referral fees to lawyers who refer clients to it, because Rule 7.2(a) prohibits paying for referrals and neither exception applies. The Rule 7.2(a)(1) exception reaches only Rule 5.8 relationships with professionals listed in Section 1205.3 of the Joint Appellate Division Rules, which do not include such a business; the Rule 7.2(a)(2) exception for referral fees to another lawyer requires compliance with Rule 1.5(g), which permits a division only in proportion to the services each lawyer performs or where each lawyer assumes joint responsibility in a writing given to the client, conditions the proposal did not contemplate. |
| NYSBA Opinion 1166 | 2019 | A New York lawyer admitted in several jurisdictions must determine which jurisdiction’s rules apply under the choice-of-law rule in Rule 8.5(b) activity by activity, since where the lawyer principally practices and where conduct has its predominant effect are fact-specific; the committee assumed New York’s Rules applied. Because the lawyer’s IP consulting firm provided services not distinct from legal services, the lawyer may not share legal fees from either firm with nonlawyer employees (a patent agent and a technologist) unless a Rule 5.4(a) exception applies; under Rule 5.4(a)(3) they may share in a profit-sharing plan based on the total profitability of the firm or a department, not on fees from a single case or referrals of particular matters. It also concluded the lawyer may share fees with a non-U.S. lawyer whose admission requirements are equivalent to New York’s and whose arrangement would not compromise the New York lawyer’s ethical obligations. |
| NYSBA Opinion 1172 | 2019 | A retiring lawyer who transferred clients’ original wills to a lawyer outside his firm may ask for and accept a referral fee from that lawyer’s later work for the testators or estates only if he assumes joint responsibility for those representations under the second clause of Rule 1.5(g)(1), since he will perform no services in them. The committee concluded he can assume joint responsibility only if he keeps his attorney registration active, because “retired” status or resignation would leave him unable to provide legal services, and Rule 5.4(a) generally prohibits sharing legal fees with a nonlawyer. It noted that Rule 1.5(g) applies to both the payor and the recipient of the fee. Opinion 1201 (2020) later modified this opinion on whether a lawyer retired under the Office of Court Administration’s rules may bear joint responsibility and on Rule 5.4(a). |
| NYSBA Opinion 1190 | 2020 | A lawyer may not practice law through a professional limited liability company that admits nonlawyer family members as minority members, because Rule 5.4(d) prohibits practicing in an entity in which a nonlawyer owns an interest. The committee declined to read Rule 5.4(a)(3), which permits including nonlawyer employees in a retirement plan based on a profit-sharing arrangement, to reach PLLC members who are not employees or to extend to other benefits, and it listed Rule 5.4(a)’s bar on sharing fees with a nonlawyer among the rule’s protections of a lawyer’s independence. |
| NYSBA Opinion 1201 | 2020 | A lawyer may pay a referral fee to a referring lawyer who later retired under the Office of Court Administration’s registration rules, if the referring lawyer assumed joint responsibility for the matter; merely forwarding a client is not a basis for sharing the fee. Rule 1.5(g) is disjunctive, so a fixed-formula division may rest on joint responsibility rather than proportion of services, and joint responsibility means financial and ethical responsibility akin to a supervising partner’s duty under Rule 5.1(a), which an OCA-retired lawyer may in some circumstances meet. Rule 5.4(a) does not apply because an OCA-retired lawyer is still a fully licensed lawyer; the opinion modified Opinion 1172 on both points. |
| NYSBA Opinion 1208 | 2020 | A lawyer with no financial interest in her paralegal’s real estate brokerage commission may accept the paralegal-broker’s closing referrals, subject to a Rule 1.7 conflict analysis. If clients ask the paralegal to recommend a lawyer and he names the inquirer, that does not violate Rule 7.3(b), but unprompted recommendations he initiates would; and if the lawyer assists, directs or induces him to solicit in a way that violates Rule 7.3(a)(1), she violates Rule 8.4(a). It applied Rule 7.3 as worded before the June 1, 2026 rewrite, under which 7.3(b) defined “solicitation”; former 7.3(a)(1) is no longer in force. |
| NYSBA Opinion 1218 | 2021 | A firm may pay a lawyer who left to take non-judicial public office the share of fees on matters he worked on that he would have received had he stayed, unless law governing the official prohibits it. Rule 1.5(g) does not govern that payment, because Rule 1.5(h) allows payment to a formerly associated lawyer under a separation agreement, which need not be in writing, and the Rules do not require the client’s consent to it. |
| NYSBA Opinion 1221 | 2021 | A lawyer who changed firms may contact former estate planning clients to tell them of her new firm and offer to review their estate plans. Communications to former clients that are germane to the earlier representation are not advertisements, and so are not solicitations subject to Rule 7.3, though they must not be misleading (Rule 8.4(c)); even if Rule 7.3 applied, Rule 7.3(a)(1) did not bar contact with a former client. It applied Rule 7.3 and its Comment [1] as worded before the June 1, 2026 rewrite; former 7.3(a)(1) is no longer in force. |
| NYSBA Opinion 1222 | 2021 | Lawyers may not co-own, with a nonlawyer mediator, a mediation business that employs lawyers to give legal services to mediation clients, because Rule 5.4(a) bars sharing those legal fees with the nonlawyer (and Rules 5.4(b) and (d) also forbid it). If mediation itself were the practice of law its fees would be legal fees shared in violation of Rule 5.4(a), but co-ownership of a business giving only nonlegal mediation services is permitted. It directed the inquirers to Judiciary Law § 495 without construing it. |
| NYSBA Opinion 1227 | 2021 | An email from a California firm to a list of specific individuals in New York, seeking clients for future false advertising and products liability class actions, is both an advertisement and a solicitation: it is targeted at the specific recipients on the list, regardless of the list’s size or that the firm knows nothing else about them. It took jurisdiction because former Rule 7.3(i) applied the Rule to lawyers not admitted in New York who solicit New York residents. It applied Rule 7.3 and its Comments as worded before the June 1, 2026 rewrite, including the former definition of solicitation in Rule 7.3(b) and paragraph (i), neither of which is in the current Rule. |
| NYSBA Opinion 1232 | 2021 | A lawyer who asks a fertility clinic to list him on its website as a lawyer for assisted reproduction matters is advertising but not soliciting, because the website posting is not directed to or targeted at a specific recipient or group of recipients. It cautioned that offering the clinic anything of value for the listing would be an improper payment of a referral fee under Rule 7.2(a). It applied Rule 7.3(b) and Comments [3] to [5] to Rule 7.3 as worded before the June 1, 2026 rewrite. |
| NYSBA Opinion 1234 | 2021 | A New York lawyer may not be a partner, associate or employee of a firm, in New York or elsewhere, with direct or indirect nonlawyer ownership, unless he principally practices in the other jurisdiction and the predominant effect of his conduct is not clearly in New York. Reading Rule 8.5(b)(2)(ii), it said that for a lawyer licensed in New York and another jurisdiction the New York Rules apply if he principally practices in New York and the predominant effect of his conduct is there, or if the particular conduct clearly has its predominant effect in New York; because the proposed sale or merger would keep a New York office staffed by New York lawyers, the New York Rules applied and the firm would violate Rule 5.4. It applied Rule 5.4 as worded before paragraph (a)(4), on dividing fees with firms that have nonlawyer owners, was added effective November 10, 2025. |
| NYSBA Opinion 1237 | 2022 | A lawyer may not accept real estate closing referrals from an agent associated with a brokerage the lawyer owns where the agent and the brokerage split the commission, which is a per se non-waivable conflict. Waiving the brokerage’s share of the commission for clients who hire the lawyer would not cure it: letting the agent offer those clients a lower commission without reducing the agent’s own share is something of value given in exchange for referrals, in violation of Rule 7.2(a). |
| NYSBA Opinion 1244 | 2022 | A retired lawyer may receive a referral fee only if the retiree keeps joint responsibility for the referred matter: retirement does not end that responsibility if the lawyer wants to share the fee, and successor counsel’s own engagement letter with the client does not displace it. It read Rule 1.5(g) to require the client’s written consent disclosing both the referring lawyer’s joint responsibility and share of the fee, and reaffirmed Opinion 1201 that Rule 5.4(a) does not apply because a lawyer retired with the Office of Court Administration is still a lawyer. |
| NYSBA Opinion 1246 | 2022 | The committee saw no basis for a Rule 5.4 violation by New York lawyers in a New York firm solely because the firm’s majority partner, an English solicitor, is also a partner in a U.K. Alternative Business Structure with nonlawyer owners, where that U.K. firm has no ownership in or control over the New York firm. On how the two firms might otherwise be affiliated it declined to opine without more facts, but repeated advice from an earlier opinion, given under the predecessor Code provisions, to consider Judiciary Law § 479, the bar on paying for recommendations now in Rule 7.2(a), and dividing fees only as Rule 1.5(g) permits; it did not decide those questions. It applied Rule 5.4 as worded before paragraph (a)(4), on dividing fees with firms that have nonlawyer owners, was added effective November 10, 2025. |
| NYSBA Opinion 1259 | 2023 | A lawyer may enter a non-exclusive arrangement with an independent paralegal who refers clients and prepares forms, but must not share legal fees with the paralegal (Rule 5.4(a)) and must not pay the paralegal a fee for referrals (Rule 7.2(a)). The paralegal may be paid for the value of paralegal services on an hourly or per-document basis, and the lawyer must not induce the paralegal to solicit in person on the lawyer’s behalf. |
| NYSBA Opinion 1262 | 2023 | A lawyer may pay for an advertisement on a not-for-profit organization’s website and may be listed as a sponsor in exchange for a donation, but may not donate in exchange for being listed on a page discussing legal options for victims of toxic chemicals. A sponsor list alone is not a recommendation, but singling out contributing lawyers on such a resource page is an implied recommendation, and paying for it violates Rule 7.2(a). |
| NYSBA Opinion 1267 | 2024 | Lawyers who pay a business to be matched with potential clients through a website saying it vets its lawyers and offers ones with excellent qualifications are paying for a recommendation in violation of Rule 7.2(a), and a lawyer who operates the website violates Rule 8.4(a) by inducing that misconduct. No exception applied: the Rule 5.8 exception does not cover monetary rewards, the Rule 1.5(g) exception covers only a lawyer dividing a fee for legal services, and the business was not a qualified legal assistance organization. It did not address whether the business implicates Judiciary Law § 495(1)(d). |
| NYSBA Opinion 1271 | 2024 | A lawyer who pays an online bidding service owned by nonlawyers a percentage of the legal fee (there, 7.5% of the total fee) shares legal fees with nonlawyers in violation of Rule 5.4(a), even though the service collects its share from the client before remitting the rest to the lawyer. Because the service claims to vet participating lawyers and to have assessed their skills, it recommends them, so paying it to participate is an impermissible referral fee under Rule 7.2(a); the committee noted that verifying only licensure and good standing would not have made the payment one for a recommendation. |
| NYSBA Opinion 1279 | 2025 | A lawyer may not promise nonlawyers who refer clients a flat fee for “administrative” work, such as completing and filing arbitration request forms, on each referred matter; the committee concluded that the opportunity for paid work is a thing of value given as compensation or reward for the referral and violates Rule 7.2(a). It stated that the only exceptions to Rule 7.2(a) appear in Rules 1.5(g) and 5.8, which did not apply. |
| NYSBA Opinion 1284 | 2025 | Lawyers admitted in New York and a foreign country who are partners with a lawyer admitted only in that country may pay that lawyer a referral fee for New York cases without violating the Rules, if they first determine that a New York lawyer may ethically partner with a lawyer from that country. The committee reasoned that because the lawyers are associated in the same firm, Rule 1.5(g) permits them to divide a fee without meeting the conditions it sets for lawyers in different firms, and that Rule 7.2 does not apply to intra-firm compensation arrangements such as origination credit. This page rests no statement about payments between separate firms on it. |
| NYSBA Opinion 1286 | 2025 | A lawyer may ask former clients to write Google reviews and may offer a nominal gift, provided the lawyer does not draft the review or condition the gift on its content. The committee concluded such requests to former clients are neither advertising nor solicitation, pointing to former Rule 7.3(a)(1), which excepted former clients from the ban on in-person and telephone solicitation; it applied Rule 7.3 as worded before the June 1, 2026 rewrite. It cautioned that the lawyer may not use a former client’s confidential information to the former client’s disadvantage. |
| NYSBA Opinion 1288 | 2025 | An irrevocable testamentary trust may not take over a deceased attorney’s ownership interest in a law firm organized as a professional corporation, even with an attorney trustee and for the benefit of an attorney employee, because the trust is a nonlawyer not authorized to practice law. As an owner the trust would receive a portion of the firm’s legal fees, which the committee concluded would violate Rule 5.4(a), and the arrangement would also violate Rule 5.4(b) and (d). |
| NYSBA Opinion 1289 | 2025 | If an attorney-owned entity that submits tax filings operated as a law firm, paying a nonlawyer technology developer a percentage of its revenue would violate Rule 5.4(a), and paying referral fees to other attorneys would violate Rule 7.2(a); but if the attorneys prevent customers from reasonably believing the services are subject to a client-lawyer relationship, including by giving the written disclaimer described in Rule 5.7(a)(4), neither rule applies to the entity. The committee also concluded that Rule 7.2(a) applies to lawyers who accept referrals, not to lawyers who make them, so it does not bar lawyers from accepting referral fees from nonlawyer entities, though Rule 1.7 may, and the entity’s owners may not pay a referral fee they know the referring lawyer is forbidden to accept. |
| NYSBA Opinion 1291 | 2026 | A New York lawyer may hold a financial interest in an Alternative Business Structure lawfully practicing in another jurisdiction (Arizona) and may receive lead-counsel and referral fees from it, but under Rule 5.4(a)(4), effective November 10, 2025, which governs dividing a fee with a firm that has nonlawyer owners, the division must comply with Rule 1.5(g); the committee concluded Rules 5.4(a)(4) and 1.5(g) apply both to the lawyer paying and to the lawyer receiving the share. Because the inquirer was licensed only in New York and the work would be performed in New York, Rule 8.5(b)(2)(i) made the New York Rules apply. For a lawyer admitted in New York and elsewhere who would manage the ABS, Rule 8.5(b)(2)(ii) applies the rules of the jurisdiction where the lawyer principally practices unless particular conduct clearly has its predominant effect in another admitting jurisdiction; if that is New York, Rule 5.4(b) and (d) would make the participation unethical. |
| NYSBA Opinion 1294 | 2026 | Where a platform shares anonymized information about users’ workplace experiences with employment lawyers, who pay to receive a consenting user’s contact details, the lawyer’s resulting communication is neither a solicitation, because it is initiated by the user’s request, nor an advertisement. The lawyer’s payment is a permissible payment to a lead generator, not a prohibited payment to obtain employment under Rule 7.2(a), as long as the platform does not recommend the lawyer, selects lawyers by neutral criteria clearly explained to users, and charges a fee that does not depend on retention or on the resulting fee. It applied Rule 7.3 as worded before the June 1, 2026 rewrite, including the former definition of solicitation in Rule 7.3(b), and said it could not determine whether such a private response would violate Judiciary Law § 479, a question of law beyond its jurisdiction. |
| NYSBA Opinion 1295 | 2026 | A lawyer admitted in New Jersey and the District of Columbia but not New York, who works for a New York firm and plans his own New Jersey firm, is subject to the New York Rules for advertising that firm in New York; the committee cited Rule 8.5(b)(2)(ii) and former Rule 7.3(i), which applied New York’s solicitation rules to lawyers not admitted in New York who solicit New York residents. If his advertising would be a solicitation, he must comply with Rule 7.3, including the former Rule 7.3(c)(1) requirement to file a copy of certain solicitations. It applied Rule 7.3 as worded before the June 1, 2026 rewrite; today’s Rule 7.3(c)(1) is a different rule. |
| NYC Bar Formal Opinion 2018-5 | Not dated in its text | Rule 5.4(a) bars a lawyer from a financing agreement with a nonlawyer litigation funder under which the lawyer’s payments are contingent on receiving legal fees, or on the amount of legal fees, in one or more specific matters, whether through a non-recourse loan secured by the fees or through payments that vary with the fees. A traditional recourse loan at a fixed rate, even one secured by accounts receivable, is not fee sharing, and client-funder arrangements to which the lawyer is not a party do not implicate Rule 5.4. It applied Rule 5.4(a) as worded before paragraph (a)(4) was added effective November 10, 2025. |
What our research did not find
- Rule 7.3 was rewritten effective June 1, 2026. Twenty former sub-parts with no counterpart in the current Rule (7.3(a)(1), (a)(2) and (a)(2)(i)–(v); (c)(1)(i)–(iii); (c)(3), (c)(4), (c)(5) and (c)(5)(i)–(iii); and (f), (g), (h) and (i)) are held in our research with an end date of June 1, 2026. Their words are the last in force before the rewrite; they are not in force, and this page states them only as former law. Opinions 1160, 1227 and 1295 applied former Rule 7.3(i) (out-of-state lawyers soliciting New York residents); Opinions 1208, 1221, 1286 and 1294 applied former Rule 7.3(a)(1).
- Several Rule 7.3 numbers now name different rules. Before June 1, 2026, Rule 7.3(b) defined “solicitation” and Rule 7.3(c)(1) required filing a copy of a solicitation. Today Rule 7.3(b) bars soliciting professional employment by live person-to-person contact when a significant motive is the lawyer’s or law firm’s pecuniary gain, unless the contact is with a lawyer, a person who has a family, close personal, or prior business or professional relationship with the lawyer or law firm, or a person who routinely uses for business purposes the type of legal services offered by the lawyer; and Rule 7.3(c)(1) bars soliciting a person who has made known to the lawyer a desire not to be solicited by the lawyer. Matter of Lung (2013) and Opinions 1131, 1208, 1227, 1232 and 1294 applied the earlier Rule 7.3(b), and Opinions 1294 and 1295 the earlier Rule 7.3(c)(1); those earlier words are held in our research as earlier versions but are not carried in the research this page is drawn from. Opinions 1221, 1227 and 1232 applied the pre-2026 Comments [1]–[5] to Rule 7.3, which are not held; today’s Comments carry those numbers. This page does not present any of these authorities as construing today’s Rule 7.3(b), Rule 7.3(c)(1) or Comments. Lung cited Rule 7.3(b) for compensating a nonlawyer for a recommendation, which neither held version of Rule 7.3(b) addresses.
- Matter of Lung (2013), Matter of Kulcsar (2014) and Matter of Goldberg (2018) rested on former Code provisions (DR 2-103(b), DR 2-107(a)) together with the Rules, for conduct that began before the Rules took effect; their holdings above say so.
- Rule 5.4(a)(4) (dividing a fee with a lawyer or law firm that has nonlawyer owners or nonlawyer supervisors) took effect November 10, 2025. Opinions 1041 (2014), 1234 (2021) and 1246 (2022) and NYC Bar Formal Opinion 2018-5 predate it, and Opinion 2018-5 and Opinion 1288 (December 2025) describe Rule 5.4(a) as having three exceptions. This page does not adopt that description: Rule 5.4(a)(4) is in force.
- The words of Rule 1.5(g), the Rule 5.4(a) lead-in and (a)(1)–(3), Rule 7.2(a) and Rule 8.5(b) are copied from the court system’s legacy compilation (dated January 1, 2017, fetched October 3, 2026) and are held with no effective dates, so this page gives none for them. Only Rule 5.4(a)(4) and Rule 7.3 are held from the compilation amended through July 1, 2026.
- Judiciary Law §§ 479, 481, 482, 491 and 495 are taken from nysenate.gov (fetched October 3, 2026) with no effective dates held, so this page gives none. Sections 491 and 495 are held as their subsections’ words; § 495(3), (4) and (6) are not held. Our search of New York statutes (nysenate.gov Consolidated Laws, Judiciary Law article 15, and the open web, October 3, 2026) found no New York statute governing the division of fees between lawyers, no lawyer-referral-service statute, and none on choice of law for lawyer discipline; § 491(1) expressly does not apply to an agreement between attorneys to divide compensation.
- Fifteen opinions are held with no issue date: NYSBA Opinions 1201 (dated in its text September 2, 2020), 1208 (November 16, 2020), 1218 (February 24, 2021), 1221 (April 7, 2021), 1222 (April 21, 2021), 1227 (August 26, 2021), 1232 (November 10, 2021), 1234 (December 10, 2021), 1237 (March 3, 2022), 1244 (October 11, 2022), 1246 (December 8, 2022), 1259 (June 8, 2023), 1262 (December 19, 2023) and 1267 (June 18, 2024), and NYC Bar Formal Opinion 2018-5, whose text gives no date. The years given for them come from the opinions’ own text, not our database; this page gives no year for Opinion 2018-5.
- For Wolfe & Yukelson (2017) and Matter of Quigley (2019), the Rule 1.5(g) violations were lower-court findings: the Appellate Division did not itself find a violation (Wolfe & Yukelson affirmed on another ground; Quigley assumed a violation without deciding it and reversed). Ginarte, O’Dwyer (2019) paraphrased Rule 1.5(g)(1) with “and” between proportion and joint responsibility; the rule says “or”, and this page does not repeat the paraphrase as the rule. Opinion 1284 (2025) treats the three lawyers as one firm although its facts place the paying lawyer’s PLLC apart from the foreign partnership; this page rests no statement about payments between separate firms on it. Opinions 979, 1121 and 1246 only mention the rules or statutes they are linked to (Rules 1.5(g) and 5.4(a); Judiciary Law § 495(2) and (5); § 479) without deciding them.
- The stored texts of Opinions 1222, 1234, 1237, 1244, 1246, 1271, 1279, 1294 and 1295 drop characters or words in places (for example “Rule 2(a)” for 7.2(a)); their holdings here rest on the intact digest, analysis and conclusion.
- No New York court decision construing Rule 8.5(b) is held (CourtListener and the nycourts.gov reporter, searched October 3, 2026). This page does not say no New York court has applied it.
- Later treatment of every New York authority on this page has not been searched. This page states what each authority held, not that it remains good law.
Frequently asked questions
Can I share a referral fee with a lawyer in New York?
Yes, under Rule 1.5(g) of the New York Rules of Professional Conduct, if three conditions are met. A lawyer may divide a fee for legal services with another lawyer who is not associated in the same law firm only if the division is in proportion to the services performed by each lawyer or, by a writing given to the client, each lawyer assumes joint responsibility for the representation; the client agrees to employment of the other lawyer after a full disclosure that a division of fees will be made, including the share each lawyer will receive, and the client’s agreement is confirmed in writing; and the total fee is not excessive. Rule 7.2(a)(2) lets a lawyer pay referral fees to another lawyer as permitted by Rule 1.5(g).
Is there a cap on referral fees in New York?
Rule 1.5(g) states no percentage limit on either lawyer’s share. It requires that the total fee not be excessive, and that the division be in proportion to the services performed by each lawyer or that, by a writing given to the client, each lawyer assume joint responsibility for the representation.
Does the client have to agree to a fee division in writing in New York?
Yes. Rule 1.5(g)(2) requires, for every division with a lawyer not associated in the same law firm, that the client agree to employment of the other lawyer after a full disclosure that a division of fees will be made, including the share each lawyer will receive, and that the client’s agreement be confirmed in writing. Where the division rests on joint responsibility rather than proportion to services, each lawyer’s assumption of joint responsibility must be made by a writing given to the client (Rule 1.5(g)(1)).
Can a New York lawyer divide a fee with a lawyer from another state?
Rule 1.5(g) governs a division of a fee for legal services with another lawyer who is not associated in the same law firm. Which jurisdiction’s rules apply when New York exercises its disciplinary authority is set by Rule 8.5(b): for conduct in connection with a proceeding in a court where the lawyer is admitted, the rules of the jurisdiction where the court sits, unless the court’s rules provide otherwise; for other conduct, New York’s rules for a lawyer licensed only in New York, and for a lawyer licensed in New York and another jurisdiction, the rules of the admitting jurisdiction where the lawyer principally practices, unless particular conduct clearly has its predominant effect in another jurisdiction where the lawyer is licensed, whose rules then apply. NYSBA Ethics Opinion 1291 (2026) concluded that a lawyer licensed only in New York who would receive lead-counsel and referral fees from an Alternative Business Structure lawfully practicing in Arizona, for work performed in New York, is governed by the New York Rules (Rule 8.5(b)(2)(i)), and that under Rule 5.4(a)(4), which governs dividing a fee with a lawyer or law firm that has nonlawyer owners, the division must comply with Rule 1.5(g); Rules 5.4(a)(4) and 1.5(g) apply both to the lawyer paying and to the lawyer receiving the share. Rule 5.4(a)(4) also requires that nonlawyer ownership of law firms be permitted in the jurisdiction whose rules govern the other lawyer’s conduct, and that the lawyer who divides the fee not permit any nonlawyer to interfere with the lawyer’s independent professional judgment or with the client-lawyer relationship. We hold no New York court decision construing Rule 8.5(b).
Sources
- New York Rules of Professional Conduct, 22 NYCRR Part 1200 (Rules 1.5(g), 5.4(a)(1)–(3), 7.2(a), 8.5(b), and the former Rule 7.3), court system compilation dated January 1, 2017, fetched October 3, 2026: nycourts.gov
- New York Rules of Professional Conduct as amended through July 1, 2026 (Rule 5.4(a)(4), Rule 7.3), New York State Bar Association, fetched October 3, 2026: nysba.org
- N.Y. Judiciary Law §§ 479, 481, 482, 491 and 495, fetched October 3, 2026: § 479, § 481, § 482, § 491, § 495
- Cases and ethics opinions: linked in the tables above.
More states: Referral fee rules by state.
Disclaimer
This page summarizes a state’s rules on dividing fees between lawyers, from the primary sources it cites, as of the dates shown. It is general information for lawyers, not legal advice, and reading it does not create an attorney-client relationship with Rose Law Firm, PLLC dba LegalFlare. Rules and the way courts and bar authorities read them change. Read the cited sources, and check with the state bar or your own counsel, before relying on anything here.