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May 22, 2024 1:00 pm EST
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June 12, 2024 1:00 pm EST
1.0 Ethics Credit

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Four “Ds” of Client Relations: Dabbling, Documentation, Difficult Clients, Don’t Do it!

Client Referrals

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Executive Summary

You might think referring a client to another lawyer is as simple as making a phone call. That would be a mistake. When you send a client elsewhere, it’s important to protect yourself by: (a) defining the referral, (b) informing the client, and (c) documenting the event. You should also flag any special issues or potential problems.

Referrals Are Good for Business

Lawyers refer cases all the time. Sometimes it’s because the firm lacks the time, expertise or resources to handle a matter. Perhaps a specialist is needed.

Some referrals contemplate a sharing of fees. This may be a percentage of the recovery in a contingent matter. Make sure your arrangement complies with the ethics rules. Also make sure the client knows about the fee split.

Some firms solicit specific types of cases – often online – with the specific intent of referring them out to other firms. These firms usually have appropriate procedures and disclaimers in place, because they do this all the time.

By contrast, most malpractice claims stem from the occasional referral with an agreement to split fees. Such arrangements can be confusing to clients. They might think both lawyers are actively engaged in their case.

Alta Pro Practice Pointers

  1. Know your state and local ethics rules on referrals. Call your State Bar if you’re unclear.
  2. Vet the lawyer you’re recommending. You want to send the prospective client to the right place. Referring a case constitutes legal advice and establishes an attorney-client relationship, albeit a limited one. You risk liability for a negligent referral. You can mitigate that risk by working only with attorneys you know have insurance.  You have made the responsible decision to be insured. You want to refer your prospective clients to someone equally responsible. Do not expose your limits or your deductible by sending clients to uninsured attorneys.
  3. Confirm the referral with the client in writing. Use clear, precise and unambiguous language to let the client know exactly what’s happening, why it’s happening and what impact it will have on their case. Explain that the referral is for their benefit, and that there will be no extra cost to them.
  4. If you won’t have further involvement, say so. In your referral letter, tell the client that you are no longer in the case. Then step out of the picture. You’re either in or out. Problems occur when lawyers maintain a halfway presence in the case.
  5. If you will have further involvement, say so. Joint representation means shared responsibility for the outcome – and shared liability for mishaps. Define each lawyer’s role in writing. Do your part. Participate in managing the case as agreed upon. Maintain a relationship with the client. Ask to be copied on all correspondence. Attend hearings and major events. Earn your fee.
  6. Don’t be a passive observer. If you have concerns about how the case is being handled, don’t watch from the sidelines. Help resolve problems. Counsel the client as appropriate. Don’t infringe on the referred firm’s turf, but do what is necessary to protect the client’s interests.

The Bottom Line: Don’t hesitate to refer a case to a firm with the capability and skills your clients need—even if you don’t get a fee. Put the client’s interests first.

What’s Next?


Got a question about client referrals? Ask the Risk Pro


Looking for pointers on firm dissolutions? Click here!

Heads up!
This information is intended for informative purposes for members of Alta Pro Lawyers Risk Purchasing Group. It is not intended as legal advice. Lawyers should always refer to local and state rules and statutes for applicable standards and rules. These guidelines are designed to help lawyers avoid professional liability claims and are not intended for any other purpose. No legal or fiduciary relationship is intended to be created by receipt of this material.

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In an age of consolidation where increasingly impersonal transactions have made customer service an oxymoron, we bring together independent agents, insurance companies, and other industry specific service providers to develop and deliver insurance products and risk management solutions that benefit our insurance customers.

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