Ethics Opinion 104
Opinion #104 – 06/10/1969 (10-68)
Topic: Fees, Lay forwarder
existing clients, legal fees, non-legal fees, intermediary
Digest: Receiving a fee from a fire adjuster
Canons: Former Canons 28, 34, 35
An attorney has asked whether it is proper for him to receive a fee from a fire adjuster who has requested that he assist in the legal aspects of a claim against an insurance company for a fire loss. We understand that the adjuster’s fee will be paid out of the recovery and may be on a contingent basis.
Canon 35 provides that “A lawyer’s relation to his client should be personal, and the responsibility should be direct to the client.” His services should not be directed or controlled by an intermediary. Canon 34 forbids a lawyer to share fees with persons other than lawyers. Canon 28 prohibits the use of intermediaries to direct legal business to the lawyer.It would be improper for a lawyer to be retained by a fire adjuster and to share the adjuster’s fee, irrespective of whether fixed or contingent. However, where the adjuster on his own initiative suggests to the claimant that the lawyer be retained, it would be proper for the lawyer in direct dealings with the claimant as his client to agree that his fee will be paid out of the recovery and be based upon the amount of the recovery, even though such agreement will have the effect of reducing the fee of the adjuster.