Referral agreements aren’t just some ethics formality. They’re not red tape. They’re not a box to check. And they’re definitely not just “compliance bullshit.”
I hated ethics class more than any other course in law school. Felt like a bunch of blowhards trying to lecture me on morality.
But here’s what I eventually figured out – the rules aren’t there to tell you how to be a good person. They’re there to help you build a record. A system. An infrastructure that protects you when shit goes sideways.
And it will go sideways. Maybe a client gets pissed. Maybe a lawyer leaves the firm. Maybe someone forgets who was supposed to do what – or what the original split even was.
You’ve seen this happen. We all have. Someone “refers a case” and months later everyone’s got a different version of the agreement – and no documentation to back it up.
So let’s get clear:
Referral agreements aren’t for when things go right. They’re for when everything goes wrong.
What Should Be in a Real Referral Agreement?
First: know your jurisdiction. Every state has its own Rules of Professional Conduct. Some follow the ABA’s version of 1.5(e), some don’t.
But in almost every case, you’re going to need:
- A written agreement
- Fee split percentages
- Informed client consent – signed, not implied
But even that’s not enough.
A solid referral agreement should also spell out the intent behind the deal:
- Is this a pure referral, or will both firms be working the file?
- Who’s responsible for managing timelines, filings, status updates?
Don’t just say “we’re associating.” Say what that actually means – especially if one of you gets hit by a bus, or a partner bails, or the client goes full-on meltdown mode and starts emailing the bar.
Why It Matters
You wouldn’t fire an employee right after their FMLA leave without documenting every performance issue first, right?
Because you know what happens if you don’t:
“Do you have a record of that?”
“Did you tell them why?”
“Was it in writing?”
Same rules apply here. You can’t prove intent, boundaries, or roles without documentation.
And if someone challenges the fee, or the bar wants to see what was agreed to, your defense shouldn’t be a PDF you found six months later with a blank signature line.
It should be: “Here’s exactly what we agreed to – in writing – with the client’s full consent.”
That’s not ethics for the sake of it. That’s not morality. That’s smart business.