Court Opinion

ID: 9606425
Source: CourtListenerOpinion
Date Created: 2023-08-22 02:49:39.51846+00
Date Added: 2024-06-11T18:02:34.512787
License: Public Domain

NEELY, Justice
concurring:
It is now time for the courts to reevaluate the “services performed and responsibility assumed” section of DR2-107 (A)(2). This rule was originally designed to prohibit lawyers’ “specializing” in ambulance chasing. Without a formal rule, marginally qualified lawyers would make careers of being law-trained runners; their only function would be to visit hospitals, union halls, and funeral parlors to “inform” potential plaintiffs of their rights and encourage them to file suits.1
However, Mr. Pietranton’s conduct was well outside anything that the rule could reasonably have been intended to proscribe. For many years Mr. Pietranton was a well regarded, general practice lawyer who was available to. all who needed legal help. Like most of our general practitioners, Mr. Pietranton was not a lightning fast calculator of his clients’ abilities to pay and he helped those who couldn’t pay fair market value for his services. He worked in the community; he took court-appointed criminal cases; and he was active in community affairs. The result was that Mr. Pietranton was trusted, which was why Mrs. Sayre came to him. Trust is the cynosure of the lawyer/client relationship, and although it is intangible, it is an expensive commodity to produce.
In the world of family lawyers, the lawyer makes money when big money changes hands. Most of the routine legal matters that a family lawyer performs for clients don’t generate large enough fees to pay the overhead directly associated with those matters. For’most ordinary people, legal fees are unbudgeted expenses that are highly resented. This is particularly true when a lawyer must be retained to secure a right or benefit to which the client believes he is entitled anyway. Contested divorces, child custody cases, and non-support matters are prominent examples of this phenomenon.
The general availability of legal services in the community is subsidized by big personal injury suits, real estate closings when *804bank loans pay the fees, and the settlement of estates. Thus if these subsidies supporting provision of routine legal services to individuals dry up, the whole community suffers: suddenly the world of law offices begins to look like the world of McDonalds where if you want fries, you pay for fries. That’s not how I practiced law and that’s not how I want law to be practiced.
Indeed, Mr. Pietranton did “perform services” and “assume responsibility,” but he did those things for decades before Mrs. Sayre walked into his office. Furthermore, Mr. Pietranton had attended seminars and bar meetings, and he regularly read professional literature that allowed him to understand Mrs. Sayre’s problem. Because of his expensive training, Mr. Pietranton also understood that he needed help with Mrs. Sayre’s case, and he knew where to get the best help available. No one in this proceeding has asked how many women like Mrs. Sayre Mr. Pietranton listened to over the years who did not have cases and whom he advised free of charge. Contingent fee lawyers don’t get paid for listening to clients who don’t have cases; they get paid for winning lawsuits.
Furthermore, the clients themselves are ill served when general practice lawyers are required under DR 2-107(A)(2) to participate in cases for which they are untrained. The world is full of well capitalized law factories that specialize in certain types of cases: for air crash cases, you go to one law firm; for product liability cases you go to another, and for medical malpractice you go to yet another. The general practice lawyer devotes both time and attention to evaluating the abilities and qualifications of these specialists so that he can refer clients to exactly the right lawyer. That costs money and takes work; it is an office overhead expense.
When a family lawyer who does not understand air crash cases is required to participate in an air crash case’s trial to share the fee, he is freight and not power for the specialist. Furthermore, too narrow a reading of DR2-107(A)(2) can lead to one of two possible results, both of which are bad: First, a lawyer who needs the fee may try to do a case for which he is either unqualified or undercapitalized himself and, as a result, may badly bungle the client’s case. Second, an unqualified lawyer may insist on “helping” a specialist, and either cause the specialist unnecessary work, or cause the specialist himself to bungle the case. Who wants a novice helping in the trial of a multi-million dollar case?
Finally the client does not pay for services not received.2 The specialist law firms do not need to waste overhead and manpower picking through and sorting out cases and clients. The general practice lawyers understand the difference between a pearl and a stone, which means that the specialists can devote their undivided attention to the energetic litigation of pearl-like cases. Why shouldn’t the general practice lawyer be given credit for all the stones he has politely and carefully sorted? Much of the work of these family lawyers amounts, as in this casé, to assessing litigability. Custom and usage is that the big, special*805ized, well-capitalized firms charge contingent fees amounting to one third of whatever the client recovers — exactly what the most notoriously, incompetent hack would charge. Of this fee, the specialist regularly gives one third to the family lawyer who has forwarded the case. The client loses nothing!
Thus, although I concur in the majority’s holding, I also believe that under any intelligent reading of DR2-107(A)(2) Mr. Piet-ranton did a lot of work for his fee. There is no evidence that the client paid a higher fee because of the fee-splitting arrangement, which means that under established custom and usage a Pareto optimum is achieved: everyone is made better off without anyone’s being made worse off. And this is the system that we should not only condone, but encourage.

. The public policy behind DR-2-107 (A)(2) is that the payment of a referral fee could unfairly increase the client’s bill by allowing attorneys to collect payment for little or no work. See Weil v. Neary, 278 U.S. 160, 49 S.Ct. 144, 73 L.Ed. 243 (1928); Palmer v. Breyfogle, 217 Kan. 128, 535 P.2d 955 (1975); McFarland v. George, 316 S.W.2d 662 (Mo.Ct.App.1958); Greenwald v. Zyvith, 23 A.D.2d 201, 259 N.Y.S.2d 387 (Sup.Ct.1965).

. In the June, 1978, Report of the Roscoe Pound-American Trial Lawyers’ Foundation, the recommendation was set forth that DR2-107(A)(2) be eliminated. The effect of such a move would be to legalize referral fees. The Foundation asserted that there is little or no evidence that a client will pay a higher fee for legal services rendered under a fee-splitting arrangement. Most arrangements occur in the areas of contingent fee/personal injury litigation where the contingent fee would be the same regardless of fee-splitting. Roscoe Pound-Am. Trial Lawyer Found., Ann. Chief Justice Earl Warren Conf., Ethics and Advocacy, Final Report, note 6 at 18 (June 23, 24, 1978).
DR-2-107 as it now stands does very little good. It is frequently violated and the violators are rarely censured. The effect has been to encourage those attorneys who desire referral fees to forward cases to attorneys who are known to pay referral fees rather than to attorneys who are known to be competent in the specific area. As a result, although legalizing referral fees may increase their use, the overall effect will be to help the client by encouraging the referring attorney to forward the case to the lawyer most likely to get the largest recovery. Legalizing referral fees would actually benefit the client by giving lawyers the incentive to refer their contingent fee clients to the most competent lawyers. See also Carter, Lewis. "Attorneys: The Referral Fee: A Split in Opinion.” 33 Oklahoma Law Review 628, 631 (1980).