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February 15, 2014
Bar panel completes rewrite of rules governing for-profit referral services

After months of study, a Bar committee presented a rewrite of rules governing for- profit lawyer referral services to the Board of Governors.

The board received the rewrite at its January meeting and is scheduled to vote at its March 28 meeting.

Carl Schwait The Board Review Committee on Professional Ethics spent more than a year studying the findings and recommendations of the Special Committee on Lawyer Referral Services. Its main change from the special committee’s recommendations was to drop the prohibition on a lawyer referring a client obtained from a referral agency to another service provided by that entity — such as medical care — from the same incident that generated the referral.

Instead, such referrals would be allowed, but only under strict conditions, including getting signed informed consent from the client.

“We are not here to punish people who use lawyer referral services. Those are our brothers and sisters who practice law who find this is the way they wish to practice law ethically, professionally, and the way they bring in cases,” said Board Review Committee on Professional Ethics Chair Carl Schwait. “We also understand we don’t regulate lawyer referral services. We only regulate lawyers who are part of for-profit lawyer referral services.”

He said the committee tried to walk a fine line between two sometimes competing goals.

“One, the Florida Supreme Court tells us we must protect the public, while the federal courts tell us we must protect free speech and private enterprise,” Schwait said.

He noted the amendments for Rule 4-7.22 will be advertised in the Bar News ahead of the board’s consideration in March.

The special committee had recommended that lawyers be prohibited from sending a client to, say, a medical clinic operated by the referral service for the incident that created the referral to the lawyer due to conflicts of interest concerns. The revised recommendations provide:

* The attorney cannot accept a referral from an entity that directly or indirectly requires the lawyer to refer the client to that entity for other services, or pressures the lawyer to make such a referral.

* The lawyer cannot accept a referral that interferes with the lawyer’s best judgment in representing the client, including referring the client to other services which may be provided by the referral entity.

* The lawyer may not refer the client to another service provided by the referral agency unless the requirements of Rules 4-1.7 and 4-1.8 (which govern conflicts of interest) are met and the lawyer provides in writing a statement of his or her relationship with the referral agency to the client and the client gives informed consent in writing.

Other recommendations, which track those made by the special committee, include:

* The lawyer must inform the Bar in writing when he or she joins a for-profit referral service and again when the lawyer ceases working with that service.

* After the service makes a referral to a caller, the initial contact with the lawyer must be made by the potential client, not the lawyer.

* One or more lawyers at a firm accepting referral from a for-profit service must be designated to oversee compliance with lawyer referral service rules. (The Bar cannot directly regulate private referral firms, but it can prohibit lawyers from belonging to firms that do not meet Bar rules, including its advertising rules.)

* Lawyers must tell referred clients that they paid for the referral services and may not charge a higher fee to the client than if no referral service was involved.

* Lawyer referral service names must not be misleading or imply that the service itself is a law firm that provides legal services.

Schwait told the board that the work on the referral service rules completes the rewriting of the Bar’s advertising rules undertaken at the Supreme Court’s behest several years ago. Because of the complexity of the referral rules, those were split out from the rest of the advertising rules, which were submitted earlier and approved by the Supreme Court last year.

[Revised: 07-20-2018]