Opinion 1948

The inquirer asks whether, in light of his recent post-retirement change to inactive member status, the performance by his firm and him of his retirement agreement meets ethical standards set forth in the Rules of Professional Conduct (RPC). The agreement in question provides for the firm to pay post-retirement compensation in several forms to the inquirer, potentially including monthly salary, membership fee, expense account reimbursement, fee for personal services as a consultant, and a referral fee based on a percentage of fees generated, as well as 30 percent of net accounts receivable upon dissolution.

The committee opined that to the extent that it required payment to the inquirer of monetary or other value for recommending legal services, the performance of the agreement in question violates RPC 7.2. This would be the effect of section 2.b of the agreement, which provides for the payment of a "referral fee". Portions of this agreement that act solely to provide for the making of retirement benefits payments to the inquirer do not violate the RPCs. Section 2.a and c, and 4, so long as they are retirement payments or compensation for future services that can be performed by a non-lawyer and do not involve referral of cases, may be in compliance with the RPCs. With regard to the compensated advisory consulting services, to the extent that they are not precluded as conduct violative of RPC 7.2 and do not involve an equity interest funded by the sharing of legal fees which is held by a non-lawyer, they are ethically permissible and the conflict provisions of RPC 1.8 would not be applicable so long as the inquirer does not practice law and these services are rendered to his firm and do not directly involve its clients.

Advisory Opinions are provided for the education of the Bar and reflect the opinion of the Committee on Professional Ethics (CPE) or its predecessors. Advisory Opinions are provided pursuant to the authorization granted by the Board of Governors, but are not individually approved by the Board and do not reflect the official position of the Bar association. Laws other than the Washington State Rules of Professional Conduct may apply to the inquiry. The Committee's answer does not include or opine about any other applicable law other than the meaning of the Rules of Professional Conduct.