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Sample Of Counsel Agreements

In Los Angeles County, a company should not pay a bonus to an “Of Counsel” lawyer, which is calculated as a percentage of the profits generated by the reference transactions and must not pay a bonus without the client`s consent. You should check your state`s ethical opinions to see if they allow unlimited compensation plans or if they are subject to restrictions. Many years ago, when “Of Counsel” relationships were not as frequent as they are today, the Ethics Committee of the American Bar Association (ABA) held that an “Of Counsel” lawyer could not be an employee and could only be compensated by a royalty sharing in some cases or on the basis of consulting fees. However, in 1990, when the ABA issued its pioneering opinion on the “Of Counsel” relationship, it became more modern and stated that the method of compensation was not relevant in determining whether an affiliation could be characterized as “Of Counsel”. Some countries, such as Michigan and New York, agree with the ABA approach. From this point of view, an “Of Counsel” lawyer may, for example, be compensated by a salary or the payment of pension benefits. But because the “Of Counsel” lawyer is not a partner or an employee of the firm, some authorities believe that it makes sense that the rules for allocating fees between lawyers who are not in the same firm apply to the “Of Counsel” relationship as in Arizona, California and Maryland. One way to look at this issue is to treat “Of Counsel” as part of the firm for royalty-sharing purposes. Such a lawyer would therefore not be subject to the restrictions that apply to lawyers outside the registry. This is the view of the Restatement of the Law Governing Lawyers, Section 47, Comment g (2000), and several government and local ethics opinions, including Alabama, New Jersey, New York City, Philadelphia, Texas and Virginia. According to ABA Model Rule of Professional Responsibility 1.5 (e), two lawyers from different companies must apportion a fee if they are distributed in relation to the services provided by each lawyer, unless the lawyers have agreed, with the client`s written consent, to take over the representation. Contact your national or local ethics authorities for advice on the allocation of fees with “Of Counsel” lawyers.

It should be self-evident that it is never a good idea to try to avoid the cost-sharing rules by using the “Of Counsel” label if the relationship is not qualified as such. If you are satisfied that it is appropriate to appoint an “Of Counsel” lawyer for your firm and that all methods of compensation are authorized, the terms of compensation are freely negotiable and should be stipulated in the employment contract. For an “Of Counsel” lawyer who acts as an employee, there may be a multitude of bonus configurations, including those based on accounting hours, revenues billed and collected or a percentage of contingencies. The “Of Counsel” lawyer could be given to profit sharing in the company, which is often coupled with a gross even turnoverParting fees paid by the lawyer`s clients. You can also hire “Of Counsel” lawyers as independent contractors. Of Counsel`s lawyers often receive offices, administrative assistance, medical or other services.