ETHICS OPINION 351-1939

NUMBER 351 1939

Question. A, an attorney, in the month of October, 1934, agrees with B, a layman, to pay B a percentage of the fee which A would receive if B induces C to retain A to bring suit for a sum of money wrongfully withheld from C by D, which suit C already intends to commence. C retains A and pays A an agreed fee. A then refuses to fulfill A’s agreement with B.

Would it be professionally proper for E, an attorney, to accept a retainer from B to commence suit against A for the recovery of the amount which A agreed to pay B?

Answer. The date of the agreement is given as October, 1934, which is prior to the amendments of Sections 270 and 275 of the Penal Law. The possible conflict between the decisions in Irwin v. Curie, 171 N.Y. 409, and Mendelson v. Gogolick, 243 App. Div. 115, may be claimed to cause some doubt on the question as to whether the agreement, when made, was enforceable by the layman. While the Committee is of the opinion that lawyer A’s agreement offends against the ethics of the profession, nevertheless, if lawyer E, after having used due diligence to familiarize himself with the law on the subject, in good faith believes that the law is unsettled and that layman B may be held to have the right to recover, it is not professionally improper for E to accept such a retainer. (See Canon 30 of the Canons of Professional Ethics of the American Bar Association and Opinions 95 and 352 of this Committee.)