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RULE 19-305.4. PROFESSIONAL INDEPENDENCE OF AN ATTORNEY (5.4)

West's Annotated Code of MarylandMaryland Rules

West's Annotated Code of Maryland
Maryland Rules
Title 19. Attorneys
Chapter 300. Maryland Attorneys' Rules of Professional Conduct
Law Firms and Associations [Rules 19-305.1 to 19-305.7]
MD Rules Attorneys, Rule 19-305.4
RULE 19-305.4. PROFESSIONAL INDEPENDENCE OF AN ATTORNEY (5.4)
(a) An attorney or law firm shall not share legal fees with a non-attorney, except that:
(1) an agreement by an attorney with the attorney's firm, partner, or associate may provide for the payment of money, over a reasonable period of time after the attorney's death, to the attorney's estate or to one or more specified persons;
(2) an attorney who purchases the practice of an attorney who is deceased or disabled or who has disappeared may, pursuant to the provisions of Rule 19-301.17 (1.17), pay the purchase price to the estate or representative of the attorney.
(3) an attorney who undertakes to complete unfinished legal business of a deceased, retired, disabled, or suspended attorney may pay to that attorney or that attorney's estate the proportion of the total compensation fairly allocable to the services rendered by the former attorney;
(4) an attorney or law firm may include non-attorney employees in a compensation or retirement plan, even though the plan is based in whole or in part on a profit-sharing arrangement; and
(5) an attorney may share court-awarded legal fees with a nonprofit organization that employed, retained or recommended employment of the attorney in the matter.
(b) An attorney shall not form a partnership with a non-attorney if any of the activities of the partnership consist of the practice of law.
(c) An attorney shall not permit a person who recommends, employs, or pays the attorney to render legal services for another to direct or regulate the attorney's professional judgment in rendering such legal services.
(d) An attorney shall not practice with or in the form of a professional corporation or association authorized to practice law for a profit, if:
(1) a non-attorney owns any interest therein, except that a fiduciary representative of the estate of an attorney may hold the stock or interest of the attorney for a reasonable time during administration;
(2) a non-attorney is a corporate director or officer thereof or occupies the position of similar responsibility in any form of association other than a corporation; or
(3) a non-attorney has the right to direct or control the professional judgment of an attorney.
Cross reference: Md. Rule 19-742.
COMMENT
[1] The provisions of this Rule express traditional limitations on sharing fees. These limitations are to protect the attorney's professional independence of judgment. Where someone other than the client pays the attorney's fee or salary, or recommends employment of the attorney, that arrangement does not modify the attorney's obligation to the client. As stated in section (c) of this Rule, such arrangements should not interfere with the attorney's professional judgment.
[2] This Rule also expresses traditional limitations on permitting a third party to direct or regulate the attorney's professional judgment in rendering legal services to another. See also Rule 19-301.8 (f) (1.8) (attorney may accept compensation from a third party as long as there is no interference with the attorney's independent professional judgment and the client gives informed consent).
Model Rules Comparison: Rule 19-305.4 (5.4) is substantially similar to the language of the Ethics 2000 Amendments to the ABA Model Rules of Professional Conduct with the exception of: 1) retaining existing Maryland language in Rule 19-305.4 (a)(2) (5.4); 2) retaining existing Maryland language in Rule 19-305.4 (a)(3) (5.4) with appropriate redesignation of the subsections of Rule 19-305.4 (a) (5.4).

Credits

[Adopted June 6, 2016, eff. July 1, 2016.]
MD R Attorneys, Rule 19-305.4, MD R ATTORNEYS Rule 19-305.4
Current with amendments received through July 15, 2020.
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