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Referral and Marketing Arrangments (Prohibited Referral Fees (YES -…
Referral and Marketing Arrangments
Referral Fees - a payment which is prohibited includes not only financial payment but also any benefits in kind such as the provision of services or facilities for no cost or at reduced rates
Prohibited Referral Fees
YES - Amounts to bribery
YES - For personal injury work - prohibited by LASPO
MAYBE - payment to an introducer linked to specific referrals
MAYBE - payment to an introducer for services provided by the barrister - not a set fee - linked to referrals
MAYBE - payment is a condition of a referral
MAYBE - payment for marketing is higher than market rates
MAYBE - publicly funded - fee paid is less than LAA fee
MAYBE - payment made to professional person acting for lay client who has duty to act in best interests of that client when making a referral
Examples - NOT A REFERRAL FEE:
(2) Marketing services - members pay a fee for this, reviewed quarterly - does not mislead clients into believing they are receiving independent advice as to their choice of barrister
(1) Outsourced clerking arrangements - they are acting for the barrister, and are not purporting to make recommendations independent of the barristers who retrain it or advise clients as to the selection of barristers
(3) Barrister owned referral company - advertise and market their services more effectively - pay regular fixed fees to the company - not linked to individual referral
(4) Third party introducer - introduces direct access to barristers - introduce potential clients to barristers who are on a national panel, pre-selected by the introducer - recoup costs of fees or barristers may be charged one off or annal fixed fee - not dependent on number of referrals
(5) Third party introducer - introducer makes own independent judgment - percentage received is the same regardless of which of the barristers on its panel is instructed
(6) Membership subscriptions - panel of accredited barristers from which it proposes barristers to those who contact the body requiring those with particular expertise - annual or regular fixed basis
(7) Membership subscription - dependent on percentage of fees received - need to consider if this would be a referral fee
Not a referral fee
Payment made to an employee or agent of the barrister making the payment e.g: clerk
Payment made to marketing agency - not dependent on value of instructions received
Payment made to an introducer who is not a professional person + not dependent on number of referrals received
BSB will take a purposive approach - look at the circumstances
If it appears that a fee is a referral - the barrister will need to demonstrate that the payment is made genuinely in return for a service
Example of referral fee - client mistakenly believes that the introducer or ADR body was acting independently in selecting barrister, when actually their recommendation was based on the highest bid