Small Law Firms

The Practice: When The Referral Source Is A One-Way Street

Small-firm columnist Brian Tannebaum has got some advice on what to do if a referral source is a one-way street...

By  
on

For those ignoring the unemployed “future of law” idiots typing away from their kitchen table in some crap city with a regional airport and instead still living in the universe where you believe practices can be built and survive on the referrals of others, I have some advice on maintaining your referral base. Some good stuff here, so keep reading if you actually practice law and have to bring in business instead of living off the originations of lawyers who people actually hire.

A referral base is sometimes, but not always, a two-way street. This is where honesty comes into the equation. There may be a lawyer who refers you business, to whom you would never refer business. There may be those lawyers who refer you business, but you have never had the opportunity to send them any. On the other hand, there are those lawyers to whom you send business, who haven’t sent you anything.

Referrals from other lawyers happen for two reasons, either the lawyer is your BFF, or because they know your reputation in the practice area. Sad news for some of you, your reputation, as I’ve said before, is not based on how many people have accepted your begging them invitation to write online testimonials about you….

Let’s talk first about the second type of referral — the call from the lawyer with whom you have no relationship.
I don’t pay “referral” fees or take them from other lawyers, except in a significant personal injury case of which I’ve had three in 17 years. PI lawyers have a thing with referral fees: they like to pay them because they think it will ensure they get the next case. They won’t take no for an answer. On typical hourly or flat-fee work, I’m not taking a piece just because I sent the client your way.

You should check your state bar ethics rules. In Florida, we have “partial participation” fees, meaning you must do “something” other than make the referral in order to get a portion of the fee, and the client must be advised. So the way it’s done in Florida is that lawyers make the referral, do nothing, and take a “partial participation” fee. I mean, they did make a phone call, so why shouldn’t they be entitled to 25% of the fee?

Some lawyers make a practice of taking referral fees. They’ll call, have a referral, and start the conversation with, “Will you pay me a referral fee?” I never get to hear about the case, because that’s where the conversation ends with me. Years ago a young lawyer kept trying to refer me cases. He also kept asking for referral fees. I finally asked, “Are you looking for a relationship with me or a check?” Never heard from him again.

Sponsored

Some lawyers I discuss this with, the ones who take referral fees, think I look down on them for doing so. I do. I think it’s cheesy. I think it’s cheap. If you understand relationship-based referrals, you would too. Tell a lawyer you don’t want a piece of the fee and see where that gets you.

So this local lawyer that you don’t know has just helped pay for your next iPad or maybe the annual salary of your associate. What to do? May I suggest after the retainer is signed you pick up the phone? I know, email and text is so much easier. During that phone call, how about an invitation to a meal? (And not a “let’s have lunch” at some point in the next year.) A gift is sent, or a handwritten note, and then again at Christmas (Hanukkah, Kwanza, whatever).

If you’ve never sent this lawyer any business, you need to learn everything that you can about his practice and unless he’s some incompetent dope, make an effort to reciprocate. You may not be in a position to send him business, but at least try to introduce him to someone, or try to set him up for a speaking engagement, or invite him to an event where there will be people for him to meet. There’s no reason to limit your relationship to trading business. Saying “I hope to send you something” gets old. If you can’t send business the other way, try something else.

Remember something: one of the most important things you can do in the area of developing relationships is to connect others. There are plenty of lawyers in my network that for various reasons I can’t or don’t send business. So what? I can connect them with others that are in a better position to refer them work, and I can make sure they know I appreciate what they’ve done for me.

Now let’s talk about the lawyers you send work to and get nothing back. There’s two reasons for this — either it’s the same scenario where the other lawyer doesn’t have the ability to send you work, or there’s another issue (his firm has a lawyer that does what you do, he thinks you are an incompetent dope, or he doesn’t really understand what you do.) Whatever the reason, you’ve got to know.

Sponsored

While I don’t believe in a quid pro quo, I am not going to spend my time repeatedly sending you work when you don’t send me any, don’t make an effort to connect me with others, and show no appreciation. I owe you nothing. There are plenty of lawyers out there.

So I’m going to do the same thing — I’m going to invite you to lunch, my treat, and I’m going to ask you why this is a one-way street. Maybe the reason is innocent — the lawyer just doesn’t get calls for the type of work I do. Maybe it’s something else. Maybe he hasn’t thought about the people he knows that may be a good referral source for me.

Some people just don’t understand the concept of relationship-based referrals — that it’s not about the relationship between two people — it’s who each of you know. If you can’t send or receive business to or from someone, figure out who can, especially when they are lining your pockets.

Brian Tannebaum will never “get on board” at the advice of failed lawyers who were never a part of the past but claim to know “the future of law.” He represents clients, every day, in criminal and lawyer discipline cases without the assistance of an Apple device, and usually gets to work (in an office, not a coffee shop) by 9 a.m. No client has ever asked if he’s on Twitter. He can be reached at bt@tannebaumweiss.com.

Topics

, , , , , ,