What's the difference between a "matter" and a "referral fee matter" on TrustReq?

This quick tip explains some terminology used in the TrustReq platform, to help you get the most out of your TrustReq experience. It is not based on any LSO-related or regulatory terminology.

A “Matter” is usually intended for situations where the licensee provides legal services to a client, and is a way to help the licensee stay organized concerning the client’s file. On the other hand, a “Referral Fee Matter” is primarily intended to manage a licensee’s regulatory compliance obligations when paying or accepting referral fees.

Here are some example of how you might use these concepts:

Example 1

Lucy practices only in residential real estate closings. Carla contacts Lucy on Lucy’s website indicating that Carla is looking for a real estate litigation lawyer concerning an aborted real estate deal. Lucy reaches out to Carla and lets Carla know that Lucy doesn’t provide litigation services. Lucy offers to refer Carla to another lawyer named Martin, who practices in real estate litigation. Lucy also discloses to Carla that Martin and Lucy have a referral fee relationship. Carla gives Lucy permission to refer her to Martin.

In this example, Lucy never provided legal services to Carla, so it wouldn’t make sense for Lucy to create a new “Matter” under Carla’s name, but Lucy could and should create a new “Referral Fee Matter” on TrustReq. In doing so, Lucy can be confident that the referral fee checklist, mandatory referral fee agreement, and record keeping requirements concerning referral fees, can all be easily and conveniently complied with.

Example 2

Lucy specializes in estate planning and probate law. One day, she receives an inquiry from John, who is seeking legal assistance in drafting his will and establishing a complex trust structure to manage his assets for his children and charitable endeavors. Lucy conducts an initial consultation with John, during which they discuss his goals, assets, and wishes for his estate plan.

After the consultation, Lucy begins preliminary work on John's case, including gathering necessary documentation, conducting research, and outlining a proposed estate plan based on their discussions. However, as she delves deeper into John's case, she realizes that the complexity of his estate planning needs exceeds her expertise. The trust arrangements and tax implications involved require specialized knowledge that Lucy doesn't possess.

Recognizing the importance of providing John with the best possible assistance, Lucy decides to refer him to a colleague, Sarah, who is highly experienced in handling complex estate planning matters. Lucy informs John about her decision to refer him to Sarah and explains the reasons behind it. John understands and appreciates Lucy's honesty and commitment to his best interests, and he agrees to the referral.

Since Lucy had already done some work for John before referring him to Sarah, she opens both a "Matter" and a "Referral Fee Matter" to ensure proper organization and compliance. The "Matter" reflects the work Lucy completed for John before the referral, including initial consultations, document gathering, and research. The "Referral Fee Matter" is established to manage the referral process and document the referral fee transaction between Lucy and Sarah.

This dual approach allows Lucy to maintain clear records of her involvement in John's case, from the initial consultation to the referral, while also ensuring compliance with regulatory obligations regarding referral fees.