## Facts

- In December 1971, Muriel Joseph consulted attorney John T. Moran about suspected medical negligence involving her infant granddaughter.
- Moran advised that the child’s parents should retain a medical-malpractice specialist and arranged a meeting with attorney Gordon Von Kalinowski in January 1972.
- The parents retained Von Kalinowski on an oral contingent-fee agreement, with the percentage to be set and approved in a minor’s compromise.
- After the meeting, Von Kalinowski orally agreed to split his contingent fee equally with Moran; Moran was to maintain client communications and perform requested services, while Von Kalinowski controlled the litigation.
- Von Kalinowski filed the malpractice action in June 1972; Moran communicated with the family during early stages of the case.
- Due to Von Kalinowski’s ill health, attorney Wesley H. Harris offered to take over the case and agreed to be bound by Moran’s fee-splitting arrangement; Harris was substituted as counsel of record in 1974.
- Harris settled the malpractice action by 1975, generating attorney’s fees of about $226,996.37, and refused to pay Moran any share.
- Moran sued to enforce the oral fee-splitting agreement.

## Issues

1. Whether an oral attorney fee-splitting/referral-fee agreement made in January 1972 was unenforceable as against public policy based on later-adopted professional conduct rules and related case law.
2. Whether a successor attorney who agreed to be bound by the arrangement could avoid payment on public-policy grounds, and whether Moran could recover in contract or in quantum meruit.

## Decision

- The Court of Appeal reversed the judgment for Harris and remanded for further proceedings.
- The court held that public policy did not prohibit enforcement of the January 1972 referral-fee agreement.
- The court concluded that later ethics rules and their interpretations did not retroactively invalidate the pre-rule agreement, and that Harris’s assumption of the obligation supported enforceability.

## Legal Principles

- Enforceability of an attorney fee-sharing agreement is assessed in light of public policy and governing professional conduct rules at the time the contract was formed; later-enacted restrictions generally do not operate retroactively to void earlier agreements.
- Subsequent amendments to professional conduct rules permitting forwarding/referral fees under specified conditions may inform the public-policy analysis and weigh against treating such agreements as inherently void.
- A successor attorney who expressly agrees to be bound by an existing fee-sharing arrangement may be held to that obligation, particularly where the successor accepts the benefits of the referral and representation.

## Conclusion

The court held that an oral, pre–November 1972 attorney referral-fee split was not void as against public policy and was enforceable despite later ethics-rule developments; because Harris agreed to take over the matter on the same terms, the judgment for Harris was reversed and the case was remanded to allow Moran to pursue recovery under the agreement.


Moran v. Harris, 131 Cal. App. 3d 913 (Cal. Ct. App. 1982)