Rep. Norm Thurston — Voting Record

Bill

Number

H.B. 179 First Substitute (2021GS)

Sponsor

Rep. Abbott, N.

Final action

Governor Signed 3/16/2021

Outcome

Became law — signed by Gov. Spencer J. Cox

Summary

What it does

• This bill:
• defines terms;
• creates a cause of action that may be brought against an attorney or a law firm to recover a referral fee that is paid to a person that is not an attorney if the attorney or the law firm pays the referral fee for a client and fails to provide notice of the referral fee to the client;
• provides exceptions for payments for profit-sharing plans, marketing services, and debt collection; and
• addresses joint and several liability.

Every vote on this bill

Bill text

PRIVATE CAUSE OF ACTION FOR UNDISCLOSED
REFERRAL FEES
GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Nelson T. Abbott
Senate Sponsor: 
Daniel McCay
LONG TITLE
General Description:
This bill creates a cause of action that may be brought against an attorney or a law firm
for failure to provide notice of a referral fee.
Highlighted Provisions:
This bill:
▸ defines terms;
▸ creates a cause of action that may be brought against an attorney or a law firm to
recover a referral fee that is paid to a person that is not an attorney if the attorney or
the law firm pays the referral fee for a client and fails to provide notice of the
referral fee to the client;
▸ provides exceptions for payments for profit-sharing plans, marketing services, and
debt collection; and
▸ addresses joint and several liability.
Money Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:
ENACTS:
78B-3-111
, Utah Code Annotated 1953
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 
78B-3-111
 is enacted to read:
 78B-3-111.
Cause of action against attorney or law firm for referral fee --
Exceptions.
(1) As used in this section:
(a) "Attorney" means an individual who is authorized to provide legal services in any
state or territory of the United States.
(b) "Client" means an individual who is provided legal services by an attorney or a law
firm.
(c) "Client referral fee" means any amount paid by an attorney or a law firm to a person
that is not an attorney for the purpose of referring the client to receive legal services from the
attorney.
(d) "Law firm" means a person that employs an attorney.
(e) "Legal services" means any form of legal advice or legal representation that is
subject to the laws of this state.
(2) A client may bring a cause of action against an attorney or a law firm to recover a
client referral fee if:
(a) the attorney or the law firm pays a client referral fee; and
(b) the client referral fee was not disclosed to the client before the client paid for, or
was obligated to pay for, legal services from the attorney or the law firm.
(3) A client may not bring a cause of action under this section if the client referral fee
was paid:
(a) as part of a profit-sharing plan that complies with the requirements of Section 401,
Internal Revenue Code;
(b) to a person that provides marketing services, including pay-per-click advertising,
for the attorney or the law firm, and the client referral fee was not contingent on whether the
attorney or the law firm retains a client; or
(c) to a third party debt collection agency, as that term is defined in Section 
12-1-11
,
for the purpose of recovering money owed to the attorney by the client.
(4) Any attorney or law firm that provides legal services to the client in the matter for
which the client referral fee was paid shall be jointly and severally liable in a cause of action
under Subsection (2).
(5) This section applies to a cause of action described in Subsection (2) that arises on
or after May 5, 2021.