Bartering—Accepting Non-Monetary Compensation for Legal Services

by Reba Nance on August 29, 2013

The Mesopotamians were known to have bartered as early as 6000 B.C. The system of bartering continues to this day. However, except for situations such as exchanging stock in a company for services, lawyers traditionally have done little (if any) bartering with clients. From 2006 to 2009, I began seeing articles and receiving calls from lawyers who wanted to explore the possibility of exchanging goods or services for legal services. Despite the economy improving, bartering situations or opportunities continue to arise; for example, a contractor may approach his or her lawyer and suggest paying legal fees by building a home deck. Such situations may be a win-win for both the client and the lawyer. But is bartering for legal services ethical in Colorado? Can a lawyer accept goods or services in lieu of monetary payment for legal fees? The answer is yes, but you must know the ethical and tax issues before you enter into such an agreement with a client.

When an attorney accepts non-monetary compensation, what special precautions should be taken? Jerry Pratt, the chair of the CBA’s Professional Liability Committee, covered these questions and more in his article titled “Non-Monetary Compensation for Legal Services—How Many Chickens Am I Worth?

For more information on this topic, check out Chris Buckman’s article “Whoops: Malpractice Minute: Taking Stock in Lieu of Fees Can Create Real or Perceived Conflict.”

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