Section 58 of the Bar Association Law prohibits a lawyer from engaging in partnership with another person, who is not a lawyer, or sharing his income in exchange for services, assistance, or other benefit to his business.
"A lawyer shall not practice his profession in partnership with a person who is not a lawyer or with a person who is not a foreign lawyer as defined in section 98A, and such a person shall not share his income - whether gross or net - in exchange for services, assistance or other benefit to his business. However, a lawyer may share his income with the spouse, descendants and parents of his partner, present or in the past, who died while he was still a member of the Bar or while he was registered in the Registry as defined in section 98A, and of a lawyer or a foreign lawyer from whom he acquired his business."
This prohibition is intended to prevent circumvention of the restrictions imposed on a lawyer by virtue of the laws of professional ethics, by way of maintaining a partnership relationship with a person who is not a lawyer and is not obligated to comply with these limitations; and also to prevent a situation of conflict of interest between the desire of a partner, who is not a lawyer, to increase the profits of the partnership, and the duty of a lawyer to provide proper service to his clients (Appeal Petition/Administrative Claim 8539/11 Malka Engelsman & Co. Law Offices v. Ministry of Finance, Accountant General's Department [Nevo] (July 5, 2012) Hereinafter: "Engelsman Tax Appeal"), paragraph 19 of the judgment of Judge Vogelman).
The fact that Kotler did not take any action after the signing of the agreement indicates the existence of an economic arrangement or cooperation between the plaintiff and the Meyuhas law firm, in violation of the aforementioned rules. Attorney Shemesh was asked during his interrogation: "...But the essential idea was to cooperate. I'll find and look for clients, you'll provide legal service, right?" I'm just going to be precise in the end he could only recommend us." (p. 42, lines 24-27).