In January, a Florida Bar News article clarified some of the issues concerning when an attorney may provide financial assistance to a client. Beware
Rule 4-1.8(e), entitled “Financial Assistance to Client,” establishes a broad prohibition on assisting clients financially in relation to “pending or contemplated litigation.” However, two exceptions to the prohibition reserve some flexibility for lawyers representing clients experiencing financial difficulty. Lawyers may advance court costs and litigation expenses, so long as the client repays the lawyer from any recovery. Further, a lawyer representing an indigent client may advance these court costs without any reimbursement requirement.
While the overarching rules may be clear to many attorneys, the article points out some unique specifics illustrating the rule in operation. For example, the article cautions that where a lawyer’s financial assistance to a client prevents the lawyer from keeping “the client’s interest paramount,” a conflict of interest in violation of Rule 4-1.7(a)(2) may exist.
The article further makes clear that while some lawyers may misunderstand litigation expenses to include food, mortgage payments, or medical bills, none of these personal expenses may be provided for with the lawyer’s money. We recently reported that the New York City Bar Association sent a letter to the New York Supreme Court supporting a modification of this rule to include an humanitarian exception to allow assistance to clients, especially in light of COVID-19.
We are not aware of any similar proposal in Florida. However, Florida does have a 1994 case, that may be an outlier, in which the Florida Supreme Court did not sanction a lawyer who had provided used children’s clothing and $200 to an indigent client. The Court noted that there was no agreement for repayment and no indication that the clothing was provided as an incentive to maintain the lawyer’s employment. Thus, no violation of Rule 4-1.8.
More recently, the Florida Bar Standing Committee on Advertising advised a personal injury lawyer that he may offer to loan cell phones to prospective clients for use only in connection with litigation. “The committee emphasized that the loan offer to prospective clients was permissible under Rule 4-7.15(d) and did not provide a prohibited economic incentive to hire the lawyer or view his advertising, because the inquiring lawyer stated that the client’s use of the device would be restricted to review of materials related to the client’s case and disabled to prevent the client’s personal use.”
For more information, read the Florida Bar News article here.
Beware Beware Beware
