In Kentucky, may a lawyer arrange with a charity to provide estate-planning services to donors, and may a charity pay or recommend the lawyer?

Plain-English summary

The opinion answered four questions about lawyers assisting charitable organizations and providing estate-planning services to donors. On Question 1, the Committee concluded a lawyer may not enter an agreement to charge a charity or its members a reduced fee for estate planning conditioned on a bequest to the charity. The Committee reasoned that Rule 7.20(2) prohibits giving anything of value to a person for recommending the lawyer's services, and that offering reduced or conditioned services gives the organization something of value as consideration; in substance the lawyer is soliciting the employment, so services may not be conditioned on a gift or bequest. Pro bono service to members, by contrast, is permitted.

On Questions 2, 3, and 4 (a qualified yes to each), the Committee concluded the lawyer must evaluate, client by client, the relationships among the lawyer, the donor client, and the charity for conflicts under Rule 1.7(b); the client may consent after consultation, but if the lawyer cannot reasonably conclude the representation will not be adversely affected, consent may not be sought. On payment by the charity, Rule 1.8(f) permits a lawyer to accept third-party payment if the lawyer's professional judgment is not compromised and the client consents after consultation; the Committee, noting ABA Informal Op. 1288's concern about reluctance to give independent advice, concluded the lawyer may proceed if the donor's decision to give is independent and free of undue influence, the donor has the capacity and competency to make the gift, and (preferably in writing) the commitment is documented. The lawyer must also protect the client's confidentiality under Rule 1.6.

Currency note

This opinion was issued in 1996 and predates the Kentucky Supreme Court's substantial 2009 revisions to the Rules of Professional Conduct (SCR 3.130), as the opinion's own prefatory note states. The bar notes that Rule 1.7 was later amended. Treat this page as historical context, not current guidance. Verify against the current rules before relying on any specific rule, deadline, or requirement mentioned here.

Common questions

Q: Could a lawyer offer reduced-fee wills to a charity's members if conditioned on a bequest to the charity?

A: No. The Committee concluded conditioning services on a gift or bequest gives the charity something of value for recommending the lawyer, in violation of Rule 7.20(2).

Q: Could the lawyer provide the same services pro bono?

A: Yes. The Committee stated that ethical considerations do not prevent a lawyer from offering services on a pro bono basis to members of the organization.

Q: Could a lawyer serve a donor whose fees the charity pays?

A: Per the opinion, yes, under Rule 1.8(f), if the lawyer's judgment is not compromised, the client consents after consultation, and the donor's decision to give is independent and free of undue influence.

Q: What confidentiality limit did the opinion stress?

A: The Committee concluded that an agreement to provide services only if a gift or bequest is made would violate the confidentiality duty under Rule 1.6, though a donor may notify the charity of an intended gift and ask it to recommend a lawyer.

Background and rules framework

The opinion interprets the third-party-solicitation rule then numbered KRPC 7.20(2) (Model Rule 7.2, giving value for recommendations), the conflict rule KRPC 1.7(b) (Model Rule 1.7), the third-party-payment rule KRPC 1.8(f) (Model Rule 1.8(f)), and the confidentiality rule KRPC 1.6 (Model Rule 1.6). The analysis turns on whether the lawyer gives the charity value for referrals and on protecting the donor client's independent judgment and confidences.

Citations and references

Rules of Professional Conduct:

• MR 7.2 / KRPC 7.20(2) (giving anything of value for recommending the lawyer)
• MR 1.7 / KRPC 1.7(b) (conflicts of interest)
• MR 1.8 / KRPC 1.8(f) (accepting payment from a third party)
• MR 1.6 / KRPC 1.6 (confidentiality)

Other opinions cited:

• New York County Op. 656 (1980); New York City Op. 81-69; Indiana Op. 8 (1986); Nevada Formal Op. 5 (1987); Oregon Formal Op. 1991-116; Philadelphia Inquiry 91-34; KBA E-293 (1984); ABA Informal Op. 1288

See also

• KBA Ethics Op. E-388: Advertising That the Lawyer Will Donate a Percentage of Fees to Client-Designated Charities
• KBA Ethics Op. E-385: Legal-Aid Referrals From Nonprofit Service Organizations

Source

• Landing page: https://kybar.org/For-Members/Rules-Ethics-Information/Ethics-Opinions
• Original PDF: https://kybar.org/Portals/0/Admin/Ethics%20Opinions/KBA_E-391.pdf

Original opinion text

Reproduced from the official source for research purposes. The linked source is authoritative.

KENTUCKY BAR ASSOCIATION
Ethics Opinion KBA E-391
Issued: July 1996

Since the adoption of the Rules of Professional Conduct in 1990, the Kentucky Supreme
Court has adopted various amendments, and made substantial revisions in 2009. For
example, this opinion refers to Rule 1.7, which was amended. Lawyers should consult
the current version of the rules and comments, SCR 3.130 (available at
http://www.kybar.org), before relying on this opinion.

The Committee has received a number of questions regarding the limitations imposed by the
Rules of Professional Conduct on lawyer assistance to charitable organizations in their fund
raising activities, and with regard to a lawyer providing estate planning services to donors of
charitable organizations.
Question 1:

Answer:

May a lawyer enter into an agreement with a charitable
organization pursuant to which the lawyer will charge a reduced fee to the
organization or the organization's member for estate planning services,
conditioned on a bequest to the organization?
No.

Question 2:

May a lawyer agree to provide pro bono wills or other estate
planning services for the members of a church or other charitable
organization?

Answer:

Qualified yes.

Question 3:

If a lawyer serves on a charitable organization's "planned giving
committee" which offers estate planning seminars to potential donors, may
the lawyer later accept employment from a client who attended the
seminar?

Answer:
Question 4:

Qualified yes.
If a donor has already decided to give a bequest to a charity, but
wants the charity to recommend a lawyer to provide the legal services

necessary to effectuate the gift or bequest and/or pay any lawyer fees
associated with the making of the gift or bequest, may a lawyer accept
such representation?
Answer:
References:

Qualified yes.
Indiana Op. 8 of 1986; (lawyer may not participate in a program
where charity or its members are charged a reduced fee for the preparation
of a will); Nevada Formal Op. 5 (June 16,1987) (lawyer may not charge
reduced legal fees for estate planning services upon condition that savings
be paid to charity); New York City Op. 81-69 (estate planning services
may not be conditioned on a gift or bequest to the charity); New York
County Op. 656 (1980) (lawyer may not participate in a church sponsored
program to write wills for free upon condition of will containing gift to
church); compare: Oregon Formal Op. 1991-116 (lawyer who represents
charity and serves on its Board of Directors may represent donor who
desires to create charitable remainder trust and prepare will leaving
bequest to donor); and Philadelphia Inquiry 91-34 (lawyer may, on his
own, advertise that he will prepare free "living will" for anyone who has
[already] given a gift to a particular charity); KBA E-293 (1984); ABA
Informal Opn. 1288.
OPINION

Any agreement between a charitable organization and a lawyer to provide services for its
members and/or benefactors must comply with the provisions of the Kentucky Rules of
Professional Conduct prohibiting third-party solicitation. Specifically Rule 7.20(2) prohibits any
lawyer from giving “anything of value to a person for recommending the lawyer’s services.” By
offering services at a reduced fee or by conditioning services on a gift or bequest results in the
lawyer giving the organization something of value as consideration for offering legal services.
"Although in form it is the charitable organization which solicits members of the public in
connection with the preparation of their wills, in substance it is the lawyer who, by participating
in the plan, offers his professional services and solicits the employment." See New York County
Opinion 656 (November 1980). Consequently, the offering or recommendation of services may
not be conditioned on a gift or bequest to the charitable organization. However, ethical
considerations do not prevent a lawyer from offering services on a pro bono basis to members of
the organization.
With regard to Questions 2, 3, and 4, in each instance the lawyer must evaluate the
relationship between the lawyer and the charity, the relationship between the donor client and the
charity, and the relationship between the lawyer and the client. This evaluation must involve an
analysis of the potential for a conflict of interest, and the resolution of such conflicts.
Agreements between a lawyer and a charitable organization for the recommendation of services

or for providing services to members and benefactors of the charity is fraught with the possibility
of conflict of interest. However, a blanket prohibition of such arrangements is not necessary.
Instead the lawyer must evaluate each relationship on a client by client basis as discussed herein.
Rule 1.7(b). The client may consent to any possible conflicts of interest after consultation.1 Rule
1.7(b)(2). However, if the lawyer is unable to reasonably conclude that the representation will
not be adversely affected by the relationship with the charity then the client cannot be asked to
consent to the representation.
A lawyer must, at all times, ensure that the lawyer’s professional judgment is not
compromised by influences outside the lawyer-client relationship. A situation where the
lawyer’s independent judgment may be compromised could likely arise in an arrangement which
allows for payment of the lawyer’s estate planning services from funds of the charitable
organization. Rule 1.8(f) provides, in effect, that a lawyer may accept payment from a third
person as long as there is no interference with the lawyer’s professional judgment and as long as
the client consents after consultation.2 The ABA Ethics Committee has expressed concern that
such a representation may result in a reluctance on the part of the lawyer to give independent
advice to a donor client without seeming disloyal to the organization. See ABA Informal Op.
1288. However, we are of the view that if the decision to donate to the charitable organization is
a result of the donor’s independent decision making process, and the lawyer is satisfied that such
decision is the decision of the donor free of undue or inappropriate influence of the charitable
organization, then the lawyer may proceed with the transaction. In coming to a reasoned
decision the lawyer must be satisfied that the donor has the economic capacity to make the
intended gift, the competency to honor and understand the transaction, and its affect on the donor
and the donor’s family who are natural objects of the donor’s bounty. It is preferable that the
donor’s commitment to the charity be in writing.
The lawyer must also ensure that the client’s confidentiality is maintained as required by
Rule 1.6. Rule 1.6 prohibits a lawyer from revealing information concerning the lawyer-client
relationship unless the client consents after consultation. Consequently an agreement that allows
a lawyer to provide services only if a gift or bequest is made would violate the obligation of
1

The Model Rules of Professional Conduct define "consult" or "consultation" as denoting "communication
of information reasonably sufficient to permit the client to appreciate the significance of the matter in question." A
lawyer is obligated to disclose to the client the existence of the conflict, that multiple representation is sought, and
then disclose the implications thereof, including its risks and advantages. In this regard pages 125 through 127 of
the American Bar Association’s text, Annotated Model Rules of Professional Conduct, Second Edition, (1992)
contain numerous citations and commentary on this issue of client "consultation," and is suggested reading for a
further understanding of the requirements for and the meaning of "consultation." This Committee, as a matter of
course, recommends that all communications between a lawyer and the client, regarding questions of conflict, be in
writing, and that the client’s consent be in writing.
2

Also, see Comment 9 to Rule 1.7 which provides that "A lawyer may be paid from a source other than the
client, if the client is informed of that fact and consents and the arrangement does not compromise the lawyer's duty
of loyalty to the client.".... It is preferable that the donor’s commitment to the charity be in writing.

confidentiality. However this obligation should not affect the situation where the benefactor
notifies the charity of an intent to provide a gift or bequest and requests a recommendation or
asks the charity to provide the services of a lawyer to effectuate the gift.

Note to Reader
This ethics opinion has been formally adopted by the Board of Governors of the Kentucky
Bar Association under the provisions of Kentucky Supreme Court Rule 3.530 (or its predecessor
rule). The Rule provides that formal opinions are advisory only.