Can a lawyer advance or lend living expenses to a contingent-fee client to keep the client from taking the case elsewhere?

Plain-English summary

A lawyer took a personal injury case on a contingent fee. The client later said he needed money for living expenses during the pendency of the suit and that, unless the lawyer would advance or lend him money, he would take the case to other lawyers who had offered to support him while the suit was pending.

The Committee concluded that it would violate Canon 24 for a lawyer to advance or lend money to a client in order to obtain or hold employment (8-0). The opinion treated the arrangement as a form of indirect solicitation.

Currency note

This opinion was issued in 1954, under the former Texas Canons of Ethics, which the Texas Disciplinary Rules of Professional Conduct replaced effective January 1, 1990. The advancing of financial assistance to a client is today governed by Texas Disciplinary Rule 1.08(d) and ABA Model Rule 1.8(e). Subsequent rule amendments or later opinions may have changed the analysis. Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific rule, deadline, or requirement mentioned here.

Common questions

Q: Could a lawyer lend a client living expenses to keep the client from leaving for another firm?

A: No. The Committee held that advancing or lending money to obtain or hold employment violates Canon 24 (8-0).

Q: Did it matter that the client threatened to take the case to lawyers willing to fund him?

A: No. The opinion treated advancing money to obtain or hold the employment as improper regardless of the competing offers.

Background and rules framework

The opinion interprets former Texas Canon 24 and treats advancing living expenses to keep a case as indirect solicitation. The modern home of the financial-assistance question is ABA Model Rule 1.8(e) and Texas Disciplinary Rule 1.08(d), which restrict providing financial assistance to a client in connection with pending or contemplated litigation.

Citations and references

Rules of Professional Conduct:

• MR 1.8(e) (financial assistance to a client), as the modern analog
• Texas Canon 24 (advertising and solicitation)

See also

• TX Ethics Op. 130: Claimant's Lawyer's Letter to a Tortfeasor
• TX Ethics Op. 129: Displaying Photocopies of Settlement Checks
• TX Ethics Op. 110: Contributor Credit Noting "Attorney"

Source

• Landing page: https://www.legalethicstexas.com/resources/opinions/opinion-106/
• Original PDF: https://tcle-web.s3.amazonaws.com/public/documents/Opinion_106.pdf

Original opinion text

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

QUESTION PRESENTED

An attorney accepted employment on a contingent basis from the plaintiff in a personal injury action. Thereafter plaintiff notified his attorney that he needed money for living expenses during the pendency of the suit and that, unless the attorney would advance or lend money to him, he would find it necessary to take his case to other attorneys who had expressed willingness to support him during the pendency of the suit. Would it violate the Canons of Ethics for the attorney to advance or lend money to his client under these circumstances?

18 Baylor L. Rev. 238 (1966)

INDIRECT SOLICITATION - ADVANCING MONEY TO CLIENT
Advancing money for living expenses during the pendency of a personal injury action in order to hold employment is improper.

Canon 24.

The committee is of the opinion that it would violate Canon 24 for an attorney to advance or lend money to a client in order to obtain or hold employment. (8-0)

Tex. Comm. On Professional Ethics, Op. 106 (1954)