Statement of Facts
A lawyer represents a plaintiff in a personal injury matter. The client suffered significant disabling injuries, has not worked since being injured, and was denied disability benefits. The client has no ready means of income and is in desperate need of money.
Issue and Conclusions
May a lawyer loan money to this client pending the resolution of his lawsuit?
1. The proposed loan is prohibited by Colorado Rule of Professional Conduct ("CRPC") 1.8(e), which prohibits a lawyer from advancing or guaranteeing financial assistance to a client. The only exception contained within CRCP 1.8(e) is that a lawyer may advance or guarantee the expenses of litigation.
2. The Colorado Supreme Court has disciplined lawyers who have violated CRCP 1.8(e) by providing clients advances on potential settlement of their claims. See People v. Kocel, 61 P.3d 56, 57-59 (Colo. 2003); In re Gibson, 991 P.2d 277, 278-79 (Colo. 1999).