Recently, while contemplating the ethics of whether to help a client financially, our POTUS popped into mind. I was reminded about how attorney Michael Cohen violated Rule 1.8(e) in paying Stephanie Clifford (Stormy Daniels) the sum of $130,000 in order to buy her silence about her relationship with Donald Trump. That the same ethical rule governs my actions with respect to an indigent client as it governed Mr. Cohen's actions with respect to Donald Trump deeply troubled me.

Many of us who chose to become legal services lawyers did so because we wanted to help people. The legal system is infamously imbalanced against those who lack resources, and many of us made this issue our professional calling. However, while we can give our time, legal skills and effort to our clients, we cannot give our poor clients any money. The ethical rules prohibit us from giving a client subway fare to go home from court, from buying the hungry young child of a client a bag of chips, from offering to buy an elderly client a bottle of water. But why is there no distinction between rich and poor clients?

New York Rules of Professional Conduct, Rule 1.8(e) states:

While representing a client in connection with contemplated or pending litigation, a lawyer shall not advance or guarantee financial assistance to the client, except that: (1) a lawyer may advance court costs and expenses of litigation, the repayment of which may be contingent on the outcome of the matter; (2) a lawyer representing an indigent or pro bono client may pay court costs and expenses of litigation on behalf of the client; and (3) a lawyer, in an action in which an attorney's fee is payable in whole or in part as a percentage of the recovery in the action, may pay on the lawyer's own account court costs and expenses of litigation. In such case, the fee paid to the lawyer from the proceeds of the action may include an amount equal to such costs and expenses incurred.

New York, like almost every other state, has mostly adopted the Model Rules of Professional Conduct, which are nearly identical in their prohibition against giving money to a client.

In untangling what links our duty to clients like Donald Trump and to clients who are poor and vulnerable, a brief survey of Rule 1.8(e) is helpful. (For an excellent and in depth overview of Rule 1.8(e), see Schrag, Philip G., “The Unethical Ethics Rule: Nine Ways to Fix Model Rule of Professional Conduct 1.8(e),” Georgetown Journal of Legal Ethics, Vol. 28, No. 1, 2015 (April 2, 2015)). The rule seems to have been intended to address three issues: (1) to prevent lawyers from using clients to advance their own issues, (2) to protect the client's free agency and autonomy, and (3) to prevent conflicts of interest between the lawyer and the client.

Apparently, the origins of Rule 1.8(e) lie in the Star Chamber Act of 1487 and the Statute of Liveries of 1504 which were intended to prevent wealthy landowners from bankrolling legal claims of their serfs as a means to gain more land and power for themselves. Rule 1.8(e) derives from the historical prohibitions on champerty and maintenance. Champerty was the crime of improperly stirring up litigation by investing in a lawsuit. The landowners would hire lawyers and advance financial support through these lawyers to the individual claimants. James E. Moliterno, “Broad Prohibition, Thin Rationale: The 'Acquisition of an Interest and Financial Assistance in Litigation; Rules,” 16 Georgetown J. Legal Ethics, 223, 228 (2003) (drawing on Max Radin, Maintenance by Champerty, 24 Calif. L. Rev. 48 (1934)). In essence, the rule was intended to prevent the rich from using the poor to engage in proxy fights for money and power. So far, this sounds perfectly relevant to Michael Cohen and Donald Trump.

Later, the rules evolved to address cases in which personal injury lawyers would advance funds to support their clients through the course of litigation. An early opinion of the Association of the Bar of the City of New York (today the New York City Bar) addressed a case in which a lawyer supported a client who had lost his hand during an accident on a ship and was therefore unable to work. The bar ethics committee ruled that the lawyers support of his client gave him too much control over his client and the litigation. The concept that a client's free agency would be diminished is a very important consideration that all legal services attorneys should be mindful of. We, as privileged attorneys, wield a great degree of influence and control over our clients' lives. From this perspective, Rule 1.8(e) makes sense: it seeks to maintain the client's position and their interests and limitations as central to every case.

Also, it is clear that Rule 1.8(e) seeks to limit conflicts of interest. Simply stated, where a lawyer has financially invested in the outcome of a case, whether through a gift or a loan to the client, the lawyers independent judgment may be clouded. However, the gaping hole in the New York rules is 1.8(e)(3), which allows for contingency fee arrangements under which costs and fees of litigation may be advanced and then recovered from the proceeds of the action. This exception clearly swallows the rule because all contingency fee agreements tie lawyers to the outcomes of cases. The ABA acknowledged this conflict:

[T]his conflict of interest need not and should not be extended to permit the lawyer to acquire an additional stake in the outcome of the suit which might lead him to consider his own recovery rather than that of this client and to accept a settlement which might take care of his own interest in the verdict but would not advance the interest of his client to the maximum degree.

ABA Formal Op. 288 (1954), in ABA Journal, Jan. 1955, at 33 n.53.

So where does this leave a legal services lawyer who sincerely desires to help their indigent client meet their daily needs such as medicine, food, and rent? Fortunately, many states are moving away from the traditional rules as reflected in Rule 1.8(e) and towards a more humanistic approach. The New York City Bar now calls for amending Rule 1.8(e) to add a provision that would permit legal services lawyers to offer financial assistance to their clients. The text of the proposed amendment to the New York Rules, which adds a fourth section to the existing rule, reads:

A lawyer providing legal services without fee, a not-for-profit legal services or public interest organization, or a law school clinical or pro bono program, may provide financial assistance to indigent clients but may not promise or assure financial assistance prior to retention, or as an inducement to continue the lawyer-client relationship, and shall not publicize or advertise a willingness to provide such financial assistance to clients.

In its report about this proposed amendment, the New York City Bar provides present-day context for the need for such a change—the President's travel ban and its restriction on a four-month old Iranian baby and her family from entering the United States for life-saving surgery. See Report by the Professional Responsibility Committee on the Proposed Amendment to Rule 1.8(E), NY Rules of Professional Conduct. Lawyers worked to help the family and raised money to pay for all expenses while the baby was undergoing medical treatment. However, the report notes, if the lawyers were representing the girl and her family in connection with actual or contemplated litigation, this act of charity could have been a violation of the disciplinary rules. The report also notes that 10 other states and the District of Columbia have adopted rules to liberalize the current prohibitions in the ABA Model Rule 1.8(e).

In sum, Rule 1.8(e), as currently written, makes it harder for legal services lawyers to help those most in need. A new rule should recognize that many of us act in the manner of simple charity, to improve access to the justice system for the indigent, and to help restore the balance between the rich and the poor in the courts.

Sateesh Nori is Attorney in Charge, Queens Neighborhood Office, The Legal Aid Society.