MRPC Rule 1.8

(a) A lawyer shall not enter into a business transaction with a client or knowingly acquire an

ownership, possessory, security, or other pecuniary interest adverse to a client unless:

(1) the transaction and terms on which the lawyer acquires the interest are fair and

reasonable to the client and are fully disclosed and transmitted in writing to the client in

a manner that can be reasonably understood by the client;

(2) the client is given a reasonable opportunity to seek the advice of independent counsel in

the transaction; and

(3) the client consents in writing thereto.

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(b) A lawyer shall not use information relating to representation of a client to the disadvantage

of the client unless the client consents after consultation, except as permitted or required by

Rule 1.6 or Rule 3.3.

(c) A lawyer shall not prepare an instrument giving the lawyer or a person related to the lawyer

as parent, child, sibling, or spouse any substantial gift from a client, including a testamentary

gift, except where the client is related to the donee.

(d) Prior to the conclusion of representation of a client, a lawyer shall not make or negotiate an

agreement giving the lawyer literary or media rights to a portrayal or account based in

substantial part on information relating to the representation.

(e) A lawyer shall not provide financial assistance to a client in connection with pending or

contemplated litigation, except as provided in this subrule.

(1) A lawyer may advance court costs and expenses of litigation, the repayment of which

shall ultimately be the responsibility of the client.

(2) A lawyer representing an indigent client may pay court costs and expenses of litigation

on behalf of the client.

(3) A lawyer who represents an indigent client pro bono, pro bono through a nonprofit legal

services or public interest organization, or pro bono through a law school clinical or pro

bono program, may pay for or provide the following types of assistance to the client to

facilitate the client’s access to the justice system in the matter:

(i) transportation;

(ii) lodging if it is less costly than providing transportation for multiple days;

(iii) meals; or

(iv) clothing.

Assistance may be provided under this subrule even if the indigent client’s

representation is eligible for a fee under a fee-shifting statute.

(4) Any assistance provided under subrule (3) must be delivered at no fee to the indigent

client, and the lawyer may not:

(i) promise, assure, or imply the availability of such assistance prior to retention or as

an inducement to continue the client-lawyer relationship after retention;

(ii) seek or accept reimbursement from the client, a relative of the client or anyone

affiliated with the client; and

(iii) publicize or advertise a willingness to provide such assistance to prospective

clients.

(f) A lawyer shall not accept compensation for representing a client from one other than the

client unless:

(1) the client consents after consultation;

(2) there is no interference with the lawyer’ s independence of professional judgment or

with the client-lawyer relationship; and

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(3) information relating to representation of a client is protected as required by Rule 1.6.

(g) A lawyer who represents two or more clients shall not participate in making an aggregate

settlement of the claims of or against the clients, or, in a criminal case, an aggregated

agreement as to guilty or nolo contendere pleas, unless each client consents after

consultation, including disclosure of the existence and nature of all the claims or pleas

involved and of the participation of each person in the settlement.

(h) A lawyer shall not:

(1) make an agreement prospectively limiting the lawyer’s liability to a client for

malpractice unless permitted by law and the client is independently represented in

making the agreement; or

(2) settle a claim for such liability with an unrepresented client or former client without first

advising that person in writing that independent representation is appropriate in

connection therewith.

(i) A lawyer related to another lawyer as parent, child, sibling, or spouse shall not represent a

client in a representation directly adverse to a person whom the lawyer knows is represented

by the other lawyer except upon consent by the client after consultation regarding the

relationship.

(j) A lawyer shall not acquire a proprietary interest in the cause of action or subject matter of

litigation the lawyer is conducting for a client, except that the lawyer may:

(1) acquire a lien granted by law to secure the lawyer’s fee or expenses; and

(2) contract with a client for a reasonable contingent fee in a civil case, as permitted by

Rule 1.5 and MCR 8.121.

Transactions between Client and Lawyer.

As a general principle, all transactions between client and lawyer should be fair and reasonable

to the client. In such transactions a review by independent counsel on behalf of the client is

often advisable. Furthermore, a lawyer may not exploit information relating to the representation

to the client’s disadvantage. For example, a lawyer who has learned that the client is investing in

specific real estate may not, without the client’s consent, seek to acquire nearby property where

doing so would adversely affect the client’s plan for investment. Paragraph (a) does not,

however, apply to standard commercial transactions between the lawyer and the client for

products or services that the client generally markets to others, for example, banking or

brokerage services, medical services, products manufactured or distributed by the client, and

utilities’ services. In such transactions, the lawyer has no advantage in dealing with the client,

and the restrictions in paragraph (a) are unnecessary and impracticable.

A lawyer may accept a gift from a client if the transaction meets general standards of fairness.

For example, a simple gift such as a present given at a holiday or as a token of appreciation is

permitted. If effectuation of a substantial gift requires preparing a legal instrument such as a will

or conveyance, however, the client should have the detached advice that another lawyer can

provide. Paragraph (c) recognizes an exception where the client is a relative of the donee or the

gift is not substantial.

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Literary Rights.

An agreement by which a lawyer acquires literary or media rights concerning the conduct of the

representation creates a conflict between the interests of the client and the personal interests of

the lawyer. Measures suitable in the representation of the client may detract from the publication

value of an account of the representation. Paragraph (d) does not prohibit a lawyer representing

a client in a transaction concerning literary property from agreeing that the lawyer’s fee shall

consist of a share in ownership in the property, if the arrangement conforms to Rule 1.5 and

paragraph (j).

Person Paying for Lawyer’s Services.

Paragraph (f) requires disclosure of the fact that the lawyer’s services are being paid for by a

third party. Such an arrangement must also conform to the requirements of Rule 1.6 concerning

confidentiality and Rule 1.7 concerning conflict of interest. Where the client is a class, consent

may be obtained on behalf of the class by court-supervised procedure.

Limiting Liability.

Paragraph (h) is not intended to apply to customary qualifications and limitations in legal

opinions and memoranda.

Family Relationships between Lawyers.

Paragraph (i) applies to related lawyers who are in different firms. Related lawyers in the same

firm are governed by Rules 1.7, 1.9, and 1.10. The disqualification stated in paragraph (i) is

personal and is not imputed to members of firms with whom the lawyers are associated.

Acquisition of Interest in Litigation.

Paragraph (j) states the traditional general rule that lawyers are prohibited from acquiring a

proprietary interest in litigation. This general rule, which has its basis in common-law

champerty and maintenance, is subject to specific exceptions developed in decisional law and

continued in these rules, such as the exception for reasonable contingent fees set forth in Rule 1.5

and the exception for certain advances of the costs of litigation set forth in paragraph (e).

Sexual Relations with Clients.

After careful study, the Supreme Court declined in 1998 to adopt a proposal to amend Rule 1.8

to limit sexual relationships between lawyers and clients. The Michigan Rules of Professional

Conduct adequately prohibit representation that lacks competence or diligence, or that is

shadowed by a conflict of interest. With regard to sexual behavior, the Michigan Court Rules

provide that a lawyer may be disciplined for “ conduct that is contrary to justice, ethics, honesty,

or good morals.” MCR 9.104(3). Further, the Legislature has enacted criminal penalties for

certain types of sexual misconduct. In this regard, it should be emphasized that a lawyer bears a

fiduciary responsibility toward the client. A lawyer who has a conflict of interest, whose actions

interfere with effective representation, who takes advantage of a client’s vulnerability, or whose

behavior is immoral risks severe sanctions under the existing Michigan Court Rules and

Michigan Rules of Professional Conduct.

Humanitarian Exception.

Paragraph (e)(3) serves as a humanitarian exception. The lawyer can assist the client with needs

that frustrate the client’s access to the justice system in the specific matter for which the

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representation was undertaken, while still preserving the nature of the attorney-client

relationship. For purposes of this rule, indigent is defined as people who are unable, without

substantial financial hardship to themselves and their dependents, to obtain competent, qualified

legal representation on their own.