Opinion 1926

[Editor's Note: Ethics inquiry #1926 concerns multidisciplinary practice and the RPCs.]

The Committee has reviewed your inquiry and determined the following:

The inquiry concerns whether a dually licensed lawyer may ethically advise a client to purchase life insurance and then sell it to the client. The committee opined that a lawyer is not precluded from owning or having an interest in another business independent of the practice of law. Under the facts presented, multiple businesses must be separate and the separation must be physical, financial, substantive and practical. A lawyer may not hold himself or herself out to be a lawyer to customers of the independent business and referrals to or from the independent business must not be made. See Formal Opinion 187.

A lawyer may not under any circumstances both advise the client as to the need for insurance and sell the client that insurance. Nor may the lawyer have a financial interest in the purchase of insurance by the client which includes the receipt of any portion of a commission from the purchase of insurance by the client. This would constitute a conflict under RPC 1.7 and 1.8, which cannot be overcome with any amount of disclosure due to the financial interest of the lawyer.

The committee directs the inquirer to Formal Opinion 87 for information regarding advertising when an individual is dually credentialed. Also, the committee recommends to the inquirer that, since the Rules of Professional Conduct may apply to conduct in an unrelated business owned by a lawyer, the inquirer should review these rules in the context of that business as well as his law practice.

Advisory Opinions are provided for the education of the Bar and reflect the opinion of the Committee on Professional Ethics (CPE) or its predecessors. Advisory Opinions are provided pursuant to the authorization granted by the Board of Governors, but are not individually approved by the Board and do not reflect the official position of the Bar association. Laws other than the Washington State Rules of Professional Conduct may apply to the inquiry. The Committee's answer does not include or opine about any other applicable law other than the meaning of the Rules of Professional Conduct.