Advisory Opinion:
1068
Year Issued:
1987
RPC(s):
RPC 1.7; 1.8; 7.2; 7.3
Subject:
Ownership interest in counseling service; serving as both general counsel and director; receiving referrals from business in which lawyer has ownership interest; solicitation
The Committee reviewed your inquiry concerning your proposal to enter into a business with other non-lawyers to counsel alcoholics and in which you intend to serve on the board of directors, act as general counsel, have a proprietary interest in the counseling service, and accept referrals of clients from the service. The Committee was of the opinion that nothing would prohibit you from entering into such a business, and that you could both serve on the board of directors and be general counsel. However, RPC 1.7 would require you to make a prior determination whether the responsibilities of the two roles might conflict. The Committee was of the opinion that if there is a material risk that the dual role would compromise your independent and professional judgment, you should not serve as a director. The Committee was of the opinion that if you were an owner of the counseling association and paid employees to make referrals to you, you would be in violation of RPC 7.2. The Committee felt this to be true even if your name was merely one of several lawyers' names on a list given to clients of the counseling service. The Committee also was of the opinion that pursuant to RPC 1.8, any referrals by you of your legal clients to the counseling service could be made only after compliance with that rule, which would require disclosure to them of your proprietary interest in the service. Finally, the Committee was of the opinion that RPC 7.3 would prohibit you from directing advertisements or letters to specific recipients soliciting professional employment.
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