Gifts
A client gives you a $15 Starbucks gift card as a thank you. Do you accept or decline?
Accept.
Under Rule 3.4-13: small, nominal gifts which do not suggest undue influence are ok to accept.
Commentary [16]: "A lawyer must refuse to accept a gift that is other than nominal unless the client has received independent legal advice."
A client says, "Take this fee now, and I’ll pay you extra if we win." Accept or decline?
Decline OR Formalize as a written contingency fee agreement under Rule 3.6-2.
Rule 3.4-2 prohibits fee arrangements tied to case outcomes without client consent.
An additional payment contingent on a favourable outcome constitutes a contingency fee agreement, which is allowed only if governed by a formal written agreement (Rule 3.6-2)
Commentary [1]: "A lawyer may enter into a written agreement in accordance with governing legislation that provides that the lawyer’s fee is contingent, in whole or in part, on the outcome of the matter for which the lawyer’s services are to be provided."
A corporate client gives you a VIP membership to their golf club to "thank you for being part of the team." Accept or decline?
Decline.
Rule 3.4-1 Commentary cautions against gifts implying membership or financial ties, as they could impair impartiality.
Commentary [1]: "A conflict of interest exists when there is a substantial risk that a lawyer’s loyalty to or representation of a client would be materially and adversely affected by the lawyer’s own interest."
A small business client who has worked with your firm for years is facing bankruptcy and asks if you would guarantee a short-term loan to help them stay afloat. They argue that the business's survival ensures future work for your firm and promise to repay the loan in three months. Can you proceed?
Cannot Proceed
Rule 3.4-15 prohibits a lawyer from personally guaranteeing or providing security for a client’s indebtedness unless specific exceptions apply.
The loan is not:
Commentary [15]: “A lawyer must not personally guarantee, or otherwise provide security for, any indebtedness in respect of which a client is a borrower or lender unless:
the lawyer has entered into a business venture with a client and a lender requires personal guarantees from all participants in the venture as a matter of course and the lawyer has otherwise complied with these rules.”
A client sends you a holiday gift basket every year as a tradition. Accept or decline?
Accept with caution – as long as the gift is still be nominal in value
Rule 3.4-13 repeated gifts may create an implied expectation of loyalty, so transparency is key to maintaining professional boundaries.
Commentary [16]: "If a gift or bequest from a client appears to be unearned or disproportionately substantial, it is prima facie not 'fair and reasonable' to the client."
Caution:
A client offers you a performance bonus if you can secure a favourable outcome quickly. Accept or Decline?
Decline OR restructure agreement to include an hourly or flat urgency fee
Rule 3.6-1 warns against accepting performance-based bonuses tied to outcomes, as they may compromise objectivity and create a conflict of interest. Fees must be fair, reasonable, and disclosed in a timely fashion, and bonuses tied to outcomes.
However, you can offer a revised retainer agreement reflecting urgency fees rather than outcome-based fees.
A new client offers to cover all your travel expenses so you can visit their overseas office to "get the full picture." Accept or decline?
Decline.
Rule 3.4-1 warns that gifts tied to client expectations may impact impartiality and could be perceived as creating an ongoing obligation or expectation of preferential treatment.
Commentary [1]: "A client’s interests may be prejudiced unless the lawyer’s advice, judgment, and action on the client’s behalf are free from conflicts of interest."
Your firm needs funds to renovate the office after some flooding damage that is not completely covered by insurance, AB Bank offers the most competitive interest rate for your needs, however, they are also a client of your firm, can you proceed?
Proceed* but only if the client is a financial institution whose business includes lending money to the public and the loan terms are standard.
Rule 3.4-13 notes that borrowing money from a client is only permissible if the client is a lending institution that lends money to the public as part of their business.
A longtime client gifts you an iPad after a successful case. Accept or decline?
Decline OR check value
Rule 3.4-13 allows small gifts, BUT caution is advised for higher-valued items. If the gift seems disproportionate, consider discussing with the client to clarify their intentions.
Commentary [16]: "If a gift or bequest from a client appears to be unearned or disproportionately substantial, it is prima facie not 'fair and reasonable' to the client as required by this rule, and a presumption of undue influence is raised."
A client insists on sending a monthly consulting bonus for all hours accessibility. Accept or Decline?
Decline OR Include the bonus in a revised retainer agreement with clear scope of services.
Rule 3.6-1 warns about accepting recurring bonuses or additional payments from clients outside standard fees. Fees must not be hidden or ambiguous, and they must be agreed upon in advance.
Commentary [2]: "The fiduciary relationship between lawyer and client requires full disclosure in all financial dealings between them and prohibits the acceptance by the lawyer of any hidden fees."
OR
Define what "all-hours accessibility" entail, restructure the bonus is accounted for as part of fair and reasonable fees, such as a retainer agreement to include the monthly fee as a part of the regular fee schedule.
A client offers to promote your law practice on their business’s social media page as a thank you gesture. Accept or decline?
Decline.
Rule 3.4-1 promotional exchanges with clients might imply a reciprocal business relationship, which compromises professional independence. A lawyer’s loyalty and professional judgment might be influenced by the personal benefit of increased exposure.
Commentary [1]: "A client’s interests may be prejudiced unless the lawyer’s advice, judgment, and action on the client’s behalf are free from conflicts of interest."
Your client has large medical bills and requests a compassionate loan to cover their treatment, they offer to repay you with their future settlement.You estimate the loan amount will represent a substantial portion of the anticipated recovery. Can you proceed?
Cannot Proceed**
Rule 3.4-13 A lawyer must not make such loans if they create a disproportionate financial interest in the case, since the loan constitutes a significant portion of the anticipated settlement – it would compromise impartiality.
Commentary [20]: "A lawyer must not make a compassionate loan if, as a result of the lawyer's expectation of recovering fees, disbursements, and the loan from the proceeds of the case, the lawyer has a financial interest in the case that is so disproportionate that the lawyer's objectivity will be impaired."
A client sends a bouquet and a gift card worth $400 to celebrate a case win. Accept it or decline?
Decline.
Rule 3.4-13 discourages high-value gifts that might influence the lawyer-client relationship.
Commentary [16]: "If a gift or bequest from a client appears to be unearned or disproportionately substantial, it is prima facie not 'fair and reasonable' to the client as required by this rule, and a presumption of undue influence is raised."
A long-term client insists you take an extra payment for ‘emergency weekend services’ that go above your usual fee. Accept or decline?
Accept BUT with full disclosure and transparency.
Rule 3.6-1 allows unusual fees if fully disclosed in advance and justified based on urgency or special circumstances. An extra fee for additional services may be allowed if:
Commentary [1]: "Special circumstances, such as the postponement of payment, uncertainty of reward, or urgency, may justify a fee."
A corporate client invites you to a private networking event, saying it’s a great chance to meet new contacts and it would benefit both of you. Accept or decline?
Accept with caution**
Rule 3.4-1 attending exclusive events hosted by clients could imply a partnership which can appear to compromise impartiality, a cautionary step would be to inform the client of the foreseeable ways the relationship could affect their impartiality and disclose any potential conflicts in advance.
Commentary [9]: "A lawyer therefore should inform the client of the relevant circumstances and the reasonably foreseeable ways that a conflict of interest could adversely affect the client’s interests."
Your widowed client is facing eviction and asks for a loan from you to cover their rent, promising to repay it from their settlement proceeds. Can you proceed?
Decline OR Proceed** but only as a no-interest, no-charge compassionate loan.
Rule 3.4-13 notes that this is done to ensure the loan does not impair objectivity or create a disproportionate financial interest in the case.
Commentary [14]: “If a lawyer lends money to a client, before agreeing to make the loan, the lawyer must disclose and explain the nature of the conflicting interest to the client, recommend that the client receive independent legal representation, and obtain the client’s consent.”
Commentary [19]: "A lawyer must not make a loan to such a client other than on a no-interest, no-charges basis; however, it may be appropriate for a lawyer to make a compassionate loan to such a client, to be repaid out of the proceeds of the case or otherwise."
Commentary [20]: "A lawyer must not make a compassionate loan if, as a result of the lawyer's expectation of recovering fees, disbursements, and the loan from the proceeds of the case, the lawyer has a financial interest in the case that is so disproportionate that the lawyer's objectivity will be impaired."
A former client, who you recently represented successfully wants to gift you a luxury hotel stay as a token of appreciation. Can you accept or decline?
Decline or accept only if independent legal advice is sought by the former client.
Rule 3.4-13 notes to avoid gifts that appear substantial.
Even though the relationship has ended, accepting a luxurious gift could reflect poorly and might suggest a delayed payment for services.
Commentary [16]: "If a gift or bequest from a client appears to be unearned or disproportionately substantial, it is prima facie not 'fair and reasonable' to the client."
Recommend that the client seek independent legal advice to ensure fairness. Decline if the client does not obtain such advice.
A client offers to pay an upfront retainer bonus to secure your availability for any urgent matters over the next year. Accept or Decline?
Accept BUT informed consent to the arrangement
Rule 3.6-1 advises against accepting advance bonuses or retainers tied to potential future services, as these can create an ongoing expectation of priority or preferential treatment.
Commentary [3]: "A lawyer should provide to the client in writing, before or within a reasonable time after commencing a representation, as much information regarding fees and disbursements as is reasonable and practical in the circumstances."
Create a written retainer agreement outlining the services included in the bonus payment. Define the terms for availability, including response times, and confirm they are reasonable.
Your client invites you to co-sponsor a charity event, saying it would be good publicity for both of you. Accept or decline?
Decline OR Accept with caution**
Rule 3.4-1 joint sponsorships with clients may imply favouritism or partiality within the professional relationship and compromise objectivity.
Commentary [5]: "The duty of loyalty to current clients includes the duty to avoid conflicting interests."
To Accept:
1. Ensure there is informed and voluntary consent to proceed. Such as a written agreement is drafted and signed, details that the sponsorship is strictly for charitable purposes and does not create additional obligations between the lawyer and the client.
Commentary [7]: "These rules allow a lawyer to continue to act in a matter even when in a conflict of interest, if the clients consent."
Commentary [9]: "Disclosure means full and fair disclosure of all information relevant to a person’s decision, in sufficient time for the person to make a genuine and independent decision."
2. The firm’s name/logo is included as one of many contributors to the charity event, without excessive prominence or implication of a special relationship with the client.
You serve on the board of the Mustard Seed, an organization you actively support. The charity is creating a new community greenhouse project and needs a loan to fund it. AB Bank requires personal guarantees from board members to approve the loan. The charity asks if you would be willing to personally guarantee the loan given your role and commitment to the organization. Can you proceed?
Proceed
Rule 3.4-15, a lawyer may personally guarantee a client's indebtedness if the transaction benefits a non-profit or charitable institution and the lawyer is a member or supporter of that institution.
Since you are a board member and active supporter of the charity, you can provide a personal guarantee for the loan. BUT must ensure that this does not create a conflict of interest or impair your professional judgment.