New Mexico Rules of Professional Conduct
Comment - Rule 1.8
Transactions Between Client and Lawyer
[1] As a general principle, all transactions between client and lawyer must be fair and reasonable to the client. In such transactions a review by independent counsel on behalf of the client is often advisable. The lawyer is required by paragraph (a)(2) to advise the client to seek advice of independent counsel and to give the client a reasonable opportunity to do so. Furthermore, a lawyer may not exploit information relating to the representation to the client's disadvantage. See paragraph (b). 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. Paragraphs (a) and (b) do 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.
[2] 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 must be offered the opportunity to 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.
Literary Rights
[3] 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 a Lawyer's Services
[4] Rule 1.8(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
[5] Rule 1.8(h) is not intended to apply to customary qualifications and limitations in legal opinions and memoranda.
Family Relationships Between Lawyers
[6] Rule
1.8(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
Acquisition of Interest in Litigation
[7] 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).
This Rule is not intended to apply to customary qualification and limitations in legal opinions and memoranda.
Model Code Comparison
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