Can a lawyer sign a hold harmless agreement with an insurer promising to pay a client's unpaid medical bills from the client's settlement funds?

Plain-English summary

The inquiry concerned the propriety of a lawyer signing a hold harmless agreement with an insurance company on a client's behalf, providing that the lawyer would pay the client's unpaid medical bills from client funds. The committee reviewed a Wisconsin ethics opinion the inquirer provided and Washington Formal Opinion 185.

Based on Formal Opinion 185, the committee was of the opinion that a lawyer may enter into such an agreement with an insurance company provided the client consented to it after disclosure. Because the agreement could create conflicts of interest between the lawyer and the client, the committee was of the opinion that the conflict rules, including RPC 1.8(c), must be complied with. Finally, the committee was of the opinion that once the lawyer had entered into such an agreement, the lawyer is bound by it.

Currency note

This opinion was issued in 1990, before the Washington State Bar Association's adoption of the 2006 revisions to the Washington Rules of Professional Conduct. Subsequent rule amendments or later opinions may have changed the analysis. Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific rule, deadline, or requirement mentioned here.

Common questions

Q: Can a lawyer agree with an insurer to pay a client's medical bills out of the client's funds?

A: Under this 1990 opinion, yes, provided the client consents after disclosure; the committee relied on Washington Formal Opinion 185.

Q: What conflict concerns did the committee identify?

A: Because the agreement could create conflicts of interest between the lawyer and the client, the committee was of the opinion that the conflict rules, including RPC 1.8(c), must be complied with.

Q: Can the lawyer back out after signing?

A: No. The committee was of the opinion that once the lawyer had entered into the agreement, the lawyer is bound by it.

Background and rules framework

At the time of this opinion, Washington's RPC 1.7 governed conflicts of interest and RPC 1.8(c) addressed specific prohibited transactions, the subjects the Model Rules place in Rules 1.7 and 1.8. The committee treated client consent after disclosure as the gateway to the agreement and the conflict rules as the ongoing constraint, drawing the conclusion from the bar's earlier Formal Opinion 185.

Citations and references

Rules of Professional Conduct:

• ABA Model Rule 1.7 (conflicts of interest)
• ABA Model Rule 1.8 (specific conflict transactions)
• Washington RPC 1.7, 1.8(c)

Other opinions cited:

• WSBA Formal Opinion 185 (lawyer agreements with insurers on client medical bills)
• A Wisconsin ethics opinion provided by the inquirer

See also

• WA Ethics Op. 1351: Representing an Agency While Adverse to It

Source

• Landing page: https://ao.wsba.org/print.aspx?ID=435

Original opinion text

Reproduced from the official source for research purposes. The linked source is authoritative.

The Committee reviewed your inquiry concerning the propriety of a lawyer signing a hold harmless agreement on behalf of a client with an insurance company, which provided that the lawyer would pay from client funds unpaid medical bills of the client. The Committee also reviewed the Wisconsin ethics opinion which you provided with your inquiry. Finally, the Committee reviewed Washington formal ethics opinion #185, a copy of which is enclosed. Based upon that opinion, the Committee was of the opinion that a lawyer may enter into such an agreement with an insurance company provided that the client consented to such an agreement after disclosure. Further, in light of the fact such an agreement could create conflicts of interest between the lawyer and the client, the Committee was of the opinion that the conflict rules, including RPC 1.8(c), must be complied with. Finally, the Committee was of the opinion that once the lawyer had entered into such an agreement, the lawyer is bound by it.