March 24, 2019

Colorado Supreme Court: Attorney Violated Colo. RPC 1.8(a)(3) by Not Obtaining Informed Consent for Business Transaction

The Colorado Supreme Court issued its opinion in In the Matter of James C. Wollrab on Monday, June 25, 2018.

Colorado Rules of Professional Conduct—Attorney Discipline—Colo. RPC 1.8—Colo. RPC 4.2.

In this attorney discipline proceeding, the supreme court was confronted with questions as to what Colorado Rules of Professional Conduct 1.8 and 4.2 require of an attorney who enters into a business relationship with his client. The court concluded that the attorney in this case violated Rule 1.8(a)(1) when he signed a lease with his client’s company without complying with any of Rule 1.8(a)’s prophylactic requirements. The attorney also violated Rule 1.8(a)(3) when he entered into an option agreement with his client without obtaining his client’s informed, written consent to his role in the deal. However, because the attorney had the implied consent of his client’s independent counsel for the purposes of the option agreement, he did not violate Rule 1.8(a)(1) or (2) or Rule 4.2 in that transaction. The court remanded the case to the hearing board for determination of the appropriate sanction in light of its conclusions.

Summary provided courtesy of Colorado Lawyer.