Concept
Costs for Indigent Clients
Financial assistance to a client and its exceptions (Rule 1.8(e))
Costs for Indigent Clients
A lawyer who represents an indigent client may pay the client's court costs and expenses of litigation, and the rule attaches no repayment condition to the payment.1 That sentence marks the difference from the exception before it. Paragraph (e)(1) lets a lawyer advance costs, with repayment that may depend on the outcome, and it serves a client of any means.2 Paragraph (e)(2) lets a lawyer pay costs and serves only an indigent client. One court stated the consequence plainly: such a lawyer may pay court costs and litigation expenses "regardless of whether these funds will be repaid."3 Two questions therefore separate the exceptions, who the client is and whether the lawyer expects the money back, and a fact pattern usually turns on one of them.
The exception exists because cost can keep a case out of court. The same court reasoned that advances of costs "help ensure access to the courts," and it found that logic strong enough to warrant an exception for indigent clients, one that lets the lawyer pay whether or not anyone ever repays.4 For a client with no means to pay a filing fee or an expert, the cost itself can end the case before it begins, and a repayment term does nothing to lower it.
The exception also has a price. A lawyer who pays costs even when the client recovers has a sharper reason to settle early and cheaply than a lawyer who is reimbursed first out of any recovery. Commentary on the rules draws exactly this comparison. Contingent repayment already tilts the lawyer toward a lower settlement than the client's interest requires, but the tilt is less pronounced than for an indigent plaintiff whose lawyer pays the expenses even if the plaintiff recovers.5 The rule accepts that risk. The client keeps the protection that matters most: the decision whether to settle belongs to the client, and the lawyer must disclose settlement offers and supply the information the client reasonably needs to decide.6
The exception covers one category of payment, court costs and expenses of litigation. The court described that category by example while discussing advances, in language its indigent-client sentence repeats: expenses of diagnostic medical examinations used for litigation purposes, and the reasonable costs of obtaining and presenting evidence.7 The test is functional. Does the money buy something the case itself requires? A filing fee does, and so does an expert's fee. Rent and groceries do not. An exam can bundle all of them into one fact pattern, and the exception will pay for some and not others.
The rent payment is not forbidden outright. It falls outside this exception, and whether any other exception permits it depends on the modest-gift conditions taken up next.
The text of (e)(2) asks only whether the lawyer represents an indigent client and whether the payment is a court cost or litigation expense. It says nothing about the lawyer working without a fee.8 The gift exception in (e)(3) does impose that condition: by its text it covers a lawyer representing an indigent client pro bono, whether directly or through a nonprofit legal services organization or a law school clinical or pro bono program.9 A student who says that paying an indigent client's costs requires pro bono work has borrowed a condition from the wrong exception.
The indigence requirement cuts the other way as well. Take a client of ordinary means, such as a business owner suing a supplier. The lawyer may advance the expert's fee under (e)(1), with repayment out of any recovery and, if the case fails, no obligation on the client.10 A promise to absorb that fee outright, even after a large recovery, fits neither exception. Paragraph (e)(1) contemplates repayment that depends on the outcome, and (e)(2) requires an indigent client.
States may narrow the rule. Illinois follows the Model Rules but permits a lawyer to advance costs and expenses of litigation only if the client remains ultimately responsible in the event of a loss, or is indigent.11 Under the Model Rule, a lawyer may bear the loss of advanced costs for any client. Illinois allows that only for an indigent one. On an exam, the Model Rules govern unless the question names a jurisdiction.