## Facts

- Donald E. Smolen, an Oklahoma lawyer, represented Mr. Miles in a pending workers’ compensation matter.
- During the representation, Smolen gave Miles a $1,200, interest-free loan.
- The check referenced “travel expenses,” but Smolen admitted the loan’s actual purpose was to cover Miles’s living expenses after his home was destroyed by fire.
- Miles indicated that without the loan he would need to move out of state and would be unable to continue medical treatment or appear in court.
- Repayment was set at $100 per week from disability benefits; Miles repaid $200 total, and Smolen deferred further repayment until final settlement.
- After learning Miles was seeking different counsel, Smolen terminated the attorney-client relationship; Miles hired new counsel.
- The loan was reported to disciplinary authorities during a fee dispute mediation involving Miles and new counsel.
- Smolen had prior discipline, including a public reprimand for loaning money to clients and an earlier suspension for serious misconduct.

## Issues

1. Whether an attorney violates ORPC 1.8(e) by making an interest-free loan to a current client for living expenses during pending litigation.
2. Whether compassionate motives and deferred repayment affect the existence of a Rule 1.8(e) violation.
3. What discipline is appropriate given the violation and the lawyer’s prior disciplinary record.

## Decision

- The Oklahoma Supreme Court found Smolen violated ORPC 1.8(e) by providing financial assistance (a living-expense loan) to a client in connection with pending litigation.
- The Court rejected the notion that humanitarian motives, lack of interest, or repayment terms remove such conduct from the rule’s prohibition.
- Although the Professional Responsibility Tribunal recommended public censure, the Court increased the sanction to a 60-day suspension.
- Smolen was also ordered to pay the costs of the disciplinary proceeding.
- The Court reviewed the matter de novo as an original attorney-discipline proceeding.

## Legal Principles

- ORPC 1.8(e) bars a lawyer from providing financial assistance to a client in connection with pending or contemplated litigation, except for limited exceptions such as advancing court costs and litigation expenses.
- Loans for a client’s living expenses during ongoing litigation fall within the prohibition and are not excused by charitable intent or favorable loan terms.
- The rule serves to prevent conflicts of interest, debtor-creditor pressure, and interference with independent professional judgment, including incentives to prolong or shape litigation decisions.
- Sanctions in attorney discipline are set to protect the public, the courts, and the profession; prior discipline for similar conduct is a significant aggravating factor supporting stronger sanctions.

## Conclusion

The court held that an attorney’s interest-free loan to a current client for living expenses during pending litigation violates ORPC 1.8(e) and, given the attorney’s prior discipline for similar behavior, warranted a 60-day suspension and assessment of costs.


State ex rel. Okla. Bar Ass’n v. Smolen, 17 P.3d 456 (Okla. 2000)