## Facts

- The Florida Bar initiated disciplinary proceedings against attorney Martin Black after he disclosed that he had entered into an improper financial transaction with a client.
- During an ongoing attorney–client relationship, Black borrowed money from the client on terms that included a usurious interest rate.
- The loan was unsecured, leaving the client without collateral or other protections if Black failed to repay.
- Black did not advise the client to seek independent counsel and did not ensure the client had fully informed consent regarding the transaction’s risks and legality.
- The arrangement exposed the client to potential financial and legal harm, including risks associated with an illegal, usurious agreement, though the client ultimately sustained no monetary loss because Black repaid the loan.
- There was no finding that Black intended to defraud the client or permanently deprive the client of funds.
- A referee found misconduct and recommended discipline; the Supreme Court of Florida reviewed the findings and imposed final discipline.

## Issues

1. Whether an attorney violates professional conduct rules by borrowing money from a current client on usurious, unsecured terms without advising independent counsel and without protective disclosures, even when the client suffers no actual loss.
2. What discipline is appropriate where the attorney repaid the client, self-reported the misconduct, and lacked intent to defraud, but exposed the client to risk through an illegal and unfair transaction.

## Decision

- The Supreme Court of Florida found that Black committed professional misconduct by entering a loan transaction with a current client without the safeguards required for attorney–client business dealings.
- The Court treated the usurious and unsecured nature of the loan, together with the lack of independent-advice warnings and protective disclosures, as aggravating features of the violation.
- The Court considered as mitigation that Black repaid the loan, voluntarily disclosed the conduct to the Bar, and lacked intent to deceive or defraud.
- The Court imposed discipline that reflected the seriousness of the violation but was reduced in light of substantial mitigating factors.

## Legal Principles

- A lawyer’s business transaction with a current client is subject to heightened scrutiny because the attorney–client relationship is fiduciary and creates a risk that the lawyer’s personal interests will conflict with the client’s interests.
- A lawyer may not enter a financial transaction with a client unless the arrangement is fair and reasonable to the client and the client receives adequate, written disclosure and a real opportunity to seek independent counsel, followed by informed consent in writing.
- Exposure of a client to substantial risk through an illegal or unfair lawyer–client transaction can constitute serious misconduct even if the client suffers no actual monetary loss.
- In attorney discipline, restitution, self-reporting, cooperation, and absence of fraudulent intent are significant mitigating factors affecting the sanction.

## Conclusion

The Supreme Court of Florida disciplined an attorney for borrowing money from a current client on usurious, unsecured terms without required client protections, holding that the ethical breach exists even absent client loss, while reducing discipline due to repayment, self-reporting, and lack of intent to defraud.


The Fla. Bar v. Black, 602 So. 2d 1298 (Fla. 1992)