The Ohio Board of Professional Conduct has issued two advisory opinions regarding application of the Ohio Rules of Professional Conduct.

Advisory Opinion 2021-02 advises lawyers regarding the propriety of obtaining a loan from financial institutions to advance the costs and expenses of litigation in a contingent-fee matter.

The opinion concludes that a lawyer obtaining such a loan may deduct the interest, fees, and costs of the loan from a client’s settlement or judgment as an expense of litigation. However, a lawyer must borrow only the money necessary to fund the litigation and use due diligence to find a loan with terms most beneficial to the client.

The opinion advises that the written-fee agreement signed by both the lawyer and client must include the fact that the interest, fees, and costs of the loan will be deducted from the settlement or judgment. The opinion replaces Adv. Op. 2001-03 issued under the former Code of Professional Responsibility.

Advisory Opinion 2021-03 addresses whether a lawyer may, in a private arbitration, represent a closely-held corporation of which the lawyer is the sole shareholder and testify as a necessary witness. The Rules of Professional Conduct generally prohibits a lawyer from serving as both an advocate and a witness in a trial or arbitration. However, the board concludes that this prohibition doesn’t apply when the lawyer is the sole shareholder of a closely-held corporation because the lawyer is essentially representing himself or herself in the arbitration.

The board further advises that the lawyer’s representation of the corporation in the arbitration is subject to other rules governing communication with represented parties and fairness to opposing counsel and parties.