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PIABA Bar Journal

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Lawyers have a significant role to play in protecting clients with diminished capacity from financial exploitation. PIABA members, in particular, see the issue from a unique vantage point – usually after a person with diminished capacity (or a family member or concerned third party) notices a drop in value in his or her brokerage account and approaches the lawyer to help figure out what happened in the account and, if appropriate, to pursue a claim to recover damages. As such, members must understand their own obligations as lawyers to clients with diminished capacity, obligations that apply in the context of client representation during FINRA proceedings as well as in other areas of legal practice.

Clients with diminished capacity present significant challenges. As is the case for advisers in the financial arena, the existing rules for lawyers might not provide every answer. Of course, the relevant jurisdiction’s ethical rules should always serve as a starting point, most likely at the jurisdiction’s equivalent of ABA Model Rule 1.14, Clients with Diminished Capacity. Though laudable in its goal to balance the competing interests and concerns, Rule 1.14 leaves much unanswered. Moreover, it is not the only source of ethical considerations concerning clients with diminished capacity. Thus, attorneys should refer to the “Four C’s” of legal ethics: (1) client identification, (2) conflicts of interest, (3) confidentiality, and (4) competence. In addition, the National Academy of Elder Law Attorneys (NAELA) created a set of guidelines in 2005 – the “Aspirational Standards for the Practice of Elder Law” – to assist attorneys practicing in the area of Elder Law. The Aspirational Standards aim to fill in the gaps and answer questions that might not be fully answered by the ABA Model Rules of Professional Conduct and each state’s professional responsibility rules.


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Reprinted with the permission of Public Investors Arbitration Bar Association (PIABA). Elissa Germaine, Lawyers’ Obligations When Representing Clients With Diminished Capacity, PIABA B.J., Vol 23, No. 2 (2016).



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