When is a lawyer allowed to draft legal instruments that benefit them financially?

The correct answer highlights a key ethical principle in the practice of law concerning conflicts of interest and the need for transparency in attorney-client relationships. A lawyer may draft legal instruments, such as wills or trusts, that financially benefit them, but only under limited circumstances to avoid exploitation of their position.

When the client is a close relative, the relationship may provide a context where the potential for conflict is mitigated, assuming that the lawyer engages with full honesty and the relative understands the implications of the arrangement. However, this does not exempt the lawyer from the obligation to adequately disclose potential conflicts and ensure that the transaction is fair.

The other options suggest scenarios that do not adequately safeguard the lawyer's ethical responsibilities. For example, drafting legal instruments merely because a client offers a substantial gift or agrees verbally does not ensure proper accountability or transparency. Moreover, full disclosure of potential conflicts is essential in any scenario where the lawyer stands to benefit financially, but this option also emphasizes that disclosure alone is not sufficient to validate the action if it doesn't occur within a framework that respects the interests of the client. Thus, recognizing familial relationships as an acceptable basis for such actions, provided appropriate disclosures are made, underlines the importance of ethics in professional responsibility.