When is it permissible to use client funds for paying third parties?

The correct choice is that client funds may be used to pay third parties if the client has authorized it. In the context of professional responsibility, attorneys have a fiduciary duty to their clients that includes safeguarding client funds and using them only for the purposes that have been agreed upon with the client.

When a client authorizes the use of their funds for a specific purpose—such as paying a third party for services rendered in relation to the client's case—this authorization establishes the legal basis for the lawyer to act. It ensures transparency and maintains the attorney-client relationship, which is paramount in legal practice.

Without client authorization, using funds for a third party could constitute a breach of the lawyer's duties, potentially leading to ethical violations or liability issues for the lawyer. This choice aligns with the ethical guidelines emphasizing the importance of client consent in financial matters, ensuring that clients retain control over their own resources and decisions regarding their legal matters.

In contrast, utilizing client funds based on a fee dispute or the essential nature of services does not align with the obligation for client consent and could lead to misuse of funds. Consent is fundamental in legal ethics to protect the interests and rights of the client.