Wednesday, August 19, 2015

What To Do When Third Party Steals Escrow Funds

A proposed ethics opinion in North Carolina deals with the issues that arise from third party escrow theft

Proposed 2015 Formal Ethics Opinion 6
Lawyer’s Professional Responsibility When Third Party Steals Funds from Trust Account    
July 16, 2015

Proposed opinion rules that when funds are stolen from a lawyer’s trust account by a third party who is not employed or supervised by the lawyer, and the lawyer was managing the trust account in compliance with the Rules of Professional Conduct, the lawyer is not professionally responsible for replacing the funds stolen from the account.

NOTE: This opinion is limited to a lawyer’s professional responsibilities and is not intended to opine on a lawyer’s legal liability.

Inquiry #1:

John Doe, a third party unaffiliated with Lawyer, created counterfeit checks that were identical to Lawyer’s trust account checks. John Doe made the counterfeit checks, purportedly drawn on Lawyer’s trust account, payable to himself and presented the counterfeit checks for payment at Bank. Bank honored some of the counterfeit checks. As a consequence, client funds held by Lawyer in his trust account were utilized for an unauthorized purpose. Lawyer properly supervised all nonlawyer staff participating in the record keeping for the trust account. Lawyer also maintained the trust account records and reconciled the trust account as required by Rule 1.15-3. Lawyer had no knowledge of the fraud and had no opportunity to prevent the theft.

Does Lawyer have a professional responsibility to replace the stolen funds?

Opinion #1:

No.

A lawyer who receives funds that belong to a client assumes the responsibilities of a fiduciary to safeguard those funds and to preserve the identity of the funds by depositing them into a designated trust account. Rule 1.15-2, RPC 191, and 97 FEO 9. The responsibilities of a fiduciary include the duty to ensure that the funds of a particular client are used only to satisfy the obligations of that client. RPC 191 and 97 FEO 9. Rule 1.15-3 requires a lawyer to keep accurate records of the trust account and to reconcile the trust account. A lawyer has an obligation to ensure that any nonlawyer assistant with access to the trust account is aware of the lawyer’s professional obligations regarding entrusted funds and is properly supervised. Rule 5.3.

If Lawyer has managed the trust account in substantial compliance with the requirements of the Rules of Professional Conduct (see Rules 1.15-2, 1.15-3, and 5.3) but, nevertheless, is victimized by a third party theft, Lawyer is not required to replace the stolen funds. If, however, Lawyer failed to follow the Rules of Professional Conduct on trust accounting and supervision of staff, and the failure is a proximate cause of theft from the trust account, Lawyer may be professionally obligated to replace the stolen funds. Compare RPC 191 (if a lawyer disburses against provisionally credited funds, the lawyer is responsible for reimbursing the trust account for any losses caused by disbursing before the funds are irrevocably credited).

Under all circumstances, Lawyer must promptly investigate the matter and take steps to prevent further thefts of entrusted funds. Lawyer must seek out every available option to remedy the situation including researching the law to determine if Bank is liable;1 communicating with Bank to discuss Bank’s liability; asking Bank to determine if there is insurance to cover the loss; considering whether it is appropriate to close the trust account and transfer the funds to a new trust account; and working with law enforcement to recover the funds.

Inquiry #2:

Prior to learning of the fraud and theft from the trust account, Lawyer issued several trust account checks to clients and/or third parties for the benefit of a client. Despite the theft, there are sufficient total funds in the trust account to satisfy the outstanding checks. However, because of the theft, funds belonging to other clients will be used if the outstanding checks are cashed.

What is Lawyer’s duty to safeguard the remaining funds in the trust account?

Opinion #2:

Lawyer must take reasonable measures to ensure that funds belonging to one client are not used to satisfy obligations to another client. Such reasonable measures include, but are not limited to, requesting that Bank issue stop payments on outstanding trust account checks; providing Bank with a list of outstanding checks and requesting that Bank contact Lawyer before honoring any outstanding checks; and determining if Bank is liable and, if so, demanding the outstanding checks be covered by Bank. If Lawyer determines Bank is not liable or liability is unclear, Lawyer must maintain the status quo and prevent further loss by not issuing new trust account checks. If payment will be stopped on the outstanding checks, Lawyer must contact the payees and alert them to the problem.

Inquiry #3:

Assume the same facts in Inquiry #2 except there are insufficient funds in the trust account to satisfy the outstanding checks. Must Lawyer deposit funds into the trust account to ensure that the outstanding checks are not presented against an account with insufficient funds?

Opinion #3:

No. In addition to the remedial measures listed in Opinion #2, Lawyer should notify the payees if Lawyer knows that the checks will not clear.

Inquiry #4:

Hacker gains illegal access to Lawyer’s computer network and electronically transfers the balance of the funds in Lawyer’s trust account to a separate account that is controlled by Hacker. Lawyer’s trust account now has a zero balance. Lawyer has written several trust account checks to clients and/or third parties for the benefit of clients. Because of the theft, there are insufficient funds in the trust account to satisfy the outstanding checks.

Does Lawyer have a professional responsibility to replace the stolen funds?

Opinion #4:

No, Lawyer is not obligated to replace the stolen funds provided he has taken reasonable care to minimize the risks to client funds by implementing reasonable security measures in compliance with the requirements of Rule 1.15.

Rule 1.15 requires a lawyer to preserve client property, to deposit client funds entrusted to the lawyer in a separate trust account, and to manage that trust account according to strict recordkeeping and procedural requirements. To fulfill the fiduciary obligations in Rule 1.15, a lawyer managing a trust account must use reasonable care to minimize the risks to client funds on deposit in the trust account. 2011 FEO 7.

In 2011 FEO 7 the Ethics Committee opined that a lawyer has affirmative duties to educate himself regularly as to the security risks of online banking; to actively maintain end-user security at the law firm through safety practices such as strong password policies and procedures, the use of encryption and security software, and the hiring of an information technology consultant to advise the lawyer or firm employees; and to insure that all staff members who assist with the management of the trust account receive training on and abide by the security measures adopted by the firm.

If Lawyer has taken reasonable care to minimize the risks to client funds, Lawyer is not ethically obligated to replace the stolen funds. If, however, Lawyer failed to use reasonable care in following the Rules of Professional Conduct on trust accounting and supervision of staff, and the failure is a proximate cause of theft from the trust account, Lawyer may be professionally obligated to replace the stolen funds.

Inquiry #5:

Lawyer is retained to close a real estate transaction. Prior to the closing, Lawyer obtains information relevant to the closing, including the seller’s name and mailing address. Lawyer also receives into his trust account the funds necessary for the closing. Lawyer’s normal practice after the closing is to record the deed and disburse the funds. Lawyer then mails a trust account check to the seller in the amount of the seller proceeds.

Hacker gains access to information relating to the real estate transaction by hacking the email of one of the parties (lawyer, realtor, or seller). Hacker then creates a “spoof” email address that is similar to realtor’s or seller’s email address (only one letter is different). Hacker emails Lawyer with disbursement instructions directing Lawyer to wire funds to the account identified in the email instead of mailing a check to seller at the address included in Lawyer’s file as previously instructed. Lawyer follows the instructions in the email without first implementing security measures such as contacting the seller by phone at the phone number included in Lawyer’s file to confirm the wiring instructions. After the closing and disbursement, the true seller calls Lawyer and demands his funds. Lawyer goes to Bank to request reversal of the wire. Bank refuses to reverse the wire and will not cooperate or communicate with Lawyer without a subpoena.

While pursuing other legal remedies, does Lawyer have a professional responsibility to replace the stolen funds?

Opinion #5:

Yes. Lawyers must use reasonable care to prevent third parties from gaining access to client funds held in the trust account. As stated in Opinion #4, Lawyer has a duty to implement reasonable security measures. Lawyer did not verify the disbursement change by calling seller at the phone number listed in Lawyer’s file or confirming seller’s email address. These were reasonable security measures that, if implemented, could have prevented the theft. Lawyer is, therefore, professionally responsible and must replace the funds stolen by Hacker. If it is later determined that Bank is legally responsible, or insurance covers the stolen funds, Lawyer may be reimbursed.

Inquiry #6:

While pursuing the remedies described in Opinion #2, may Lawyer deposit his own funds into the trust account?

Opinion #6:

Yes.

Generally, no funds belonging to a lawyer shall be deposited in a trust account or fiduciary account of the lawyer. Rule 1.15-2(f). The exceptions to the rule permit the lawyer to deposit funds sufficient to open or maintain an account, pay any bank service charges, or pay any tax levied on the account. Id. The exceptions were expanded in 1997 FEO 9 to include the deposit of lawyer funds when a bank would not route credit card chargeback debits to the lawyer’s operating account. These exceptions to the prohibition on commingling enable lawyers to fulfill the fiduciary duty to safeguard entrusted funds.

Therefore, notwithstanding the prohibition on commingling, Lawyer may deposit his own funds into the trust account to replace the stolen funds until it is determined whether the Bank is liable for the loss, insurance is available to cover the loss, or the funds are otherwise recovered. If Lawyer decides to deposit his own funds, he must ensure that the trust accounting records accurately reflect the source of the funds, the reason for the deposit, the date of the deposit, and the client name(s) and matter(s) for which the funds were deposited.

Inquiry #7:

With regard to all of the situations described in this opinion, what duties does Lawyer owe to the clients whose funds were stolen?

Opinion #7:

Lawyer must notify the clients of the theft and advise the clients of the consequences for representation; help the clients to identify any source of funds, such as bank liability and insurance, to cover their losses; defer a client’s matter (by seeking a continuance, for example) if necessary to protect the client’s interest; and explain to third parties or opposing parties as necessary to protect the client’s interests. If stop payments are issued against outstanding checks, Lawyer must take the remedial measures outlined in Opinions #1 and #2 to protect the client’s interest. Finally, Lawyer must report the theft to the North Carolina State Bar’s Trust Accounting Compliance Counsel.

Endnote
1. See e.g. N.C. Gen. Stat. §25-4-406.

(Mike Frisch)

August 19, 2015 in Professional Responsibility | Permalink | Comments (0)

Wednesday, July 15, 2015

No Inherent Sanction Authority When Settlement Breaks Down

A decision from the Massachusetts Supreme Judicial Court

The issue presented in this case is the scope of a judge's authority under the inherent powers of the court to order an attorney for a party to pay the other parties' attorney's fees as a sanction for the attorney's misconduct where that sanction is not authorized by any statute or court rule, and where the attorney has not violated a court order or rule of procedure. We conclude that a judge may exercise the court's inherent power to sanction an attorney with an assessment of attorney's fees only if the attorney has engaged in misconduct that threatens the fair administration of justice and the sanction is necessary to preserve the judge's authority to administer justice. Because we conclude that the judge abused his discretion in exercising the court's inherent powers to sanction the attorney under the circumstances in this case, and that the attorney's alleged misconduct was more appropriately addressed by a referral to the Board of Bar Overseers (board), we reverse the judge's order imposing sanctions.

The case involved a supermarket sale. The alleged misconduct was an attorney's solicitation letter to potential clients while a settlement was being negotiated. It was alleged that the settlement broke down due to the solicitation.

The court

The judge in this case essentially found that [attorney] Goren, by sending the solicitation letter, committed a breach of the "assumption of confidentiality" that was "central to the prospect of achieving settlement," and thereby thwarted a settlement that was on the verge of being executed, which wasted three months of attorneys' time that had been invested in negotiating the settlement, and "materially prejudiced" the court by delaying the judge's effort to move the consolidated cases towards trial. Further, although the judge recognized that he had no jurisdiction "[i]n a technical sense" to decide whether Goren had violated the rules of professional conduct, he nonetheless essentially found that Goren had violated these rules, and the judge relied on these violations to demonstrate that Goren had acted unreasonably to impede "the full and effective administration of justice." We review the judge's imposition of sanctions under the court's inherent powers for abuse of discretion. See Chambers, 501 U.S. at 55. "[A] judge's discretionary decision constitutes an abuse of discretion where we conclude the judge made 'a clear error of judgment in weighing' the factors relevant to the decision, . . . such that the decision falls outside the range of reasonable alternatives" (citation omitted). L.L. v. Commonwealth, 470 Mass. 169, 185 n.27 (2014).

We know of no other case, nor has one been cited by the parties or amicus, where a judge sanctioned an attorney pursuant to the inherent powers of the court for conduct that resulted in a breakdown of settlement negotiations where there was no breach of a settlement agreement or confidentiality agreement, and no violation of an order of the court or rule of procedure. The fair administration of justice does not require the settlement of a case; although the parties are free to settle their case, their entitlement under law is to a trial, not to a settlement in lieu of a trial...

It might be regrettable that money and time were wasted in negotiations that ultimately failed to bear fruit, but that risk is inherent in every negotiation. Because of the risk that judges may misuse the inherent powers to pressure a party to settle a case by threatening the party with sanctions, and also because of the risk that judges will be drawn into collateral disputes regarding what occurred during settlement negotiations by parties seeking sanctions, we must scrutinize with special care any exercise of the inherent powers in the context of settlement negotiations...

Because the alleged wrongs committed by Goren did not threaten the judge's ability to ensure the fair administration of justice, we conclude that the judge exceeded the inherent powers of a court by his assessment of attorney's fees and therefore abused his discretion in doing so.

(Mike Frisch)

July 15, 2015 in Hot Topics, Professional Responsibility | Permalink | Comments (0)

Monday, June 29, 2015

That's A Fact

The Fifth District Court of Appeal of Florida affirmed a criminal conviction and criticized defense counsel's advocacy

While no discussion of the merits of the case is required, we find it necessary to comment on the appellant's improper insertion of alleged facts in both the statement of the facts and the argument sections of her brief. As an appellate court, we are required to consider the facts in the light most favorable to the appellee, and the appellant must properly address the facts in that manner. Such was clearly not done by the appellant in this case. The facts in this case were highly disputed, and the trial court conducted an evidentiary hearing thereon. The court thereafter expressly found the testimony of the victim to be more credible than the testimony of the appellant. In spite of this explicit finding, the appellant's brief improperly presented as "fact" the testimony of the appellant, and counsel based her legal arguments on those facts. Such practices are inappropriate and unprofessional.

Hat tip to the excellent sunEthics blog. (Mike Frisch)

June 29, 2015 in Professional Responsibility | Permalink | Comments (0)

Wednesday, June 24, 2015

Attorney Who Failed To Report Abuse Disqualified

An opinion from the Oklahoma Supreme Court

The issue before this Court is whether the district court erred in sustaining the legal parent's motion to disqualify opposing counsel. The question we consider is whether the integrity of the judicial process is likely to suffer real harm when an attorney who represents a client in a proceeding to establish paternity and to determine custody of a minor child fails to report suspected child abuse to the proper authorities as required by statute, conducts a forensic interview of the child to obtain evidence to support the client's position, does not obtain the legal parent's permission prior to the interview, and files his own affidavit attesting to the credibility of the child's affidavit. We find that the district court did not err in sustaining the motion to disqualify opposing counsel when the attorney likely compromised the legal parent's right to a fair proceeding by contaminating the fact-finding procedure and by establishing a relationship of undue influence with the child...

Attorney inserted himself into the paternity proceeding as a forensic interviewer, interviewed a minor child without parental consent, and submitted a signed affidavit attesting to Child's credibility. Attorney and Child were the only persons present during the interview. Thus, Mother's only option to rebut the evidence presented in Child's affidavit, to ascertain what type of relationship Attorney may have established with Child during the interview, and to determine if Attorney distorted Child's recollections by suggestive or leading questions would be to call Attorney as a witness to Child's credibility. Were Attorney to testify at trial, the integrity of the judicial process would be harmed in all the ways Rule 3.7 is designed to protect against: (1) Attorney's interest in winning the case for Client would call into question his objectivity as a witness, (2) Attorney's dual role as advocate-witness could confuse the factfinder, and (3) public confidence would be shaken were Attorney allowed to interview Child without parental consent.

Holding

A lawyer is not prohibited from interviewing a child witness, and nothing in this opinion should be construed to prevent an attorney from interviewing a child witness. However, if an interview scenario results in circumstances similar to those here, then he or she is no longer able to continue as an attorney in that particular case. A lawyer in a proceeding to establish paternity and to determine custody of a minor child who ignores his statutory duty to report suspected child abuse, inserts himself into the role of forensic interviewer, interviews the minor child without the legal parent's consent, likely taints the fact-finding process with improper interviewing techniques, likely establishes a relationship of undue influence with the child witness, and submits affidavits attesting to a fact witness's credibility should be disqualified from all aspects of the proceeding. Mother proved by a preponderance of the evidence that Attorney's continued representation will likely cause real harm to the integrity of the judicial process. We affirm the district court's order sustaining the motion to disqualify counsel and remand for further proceedings. Attorney is disqualified not only from acting as an advocate at trial, but also from acting as an advocate in all aspects of the underlying proceeding.

There is a concurring/dissenting opinion that would disqualify counsel but not impose the "blanket restrictions" of the majority opinion.

While I concur that under the particular circumstances, the attorney in this case should be disqualified; I do not believe lawyers should be per se prohibited from interviewing a child witness in custody disputes. Of paramount importance in any legal decision affecting the welfare of a child is consideration of his or her best interests. The majority opinion renders this basic principle subservient to the mother's custodial rights and the majority's perceived transgression of ethical boundaries governing attorney conduct...

the abuse suffered by the minor child in this case was shocking. So much so, the trial court issued an emergency order placing custody of the child with father--a direct result of the efforts undertaken by counsel and father. There were allegations the step-father drank excessively, hit the minor child, and imposed inappropriate discipline such as forced calisthenics. Additionally, it was suggested mother inflicted undue physical punishment on her son. However, the real issue presented in the trial court was the sexual abuse endured by this child. Although mother and step-father were not the perpetrators, mother had knowledge of the child's illicit encounters. She discovered the molestation and notified father. However, she apparently did not fully disclose the severity of the situation and urged him not to confront the child. On January 11, 2014, the child voluntarily disclosed the ongoing sexual activity to his father.

The father's efforts to get help through public agencies failed

After receiving no assistance from DHS and weighing the urgency of the situation, father sought to protect his son by contacting his attorney. While the attorney's interview in this case may have exceeded what was necessary, there is no ethical proscription which forbids attorney interviews of children.  Moreover, at the time the child was not represented by counsel and a guardian ad litem had not been appointed. Inherent in a lawyer's responsibilities is the obligation to thoroughly evaluate the facts of each case. This includes seeking information through witness interviews. It should be noted that [attorney] Thomas served as a Tulsa County Sherriff's Deputy for ten years prior to entering law school. During his service, Mr. Thomas interviewed numerous victims of criminal acts, including child and domestic abuse.

 (Mike Frisch)

June 24, 2015 in Law & Society, Professional Responsibility, The Practice | Permalink | Comments (0)

Tuesday, June 9, 2015

No Ghosts In Rhode Island

The Rhode Island Supreme Court has decided that ghostwritten pleadings are improper but nonetheless vacated sanctions against three attorneys who had engaged in the practice

We have carefully considered the various comments of amici and, pursuant to our general supervisory authority, we declare the policy in our courts to be as follows: An attorney may provide legal assistance to litigants appearing pro se before courts, provided the scope of the attorney’s representation is reasonable and the litigant gives informed consent. See Rule 1.2(c). Such consent shall be in writing and shall set forth the nature and extent of the attorney-client relationship. An attorney, however, shall not assist a pro se litigant with the preparation of pleadings, motions, or other written submissions unless the attorney signs the document and discloses thereon his or her identity and the nature and extent of the assistance that he or she is providing to the tribunal and to all parties to the litigation. The attorney shall also indicate on the written document, if applicable, that his or her signature does not constitute an entry of appearance.

Unless and until we are persuaded otherwise, we believe that full disclosure of the attorney’s involvement, albeit limited, is the better practice.

The court's web page summary

This set of appeals emanated from the activities of three attorneys who authored pleadings, but did not disclose their respective identities, on behalf of pro se defendants in three separate debt collection cases, a practice colloquially known as ghostwriting.  These appeals presented the Supreme Court with two issues of first impression: (1) whether Rule 11 of the Superior Court Rules of Civil Procedure applies to an attorney who neither signed a pleading nor entered his or her appearance in the case; and (2) whether the anonymous preparation of pleadings for self-represented litigants is a permissible practice pursuant to the Supreme Court Rules of Professional Conduct.
 
The hearing justices imposed sanctions on each attorney for drafting, but not signing, answers and objections to dispositive motions on behalf of the three pro se defendants.  All three attorneys argued that Rule 11 did not apply to their respective situations because none had either signed the pleadings or entered an appearance.  The Supreme Court held that the conduct of the three attorneys did not violate Rule 11 and, accordingly, vacated the sanctions imposed by the three Superior Court orders.
  
The attorneys also argued that ghostwriting was a permissible form of limited-scope representation pursuant to Article V, Rule 1.2(c) of the Supreme Court Rules of Professional Conduct.  The Supreme Court declared the policy in our courts to be as follows: An attorney may provide legal assistance to litigants appearing pro se before courts, provided the scope of the attorney’s representation is reasonable and the litigant gave informed consent.  Such consent shall be in writing and shall set forth the nature and extent of the attorney-client relationship.  An attorney, however, shall not assist a pro se litigant with the preparation of pleadings, motions, or other written submissions unless the attorney signs the document and discloses thereon his or her identity and the nature and extent of the assistance that he or she is providing to the tribunal and to all parties to the litigation.  The attorney shall also indicate on the written document, if applicable, that his or her signature does not constitute an entry of appearance.
  
Through an order, the Supreme Court invited comment from members of the bench, bar, and public on the subject of limited scope representation in general and the practice of ghostwriting in particular.

In my view, the benefits that ghostwriting pleadings provide in terms of access to justice outweighs the harms. (Mike Frisch)

June 9, 2015 in Professional Responsibility, The Practice | Permalink | Comments (0)

Monday, April 20, 2015

Call for papers and nominations for Fred Zacharias prize, 2015

Thanks to Sam Levine at Touro Law for letting us know:

Submissions and nominations of articles are being accepted for the sixth annual Fred C. Zacharias Memorial Prize for Scholarship in Professional Responsibility.  To honor Fred's memory, the committee will select from among articles in the field of Professional Responsibility with a publication date of 2015.  The prize will be awarded at the 2016 AALS Annual Meeting in New York City.  Please send submissions and nominations to Professor Samuel Levine at Touro Law Center: slevine@tourolaw.edu.  The deadline for submissions and nominations is September 1, 2015.

A worthy project, honoring a good man. (Alan Childress)

April 20, 2015 in Conferences & Symposia, Professional Responsibility | Permalink | Comments (0) | TrackBack (0)

Tuesday, December 2, 2014

First Wife's Club Overturned

Hat tip to my favorite Florida ethics blog sunEthics for finding this opinion of the Florida Fourth District Court of Appeal.

In this case involving divorce and related proceedings, the husband's attorney also is his second wife.

His first wife moved to disqualify her.

The court here found the trial court's order of disqualification to be overbroad

We conclude that the order of disqualification departs from the essential requirements of law because it is not limited to Ferrer’s participation during the contempt hearing. As is well established by numerous Florida courts, the fact that Ferrer was a potentially necessary witness at the contempt hearing would not prevent her from serving as the former husband’s attorney in other pre-trial, trial, and post-trial proceedings.

But harsh words and a sanction for the first wife's counsel

Under normal circumstances, we would conclude this opinion by simply granting the petition and quashing the trial court’s order of disqualification and therein recognize that the order of disqualification was impermissibly overbroad. However, the actions of counsel for the former wife, Kenneth Kaplan, have transformed this "simple" matter into an unnecessary and protracted controversy by the failure of Kaplan to acknowledge clear and unambiguous controlling law directly adverse to his client’s position. As such, we are compelled to take the extraordinary but not unprecedented step of awarding appellate attorney’s fees as a sanction.

Nor did the court spare the second wife in a footnote

...we are deeply troubled by attorney Ferrer’s reply, since stricken, to the response to the petition. Ferrer does not aid her husband (and client’s) case by lobbing acrimonious grenades in the form of unprofessional comments directed at opposing counsel and the trial court. We are stunned at Ferrer’s disrespectful, offensive, and inflammatory argument directed at the trial judge...

Ferrer’s filings in this court, and indeed below, are verbose and unnecessarily digress in excruciating detail into irrelevant matters. An attorney who is too personally involved with the issues in a litigation should consider withdrawing or risk violating ethical duties owed to the client.

 The court found that the reply bordered on contempt. (Mike Frisch)

December 2, 2014 in Professional Responsibility, The Practice | Permalink | Comments (0) | TrackBack (0)

Wednesday, October 22, 2014

Ethics Journal Current Developments Issue Is Out

My favorite issue of the Georgetown Journal of Legal Ethics -our yearly compilation of student notes on current developments in ethics law -  has just hit the street.

This issue holds up well with the past editions and gives the reader excellent exposure to the hottest legal ethics issues that face 21st century members of the legal profession.

As co-faculty advisor (along with my colleague Professor Mitt Regan) to the journal, I am biased in its favor.

With that disclaimer, I highly recommend that all practitioners with an interest in ethics take a look.

Kudos to the journal staff for their hard work and dedication to this notable contribution to the profession. (Mike Frisch)

October 22, 2014 in Ethics, Hot Topics, Judicial Ethics and the Courts, Law & Society, Law Firms, Professional Responsibility | Permalink | Comments (0) | TrackBack (0)

Saturday, August 23, 2014

New Trial For Prosecutorial Misconduct

From the web page of the Tennessee Supreme Court

The Tennessee Supreme Court has ordered a new trial for Noura Jackson, a Shelby County woman convicted of the second degree murder of her mother, Jennifer Jackson, because the Court found there were constitutional errors made in the course of the proceedings.

The Court explained that during the 2009 trial, the lead prosecutor impermissibly commented upon the defendant’s exercise of her state and federal constitutional right to remain silent and not testify at trial. In addition, the Court said the prosecutor violated the defendant’s right to due process by failing to turn over to the defense a statement a key witness gave to law enforcement officers investigating the murder. The Court concluded that the State had failed to establish that these constitutional errors were harmless beyond a reasonable doubt.

Jennifer Jackson was stabbed to death on June 5, 2005, in the bedroom of the home she shared with the defendant. Around 5:00 a.m. that day, the defendant reported to neighbors and the police that she had discovered her mother’s body. After the defendant gave police conflicting statements about her whereabouts at the time of the murder and about how she sustained a cut to her hand, the police began investigating the defendant.

The defendant was charged with first degree murder, but she never admitted involvement in the crime, and no DNA evidence or scientific evidence implicated her. The prosecution’s case was based on circumstantial evidence alone.

The jury acquitted the defendant of first degree murder but convicted her of second degree murder. The defendant appealed. Although the Court of Criminal Appeals affirmed the conviction, the three judges on the panel did not agree on the rationale for their decision. One judge found no constitutional error. The other two judges found the lead prosecutor had violated the defendant’s constitutional right to remain silent but concluded that the error did not prejudice the defendant.

The Supreme Court concluded that the prosecution had violated two of the defendant’s constitutional rights: her right to remain silent and not testify at trial, and her right to due process of law. The Court explained that when constitutional errors occur in criminal trials, a new trial is required unless the State establishes that the error was harmless beyond a reasonable doubt. The Supreme Court concluded that the State had failed to make this showing, and as a result, the defendant is entitled to a new trial.

The Supreme Court expressed concern that the prosecutor had violated the more than 100-year-old legal rule prohibiting Tennessee prosecutors from commenting on a defendant’s exercise of the right to remain silent. The Supreme Court reiterated a statement first made in 1984, which is that“the subject of a defendant’s right not to testify should be considered off limits to any conscientious prosecutor.” The Supreme Court also cautioned prosecutors in the Thirtieth Judicial District to comply fully in the future with the 50-year-old legal rule requiring disclosure of material evidence to the defense.

Read the unanimous opinion in State v. Noura Jackson, authored by Justice Cornelia A. Clark.

(Mike Frisch)

August 23, 2014 in Professional Responsibility | Permalink | Comments (0) | TrackBack (0)

Wednesday, April 23, 2014

Practice Pointer: If Your Case Settles, Tell The Court

The New Jersey Appellate Division sharply criticized counsel who had failed to timely advise the court that the case had settled.

We were on the eve of filing a comprehensive opinion on the many issues raised in this appeal when, on April 9, 2014, respondent's counsel advised the matter had settled. Upon further inquiry, we learned the parties reached a settlement months ago. Despite our discretion to file an opinion when notified at such a late hour, we have decided not to file our opinion on the merits and now write to dismiss the appeal with the emphatic reminder that counsel must advise this court in a far more timely manner of a settlement or serious settlement discussions so that scarce judicial resources are not needlessly wasted.

But no sanctions

Because of the enormous amount of time needlessly expended in this matter, we have seriously considered the imposition of sanctions against both counsel pursuant to Rule 2:9-9, but instead have determined that the publication of this decision is sufficient deterrent to repetition. It is within our discretion to issue an opinion when notified of a settlement shortly before an opinion is scheduled to be released, and we have done so many times. We nonetheless dismiss this appeal.

(Mike Frisch)

April 23, 2014 in Professional Responsibility, The Practice | Permalink | Comments (0) | TrackBack (0)

Monday, February 24, 2014

Willfully Failing To Learn Of Conflict

The Virginia State Bar seeks comment on a proposed revision to the Imputed Conflicts Rule:

Pursuant to Part Six: Section IV, Paragraph 10-2(C) of the Rules of the Supreme Court of Virginia, the Virginia State Bar’s Standing Committee on Legal Ethics (“Committee”) is seeking public comment on a proposed amendment to Rule 1.10 of the Rules of Professional Conduct.

RULE 1.10

This proposed Rule amendment is intended to avoid a situation in which a lawyer avoids the imputation of a conflict of interest by avoiding the knowledge that another lawyer in the firm has a conflict as to the representation. Under the current standard of “knowing” that another lawyer in the firm is prohibited from undertaking the representation, a lawyer can avoid the application of Rule 1.10(a), which would impute a conflict to him, by willfully failing to learn the information that establishes the existence of the conflict. The proposed Rule amendment imputes a conflict if the lawyer “knows or reasonably should know” that another lawyer in the firm is prohibited from representing the client. The proposed amendment adds a new Comment [2a] to explain that the failure to maintain or use a system for identifying conflicts may be deemed a violation of Rule 1.10(a), if proper use of the system would have identified the conflict.

My comment --a good idea. (Mike Frisch)

February 24, 2014 in Law & Business, Professional Responsibility | Permalink | Comments (0) | TrackBack (0)

Thursday, February 13, 2014

DOJ Sends Critical Letter to Louisiana Supreme Court re its Bar Admission Process

Dane Ciolino (Loyola-New Orleans, Law) has blogged on the recent letter of warning the DOJ sent the state's supreme court and chief disciplinary counsel about the civil and disability rights of its applicants. The 10-page, supported letter is linked by Dane here. As he quotes it:

[W]e find that Louisiana’s attorney licensure system discriminates against bar applicants with disabilities by: (1) making discriminatory inquiries regarding bar applicants’ mental health diagnoses and treatment; (2) subjecting bar applicants to burdensome supplemental investigations triggered by their mental health status or treatment as revealed during the character and fitness screening process; (3) making discriminatory admissions recommendations based on stereotypes of persons with disabilities; (4) imposing additional financial burdens on people with disabilities; (5) failing to provide adequate confidentiality protections during the admissions process; and (6) implementing burdensome, intrusive, and unnecessary conditions on admission that are improperly based on individuals’ mental health diagnoses or treatment.

Dane adds, "The irrational methods and procedures Louisiana uses to evaluate the character and fitness of bar applicants have long been questionable. It is refreshing to see that someone else has noticed and may—and can—do something to fix them."

My ethics classes have been watching these C&F issues bubble up lately in this state, including complaints to and involvement by the Department of Justice Civil Rights Division. One student recounts the tale of a friend whose admission was granted conditionally in such a way that her name is published with all the history and conditions. Anyone googling her will quickly find that she self-reported her emotional issues and read the bar's detailing of that and its specific treatment conditions. Had they just admitted her there'd be no public record of her mandatory disclosures on her bar application; by granting conditional admission and publishing it, all the world gets to essentially read her candid C&F form.

This is no way to act professionally when the bar is supposed to be the gatekeeper of professionalism! I agree with Dane that the involvement of the DOJ may stir some serious introspection with the bar apparatus and Court to make its procedures and disclosure comply with the civil rights of the applicants. (Thanks to Lauren Michel and Alston Walker for sending me Dane's link, as well as other students.) [Alan Childress]

February 13, 2014 in Bar Discipline & Process, Professional Responsibility | Permalink | Comments (1) | TrackBack (0)

Wednesday, January 29, 2014

Ethics Of Private Adoptions

A recent opinion from the District of Columbia Bar Legal Ethics Committee:

Lawyers who represent clients, whether birth parents or prospective adoptive parents, in private or independent adoption proceedings in the District of Columbia must ensure their conduct conforms to the D.C. Rules of Professional Conduct. Private adoptions frequently give rise to a number of significant ethical obligations, not the least of which are duties arising under conflict of interest rules, that the lawyer must squarely address with his or her client or clients, often at the onset of the representation. In many instances, a lawyer will be required to obtain the informed consent of one or more clients, and in some circumstances that of former clients, regarding certain aspects of the representation, in order to commence or continue representation. Private adoption practitioners should be particularly mindful of ethical duties attendant to communications with unrepresented persons, as well as duties of confidentiality owed to both current and former clients.

(Mike Frisch)

January 29, 2014 in Clients, Current Affairs, Professional Responsibility | Permalink | Comments (0) | TrackBack (0)

Thursday, January 2, 2014

No Sanction For Paralegal Firm Switch Notice Violation

Sanctions imposed on plaintiffs' counsel in a medical malpractice case were vacated by the Connecticut Supreme Court.

The problem at issue was a paralegal who left the defendants' law firm and went to work for the plaintiffs' firm a year later. Defendant counsel sought assurances that the paralegal would not share information about the case. The sought-after assurances were not forthcoming.

The defense then sought disqualification.

The trial court denied the motion, finding that the paralegal had been properly screened but that the plaintiffs' counsel failed to comply with screening notice requirements. As a sanction, counsel was ordered to pay counsel fees for the motion.

The court here agreed that the notice obligation had been breached but found "no useful purpose in  remanding the case" for a fee calculation would be served.

The fees incurred for the motion were paid by the defendant's insurance carrier and collection had not been sought. (Mike Frisch)

January 2, 2014 in Professional Responsibility | Permalink | Comments (0) | TrackBack (0)

Tuesday, December 31, 2013

Immigration Advice To Criminal Defendant Deemed Sufficient

From the web page of the Tennessee Supreme Court, reporting on a December 23 opinion

The Tennessee Supreme Court today upheld the conviction of a man who said he wasn’t aware that his guilty plea would result in his deportation or adversely affect his future eligibility to return legally to the United States.

In 2011, Juan Alberto Blanco Garcia, an alien illegally residing in the United States, pled guilty to the felony of neglect of a child under six years of age. With the aid of an interpreter in court, Blanco Garcia said he understood the charges, the sentence possibilities and that his guilty plea was made freely and voluntarily.  The trial court did not advise the defendant of the immigration consequences of the plea or inquire whether his attorney had done so. 

Before he entered the plea, however, Mr. Blanco Garcia’s attorney told him that he would be deported based on his status as an illegal alien and the guilty plea. The attorney also told Mr. Blanco Garcia that the guilty plea could adversely affect his future eligibility to return legally to the United States, but she advised him to consult an immigration lawyer for more specific information about the issue.

After his conviction, Mr. Blanco Garcia filed a petition alleging that his attorney was ineffective and his plea involuntary because he was not informed of the future immigration consequences of the guilty plea.

The Supreme Court determined that the attorney fulfilled her obligation of effectively representing Mr. Blanco Garcia by advising him that he would be deported upon pleading guilty and that the guilty plea could have future adverse immigration consequences.  The Court explained that this general warning was sufficient because federal law did not clearly and succinctly describe the effect Mr. Blanco Garcia’s guilty plea would have on his future eligibility to return legally to this country. 

As to Mr. Blanco Garcia’s claim that his plea was unknowing and involuntary, the Court declined to decide whether the federal or state constitution requires courts to advise a person pleading guilty of the immigration consequences of the guilty plea.  The Court explained that, even assuming the trial court’s failure to advise Mr. Blanco Garcia of the immigration consequences of his plea amounted to constitutional error, the error was harmless because Mr. Blanco Garcia’s attorney had already informed him of the immigration consequences of his plea.

Read the Opinion in Juan Alberto Blanco Garcia v. State of Tennessee, authored by Justice Cornelia Clark.

(Mike Frisch)

December 31, 2013 in Clients, Professional Responsibility | Permalink | Comments (0) | TrackBack (0)

Monday, October 28, 2013

Awardees of Zacharias Prize announced

Samuel Levine of Touro Law Center and chair of the prize committee has announced that the "winners have been selected for the fourth annual Fred C. Zacharias Memorial Prize for Scholarship in Professional Responsibility.  The Prize will be awarded to Dana Remus, for Out of Practice: The Twenty-First Century Legal Profession, 63 Duke Law Journal __  (2013).  An Honorable Mention will be awarded to Norman Spaulding, for The Privilege of Probity: Forgotten Foundations of the Attorney-Client Privilege, 26 Georgetown Journal of Legal Ethics 301 (2013). The awards will be presented in January at the Section Breakfast of the AALS Section on Professional Responsibility." [Alan Childress]

October 28, 2013 in Professional Responsibility, Teaching & Curriculum | Permalink | Comments (0) | TrackBack (0)

Thursday, September 5, 2013

Bruce Green on the Lawyer's Independence

Recently posted to SSRN is a new paper by Bruce Green (Fordham), entitled Lawyers’ Professional Independence: Overrated or Undervalued? It is an article for the Akron Law Review. Here is a summary:

This article explores the concept of lawyers’ "professional independence" in the literature of the U.S. legal profession. It begins with some reflections on the conventional meanings of professional independence, which encompasses both the bar’s collective independence to regulate its members and individual lawyers’ independence in the context of professional representations, including independence from clients, on one hand, and independence from third parties, on the other. The article suggests that the professional conduct rules are overly preoccupied with protecting lawyers’ professional independence from the corrupting influences of other professionals. The article then turns to an aspect of professional independence that has largely dropped out of lawyers’ discourse but that deserves more attention, namely, lawyers’ independence from the courts. This includes: (1) freedom to criticize judges; (2) freedom to disobey arguably unlawful court orders; and (3) freedom to resolve certain ethical dilemmas for oneself, as a matter of professional conscience. The article maintains that as the bar has become strongly identified and allied with the judiciary, motivated by the interests in securing judicial protection from other government regulation and in securing the bar’s own institutional influence over individual lawyers, the bar has ignored this understanding and redefined professional independence consistently with a strong judicial role in regulating lawyers.

[Alan Childress]

September 5, 2013 in Abstracts Highlights - Academic Articles on the Legal Profession, Professional Responsibility | Permalink | Comments (0) | TrackBack (0)

Monday, May 20, 2013

Mandatory Pro Bono Proposed For New Jersey Bar Admission

The New Jersey Supreme Court has asked for comments on a report of a Working Group that calls for mandatory pro bono as a condition for admission in the Garden State.

The report identifies three primary goals: increase pro bono hours for underserved populations, give admittees real-life experience and "instill in future attorneys a desire to continue pro bono work throughout their legal career - the habit of doing good."

Query: does forced service really meet the last articulated goal?

The report calls for 50 hours of required service. (Mike Frisch)

May 20, 2013 in Professional Responsibility | Permalink | Comments (3) | TrackBack (0)

Monday, April 15, 2013

Georgia Upholds Right To Conflict- Free Defense Counsel

The Georgia Supreme Court has issued an opinion approving the conclusion of the State Bar Formal Advisory Opinion Board concluding that it is impermissible for attorneys employed in the circuit public defender office to represent co-defendants when a single lawyer would be prohibited from doing so.

The court found that the board's opinion was correct in light of the constitutional right to conflict-free counsel and the construction of Georgia's ethical rule concerning imputed conflicts. (Mike Frisch)

April 15, 2013 in Professional Responsibility | Permalink | Comments (1) | TrackBack (0)

Saturday, January 12, 2013

Confidentiality Issues When Former Client Claims Ineffective Assistance

A recently issued opinion of the District of Columbia Bar's Legal Ethics Committee deals with the issue of confidentiality when a former client claims ineffective assistance of counsel:

When a former client challenges a criminal conviction or sentence on the grounds of ineffective assistance of counsel (“IAC”), D.C. Rule 1.6(e)(3) permits the lawyer to disclose client confidences and secrets only insofar as reasonably necessary to respond to the client’s specific allegations about the lawyer’s representation. Where appropriate, the lawyer should take steps, such as seeking a judicial protective order or entering into an agreement with the prosecutor, to limit the use of such disclosures to the IAC proceeding.

The committee's conclusion:

D.C. Rule 1.6(e)(3) permits a defense lawyer whose conduct has been placed in issue by a former client’s ineffective assistance of counsel claim to make, without judicial approval or supervision, such disclosures of information protected by Rule 1.6 as are reasonably necessary to respond to the client’s specific allegations about the lawyer’s performance. Even so, a lawyer should reflect before making disclosures of protected information to prosecutors, courts, or others. A lawyer’s confidentiality obligations to her former client are broader than the attorney-client privilege. Although the former client’s claim likely waives the evidentiary privilege, that alone does not eliminate the broader confidentiality obligation owed under Rule 1.6. Nor does the limited “self-defense” exception to confidentiality in Rule 1.6(e)(3) open the door to unlimited disclosures to prosecutors, courts or others of protected information. The rule allows a lawyer to disclose protected information only to the extent “reasonably necessary” to respond to “specific allegations” by the former client. Reasonableness is a fact-bound issue about which others may later disagree. Lawyers who are uncertain about the permissibility of disclosing protected information in response to an IAC claim should consider seeking independent advice or judicial approval of the disclosure.

(Mike Frisch)

January 12, 2013 in Clients, Professional Responsibility | Permalink | Comments (0) | TrackBack (0)