HomeMy WebLinkAbout85-508 WrightMr. Robert C. Wright
617 Sproul Street
Chester, PA 19013
STATE ETHICS COMMISSION
308 FINANCE BUILDING
P.O. BOX 11470
HARRISBURG, PA 17108 -1470
TELEPHONE (717) 783 -1610
January 24, 1985
ADVICE OF COUNSEL
85-508
Re: Pennsylvania Minorty Business Development Authority, Application of
Former Client
Dear Representative Wright:
This responds to your request for advice dated January 14, 1985.
Issue: The question posed regards whether you, as a member of the Board of
Directors of the Pennsylvania Minority Business Development Authority, (PMBDA)
may participate in the consideration of a loan application submitted to PMBDA
by an entity that you previously represented in your capacity as an attorney.
Facts: According to the information submitted to the Commission, you
currently serve as a member of PMBDA. In addition thereto, you are a
practicing attorney in the Commonwealth of Pennsylvania.
In approximately November or December of 1983, you were requested to file
the Articles of Incorporation for Chester Steel Production Company, Inc.,
hereinafter, the Company. This was accomplished on or about December 13,
1983. In order to finalize the incorporation process, you prepared a notice,
of Incorporation and had such notice published on February 3, 1984. The
notice as published, indicated that you were the "Solicitor" for the Company.
The aforementioned services were rendered as a courtesy.
The Company, according to your letter, has filed an application with
PMBDA. Said application may be considered on January 31, 1985.
Finally, you have indicated, and it will be assumed for the purposes of
this advice, that you have had no other association or dealings with the
Company and that you have neither acted on the Company's behalf nor rendered
other services for the Company.
Mr. Robert C. Wright
January 24, 1985
Page 2
Discussion: PMBDA is an authority created by statute which in part
provides financial assistance in the acquisition, maintenance and /or
ownership of business enterprises in the Commonwealth by persons who are
socially or economically disadvantaged. In order to receive such assistance,
a potential borrower must submit an application which must be approved by a
majority of the PMBDA Board of Directors present during the application's
consideration. The Board of Directors consists of 16 persons. You apparently
sit on the Board in your capacity as a member of the House of Representatives.
In light of the foregoing and for the purposes of this advice, you will be
considered a public official within the meaning of the Ethics Act. 65 P.S.
402.
The Ethics Act provides that: (a) No public official or public employee
shall use his public office or any confidential information received through
his holding public office to obtain financial gain other than compensation
provided by law for himself, a member of his immediate family, or a business
with which he is associated. 65 P.S. 403(a).
The Act defines "Business with which he is Associated" as any business in
which the person or a member of the person's immediate family is a director,
officer, owner, employee or holder of stock." The facts, as previously
outlined, indicate that as of February, 1984, you may have been employed by
the Company. There is a question regarding whether the nature of the services
rendered effect in any way the employee status. Had the Company's application
to PMBDA been active as of February, 1984, the Commission would have to
address this issue.
You currently, however, have no association with the Company and you also
have not acted on behalf of the Company in any other respect since the time of
the Company's initial incorporation. For the purpose of this advice it is also
assumed that no future representation of the Company is contemplated.
Additionally, the services rendered to the Company, involved the procedural
act of filing the Articles of Incorporation and thereafter advertising such
filing. You rendered no services regarding the Company's filing of the
application to PMBDA or in relation to the purpose for which the PMBDA loan
proceeds will be employed.
Based upon the foregoing factual circumstances, there would appear to be
no per se prohibition placed upon your participation in the consideration of
the Company's loan application by Section 403(a) of the Ethics Act. This
result is occasioned, not by any one particular factor, but rather by the
totality of the circumstances herein present.
Mr. Robert C. Wright
January 24, 1985
Page 3
Equal consideration must also be accorded to Section 1 of the Ethics Act,
which provides in part that public officials avoid even the "appearance of a
conflict with the public trust." 65 P.S. §401. This Section also requires
that the Act be liberally construed so as to promote complete disclosure.
With this in mind, it is the advice of counsel that you must disclose
your prior relationship with the Company not only to the other members of
PMBDA but also at the time of the public consideration of the application.
Such disclosure should be duly recorded in the minutes of the meetings.
Additionally, you are reminded that pursuant to the Ethics Act and the
opinion's of the Commission you may not use your official position to obtain
any business in a private capacity as an attorney. Opinion 80 -050, Sowers.
With regard to whether your participation in the consideration of the
Company's application presents an appearance of a conflict there would seem to
be no clear violation of the Ethics Act in light of prior Commission
interpretations. Opinion 83 -006, Miller. Of course, while you would not
necessarily be required to disqualify yourself from the application
consideration, such a disqualification would clearly obviate any possibility
that an appearance of a conflict of interest would exist. It is reiterated
however, that such a disqualification would not necessarily be required to
comply with Section 401 of the Ethics Act.
I note in closing that our review of this question is limited to the
applicability of and the questions raised under the Ethics Act. We are not
empowered to nor would we be able to render a determination of the
applicability of or requirements of the Pennsylvania Minority Business
Development Authority Act, the State Adverse Interest Act, or the Governor's
Code of Conduct.
Conclusion: You are not prohibited by Section 403(a) of the Ethics Act from
participating in the consideration of the Company's application. Your prior
association must be publicly disclosed as set forth above. You may not
utilize your public position to obtain any business in a private capacity.
While your removal from the consideration process is not required, such
removal would result in any possibility of the appearance of a conflict with
the public trust.
Pursuant to Section 7(9)(ii), this Advice is a complete defense in any
enforcement proceeding initiated by the Commission, and evidence of good faith
conduct in any other civil or criminal proceeding, providing the requestor has
disclosed truthfully all the material facts and committed the acts complained
of in reliance on the Advice given.
Mr. Robert C. Wright
January 24, 1985
Page 4
JJC /sfd
This letter is a public record and will be made available as such.
Finally, i you disagree with this Advice or if you have any reason to
challenge same, you may request that the full Commission review this Advice. A
personal appearance before the Commission will be scheduled and a formal
Opinion from the Commission will be issued. Any such appeal must be made, in
writing, to the Commission within 15 days of service of this Advice pursuant
to 51 Pa. Code 2,12.
Sincerely,
John' J. Cont no
General Counsel