Loading...
HomeMy WebLinkAbout97-563 ConfidentialSTATE ETHICS COMMISSION 309 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 17108 -1470 TELEPHONE (717) 783 -1610 ADVICE OF COUNSEL May 2, 1997 97 -563 Re: Conflict, Public Official /Employee, Borough Council Member, Attorney, Legal work for Solicitor's law firm. This responds to your letters of April 1 and April 11, 1997 in which you requested confidential advice from the State Ethics Commission. Issue: Whether the Public Official and Employee Ethics Law presents any prohibition or restrictions upon a Borough Council Member from doing private legal work as an attorney for the Borough Solicitor's law firm. Facts: You are an elected Member of Borough A Council. You were originally elected for a four -year term beginning in 1992 and re- elected in 1996. In a private capacity you are an attorney practicing law as a sole practitioner. Mr. B is the present Solicitor for Borough A. Mr. B has served as Solicitor under several different Councils being first appointed in 1992 and serving through 1993. At the January, 1994 biannual reorganization, another attorney was appointed as Solicitor who served until mid -1995 when he resigned because of his failure to keep his license active. Mr. B was appointed to succeed him and was most recently appointed Solicitor at the January, 1996 reorganization. The membership of Council was different in part in each of these periods and in each case the appointments were made by open votes at public Council meetings. You have discussed a possible arrangement with Mr. B whereby you would occasionally perform legal work for Mr. B's law firm, Firm C on the following basis: 1. Employment status: You would continue to maintain your own practice and your own office and would not be an employee of Firm C. 2. Compensation: You would be paid on a time and cost basis, subject to variation and agreement in each instance. 3. Matters assigned: Firm C maintains the right to determine what, if any, matters are assigned to you; you likewise retain the right to accept or reject any matter. Confidential Advice of Counsel, 97 -563 May 2, 1997 Page 2 4. Borough A matters: You would not work on any matters for Borough A. 5. Council votes: You would abstain from voting on the approval of Mr. B's bills to the Borough or on his appointment as Solicitor. 6. Referrals: Firm C and you may refer clients to each other with a direct relationship between the client and the attorney to whom the client was referred. These referrals, including referral fees, would be handled as per the applicable rules of attorney conduct promulgated by the Pennsylvania Supreme Court. 7. Disclosure: Written disclosure of the existence of the relationship between Firm C and you would be made to the Borough A Council. You request an advisory as to whether the proposed arrangement is permissible under the Ethics Law or what changes might be required to comply. Discussion: It is initially noted that pursuant to Sections 7(10) and 7(11) of the Ethics Law, 65 P.S. §§407(10), (11), advisories are issued to the requestor based upon the facts which the requestor has submitted. In issuing the advisory based upon the facts which the requestor has submitted, the Commission does not engage in an independent investigation of the facts, nor does it speculate as to facts which have not been submitted. It is the burden of the requestor to truthfully disclose all of the material facts relevant to the inquiry. 65 P.S. §§407(10), (11). An advisory only affords a defense to the extent the requestor has truthfully disclosed all of the material facts. As a Council Member for Borough A, you are a public official as that term is defined under the Ethics Law, and hence you are subject to the provisions of that law. Section 3(a) of the Ethics Law provides: Section 3. Restricted Activities. (a) No public official or public employee shall engage in conduct that constitutes a conflict of interest. The following terms are defined in the Ethics Law as follows: Section 2. Definitions. "Conflict or conflict of interest." Use by a public official or public employee of the authority of his office or employment or any confidential information received through his holding public office or employment for the private pecuniary benefit of himself, a member of his immediate family or a business with which he or a member of his immediate family is associated. "Conflict" or "conflict of interest" does not include an action having a de minimis economic impact or which affects to the same degree a class consisting of the general public or a subclass Confidential Advice of Counsel, 97 -563 May 2, 1997 Page 3 consisting of an industry, occupation or other group which includes the public official or public employee, a member of his immediate family or a business with which he or a member of his immediate family is associated. In addition, Sections 3(b) and 3(c) of the Ethics Law provide in part that no person shall offer to a public official /employee anything of monetary value and no public official /employee shall solicit or accept anything of monetary value based upon the understanding that the vote, official action, or judgement of the public official /employee would be influenced thereby. Section 3(j) of the Ethics Law provides as follows: Section 3. Restricted activities (j) Where voting conflicts are not otherwise addressed by the Constitution of Pennsylvania or by any law, rule, regulation, order or ordinance, the following procedure shall be employed. Any public official or public employee who in the discharge of his official duties would be required to vote on a matter that would result in a conflict of interest shall abstain from voting and, prior to the vote being taken, publicly announce and disclose the nature of his interest, as a public record in a written memorandum filed with the person responsible for recording the minutes of the meeting at which the vote is taken, provided that whenever a governing body would be unable to take any action on a matter before it because the number of members of the body required to abstain from voting under the provisions of this section makes the majority or other legally required vote of approval unattainable, then such members shall be permitted to vote if disclosures are made as otherwise provided herein. In the case of a three - member governing body of a political subdivision, where one member has abstained from voting as a result of a conflict of interest, and the remaining two members of the governing body have cast opposing votes, the member who has abstained shall be permitted to vote to break the tie vote if disclosure is made as otherwise provided herein. If a conflict exists, Section 3(j) requires the public official /employee to abstain and to publicly disclose the abstention and reasons for same, both orally and by filing a written memorandum to that effect with the person recording the minutes or supervisor. In the event that the required abstention results in the inability of the governmental body to take action because a majority is unattainable due to the abstention(s) from conflict under the Ethics Law, then in that event voting is permissible provided the disclosure requirements noted above are followed. See, Mlakar, Advice 91- 523 -S. Confidential Advice of Counsel, 97 -563 May 2, 1997 Page 4 In applying the above provisions of the Ethics Law to the instant matter, it is noted that Section 3(a) of the Ethics Law does not prohibit public officials /employees from outside business activities or employment. However, the public official /employee may not use the authority of office for the advancement of his own private pecuniary benefit or that of a business with which he is associated, Pancoe, Opinion 89 -01 1, nor may he use confidential information received by holding public office/ employment for such a prohibited private pecuniary benefit. A public official /employee must exercise caution so that his private business activities do not conflict with his public duties. Crisci, Opinion 89 -013. The Commission has held that in the event the private employer or business has a matter pending before the public official's /public employee's governmental body, or if the public official /public employee as part of such official duties must participate, review or pass upon such a matter, a conflict exists. Miller, Opinion 89 -024. Furthermore, matters before the governmental body involving clients of such a business with which the public official /public employee is associated present a conflict of interest for the public official /public employee. Miller, supra; Kannebecker, Opinion 92 -010. Finally, a reasonable or legitimate anticipation that a financial relationship will develop may itself form the basis for a conflict of interest. Garner, Opinion 93 -004; Amato, Opinion 89 -002. While Section 3(a) would not prohibit you from doing legal work as an attorney for the Solicitor's law firm, you would probably encounter with some frequency situations that would constitute a conflict of interest for you as a Councilmember, and which would require you to abstain from participation and satisfy the disclosure requirements of Section 3(j). You would have a conflict of interest as to matters before Council involving: the Solicitor, such as the appointment, termination, fees and payments; members of the Solicitor's law firm; matters before the Borough handled by the Solicitor's law firm; your law clients; as well as in the situations generally noted above. In each instance of a conflict of interest, you would be required to abstain from participation and to fully satisfy the disclosure requirements of Section 3(j). The propriety of the proposed conduct has only been addressed under the Ethics Law; the applicability of any other statute, code, ordinance, regulation or other code of conduct other than the Ethics Law has not been considered in that they do not involve an interpretation of the Ethics Law. Specifically not addressed herein is the applicability of the Borough Code or New Rules of Professional Conduct. Conclusion: As a Council Member for Borough A, you are a public official subject to the provisions of the Ethics Law. Although Section 3(a) would not prohibit doing legal work as an attorney for the Solicitor's law firm, you would have conflicts of interest as to matters before Council as noted above. In each instance of a conflict of interest, you would be required to abstain from participation and to fully satisfy the disclosure requirements of Section 3(j). Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Law. Pursuant to Section 7(11), 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 Confidential Advice of Counsel, 97 -563 May 2, 1997 Page 5 the material facts and committed the acts complained of in reliance on the Advice given. This letter is a public record and will be made available as such. Finally, if you disagree with this Advice or if you have any reason to challenge same, you may appeal the Advice to the full Commission. A personal appearance before the Commission will be scheduled and a formal Opinion will be issued by the Commission. Any such appeal must be in writing and must be actually received at the Commission within thirty (30) days of the date of this Advice pursuant to 51 Pa. Code §13. 2(h). The appeal may be received at the Commission by hand delivery, United States mail, delivery service, or by FAX transmission (717- 787 - 0806). Failure to file such an appeal at the Commission within thirty (30) days may result in the dismissal of the appeal. Si cerely, Vincent J.`Dopko Chief Counsel