3.07. Where a lawyer is subject to discipline; Choice of Law [Rule 8.5]

Rule 8.5 addresses two very important questions.  First, what disciplinary authority can discipline a lawyer?  Next, what ethical rules should you apply to determine whether a lawyer has committed misconduct? 

The first question is straight forward:  if a lawyer is licensed in a jurisdiction, then the lawyer is subject to discipline in that jurisdiction, and it does not matter where that misconduct occurs.  This makes sense.  If I am licensed in New York but commit murder in California, the New York disciplinary authorities should be able to discipline me for that conduct – even though it happened outside of New York.  Also, if I am licensed in more than one jurisdiction, then all of the jurisdictions where I am licensed can impose discipline for the conduct.  So, if I am licensed in both New York and California and commit murder in California, I would be subject to discipline in both New York and California.  Finally, a person who provides legal services in a jurisdiction is subject to discipline there even if they are not licensed there.  Once again this makes sense because a jurisdiction should be able to protect their citizens when anyone provides legal services, even if they are a non-lawyer.

When a lawyer has been disciplined in one jurisdiction and is subject to discipline in another, the second jurisdiction will often impose the same discipline.  This is known as reciprocal discipline.  Reciprocal discipline is imposed except in very rare circumstances such as when the process for imposing the discipline was so defective or inadequate that the lawyer was deprived of her due process rights or the evidence establishing the misconduct was so lacking that a court cannot justify accepting a finding of discipline.  Unless the lawyer can reach one of these high bars (which is very difficult), the adjudication of the first jurisdiction is final,  which means that the lawyer cannot challenge the findings in the second disciplinary proceeding.

Amanda Attorney is licensed to practice law in both Maryland and the District of Columbia.  A complaint was filed against Attorney for several ethical violations including incompetence (Rule 1.1) and failure to communicate with a client (Rule 1.4).  A complaint committee held a hearing on the complaint. The bar association and Attorney put on evidence at the hearing.  Ultimately, it was determined that Attorney violated both Rule 1.1 and Rule 1.4, and the sanction was indefinite suspension from the practice of law in Maryland.  The District of Columbia receives notice of the suspension and immediately issued an indefinite suspension from the practice of law in D.C.  Attorney challenged the D.C. sanction, arguing that she should have been able to put on evidence in D.C. before being sanctioned.  Is she right? In re Zdravkovich, 831 A.2d 964 (D.C. Cir. 2003)

No – she does not have the right to put on evidence.  As the Zdravkovich court notes: “We presumptively impose identical reciprocal discipline, unless the attorney demonstrates by clear and convincing evidence that the case falls within” one of the exceptions in the rule (set out above).  The court goes on to note why the attorney is barred from challenging the reciprocal discipline:  “Underlying our strict standard in reciprocal bar discipline cases is not only the notion that another jurisdiction has already afforded the attorney a full disciplinary proceeding, but also the idea that there is merit in according deference, for its own sake, to the actions of other jurisdictions with respect to the attorneys over whom we share supervisory authority.”[1]  Often reciprocal discipline orders are one paragraph – setting out that discipline has been imposed in another jurisdiction and the same discipline is being imposed in the second jurisdiction.

The second issue addressed in Rule 8.5 is slightly more complex.  It answers this question:  when a lawyer is subject to the ethical rules of more than one jurisdiction, which ethical rule should the lawyer follow?  These situations place the lawyer in an unenviable position.  If he acts consistent with the rule from one jurisdiction, he violates (and therefore, commits misconduct) in the other jurisdiction. Of course, the lawyer cannot comply with both.  Subpart (b) of Rule 8.5 answers the question:  what rule applies?

Caroline Counselor is licensed to practice law in both Florida and Montana.  Her office is in Gainesville, Florida.  One day, a client that Counselor represents in a divorce matter tells her: “I’m at my wits end.  I’m going to embezzle money from my job so I can pay the child support I owe.”  Counselor believes that the client will embezzle the funds.  Can the lawyer reveal this information to the authorities? 

The Florida Rules of Professional Conduct says that a lawyer “must reveal confidential information” if a lawyer reasonably believes it is necessary “to prevent a client from committing a crime.” (Rule 4-1.6(b)(1)).  On the other hand, the Montana Rules of Professional Conduct does not give a lawyer the right to disclose this conduct (Rule 1.6(a)).  The lawyer would be subject to discipline in one of these jurisdictions no matter what she does.  Rule 8.5(b)(1) resolves this dispute by providing that if the action relates to a matter that is pending before a tribunal, then you follow the rules of the jurisdiction where the matter is pending.  In the example above, the divorce matter is pending in Florida.  Therefore, the Florida rule applies and Counselor must reveal the information she received from her client to prevent the embezzlement.

Rule 8.5(b)(2) tells a lawyer which rule applies if a conflict in rules arise when there is not a case pending before a court.  This would include, for example, matters before a state or federal agency, transactional matters (mergers/acquisitions, contract negotiations, and formation of partnerships), and counseling only matters (tax advice, estate planning advice, etc.).  In these situations, where there is no court to anchor the decision as to which state’s rules apply, the question turns on where the lawyer’s conduct occurred, and you apply the rules of that jurisdiction unless the “predominate effect” of the conduct is in a different jurisdiction, and if it is, then you apply the rules of the jurisdiction where the effect occurred.  This test requires the lawyer to make an educated guess to decide which rule to apply.  Because it is possible that a disciplinary authority may later determine that the lawyer chose the wrong rule, Rule 8.5(b)(2) says that a lawyer cannot be disciplined even if she takes the wrong approach so long as the lawyer can show she “reasonably believe[d]” she chose the rule where the predominant effect of the lawyer’s conduct occurred.

Larry Lawyer is licensed both in Mississippi and Alabama and has an office in both states.  Lawyer’s primary office is in Mississippi and he only visits the Alabama office one day a week.  One day an Alabama couple comes to Lawyer’s Mississippi office for estate planning advice.  During the meeting, Lawyer gives the couple advice and drafts the estate planning documents (which the couple sign).  All of the couple’s property is in Alabama.  Subsequently, Lawyer learns information that making it a conflict of interest under the Mississippi ethics rules for Lawyer to continue the representation, but the Alabama rules do not make continued representation a conflict.  In determining how to proceed, should Lawyer look to the Mississippi or Alabama rules? [Based on N.Y. State Bar Ass’n Ethics Op. 1027 (2014)]

The Alabama rules would apply (and therefore no conflict of interest).  The first thing to note is that there is no court, so Rule 8.5(b)(1) does not apply.  So the next question is, under Rule 8.5(b)(2), where did the lawyer’s conduct occur?  Well, the conduct occurred in Mississippi – that is where the lawyer met the client, prepared the documents, and the documents were signed.  If that were all of the analysis then the Mississippi rules would apply.  Rule 8.5(b)(2) goes on to say, however, that where the “effect of the conduct” is not where the conduct happened – you apply the rules of the jurisdiction where the effect occurred.  In this case, the effect of the lawyer’s representation would be in Alabama.    This is because the property is in Alabama and the Alabama courts will be interpreting and enforcing the documents.  If you think about it this makes sense – although some events occurred in Mississippi, the state with the greatest interest in regulating the lawyer’s conduct is Alabama – where the effects of the lawyer’s actions will be felt.

With the increase in multi-jurisdictional practice and the loosening of the restrictions on unauthorized practice of law (we will discuss these changes in Topic 5), there was a question of whether a lawyer and their client should be able to agree which state’s ethics rules would apply.  After all, it is common in contracts to have a “choice of law” provision.  This was handled by allowing an agreement between lawyer and client in those situations where more than one jurisdiction’s rules could apply, and the lawyer is making a determination of where the lawyer “reasonably believes the predominant effect” of the lawyer’s conduct would be.  A lawyer and client cannot mutually agree to a jurisdiction if the conduct relates to a matter pending before the court or to a jurisdiction that has no relationship to the representation.[2]

[1] In re Zdravkovich, 831 A.2d 964, 968-69 (D.C. Cir. 2003).

[2] Rule 8.5, Comment [5].