CONFLICT OF INTEREST
COUNTY COMMISSION MEMBER'S LAW FIRM REPRESENTING
CLIENTS BEFORE THE COMMISSION
To: Richard E. Coates, Attorney for County Commissioner (Palm Beach County)
SUMMARY:
A prohibited conflict of interest under the second part of Section 112.313(7)(a), Florida Statutes, would be created were a member of a county commissioner's law firm to represent a client before the county commission; however, no conflict would be created were the representation to be before other boards of the county. CEO 77-126, CEO 78-86, CEO 88-40, CEO 89-47, CEO 96-1, and CEO 07-13 are referenced; CEO 76-142, CEO 03-3, and CEO 03-7 are distinguished.
QUESTION:
Would a prohibited conflict of interest be created were a member of a County Commissioner's law firm to represent a client before the County Commission?
Your question is answered in the affirmative.
By your inquiry, we are advised that Steven L. Abrams (Commissioner) serves as a member of the Palm Beach County Commission, recently having been appointed by the Governor to fill a vacancy. In addition, we are advised that the Commissioner is an attorney employed with a full-service law firm which operates five offices in the State, which contains over sixty-five practicing attorneys, and which has over one hundred total employees. Further, we are advised that the Commissioner's firm infrequently has represented clients before the Palm Beach County Commission and would like to do so prospectively, but that the Commissioner himself will not be representing clients before the County Commission.1
Continuing, regarding the Commissioner's relationship with his firm, you advise that he holds the title of "Partner," which you state is more accurately described as an "Of Counsel" relationship, with his essentially being an employee of the firm.2 Further, you advise that the Commissioner is paid a fixed salary by the firm, based upon his personal productivity, which has not changed as a result of his appointment as a County Commissioner, that his firm compensation is not based upon, nor derived from, funds paid to the firm on matters related to the County or the County Commission (and that he will not be compensated from such funds/fees of the firm, and that it is not the firm's standard practice to issue performance bonuses throughout the year, such that the Commissioner does not share in the profits of the firm. Additionally, you advise that the Commissioner does not have responsibility for the day-to-day or long-term management of the firm, nor is he privy to the firm's financial records, and that the firm is managed by its two equity shareholders and a professional, non-lawyer staff who enforce firm policies and control firm financial matters. And, you advise, the firm does not have access to the personal financial affairs of the Commissioner.
Also, you emphasize that the Commissioner will not appear before the County Commission in behalf of any of the firm's clients, that he will not lobby other County Commissioners on matters of interest to the firm's clients, that he will not have conversations or discussions with County staff or County employees relating to firm client issues, and that he will not participate in any way in the representation of the firm's clients in matters relating to the County Commission or the County. However, you advise that other attorneys of the firm and firm clients themselves may appear before the County Commission;3 that clients of the firm shall be advised (prior to commencing the representation) of the Commissioner's public office and its attendant legal/ethical obligations; that the Commissioner will declare a voting conflict, abstain from voting, and timely file CE Form 8B, regarding County Commission measures where firm clients or firm attorneys appear before the County Commission; and that no member of the firm will lobby the Commissioner. Additionally, you advise that the firm will advise its clients with business before the County Commission that the Commissioner will not provide any legal services in front of the County Commission in behalf of the client, and that each client must agree to the arrangement.
Relevant to your inquiry and contained within the Code of Ethics is Section 112.313(7)(a), Florida Statutes, which provides:
CONFLICTING EMPLOYMENT OR CONTRACTUAL RELATIONSHIP.—No public officer or employee of an agency shall have or hold any employment or contractual relationship with any business entity or any agency which is subject to the regulation of, or is doing business with, an agency of which he or she is an officer or employee . . .; nor shall an officer or employee of an agency have or hold any employment or contractual relationship that will create a continuing or frequently recurring conflict between his or her private interests and the performance of his or her public duties or that would impede the full and faithful discharge of his or her public duties.
As an attorney in the firm, the Commissioner has a contractual relationship with the firm and, consistent with our prior opinions, he also has a contractual relationship with each client of the firm. CEO 96-1, CEO 07-13.4 Therefore, we find, as we have in several situations similar to the Commissioner's, that his contractual relationship with the firm OR with clients of the firm would create a continuing or frequently recurring conflict between his private interests and the performance of his public duties, or would impede the full and faithful discharge of his public duties, under the second part of the statute, in the event a firm member represents a client before the County Commission.
We have said on more than one occasion that "[t]he representation of a client before a board of which one is a member interferes with the full and faithful discharge of one's public duties, in violation of s. 112.313(7)(a) . . . ." CEO 77-126, CEO 88-40. Even a single instance of such conduct impedes the performance of the public officer's duty, and thus violates the statute. CEO 78-86, CEO 89-47. Thus, it is clear that the Commissioner would be prohibited from representing clients before the County Commission. Further, in CEO 78-86, we found that this conflict of interest could not be mitigated or avoided by having another member or an employee of the public officer's professional firm represent the client before his board. Also, assuming the Commissioner's relationship to his firm to be a true "Of Counsel" relationship, a relationship arguably less beholden or tied to the interests of a firm or its clients than that of a partner, shareholder, or associate, we find that the prohibited conflict would nevertheless exist, due to his contractual relationship with the firm and a duty of loyalty to the firm's clients which would create a conflict when the firm was representing a client before the County Commission. See CEO 07-13; and see CEO 96-1 (Jacksonville Electric Authority member special counsel to law firm), in which we said:
because of the Board member's close, regular, and continuing relationship with the law firm and duty of loyalty to the clients of the law firm . . . An impediment to public duties could exist for the Board member to favor the law firm or the client (his private interests) and to disregard his public duty to act independently and impartially in the best interests of the JEA, when the firm's representation of the client involves the JEA.
In making our finding herein, we have not overlooked CEO 03-3, a previous opinion of ours in which we found that a conflict of interest would not be created under Section 112.313(7)(a) were other members of the law firm of a State Senator to represent clients before the Legislature, provided a number of conditions were adhered to. However, CEO 03-3 concerned a particular member of the Florida Legislature in a particular factual context; the government body of which the person seeking the opinion was a member (the State Legislature) differed significantly, in its membership size, operations, composition, and subject matters addressed, from the local government body of which the Commissioner is a member; and we made it clear in CEO 03-3 that its advisory effect, if any, beyond the effect on the person specifically requesting it went only so far as other members of the Legislature (not to persons at the local government level). See note 11 of CEO 03-3. In sum, notwithstanding that the Commissioner has represented that he would adhere to restrictions or conditions similar to those placed on the Senator in CEO 03-3, we find that the dynamic of local government (which, even in populous counties, is governed by boards with relatively small memberships), vis-à-vis private interests seeking its action, decisionmaking, or inaction, would remain qualitatively different from that of the State Legislature (a two-house body totaling 160 members), such that reasoning and safeguards akin to those present in CEO 03-3 would not prevent conflict.5 Moreover, as a member of a Commission whose membership is relatively small in number, the Commissioner's opportunity to impact County decisionmaking is much greater than that of a State Legislator to impact State decisionmaking.
Accordingly, we find that a prohibited conflict of interest under Section 112.313(7)(a), Florida Statutes, would be created were a member of the subject County Commissioner's law firm to represent a client before the County Commission.6
ORDERED by the State of Florida Commission on Ethics meeting in public session on June 12, 2009 and RENDERED this 17th day of June, 2009.
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Cheryl Forchilli, Chair
[1] More specifically, you advise that the Commissioner practices law in the area of transactions, working mostly with municipalities and other governmental entities in behalf of clients of his law firm, that he will not represent clients before the Palm Beach County Commission, including not participating in client matters that are before the County Commission, that he will participate in business development for all areas of the firm's practice, except regarding clients with issues before the County Commission, that the firm will put policies and procedures in place to prevent the Commissioner from participating in, or having express and detailed knowledge of, client matters before the County Commission, that the firm will notify the Commissioner of the names of clients with business before the County Commission, such that the Commissioner may take all actions necessary to comply with the State Code of Ethics, and that the firm will perform client conflict searches regarding the Commissioner, for all existing and new clients of the firm, on a regular and ongoing basis, to alert the Commissioner and the firm that a client has a matter pending before the County Commission, even if the firm is not representing the client in the matter.
[2]Also, you advise that, regarding the Commissioner and his firm, the title "Partner" does not denote ownership in the firm, that the firm uses the titles of "Shareholder," "Partner," and "Associate" to delineate between seniority and experience levels of the firm's attorneys, and that although the firm has many "Shareholders" and "Partners," it has only two equity members, neither of which is the Commissioner.
[3]Your inquiry states that other firm attorneys and firm clients "may appear before the [C]ounty [C]omission and conduct business with the [C]ounty." We do not read the underscored portion (our emphasis) of the statement to mean that clients of the firm will be selling goods or services to, or otherwise "doing business with," the County within the meaning of the first part of Section 112.313(7)(a), Florida Statutes, as we read your inquiry to focus on the second part of Section 112.313(7)(a). Instead, we read the underscored portion to refer to appearances before or discussions with the County Commission or County personnel. Also, we do not read your inquiry to present the question of whether a "regulatory" conflict of interest exists for the Commissioner under the first part of the statute.
[4]The Commissioner's position with the firm as set forth in the inquiry appears to us to be like the employee-member of the firm in CEO 07-13, rather than an "of counsel" relationship. However, assuming arguendo that his position is "of counsel," such that he would not hold a contractual relationship with every client of the firm (see CEO 03-7), our finding herein also is grounded in our reasoning (see CEO 96-1) which recognizes an "of counsel" attorney's duty of loyalty to the firm and the firm's clients.
[5]CEO 03-7 and CEO 76-142, also cited in your inquiry, have not been overlooked by us. However, neither opinion concerns the second part of Section 112.313(7)(a), the portion of the prohibition at issue regarding the Commissioner. While the "of counsel" status of a city council member/attorney negated some conflicts in CEO 03-7, the facts of the inquiry did not involve the member's firm's representation before the city council. And, assuming arguendo that the "legislative body" exemption of Section 112.313(7)(a)2, Florida Statutes, would apply to officers other than members of the Florida Legislature, it would not apply to conflicts arising under the second part of Section 112.313(7)(a). See CEO 03-3 and opinions cited therein.
[6]However, we find that a prohibited conflict under Section 112.313(7)(a) would not be created for the Commissioner due to representation by other members of his law firm before County boards other than the County Commission. These representations should be reported on CE Form 2 (Quarterly Client Disclosure); and the Commissioner should contact The Florida Bar regarding such representations. See CEO 07-13 (Question 2).