CEO 88-8 ‑‑ February 4, 1988
CONFLICT OF INTEREST
CITY MAYOR'S LAW FIRM REPRESENTING CLIENTS
DOING BUSINESS OR LITIGATING WITH CITY
To: (Name withheld at the person's request.)
SUMMARY:
A prohibited conflict of interest would be created under Section 112.313(7), Florida Statutes, were the law firm of the mayor of a city to represent clients doing business with or litigating against the city, even where the mayor receives no fee or share of the profits from such representation, the mayor provides no personal representation of the clients, and the firm's partnership agreement provides that there is no partnership between the mayor and the firm with respect to the representation of such clients. CEO 82-7 is referenced. Similarly, a prohibited conflict of interest would be created were the mayor's law firm to be divided into two separate partnerships, with the partnership of which the mayor is not a member representing clients doing business with or litigating against the city and the partnership of which the mayor is a member representing clients in cases in which no conflict would exist, where the two partnerships would share office space and expenses but no fees, and where all partners of the former law firm with the exception of the mayor would be members of both partnerships.
QUESTION 1:
Would a prohibited conflict of interest be created were the law firm of the mayor of a city to represent clients doing business with or litigating against the city, if the mayor receives no fee or share of the profits from such representation, even if the mayor provides no personal representation of the clients, and the firm's partnership agreement provides that there is no partnership between the mayor and the firm with respect to the representation of such clients?
This question is answered in the affirmative.
In your letter of inquiry you advise that .... serves as Mayor of the City of St. Petersburg. You question whether the law firm of which the Mayor is a partner may represent clients doing business with the City or litigating with the City if the Mayor receives no fee or share of profits from those clients, the Mayor provides no representation to the clients, the partnership agreement of the law firm provides that there would be no partnership between the Mayor and the firm with respect to the representation of such clients, and the clients are advised of the situation prior to the time that an otherwise prohibited conflict situation would arise. In such situations, the Mayor and the firm simply would have an office and expense sharing arrangement, but would share no fees or profits. In all other situations, a full partnership would exist. You also question whether a prohibited conflict of interest would be created in this situation if the Mayor's professional association, of which he is the sole stockholder, is the partner of the firm rather than the Mayor, individually.
The Code of Ethics for Public Officers and Employees provides in relevant part:
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 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 private interests and the performance of his public duties or that would impede the full and faithful discharge of his public duties. [Section 112.313(7)(a), Florida Statutes (1987).]
In a previous opinion, CEO 86-37, we advised that this provision would prohibit a city mayor's law firm from representing a business entity doing business with the city, unless one of the exemptions contained in Section 112.313(12), Florida Statutes, were to apply. In addition, we advised in CEO 82-7 that a prohibited conflict of interest existed where a city mayor was a member of a law firm which represented clients with claims against the city. That opinion was based upon CEO 80-12, in which we advised that a prohibited conflict of interest would be created were a city commissioner to be employed as a attorney by a law firm which represented clients in suits filed against the city, and upon CEO 80-26, in which we advised that a city attorney's partnership interest in a law firm representing a client against the city would impede the full and faithful discharge of his public duties.
In CEO 82-7, we stated:
We are of the opinion that this conflict of interest would be eliminated only by terminating your firm's representation of the claimants. Personally withdrawing from the firm's representation of the clients by amending the partnership agreement so that you do not share in their fees would not eliminate the conflict of interest, which is based as much upon your relationship with the firm and your interest in the firm as upon your personal financial interests in the outcome of the clients' claims. Nor do we feel that full disclosure of your position to the City and to the clients followed by avoiding any communication with City officials or agents concerning the clients' claims would eliminate the conflict of interest. In this event, you still would maintain your relationship with the firm, which would be in communication with the City officials and agents who are subject to the supervision and authority of the mayor.
We remain persuaded of this view. Under the circumstances you have described, the Mayor would maintain a continuing financial interest in the law firm, which would be obligated to provide full, professional representation of clients in matters affecting the City of which the Mayor is the chief elected official. Further, we are mindful of the appearance of the situation to the public, who do not have access to the financial records of the firm but who would know of the Mayor's partnership with the firm and the firm's representation of a client with claims against the City or with the hope of doing business with the City. Nor do we find that the Mayor's incorporation of his practice in a professional association of which he is the sole stockholder would significantly affect the conflicting interests present between the City, the firm's clients, and the Mayor's involvement with the firm.
Accordingly, we find that a prohibited conflict of interest would be created were the law firm of the subject Mayor to represent clients doing business or litigating against the City, even if the Mayor receives no fee or share of the profits from such representation, the Mayor provides no personal representation of the clients, and the firm's partnership agreement provides that there is no partnership between the Mayor and the firm with respect to the representation of such clients.
QUESTION 2:
Would a prohibited conflict of interest be created were the Mayor's law firm to be divided into two separate partnerships, with the partnership of which the Mayor is not a member representing clients doing business with or litigating against the City and the partnership of which the Mayor is a member representing clients in cases in which no conflict would exist, where the two partnerships would share office space and expenses but no fees and where all partners of the former law firm with the exception of the Mayor would be members of both partnerships?
This question also is answered in the affirmative.
You question whether a prohibited conflict of interest would be created were the Mayor's law firm to be divided into two separate partnerships, with the partnership of which the Mayor is not a member representing clients doing business with or litigating against the City and the partnership of which the Mayor is a member representing clients in cases in which no conflicting relationship would exist. You advise that the two partnerships would share office space and expenses but no fees. All partners of the former law firm would be members of both partnerships, except that the Mayor would not be a partner of the partnership providing legal services to clients doing business or litigating with the City. All clients would be fully advised in advance so that no client doing business with or litigating against the City would assume that a partnership between the client's legal counsel and the Mayor would be providing representation to the client.
We note that under these circumstances the Mayor would have no direct financial interest in the law firm representing clients doing business with or litigating against the City. However, the question posed is not simply the question of whether a Mayor may be a partner in a law firm which shares space and expenses with another firm representing clients which are doing business with or litigating against the City. We cannot ignore the fact that all of the Mayor's partners would be partners in the other firm. Thus, the Mayor would maintain an ongoing professional relationship with every partner in a firm which would be representing clients either before or against the City.
Although the form of the situation would change from that presented in your first question, as a matter of substance and appearance of a conflict we cannot conclude that the situations differ materially. In both situations, the Mayor would not directly and personally benefit from the conflicting representation. However, every partner of his law firm would benefit. The term "conflict of interest" is defined in Section 112.312(6), Florida Statutes, to mean "a situation in which regard for a private interest tends to lead to disregard of a public duty or interest." In either case, the Mayor as the chief elected officer of the City would be confronted with matters involving clients of all of the partners of his law firm. While we do not mean to imply that the Mayor would be incapable of placing the City's interest above those of his law partners, the prohibition of Section 112.313(7)(a) is directed at employment and contractual relationships which coincide with a public officer's duties to create a situation which "tempts dishonor." See Zerwick v. State Commission on Ethics, 409 So.2d 57 (Fla. 4th DCA 1982). In summary, we see no way to distinguish the interests, obligations, and appearances of this situation from that posed in your first question.
Accordingly, we find that a prohibited conflict of interest would be created were the Mayor's law firm to be divided into two separate partnerships with the partnership of which the Mayor is not a member representing clients doing business with or litigating against the City and the partnership of which the Mayor is a member representing clients in cases in which no conflict would exist, where the two partnerships would share office space and expenses but not fees and where all partners of the former law firm with the exception of the Mayor would be members of both partnerships.