Florida Commission on Ethics renders opinion on possible voting conflict of non-lawyer law firm member who acts as a lobbyist  [Added 6/25/08]

    A Florida Village Commissioner is employed by Law Firm as a lobbyist.  Commissioner is a salaried, non-lawyer employee.  Law Firm provides lobbying services to Public Utility.  The Village commission will be voting on a franchise agreement with Public Utility.  At Law Firm, Commissioner "does not work on [Public Utility] issues" and "none of the clients she represents would be affected by the vote."  Commissioner asked the Florida Commission on Ethics whether it would present a voting conflict under Fla.Stat. sec. 112.3143(3)(a) for Commissioner to vote on the franchise agreement.  The Commission answered that it would not present a voting conflict.

    The Commission concluded:  "Our past opinions have indicated that each attorney in a law firm is "retained" by each of the firm's clients, and is therefore required to abstain from voting on matters inuring to the special private gain or loss of any client of the firm.  These rulings were underpinned by case law stating that the retention of a law firm obligates every member thereof to fulfilling the contract.  See, CEO 03-7.  The courts have not applied that concept to non-lawyer employees of law firms; nor have we.  In CEO 94-41, we advised a paralegal who served as a member of a city council that unlike the attorneys in the firm, her 'principal' would be the law firm where she was employed rather than any individual client of the firm, and that she would not have a voting conflict of interest in voting on matters inuring to the gain or loss of a firm client, so long as the client was not represented in the matter by her firm.  Consistent with the opinion, we find here that the Commissioner's 'principals' would be the firm where she is employed and her individual clients.  As you have represented that the measure at issue will not inure to the benefit or detriment of any of those persons or entities, no prohibited voting conflict of interest is presented."  Florida Commission on Ethics Opinion 08-13.

Lawyer-paralegal bonus agreement that violates ethical fee-splitting rule is not void as against public policy and is enforceable by paralegal  [5/9/08]

    Lawyer hired Paralegal, orally agreeing to pay Paralegal a salary plus "bonus wages" that were calculated as 10% of Lawyer's attorney's fees from cases on which Paralegal worked.  At the time, Paralegal did not know that such an arrangement would violate Rule 4-5.4(a), Florida Rules of Professional Conduct.  Lawyer failed to pay Paralegal the full bonus amount.  Paralegal sued to collect.  Lawyer defended by asserting that "the agreement was not enforceable against her because her own promise to pay [Paralegal] the bonus wages was 'unethical and thus void as against public policy.'"  Lawyer moved for summary judgment on the ground that the bonus agreement was unenforceable as a matter of law.  The trial court granted the motion, citing Chandris, S.A. v. Yanakakis, 668 So.2d 180 (Fla. 1995).  (In Chandris, the Florida Supreme Court ruled that a contingent fee agreement that did not comply with the Rules of Professional Conduct was void as against public policy and that, as a result, a lawyer could not recover attorney's fees based on such an agreement.)

    Paralegal appealed, and the Fourth DCA reversed.  Although the court noted that the parties did not dispute that the bonus agreement violated Rule 4-5.4(a)(4), the court distinguished Chandris on several grounds.  One distinction arose from the rationale underlying Rule 4-5.4(a)(4), which is to preclude "improper interference in a case by the paralegal" who expects to share in a percentage of the lawyer's fee.  The court stated that "[i]n contrast to the contingent fee rule at issue in Chandris, which directly protects the public by strictly regulating attorney-client fee agreements, the fee-sharing rule at issue here governs agreements between attorneys and nonlawyers in an employment context and has a less direct impact upon the public."

    Additionally, the court concluded that holding the Lawyer-Paralegal bonus agreement void "would discourage, rather than encourage, attorney compliance with" Rule 4-5.4(a)(4).  The court did not want to "reward non-compliance with the fee-sharing rule by permitting an unscrupulous attorney to repudiate a non-conforming agreement after reaping the benefit of the bargain."

    The court also invoked the doctrine of in pari delicto.  "In the instant case, [Paralegal], who is not a member of the Florida Bar, is (a) not regulated by the Rules Regulating the Florida Bar and (b) did not have knowledge that [Lawyer] was breaking the Rules.  We therefore find that [Paralegal] was an innocent party and not in pari delicto to this fee-sharing agreement."  Accordingly, the agreement was enforceable by Paralegal.

    The court concluded:  "While we recognize generally that the Rules of Professional Conduct of the Rules Regulating the Florida Bar promote the public interest, we find that the public interest is not advanced if an attorney is permitted to promise a bonus arrangement that violates the fee-sharing rule, and then invoke the Rules as a shield from liability under that arrangement.  We specifically limit our holding to the factual circumstances of this case involving an employment relationship between an attorney and a paralegal.  This opinion is not to be construed to apply to a proscribed referral fee arrangement, which is distinguishable because it raises a separate set of policy considerations."  Patterson v. A Law Office of Lauri J. Goldstein, P.A., 980 So.2d 1234 (Fla. 4th DCA 2008).

Florida Supreme Court discusses whether lawyers who share space are  a "firm" for conflicts imputation purposes  [Added 11/19/07]

    A convicted Defendant appealed the trial court's denial of his motion for postconviction relief.  Two of his claims related to alleged conflicts of interest.

Original trial counsel.  Attorney Jepeway was appointed to represent Defendant.  Jepeway selected Attorney Zenobi as co-counsel.  Defendant filed a motion to remove both lawyers due to alleged conflicts of interest.  Defendant had filed a complaint with the Florida Bar against Jepeway.  Jepeway represented Defendant at a competency hearing, where Defendant was found to be competent.  After that hearing the trial court ruled that, although the Bar complaint against Jepeway was meritless, it was a factor in creating conflict between attorney and client.  The court then removed Jepeway from the case and Zenobi continued to represent Defendant.

    On appeal Defendant "seems to argue that he is entitled to have his conviction automatically reversed because Jepeway acted as his counsel in the competency hearing."  The Supreme Court rejected this contention.  In order to prevail on an ineffective assistance claim, the defendant "must demonstrate that counsel labored under an actual conflict of interest that adversely affected counsel’s performance.  See Cuyler v. Sullivan, 446 U.S. 335, 350 (1980); Wright v. State, 857 So.2d 861 (Fla. 2003)."  There was a conflict due to the filing of the Bar grievance, but Defendant "neither alleged nor demonstrated how this impacted counsel’s performance at the competency hearing."

Successor trial counsel.  Defendant argued that Jepeway's conflict of interest was imputed to Zenobi because of the business relationship between the 2 lawyers.  "The arrangement between Zenobi and Jepeway consisted of shared office space, office expenses, and secretarial services."  The Court explained why it rejected Defendant's contention:  "The Florida Rules of Professional Conduct provide:  'While lawyers are associated in a firm, none of them shall knowingly represent a client when any 1 of them practicing alone would be prohibited from doing so.'  R. Regulating Fla. Bar 4-1.10(a).  The comment to the Preamble of the Florida Rules of Professional Conduct also notes:  'Whether 2 or more lawyers constitute a firm . . . can depend on the specific facts.  For example, 2 practitioners who share office space and occasionally consult or assist each other ordinarily would not be regarded as constituting a firm.'  Without some further significant demonstration approaching the level of a partnership or professional association, shared office space and secretarial services will not permit imputation of conflict.  [Defendant] fails to present any evidence upon which the trial court could have presumed conflict."  Connor v. State, 979 So.2d 852 (Fla. 2007) (revised opinion).