Unobvious Misconduct Under “catch-all” Rules 8.4(c) and (d)
| Publication year | 2022 |
| Pages | 36 |
FEATURE PROFESSIONAL CONDUCT AND LEGAL ETHICS
This article discusses interpretation of Colorado Rules of Professional Conduct 8.4(c) and (d), which are "catch-all" provisions that may prohibit conduct not explicitly addressed elsewhere.
Like the sign on eastbound 1-70 at Dead Man's Curve warning truckers that they are not yet down the mountain, lawyers should not be fooled if no specific Colorado Rule of Professional Conduct prohibits some questionable activity. Such conduct may be prohibited by one of the two "catch-all" rules designed to catch what the specific rules do not.
No ethics code can possibly address all forms of lawyer misconduct As stated in an 1856 US Supreme Court case, "it is difficult, if not impossible, to enumerate and define, with legal precision, every offense for which an attorney or counsellor ought to be removed."[1] For that reason, the ABA Model Rules of Professional Conduct include, and Colorado and most other states have adopted, two broad catch-all rules to cover conduct not addressed in a specific rule.[2] In Colorado, these rules are Colo. RPC 8.4(c), which, in relevant part, prohibits conduct "involving dishonesty, fraud, deceit, or misrepresentation," and Colo. RPC 8.4(d), which prohibits conduct "prejudicial to the administration of justice." These rules have survived constitutional challenge.[3]
It is not always obvious whether certain conduct violates these rules. Nonetheless, Colorado attorneys are "presumed to be aware of the Rules of Professional Conduct and their impact"[4] Thus, lawyers cannot defend themselves against a disciplinary charge by arguing they didn't know their conduct violated a rule of professional conduct [5] or saying they relied on another lawyer's advice regarding their ethical obligations.[6] For these reasons, lawyers need to know that certain conduct violates, or may violate, these rules. This article discusses the interpretation of these rules in ways that may not be obvious.
Colo. RPC 8.4(c)
Rule8.4(c) does not specifically prohibit lawyers from recording conversations surreptitiously, holding client funds in the lawyer's trust account to hide them from creditors, or acquiring the nonexclusive use of another law firm's name as a keyword so that the lawyer's name will pop up when someone searches for the competitor's firm online. But Colo. RPC 8.4(c) nonetheless prohibits the first two activities and may prohibit the third.
Engaging in Surreptitious Audio Recordings
A lawyer's surreptitious audio recording of another person may not be obviously dishonest—and may even be legally permissible—but it violates Colo. RPC 8.4(c)'s prohibition on conduct involving dishonesty, fraud, deceit, or misrepresentation. As the Colorado Supreme Court stated in 1989, "The undisclosed use of a recording device necessarily involves elements of deception and trickery which do not comport with the high standards of candor and fairness to which all attorneys are bound."[7]
Some lawyers assume that they may engage in surreptitious recording as long as it does not violate the criminal statute making it illegal.[8] Under that statute, if one party—which would include the party doing the surreptitious recording—has authorized the recording, it is not illegal.[9] A lawyer's covert recording still may be unethical, even if not illegal.
The prohibition against surreptitious recording by lawyers may be absolute. In 2003, the CBA Ethics Committee (Committee) suggested in a formal opinion that surreptitious recording should not be prohibited under two circumstances: (1) in "connection with actual or potential criminal matters, for the purpose of gathering admissible evidence"; and (2) in "matters unrelated to a lawyer's representation of a client or the practice of law, but instead related exclusively to the lawyer's private life."[10] The opinion, however, goes on to state that the "Committee recognizes that the Colorado Supreme Court has yet to recognize either of these exceptions to the general rule against surreptitious recording, and that the Committee's endorsement of the exceptions arguably is inconsistent with the Court's decisions in Selby and Smith."[11] Consequently, the Committee cautioned, "attorneys should exercise particular care in relying on this ethics opinion, which, like all CBA ethics opinions, is advisory only."[12]
Even if the prohibition against a lawyer engaging in surreptitious recording remains absolute, Colo. RPC 8.4(c) does not prohibit a lawyer from directing agents to surreptitiously record conversations, provided doing so is part of "lawful investigative activities."[13] That is because, in 2017, the Colorado Supreme Court amended Colo. RPC 8.4(c) to add an exception permitting a lawyer to "advise, direct, or supervise others, including clients, law enforcement officers, and investigators, who participate in lawful investigative activities." After the rule change, the Committee considered the amended rule's scope and limitations in a formal opinion. That opinion, CBA Formal Opinion 137, provides guidance to lawyers on what activities constitute "lawful investigative activities" under Colo. RPC 8.4(c).[14] Generally, the opinion advises that criminal investigations are likely to be considered lawful investigative activities as long as they are not "designed to mislead courts or other tribunals," and in civil matters, "investigative activities are likely to be considered lawful if they are designed to ferret out violations of constitutional, statutory, or common law."[15]
Hiding Money from Creditors in a Trust Account
Another example of dishonest conduct that may not be an obvious ethical breach involves the use of trust accounts. A lawyer's trust account is not a safe haven for client funds.[16] Nothing prevents a judgment creditor from garnishing client funds held in a lawyer's trust account.[17] However, creditors may not think to look for a client's funds in a lawyer's trust account. For that reason, a lawyer who uses the trust account to conceal a client's funds from creditors almost certainly exhibits dishonest conduct in violation of Colo. RPC 8.4(c).[18] A variation on this theme is a lawyer who deposits personal funds into a trust account to hide them from the lawyer's own creditors.[19]
Using Potentially Misleading Search-Engine Optimization Techniques
Certain search-engine optimization techniques may violate Rule 8.4(c). These techniques are typically designed to ensure that a lawyer's name appears high on the list of results that appear when potential clients search for a lawyer on the Internet. One such technique is for a lawyer to acquire the nonexclusive use of the name of a competitor lawyer or law firm as a keyword so that the lawyer's name will pop up when someone searches for the competitor by name. Other states' ethics committees have reached varying conclusions on the propriety of this technique, but a slim majority concludes that the technique does not violate those states' equivalent of Rule 8.4(c).[20] A Texas ethics opinion, for example, concludes that since businesses of all kinds use this technique, it is not dishonest or deceitful for Texas lawyers to use it.[21] Ethics opinions from North Carolina and Ohio, however, reach the opposite conclusion.[22] The Ohio opinion, for example, concludes that by purchasing and using a competitor law firm's name as a keyword for advertising, the advertising lawyer is attempting to deceive the consumer into selecting the advertising lawyer instead of the intended law firm, which constitutes deceitful conduct in violation of Rule 8.4(c).[23] Even if the consumer is not deceived, the advertising lawyer's attempt to deceive the consumer violates the prohibition in Rule 8.4(a) against attempting to violate a Rule of Professional Conduct, namely Rule 8.4(c).[24] There is no Colorado legal authority addressing this particular technique. The only thing that is clear is that other controversial search-engine techniques are bound to arise.[25]
Colo. RPC 8.4(d)
Rule 8.4(d) does not specifically prohibit a lawyer from being involved in a settlement agreement that requires a party not to file or to withdraw a grievance, from threatening to sue a witness or the complainant in a disciplinary proceeding, from failing to pay a court reporter or other litigation service provider despite the lawyer's legal liability to do so, from recording a notice of charging lien, or from associating with a lawyer in a case solely to force the judge's recusal. The rule has nonetheless been interpreted to prohibit these activities.
Conduct Prohibited in Connection with Settlement Agreements
Most Colorado lawyers know that Colo. RPC 4.5(a) prohibits a lawyer from threatening to present "criminal, administrative or disciplinary charges" to obtain an advantage in a civil matter or helping to present such charges "solely to obtain an advantage in a civil matter."[26] Fewer know that Colo. RPC 8.4(d) prohibits a lawyer from participating in, entering into, or even proposing a settlement agreement that requires a party—usually the lawyer's client or the opposing party—to withdraw a pending disciplinary complaint against a lawyer or to refrain from filing one.[27] Such conduct frustrates lawyers' duty to report misconduct and interferes with the attorney discipline system.[28] For this reason, "once a request for investigation has been filed, nothing short of deliberate misrepresentation by the complaining witness could affect grievance proceedings once they have been initiated."[29]
Despite the clear prohibition on lawyer involvement in settlement agreements that require a party to withdraw or refrain from filing a grievance against a lawyer, the same may not be true of settlement agreements that require the client...
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