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THE ASSOCIATION OF THE BAR OF THE CITY OF NEW YORK

FORMAL OPINION 1994-2

COMMITTEE ON PROFESSIONAL AND JUDICIAL ETHICS

April 13, 1994

ACTION: FORMAL OPINION

TOPIC: Part-time administrative law judge; conflict of interest.

OPINION:

DIGEST: Part-time administrative law judge for Parking Violations Bureau may not receive a referral fee for a potential lawsuit against the Office of the Sheriff, which aids in the enforcement of the judge's rulings.

CODE: DRs 2-107(A), 2-107(A)(2); CJC Canon 2.

QUESTION

May a part-time administrative law judge make a referral and receive a referral fee for a potential lawsuit against an arm of the government that aids in the enforcement of the judge's rulings?

OPINION

The inquirer is a per diem administrative law judge, employed by the Parking Violations Bureau of the City of New York ("PVB"). This employment constitutes one-third of the inquirer's professional time. In this capacity, the inquirer adjudicates parking tickets issued by the PVB. In the event the inquirer upholds a ticket, the respondent has the right to appeal only after the fine ordered in the judgment is paid. If the fine is not paid, the Office of the Sheriff of the City of New York attempts to collect on the judgment. Under certain circumstances, the Sheriff is authorized to impound a car registered to a party with outstanding parking judgments.

The inquirer has been consulted by a potential client who claims to have been assaulted and injured by persons acting under the direction of the Office of the Sheriff while they were seizing a car registered to him. The car, which was towed because there were unpaid parking judgments against the client, has never been recovered. The potential client has asked the inquirer to refer the matter to litigation counsel in order to bring a civil action against the Office of the Sheriff and the City of New York. The inquirer has conducted a preliminary investigation of the matter and now wishes to refer this matter to another attorney from whom the inquirer would expect to receive a referral fee.

The inquirer asks whether it would be proper to refer this matter to litigation counsel and receive a fee for the referral and/or for the work already performed.

I.

As a part-time administrative law judge and a practicing attorney, the inquirer's professional conduct is governed by both the Code of Judicial Conduct ("CJC") and the Code of Professional Responsibility (the "Code"). n1 See Compliance with the Code of Judicial Conduct, contained in the Code of Judicial Conduct; N.Y. City 1990-4 (citing N.Y. City 814 (1956) and N.Y. State 365 (1974)).

n1 Because an administrative law judge has limited jurisdiction under certain circumstances not applicable herein, an administrative law judge may be exempt from certain of the prohibitions of the CJC. N.Y. State 594 (1989).

Application of the CJC and the Code to the facts presented produces the same result whether the inquirer decides to represent the potential client directly in a litigation against the City or to refer the matter to a third party with the expectation of receiving a legal fee either for the work performed to date or work to performed in conjunction with litigation counsel. DR 2-107(A) states:

A lawyer shall not divide a fee for legal services with another lawyer who is not a partner in or associate of the lawyer's law firm or law office, unless:

1. The client consents to employment of the other lawyer after a full disclosure that a division of fees will be made.

2. The division is in proportion to the services performed by each lawyer or, by a writing given to the client, each lawyer assumes joint responsibility for the representation.

3. The total fee of the lawyers does not exceed reasonable compensation for all legal services they rendered the client.

It is clear that the inquirer cannot accept a fee for a mere referral, but instead must satisfy the conditions set forth in DR 2-107(A)(2). If the inquirer expects to receive a fee based solely upon the value of the work performed prior to the date of the referral, that fee must bear a reasonable relationship to the legal services rendered in the matter as a whole. Id.; N.Y. City 81-65 (1981). If the inquirer expects to receive a fee based upon the amount of the recovery in litigation, the fee must be based upon the inquirer's continuing contribution to the action by assuming joint responsibility for the litigation or actually rendering legal services. Thus, in order for the inquirer to accept a fee from the litigation counsel, the inquirer must continue some measure of participation in the suit.

II.

Although the inquirer might not be confronted with a potential conflict of interest by commencing an action against a department of the City of New York with which the inquirer is not affiliated, because the inquirer is a judicial officer involved in the same parking enforcement system that led to the seizure, the facts suggest issues of potential conflict that are not easily resolved. In N.Y. City 894, this Committee concluded that, under certain circumstances, a private attorney may represent the City on a pro bono basis while simultaneously representing a private party in litigation with interests adverse to those of the City. n2 Accord N.Y. State 447 (1976) (when a government body is organized into a number of separate departments or agencies, such department or agency and not the parent governmental unit should be treated as the client for purposes of the rule which forbids the current representation of one client against another); see also N.Y. State 655 (1993).

n2 The Committee listed certain standards to be met to avoid the potential conflict: (i) it must be obvious that the lawyer can adequately represent interests of the City and private clients; (ii) informed consent of both parties must be obtained; (iii) matters cannot be substantially related; (iv) files and communication regarding matters must be kept entirely separate to the extent possible; (v) no representation by counsel to the client that legal representation of the City might assist private party in its litigation against the City.

The fact that the contemplated action will not name the PVB as a party does not relieve the inquirer of any potential conflict or appearance of conflict, which arises out of the perceived linkage between the PVB and the Office of the Sheriff with respect to the enforcement of parking judgments. Had the Office of the Sheriff committed the same acts in the enforcement of a judgment not connected to parking judgments, the conflict that we find here might not be present.

Another bar to the proposed arrangement is created by 22 N.Y.C.R.R. 100.5(b), which provides:

A part time judge may accept private employment or public employment in Federal, State or municipal department or agency, provided that such employment is not incompatible with judicial office or interfere with proper performance of the judge's duties.

Thus, a judge may not receive a fee, directly or indirectly, in a matter which originated in his or her court. N.Y. Advisory Committee on Judicial Ethics ("ACJE") 88-108. Nor may a part-time judge appear before a planning or appeals board of the municipality in which he or she sits. ACJE 90-59, 90-65. Accord, N.Y. State 632 (1991). In these opinions, a part-time judge intended to appear before a planning board in his capacity as a private attorney. The ACJE and State Bar concluded that although the judge had no jurisdiction to review decisions made by the zoning or planning board, he could not practice before said boards. n3 In reaching this determination, the ACJE and State Bar relied upon Canon 2 of the CJC, which states:

A judge should respect and comply with the law and should conduct himself at all times in a manner that promotes public confidence in the integrity and impartiality of the judiciary.

n3 N.Y. State 632 states:

Because the municipal judge is a permanent member of the municipality's governmental structure . . ., and has jurisdiction over some zoning matters, we concluded that the part-time judge must refrain from practice before the zoning boards within the same municipality.

In addition, the State Bar noted that zoning and planning matters are often fraught with emotion and that the involvement of the judge in these matters may reflect poorly on his office.

Applying the reasoning of these opinions to the situation here, we believe that the inquirer's involvement in this suit would be improper. Although the seizure of a car by the Sheriff's Department is an integral part of the enforcement scheme in which the PVB plays a major role, the acts that constitute the basis for the proposed litigation arise outside of the enforcement scheme. To the extent that the litigation raises issues limited to that tortious conduct and not issues related to the issuance of the tickets and collection of the consequent fines, the inquirer's participation in the litigation may not rise to a conflict of interest. Nonetheless, the appearance of conflict and partiality may exist. See also ACJE 91-29 (part-time judge could not act as pro bono counsel to association of police juvenile officers because 22 NYCRR 100.2 requires judges to avoid the appearance of impropriety. "[S]erving as counsel to an organization of police officers is not permissible, as there would be an appearance of partiality for any judge to act as counsel.").

Our conclusion here in no way bars the inquirer from maintaining a broad practice. In determining the scope of permissible work of a part-time judge, the ACJE and N.Y. State opinions appear to balance the need to avoid the appearance of partiality against the need to encourage service by part-time jurists by keeping to a minimum those areas of practice foreclosed to the judge. In ACJE 88-96, the Committee held that an administrative law judge may act as a town judge as the employment is compatible with judicial office and does not conflict or interfere with the proper performance of the judge's duties. A justice of the peace may act as a defense counsel for a criminal defendant in a town other than the town where he sits, "provided there is not reasonable likelihood due to proximity of the place of practice to the situs of his court. . . ." N.Y. State 150 (1970). But see N.Y. State 146 (1970) (judge who hears misdemeanors part-time cannot represent a defendant in a criminal matter in a higher court in same county); N.Y. State 181 (1971) (criminal practice by part time judge prohibited, but civil practice permitted); see also N.Y. State 146(a) 1970 (judges precluded from practicing criminal law, but not justices of the peace).

Here, we must balance the hardship imposed upon the inquirer resulting from the inability to commence or participate in an action against the City of New York and its agencies arising from the seizure of a car against the goal of promoting the integrity and impartiality of the adjudicative process. Although the likelihood of actual conflict herein is small, as the inquirer's jurisdiction as an administrative law judge is well defined, because the action arises in the context of the parking violations enforcement system, the representation will generate at the very least the appearance of a conflict of interest which should be avoided.

We therefore conclude that the CJC and the Code preclude the inquirer from representing a potential plaintiff in the contemplated action or from receiving a fee either for referring the matter to a different lawyer or for the work done to date. n4 As the matters pertaining to the contemplated action are sufficiently connected to the enforcement scheme within which the inquirer serves as an administrative law judge, participation in such litigation would not promote public confidence in the integrity and impartiality of the inquirer's role as an administrative law judge in violation of Canon 2 of the CJC. We do not believe that our interpretation of the Code and CJC materially restricts the inquirer's ability to engage in a broad civil and criminal practice. Our opinion does not preclude the inquirer from bringing actions against the City or the Office of the Sheriff under other circumstances. See N.Y. City 894. Rather, this opinion is based solely on the facts as presented. n5

n4 The inquirer may, of course, provide the prospective client with the name of an attorney capable of representing him or her without violating the duties discussed in this opinion. Only in extreme circumstances, not present here, would it be impermissible for an attorney to assist a client in finding successor counsel.

n5 We express no opinion as to whether the proposed arrangement would also be prohibited by applicable law, including the conflict of interest rules governing city employees. Nor do we express any opinion concerning the propriety of the inquirer's past conduct, i.e., undertaking of an investigation on behalf of the potential plaintiff with respect to potential claims against the Office of the Sheriff.

CONCLUSION

For the foregoing reasons, the question presented is answered in the negative.