LAWYERS & LIES: Part Four–On Negotiations

LAWYERS & LIES: Part Four–On Negotiations

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PROFESSIONAL ETHICAL RULES GOVERNING LAWYERS’ LYING, e.g., IN NEGOTIATIONS

1.   “As negotiator, a lawyer seeks a result advantageous to the client but consistent with requirements of honest dealing with others.” (ABA, Preamble [2], Texas. Preamble [2][i].)

2. A lawyer may not knowingly counsel a client to or assist a client in committing a crime or fraud, although a lawyer may advise a client as to the probable consequences of such contemplated action. (A-1.2(d), T-1.02(c). Both systems of rules define the term “knowingly” the same way, but they define the word “fraud” slightly differently, although both definitions of their “fraud”-definitions involve the idea and the language of  “purpose to deceive.”)

3.  A lawyer shall reasonably consult with his/her client about the means by which the client’s objective may be achieved.  This would include informing and explaining to the client what a lawyer cannot do as a result of controlling law, including the applicable ethical rules. (A-1.4(a)(2) and (4), T-1.02(f).)

4.  A lawyer may disclose confidential information from or regarding the client when it is reasonable to accomplish one or more of the following: to prevent the client from committing a crime or fraud, to prevent rectify, or mitigate injury in furtherance of the lawyer’s services when the act or activity has already begun,  to obtain legal advice, to avoid criminal or ethical charges against the lawyer, to deal with a lawsuit between the lawyer and client. (A-1.6(b)(2)-(5), T-1.05(C0((4)-(7).)  The rules are worded somewhat differently and applications may differ a bit.  The foregoing tried to capture both of them, but tends more toward the ABA rule.)I am tired of using the words “lawyer,” “attorney,” and “client” to summarize and paraphrase the rules. I will, therefore, switch to “L’ and “C.”

5.  L shall (= must = is obligated to) withdraw from representing C, if L’s continued representation of C would result in L’s violating the Rules of Professional Conduct or some other law, e.g., the law forbidding fraud.  (A-1.16(a)(1).)[ii]

6. L may withdraw if C persists in conduct which L has characterized to C as involving crime or fraud and has (at least thereby) advised not to perform or quite performing (A-1.16(b)(2)), or if L has advised C regarding the criminal or fraudulent character of his contemplated conduct,  and C goes forward anyway  (A-1.16(b)(3).) [For the purposes of this discussion Item #5 is vastly more significant than Item #6.]

7. L shall not knowingly “make a false statement of fact or law to a tribunal or fail to correct a false statement of material fact or law previously made to the tribunal by” L. (A-3.3(a)(1), T-3.03(a)(1) & 3,03(B). The A-rule and the T-rule are different when it comes to correcting past errors; the former covers corrections with respect to both fact and law, while the latter covers only facts.)

8.  L shall not knowingly offer evidence L knows to be false, and if has done so, he will correct the error upon learning the truth. (A-3.3(a)(3), (T-3.03(a)(5)-(b).)

9.  If L is representing C in an adjudicative proceeding, and L knows that C was, is, or intends to engage in criminal or fraudulent conduct related to the proceeding, then L “shall take reasonable remedial measures, including, if necessary, disclosure to the tribunal.” (A-3.3(b); the T-rules have no independent or equivalent or analog to 3.3 (b) in  T-3.03(b).) 

10. “In the course of representing [C, L] shall not knowingly: (a) make a false statement of a material fact or law to a third person; or (b) fail to disclose a material fact when disclosure is necessary to avoid assisting a criminal or fraudulent act by [C] unless disclosure is prohibited by Rule 1.6.” (A-4.1. T-4.01(a) is the same and A-4.1(a). [iii]) 

Comment [2] to the A-rule reads as follows:  “Under generally accepted conventions in negotiation, certain types of statements ordinarily are not taken as statements of material fact.  Estimates of price or value placed on the subject of a transaction and a party’s intentions as to an acceptable settlement of a claim are ordinarily in this category, and so is the existence of an undisclosed principal except where nondisclosure of the principal would constitute fraud.[iv]

11.  If L1 knows that L2 has violated the applicable rules of professional conduct and if that violation “raises a substantial question about [L2]’s honesty, trustworthiness, or fitness as a lawyer in other respects, [L1} shall inform the appropriate [professional/disciplinary] authority. (A-8.3, T-8.03.)

12.  It is professional misconduct, so no  L shall violate the ethical rules or either induce or assist someone else to do so, nor shall L commit [T: any “serious”] criminal acts [or any at all] that reflect adversely upon L’s “honesty, trustworthiness, or fitness”; of “engage in conduct involving dishonesty, fraud, deceit or misrepresentations[.] (A-8.4(a)-(c), T-8.04(a)(1)-(3).) 

Part One was published on July 17, 2014. Parts Two and Three were published on October 22, 2014.  

[i] Citations will hereinafter be abbreviated by  “A-“ for rules, etc., of the ABA, Model Rules of Professional Conduct, and “T-“ for the Texas Disciplinary Rules of Professional Conduct.  All of the underlinings in this list are mine, and they emphasize fraud since that is more or less the focus of this presentation.

[ii] This rule is related to the “Misconduct” rules in  Rule 8.4.

[iii] The T-rule is different when it comes to §(b).  Here is how T reads: 4.04(b): “fail to disclose a material fact to a third person when disclosure is necessary to avoid making [L] a party to a criminal act or knowingly assisting a fraudulent act perpetrated by [C].”  This is different from A-4.1(b): (1) the A-rule talks about “assisting” the T-rule talks about being a “party.” (2) The A-rule except disclosures prohibited by A-1.6, which prohibits the disclosure of lots of confidential information, whereas the T-rule contains no such exception. 

Question: Why is law included in both sections (a) but left out of both sections (b)?

[iv] The T-Comment is almost the same.  As to a party’s intention regarding settlement, the T-Comment #1 reads slightly different: “a party’s supposed intentions as to an acceptable settlement of a claim may be viewed merely as negotiating positions rather than as accurate representations of material fact.”

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LAWYERS & LIES: PART THREE

LAWYERS & LIES: PART THREE

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All Witnesses Lie

The first part of the following comes from a piece of fiction.  Many people believe it to be true.  I have little experience in criminal law, but I’m not so sure that it is true in civil litigation, as I shall suggest.  The fiction begins with the first quotation mark and ends with the last one.

Everybody lies.  Cops lie. Lawyers lie. Witnesses lie.  The victims lie.

A trial is a contest of lies.  And everybody in the courtroom knows this.  The judge knows this.  Even the jury knows this.  They come into the building knowing they will be lied to.

They take their seats in the box and agree to be lied to.

The trick if you are sitting at the defense table is to be patient.  To wait.  Not for just any lie.  But for the one you can grab on to and forge like hot iron into a sharpened blade.  You then use that blade to rip the case open and spill its guts out on  the floor.–MSQ

That’s my job, to forge the blade.  To sharpen it.  To use it without mercy or conscience.  To be the truth in a place where everybody lies.”

Michael Connelly, The Brass Verdict: A Novel p. 3 (New York: Little, Brown, 2008).  (This is a crime novel in which the lead character is a criminal defense lawyer.  He has appeared in at least one more ofConnelly’s novels.)

Here is one of my doubts.  There are degrees of lying. Connelly doesn’t seem to realize this. There is such a thing as big, and there is such a thing as small.

One of them is the out-and-out radical lie. (“I was not unfaithful to my husband, at all ever, though he was to me, as he told me many times when I would not haves sex with him, because I couldn’t.  He was too drunk.”)

And there are regular lies. (“I did not run that light.”)

There are more restrained lies. (“I don’t think I ran the light.”). And there are levels of these, just are there are for each of the listed categories.

There are lies of exaggeration. (“Last year, my wife weighed 216 lbs, before she lost weight.”)

Exaggeration has an opposite; it could be called lies of “Negative-ggeration.” These tend to be on the small size.  Maybe it’s because the “distance” between the degree of the lie and a zero-level of lying is always smaller than if the lie goes in the “opposite” direction.

Then there are subtle lies.  These are different, since they might be of various sizes. Big ones are great for impeachment; little ones are not.

Connelly may be right that every real trial contains some of these.  It might even be that in a big money trial every important member of the cast of witnesses tells at least one, at some level or other.  But I think he is suggesting that for every witness, there is at least one radical lie from that witness.

I doubt it, and I am not lying.  My statement is not even a “restrained” lie.

A Small Lie Here & There Do Not Really Add Up To Much Impeachment.  It Can Look Overly Hostile, Since It Is So Common.  However, What Counts As Small Depends On The Size And Nature Of The Case.  A Whole Long List Is Different; It’s The Opposite.–MSQ

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LAWYERS AND LIES: PART TWO

LAWYERS AND LIES: PART TWO

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American Lawyers Have to Lie

Here is what a leading Yale Law School scholar says about lawyers lying.  He says that it is “part of the “systematic interpretive engagement with the professional obligations of adversary advocates. . . .” It is part of the “ordinarily immoral conduct to which lawyers are professionally committed. . . .”

Of  course this is not the whole story he tells in his 250 page (not including endnotes) very complicated and often brilliant book, though one difficult to read.

Here we go.

Unlike juries and judges, adversary lawyers should not pursue a true account of the facts of a case and promote a dispassionate application of the law to these facts.  Instead, they should try aggressively to manipulate both the facts and the law to suit their clients’ purposes.  This requires lawyers to promote beliefs in others that they themselves (properly) reject as false.  Lawyers might, for example, bluff in settlement negotiations, undermine truthful testimony, or make legal arguments that they would reject as judges.  In short, lawyers must lie. [p. 3, emphasis added.]

[L]awyers are professionally obligated to lie and cheat [i.e., treat people unfairly], both under the positive law of lawyering as it stands and under any alternative regime of professional regulation that remains consistent with adversary adjudication’s basic commitment to a structural separation between advocate and tribunal. . . . The center of gravity of my argument remains the genetic structure of adversary lawyers, and in particular the separation between advocates and tribunals that constitute adversary adjudication’s core[.] [p. 4]

[P]rofessional ethics requires lawyers to betray their own senses of truth and justice in ways that contravene the ethic of self-assertion that dominates ordinary morality[.] [p. 5]

[L]awyers’  professional obligations to mislead and to exploit are incidents not of any specific, elaboration of the adversary ideal[,] but rather of that ideal itself.  The arise ineliminably out of the structural separation between advocate and tribunal, and the associated principles of lawyer loyalty and client control, that belong to every conception of adversary advocacy, no matter what its limits. [p. 8]

Daniel Markovits, A Modern Legal Ethics: Adversary Advocacy in a Democratic Age  (Princeton: Princeton University Press, 2008).   The author is a law professor at Yale, and for those of you who care about this kind of thing, he comes from a distinguished family amongst the law school professoriate, and elite economists.

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THE NATURE OF LEGAL AGENCY AND THEREFORE LAWYERS

THE NATURE OF LEGAL AGENCY AND THEREFORE LAWYERS

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The RESTATEMENT is as good as any other source. Here is what § 1(1) says:

“Agency is the fiduciary relationship which results from the manifestation of consent by one person to another that the other shall act on his behalf and subject to his control and consent by the other so to act.”

Notice that agency is in general a voluntary relationship. It is to be conceived in fundamentally dyadic ways. The agent acts on behalf of the principal. And the principal has the right to control the conduct of the agent. In fact, the law of many states, including Texas, is that a principal has the right to control the details of an agent’s activities. See State Farm Mut. Auto. Ins. Co. v. Traver, 980 S.W.2d 625, 627 (Tex. 1998). There is a school of thought and a strand of the law, which creates a division of labor between clients and lawyers. It has been variously described as “ends-means,” substance-procedure, strategy-tactics, or objective-means[,]” Wolfram at 156, with the client in control of what comes before the hyphens and the lawyer in control of what comes after the hyphens. TxDR 1.02(a)(1) provides that “a lawyer shall abide by a clients decision . . . concerning the objectives and general methods of representation[.] Cmt. #1 for this rule states the following: “The lawyer should  assume responsibility for the means by which the client’s objectives are best achieved thus, a lawyer has very broad discretion to determine technical and legal tactics, subject to the client’s wishes regarding such matters as the expense to be incurred and concern for third-persons who might be adversely affected.” Similarly, Hazard and Hodes comment on these matters in their commentary, THE LAW OF LAWYERING. Some Central Rules (etc.) of the Law of Agency: Duties of Agents. The most central of all is this one: Agents are always bound by a “Fiduciary Rule.” An Agent (“A”) has a duty to his Principal (“P”) to act solely and only for P’s benefit in all matters related to the agency, absent an informed agreement between P and A to some other effect. Here are some components of that Rule: A. A is always a fiduciary of P. (All agents are fiduciaries of their principals, but not all fiduciaries are agents.) B. A is not a fiduciary with respect to everything pertaining to P but only that which is within the scope of the agency. C. Every agency has some scope, whether express or implied. D. The scope of an agency is not always obvious or easy to determine. E. “However, an agent may be in such a confidential relationship to the principal that he has a duty of disclosure and fair dealing as to all matters.” RAg § 390 Cmt d.  This kind of rule will apply to some lawyers under some circumstances. F. Agents are in general not in a fiduciary relationship with their principals before the formation of the contract of agency and while they are negotiating the fee arrangements. The fee agreement is not (usually) within the scope of the agency. Sub-parts: 

“If, however, as in the case of attorney and client, the creation of the relation involves peculiar trust and confidence, with reliance by the principal upon fair dealing by the agent, it may be found that a fiduciary relationship exists prior to the employment and if so, the agent is under a duty to deal fairly with the principal and arranging the terms of the employment.” Id. at Cmt. e. Fees of agents can be percentages, e.g., of profits.

G. Obviously, agents must subordinate their interests to the interests of their principals, at least with respect to anything affecting matters within the scope of the agency. Sub-parts

For this reason, A may not compete with P, if the competition would affect matters within the scope of the agency, absent a fully informed agreement. A may not undertake an activity for a third party (“X”), where A’s activities for X are outside the scope of his agency arrangements with P, if those activities for X would have consequences for matters within the scope of A’s relationship with P, absent fully informed agreement.

H. A cannot serve the interests of someone other than P, if that service would adversely affect the interests of P, insofar as they pertain to matters within the scope of the agency, absent . . . . I. A’s duty to P are the same as those of a trustee to a beneficiary. J. A may lawfully injure the interests of P if A is acting in good faith, is acting outside the scope of the agency, and the interests of P are not interests related to the scope of the agency. K. If A acquires confidential information pertaining to P as a result of the existence of the agency relationship, you may not use that information to the disadvantage of P.(For this reason, A may not compete with P, if the competition would affect matters within the scope of the agency, absent a fully informed agreement. L. Because they are fiduciaries, agents have a duty of uberrima fidei (or, uberrima fides, or uberrimae fidae) with respect to their principals. Here is how the terms are defined: “Of the utmost good faith, a term applied to a category of contracts and arrangements where each party must not only refrain from misrepresenting to the other but must voluntarily and positively disclose any factor which a reasonable person in the position of the other party might regard as material in determining whether or not to undertake the contract. This requirement applies to contracts of guarantee, insurance, partnership, family arrangements, and certain others, but not such contracts as sale.” David M. Walker, THE OXFORD COMPANION TO LAW 1245 (1980). Or this:

“The most abundant good faith; absolute and perfect candor openness and honesty; the absence of any concealment or deception, however slight. A phrase used to express the perfect good faith, concealing nothing, with which a contract must be made; for example, in the case of insurance, the insured must observe the most perfect good faith towards the insurer.”BLACK’S LAW DICTIONARY 1690 (1968). See Mayes v. Mass Mut. Life Ins. Co., 608 S.W.2d 612, 616-17 (Tex. 1980), citing Stipcich v. Metro. Life Ins. Co., 277 U.S. 311(1927).

What might “utmost good faith” mean? Obviously something more than merely good faith, the Latin phrase for which is usually bona fides. The Latin phrase is not much used in discourse upon the law of agency, but if agents are fiduciaries with respect to their principals, then they have a duty of utmost good faith.  

A duty of utmost good faith requires that high level of good faith none higher than which the community can conceive. Otherwise, what would utmost really mean? In the end, if this suggestion actually were taken up by a court, a court would affirm my suggestion, but then temper with some remark about how everyone had to be reasonable (realistic, common sensical [if that’s a word], &c.) at all times. The court’s position would be inconsistent. –MSQ

 M. A fiduciary (and therefore an agent so hence a lawyer) can fail to succeed as a fiduciary and not be subject to blame.  Probably, if A has made a very reasonable attempt to act for the benefit of his P, then he is not blameworthy. Energetic trying counts for something. There is some blame if he is merely reasonable and not very reasonable. If he is negligent there is more blame. Some genuine trying counts for something, just a little less. At least the last one is a failure to be a fiduciary, but it is not a violation of the fiduciary duty. The violation is still not a refusal or even a refraining.

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Problems of Judges: Criminal–Performance & Victim

Problems of Judges: Criminal–Performance & Victim

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Judicial Poison

An Ohio judge, 72 years old, was poisoned by his wife. She used antifreeze that she poured into his drink. The marriage has lasted 45 years up until then. She did it as a device to secure medical treatment for him, not just for the poisoning but for other medical problems, as well. One wonders what the other medical problems were.  Any chance it was alcoholism?  She pleaded guilty to “felonious assault.”

October 2014. A Pa. judge, age 41, faced minor criminal charges when she side-swiped a car after crossing the center line and then took off. The other driver followed her and claims to have observed several other similar swerves.  On the other driver, there was a smell of booze.

The side-swiper was a “Magisterial District Judge,” no less. The charge was obstruction of justice. His lawyer said that this was private and did not reflect the way she would discharge her judicial duties.

To be sure, the charge is unusual, but doesn’t it fit? And surely it is better, in some ways, for her than DUI/DWI. Then again, maybe not.  If a judge obstructs justice in any part of his/her life, perhaps that person should not continue being a judge.  Better a drunk judge than a one with proclivities to injustice.

September 2014. A municipal judge in Philly, Pa. 61 years old, plead guilty to various federal charges–the usual, I guess mail fraud, wire fraud, etc.–arising out of his offering his “services” (judicial influence) in exchange for campaign contributions. He is scheduled for sentencing in January 2015, and the prosecutors are said to be recommending 2 yrs.

Municipal judges in Pa. must have a lot of judicial power since it was a gun charge involved. In some states, the usual type of case many judges hear is tipping over on a sidewalk while tying your shoes.

September 2014. A Nevada judge gave up his law license and his judgeship after pleading guilty to one count of a 19-count indictment, to wit: a wire fraud conspiracy charge. The case arose out of a $3M investment scheme. I guess he made a bet on an investment, of sorts. The prosecution will, it is reported, suggest 27 months at his January sentencing, and J. keeps his $150T yearly pension. (He must have been a judge a long time. Maybe he just got bored and decided to gamble.

If I were in LV, where he was a judge, I would bet he’s squealing. Wouldn’t you?

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