Month: October 2022

How Big is Your E? Ethics Rules Large and Small

Shappell Socal Rental Properties v. Chico’s FAS, Fourth App. Dist., Div. 3, case no. G060411, filed 10/17/22.

Ethics lawyers, like every group of professionals, have a jargon all their own. One thing you might hear them talk about is “ethics with a big E” as opposed to “ethics with a small e.” Ethics with a big E refers to the black letter rules and statutes setting forth norms of lawyer behavior. This includes the Rules of Professional Conduct, sometimes codified as statutes, and other statutes, in California the statutes in the State Bar Act (Bus. & Prof. Code section 6000 et seq.) Ethics with a small “e” is taken to mean an undefined territory more vast, all the norms of the legal profession that have not been reduced to “black letter” rules. One principal difference is consequence; violation of a Big E rule raises a presumption of unfitness to practice and justifies discipline, but the sanction for violating a small e rule is usually significantly less, maybe even just the opprobrium of fellow lawyers or a court. A useful concept to keep in mind is the difference between normative ethics (absolutely Big E rules) and descriptive ethics, i.e. what lawyers actually do, which can be Big E but is mostly small e.

The distinction is important in understanding the incivility crisis. For some years now, the profession and the courts have been moaning about the decline of civility in the profession. This has produced a torrent of task-forces, reports, civility codes and much hand-wringing about what to do about it. Part of the problem is a lack of Big E rules, at least in California. California did have a civility rule, former Bus. & Prof. Code section 6068(f), which stated that it was the duty of lawyer to avoid “offensive personality.” Three decades ago, I prosecuted a lawyer for offensive personality. He had a habit of losing his temper in depositions and doing things like throwing chairs around the room. Definitely not civil. California lost the “offensive personality” rule when the Ninth Circuit found it unconstitutionally vague in US v. Wunsch 84 F.3d 1110 (1996). Now, the most recent civility proposals in California are looking at beefing up Rule of Professional Conduct 8.4(d) which states that “[i]t is professional misconduct for a lawyer to:…(d) engage in conduct that is prejudicial to the administration of justice…” (see Committee on Professional Responsibility and Conduct meeting agenda 10/14/22, item F.1) and other rules.

Small e violations are not without consequence, even if that consequence is not discipline. Shappell illustrates this. The Court of Appeal reversed the order denying the motion to vacate the default judgment because Shappell’s counsel violated the rule that “[a]n attorney has both an ethical and statutory obligation to warn opposing counsel, if counsel’s identity is known, of an intent to seek a default and to give counsel a reasonable opportunity to file a responsive pleading.” This rule cannot be found in the realm of Big E. Instead it comes from case law, specifically LaSalle v. Vogel (2019) 36 Cal.App.5th 127, 137. In LaSalle, the Fourth District Court of Appeal concluded “unequivocally, and without qualification…. that [this] obligation is rooted in decades of case authority and… is reinforced by a statutory obligation arising under Code of Civil Procedure section 583.130.” Justice Bedsworth, writing for the court, cited the small e California civility guidelines as cementing this duty as an ethical rule:

In contrast to the stealth and speed … courts and the State Bar emphasize warning and deliberate speed. The State Bar Civility Guidelines deplore the conduct of an attorney who races opposing counsel to the courthouse to enter a default before a responsive pleading can be filed. (Fasuyi v. Permatex, Inc. (2008) 167 Cal.App.4th 681, 702, 84 Cal.Rptr.3d 351 (Fasuyi), quoting section 15 of the California Attorney Guidelines of Civility and Professionalism (2007).) Accordingly, it is now well-acknowledged that an attorney has an ethical obligation to warn opposing counsel that the attorney is about to take an adversary’s default. (Id. at pp. 701-702, 84 Cal.Rptr.3d 351.) LaSalle was previously discussed on the California Legal Ethics blog where I characterized it as A Judicial Cri de Coeur on Civility. It is an impressively written opinion but it still rests on small e as the court’s dismissal of Bellm v. Bellia (1984) 150 Cal.App.3d 1036 (LaSalle at 136) and its distinction of “legal” v. “ethical” shows. Big E is all about the law, the law that can get you suspended or disbarred.

But what about Code of Civil Procedure 583.130 cited as supporting a duty to warn before taking default? It says “It is the policy of the state that a plaintiff shall proceed with reasonable diligence in the prosecution of an action but that all parties shall cooperate in bringing the action to trial or other disposition.” This is real black letter law, right in the Code of Civil Procedure! Could this be a route to get from small e to Big E? California Bus. & Prof. Code section 6068(a) says that it is duty of lawyer to support the laws of the state of California. The State Bar Court Review Department held in In the Matter of Lilley (Review Dept. 1991) 1 Cal. State Bar Ct. Rptr. 476, that “that the Supreme Court interprets section 6068(a) as a conduit by which attorneys may be charged and disciplined for violations of other specific laws which are not otherwise made disciplinable under the State Bar Act.” The Lilley court was unclear as to whether this conduit was so wide as to admit a violation of a statute not in the State Bar Act but 6068(a) is broadly worded. The statute is also vague about what cooperation entails, much as Rule 8.4(d) is vague in lacking anything like a definition of the prohibited conduct beyond “prejudicial to the administration of justice.”

Vague but Wunsch-caliber vague? So far OCTC has shown no appetite for creative theories justifying civility prosecution. But small e can make a big difference in in the civil courts, especially in the Fourth Division.

Sticking By His Guns

In the Matter of Thomas, Review Dept. State Bar Court, 15-O-14870; SBC-20-O-00029 (Consolidated). filed 8/26/22. Respondent lawyer was admitted to practice in 1978. Despite a lack of prior discipline, the Review Dept. upheld a hearing judge’s recommendation of disbarment. Respondent engaged in a pattern of frivolous and harassing litigation over a period of eight years, which generated sanctions of $188,350.64. None of the sanctions were reported to the State Bar and none of this amount of was paid. The original litigation began in 2012 with a real estate dispute involving the True Harmony company. The lawyer was found to have violated section 6068, subdivision (c), by

“(1) making multiple claims and argument slacking any legal or factual basis and filing and pursuing an untimely motion (despite being forewarned that the motion was without merit and should be dismissed) in the interpleader action;

(2) filing a frivolous appeal of the interpleader action, which lacked any merit and was prosecuted for the improper purpose to harass and increase litigation costs;

(3) filing a motion for reconsideration in the True Harmony matter, which had no basis in law and unnecessarily increased the costs of litigation; and

(4) repeatedly pursuing improper appeals and filing frivolous and harassing briefs and/or motions, which unnecessarily increased the costs of litigation in the appeal of the True Harmony matter.

The hearing judge found culpability under section 6068, subdivision (c), for [the lawyer’s] use of abusive litigation tactics where he initiated and maintained multiple claims and defenses, at the trial and appellate levels, which were foreclosed by legal authority.”

The lawyer was also found to have violated former Rule 5-100 by threatening criminal charges against opposing counsel to gain an advantage in the civil litigation. He was also found culpable of violating Business and Professions Code section 6103 by failing to pay the sanctions and section 6068(o)(3) by failing to report the sanctions. Aggravation was found in a pattern of misconduct, significant harm to the opposing party and the administration of justice, and indifference toward rectification of the misconduct.

The lawyer made a number of arguments, including collateral attacks on the civil judgments, Constitutional objections, and unclean hands by the Office of Chief Trial Counsel (OCTC) in not investigation his claims of misconduct by opposing counsel. The Review Department rejected these arguments. Giving substantial weight to aggravating factors, including a pattern of misconduct spanning years, it recommended disbarment. Respondent now has the option of petitioning the Supreme Court, which he has vowed to do. In this closing argument at trial, Respondent stated that he was going to “stick to his guns” and so far he has been true to his word.