BAR ASSOCIATION OF NASSAU COUNTY

COMMITTEE ON PROFESSIONAL ETHICS OPINION

 

Opinion No. 2008-01

(Inquiry No. 736)

 

Topic

 

Duty to report misconduct of another attorney – Attorney’s responsibility to report suspicion that opposing attorney may be proffering false evidence in litigation.

 

 

Digest

 

In the course of litigation over the purchase and sale of goods on consignment inquiring attorney, had cause to suspect that copies of sales receipts submitted by plaintiff in support of the claim were altered to misrepresent the value of the goods in dispute.  The inquiring attorney took steps to advise his adversary that the documents appeared altered, and offered to allow plaintiff’s counsel to inspect the originals.  Inquiring attorney reports that adverse counsel refused to inspect the original documents, and continues to maintain the authenticity of the copies as submitted by his client.  Inquiring attorney asks whether he is required to report his suspicion that adverse counsel has engaged in misconduct by proffering false evidence in support of his client’s claim.  The Committee finds that the inquiring attorney is not obligated under DR 1-103(A) to report his adversary’s conduct in proffering the disputed documents in support of his client’s claim unless and until inquiring attorney is satisfied by means of actual knowledge that adverse counsel has commenced or continued the client’s claim knowing that the documents are false. 

 

 

Code Provisions

 

DR 1-103

DR 1-102(A)(4) & (5)

22 NYCRR §1200.1(i)

EC 1-4

EC 8-5

 

 

Facts Presented

 

Inquiring attorney reports that he represents a client that buys, sells and accepts artwork on consignment.  The client was sued by a party seeking to recover $400,000 for artwork purportedly accepted by the client on consignment.  Annexed to the complaint in the lawsuit are photocopies of invoices, the originals of which were created on multipart pressure sensitive business stationary.  These invoices list the items which the plaintiff claims that the inquiring attorney’s client accepted on consignment and did not pay for or return.  The complaint was prepared and filed by the plaintiff’s attorney, but verified by the plaintiff.  Inquiring attorney compared the photocopied exhibits to original invoices in his client’s possession and discovered a number of discrepancies suggesting that plaintiff’s copies were altered to misrepresent the value of the property claimed to have been consigned.  On one such invoice it appears that the value of the item was changed from $25,000 to $125,000 and a different description of the item was substituted.  In another instance, an item is represented as having been consigned for $120,000, while the original invoice evidences a completed sale for the same item.  In other instances the amounts on the invoices were simply altered.  In one such invoice, the amount was changed from $500 to $5,000, in another from $500 to $1,500.  The inquiring attorney advises that all of the originals in his possession are authentic, and because they are on pressure sensitive paper cannot be altered without detection.  The inquiring attorney brought this information to the attention of adverse counsel and offered counsel the opportunity to review the originals so that counsel might  see for himself that the authenticity of the photocopies proffered with the complaint are suspect.  The attorney refused to view the originals and instead responded by letter accusing inquiring attorney’s own client of fraudulently altering the documents in question.  Under these circumstances, inquiring counsel wishes to know whether he is obligated by The Code of Professional Responsibility to report to disciplinary authorities what he perceives to be his adversary’s complicity in plaintiff’s use of fraudulent documents. 

 

 


Analysis


The inquiry raises the issue of an attorney’s obligation to report another lawyer’s misconduct to appropriate disciplinary authorities under circumstances which suggest that the lawyer may be complicit in his client’s attempt to perpetrate a fraud.  The law is a self-governing profession.  Therefore, in addition to regulating their own conduct, lawyers are charged with the obligation to police the conduct of other attorneys.  This principle is reflected in Ethical Consideration 1-4 which states:

 

The integrity of the profession can be maintained only if conduct of lawyers in violation of the Disciplinary Rules is brought to the attention of the proper officials.  A lawyer should reveal voluntarily to those officials all knowledge, other than knowledge protected as a confidence or secret, of conduct of another lawyer which the lawyer believes clearly to be a violation of the Disciplinary Rules that raises a substantial question as to the other lawyer’s honesty, trustworthiness or fitness in other respects as a lawyer.

 

Ethical Considerations are essentially aspirational goals rather than mandates on attorney conduct, and while illuminative of the issue, EC 1-4 defers to DR 1-103(A) of The Code of Professional Responsibility to define the nature and scope of the attorney’s duty to report the professional misconduct of another lawyer.  That rule provides as follows:

 

                        DR 1-103 [22 NYCRR §1200.4] Disclosure of Information to Authorities             

 

A. A lawyer possessing knowledge, (1) not protected as a confidence or secret, or (2) not gained in a lawyer’s capacity as a member of a bona fide lawyer assistance or similar program or committee, of a violation of DR 1-102 [22 NYCRR §1200.3] that raises a substantial question as to another lawyer’s honesty, trustworthiness or fitness as a lawyer shall report such knowledge to a tribunal or other authority empowered to investigate or act upon such violation.

 

 

At a minimum, DR 1-103(A) requires a lawyer to report any knowledge that another lawyer is guilty of any of the categories of misconduct enumerated under DR 1-102.  Reporting knowledge of another attorney’s misconduct is mandatory unless the knowledge was acquired as a confidence or a secret or if the knowledge was acquired in the course of aiding a lawyer in a lawyer assistance program. These programs, which are typically offered by bar organizations, help lawyers to overcome alcoholism, drug abuse and other personal problems effecting lawyers.  Because the obligation to report is predicated upon actual “knowledge”, the attorney need not report a mere suspicion or belief that another lawyer has engaged in a type of misconduct prohibited by DR 1-102. 

 

The circumstances related in the inquiry appear to implicate two categories of misconduct prohibited by DR 1-102(A):

 

A. A lawyer or law firm shall not:

 

         * * *

 

     (4) Engage in conduct involving dishonesty, fraud, deceit, or misrepresentation. 

 

     (5)   Engage in conduct that is prejudicial to the administration of justice.

 

 

As described in the inquiry, the adverse attorney’s own participation in altering the documents in question or the attorney’s actual knowledge of the fraudulent nature of the documents submitted in support of the claim can only be supposed.  The facts in the inquiry represent that the attorney has not seen the originals, which are in the possession of the inquiring attorney - although apparently as a result of that attorney’s own refusal to review the originals as offered by inquiring counsel.  The conduct described by DR 1-102(A)(4) contemplates a specific intent to deceive or at the very least a knowing disregard of the truth.  As defined by The Code of Professional Responsibility, “fraud” does not include conduct, “which lacks an element of scienter, deceit, intent to mislead or knowing failure to correct misrepresentations which can be reasonably expected to induce detrimental reliance by another.”  22 NYCRR §1200.1(i).  Here it cannot be determined what explanation the adverse lawyer’s client might have for any discrepancies that may exist among documents proffered at the very inception of the litigation.  And given the attorney’s responsibility to advance his client’s claims fully and zealously within an adversarial system of justice, the adverse attorney is not immediately bound to accept the inquiring attorney’s conclusions from the documents that he possesses or the version of the events that those documents might imply to inquiring counsel.  The litigation process provides a suitable means for determining the genuineness of evidence, and that process should not be frustrated or chilled by accusations of misconduct that have not been fully verified. Nevertheless, if the inquiring attorney is reasonably satisfied from the information currently available to him that the adverse attorney is knowingly submitting false documents to advance his client’s claims in the litigation he may, at his own discretion, report his suspicion of misconduct to the Court presiding over the matter or to the appropriate disciplinary body within the attorney’s jurisdiction in compliance with DR 1-103(A).

 

Our position that the attorney need only report the matter at the attorney’s discretion unless and until the attorney has actual knowledge of his adversary’s willful participation in a fraud or deceit is consistent with our opinion in Nassau County Bar OP. 98-12 (1998).  There, in the course of a contested family court proceeding, it was suspected that the opposing attorney had knowingly submitted papers to the court misrepresenting his client’s income and ability to meet his child support obligations.  Information obtained during the course of the investigation revealed that the defendant-spouse was deriving income “off the books” contrary to the representations made by his counsel in child support proceedings.  Since the inquiring attorney in that matter did not know whether his opposing counsel was aware of his client’s “off the books” income, this Committee concluded that the inquiring attorney’s first obligation was to confront the opposing attorney in order to give him an opportunity to learn the true information and take corrective measures as necessary to rectify any misrepresentation to the court.  We concluded that if the adverse attorney failed to take any corrective action in light of the information disclosed, then the inquiring attorney would be obligated to report the matter to the appropriate authorities pursuant to DR 1-103(A). 

 

The Committee concludes that the same level of knowledge is required before the inquiring attorney can be mandated to report his adversary’s conduct as “prejudicial to the administration of justice” pursuant DR 1-102(5).  Ethical Consideration 8-5 advises that:

 

Fraudulent, deceptive, or otherwise illegal conduct by a participant in a proceeding before a tribunal or legislative body is inconsistent with fair administration of justice, and it should never be participated in or condoned by lawyers.  Unless constrained by his obligation to preserve the confidences and secrets of the client, a lawyer should reveal to appropriate authorities any knowledge the lawyer may have of such improper conduct. 

 

Here, again EC 8-5 speaks of conduct involving willful dishonesty and alludes to an attorney’s obligation to report that conduct based upon the attorney’s own knowledge of its occurrence.  The Committee is conscious of the fact that there exists a wide range of conduct of lesser severity than rank fraud or deceit that might reasonably be expected to frustrate the administration of justice or undermine the public confidence in the legal system and the courts.  For this reason, while reaffirming an attorney’s discretion to report sufficient evidence of misconduct by another lawyer, we believe that mandating such a report is more prudently reserved to situations where an attorney’s knowledge of another lawyer’s misconduct is not dependent in any manner on suspicion or surmise.

 

 


Conclusion

 

An attorney who suspects that an adversary attorney has submitted fraudulent documents in support of claims made on behalf of his client in litigation is not required to report the suspected misconduct to the tribunal or to appropriate disciplinary authorities unless and until the attorney acquires positive knowledge of the adversary attorney’s complicity with a client’s fraud, deceit or misrepresentation; whereupon the attorney’s duty to report becomes mandatory unless the information is protected as a confidence or secret.

 

[Approved by the Full Committee on March 26, 2008]   


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