Inquirer has asked whether it is ethical to serve as a member of the Worker's Compensation Appeal Board while his law firm continues to practice before the Board and, if so, whether Inquirer could share his salary as a Board member with his partners or accept a reduced partnership share reflecting inquirer's salary as a Board member. For the reasons which follow, the Professional Guidance Committee believes that current ethical rules bar a lawyer from serving as a member of a quasi-judicial body while the lawyer or his or her law firm continues to practice before the body fn1.
There can be little doubt that the Worker's Compensation Appeal Board performs quasi-judicial functions. The Board has the power to review a referee's decision and to determine whether an error of law has been committed or that an award or disallowance of compensation was warranted by sufficient competent evidence or was procured by fraud, coercion or other improper conduct of any party in interest. 77 P.S. §853. Moreover, the Board has the option to employ its own evidentiary hearing de novo or to remand for rehearing. 77 P.S. §854. See also Borovich v. Colt Industries, 412 Pa. 372, 424 A.2d 1237 (1981).
Initially, it is noted that the Pennsylvania Code of Judicial Conduct may apply to preclude the proposed activity. The Pennsylvania Code of Judicial Conduct provides that:
Anyone, whether or not a lawyer, who is an officer of a judicial system performing judicial functions, including an officer such as a referee in bankruptcy, special master, court Commissioner, or magistrate is a judge for the purpose of this Code....
Cannon 7 of The Model Code of Judicial Conduct requires a part-time judge to comply with Cannon 5(c)(1) which states that:
A Judge shall refrain from financial, and business dealings that tend to reflect adversely on his impartiality, interfere with proper performance of his judicial duties, exploit his judicial position, or involve him in frequent transactions with lawyers or persons likely to come before the court on which he serves.
It would appear that Inquirer's continued association with a law firm practicing before the Board would violate Canon 5(c)(1) of the Model Code of Judicial Conduct. Canon 5(C)(l) of the Model Code is identical to Canon 5(C)(1) of the Pennsylvania Code. However, the Pennsylvania Code of Judicial Conduct, as adopted by the Pennsylvania Supreme Court (effective January 1, 1974), does not recognize the classification of "part-time judge." While the Pennsylvania Code of Judicial Conduct does not expressly state that it applies to persons performing quasi-judicial functions on a part-time basis, it does not expressly exclude such persons from its coverage. Accordingly, the Committee cannot say with certainty whether the Pennsylvania Code of Judicial Conduct would apply to part-time members of the Worker's Compensation Appeal Board fn2.
The Committee believes that public confidence in the legal system would inevitably be eroded if a law firm is permitted to practice before a quasi- judicial body on which an associate or member of the firm sits. In that regard, D.R. 9-1018 provides that "a lawyer shall not state or imply that he is able to influence improperly or upon irrelevant grounds any tribunal, legislative body or public official." See also Rule 8.4(e) of the Model Rule of Professional Conduct, as adopted by the American Bar Association ["It is professional misconduct for a lawyer to: (e) state or imply an ability to influence improperly a government agency or official."]. The Committee was of the view that the public will inevitably perceive that a law firm has a privileged relationship with a quasi-judicial board on which a member of the firm sits D.R. 9-1018 and Model Rule 8.4(e) are directed to prohibiting such perceptions.\
Some bar associations in other jurisdictions have attempted to resolve appearance of impropriety and undue influence issues, as well as actual conflicts of interest, by establishing limitations on the attorney and his or her firm's practice before the Board. The West Virginia Bar Association has determined that a lawyer may serve as a hearing examiner for a state human rights commission while a member of his or her firm represent clients before the commission provided that while acting as a hearing examiner the lawyer:
(1) does not hear a case in which he or any member of his firm has been previously involved, or in which a lawyer or his firm is involved as counsel, or a client of the firm is a party, (2) does not knowingly agree to hear a case involving a major uncontested legal issue in which his law firm has a present interest, (3) disqualifies himself in the event a conflict develops unless all parties concerned, after full disclosure, agree in writing that he may continue to act as a hearing examiner, and (4) does not state or imply to any client of his own or of his firm that his service as a hearing examiner provides an opportunity to influence the commission.
West Virginia Bar Association Opinion, No. 84-5 (2/1/85).
The complex questions raised by the measures adopted by the West Virginia Bar Association to guard against the appearance of impropriety and undue influence illustrate the extreme difficulty of assuring that board members of a quasi-judicial bodies and their firm do not engage in conduct which either appears to the public to be improper or which is actually prejudicial to the administration of justice. For example, how is the attorney-board member to determine if his or her firm has a present interest in a case involving a major legal issue pending before the board? Is it ever possible to avoid the implication that the law firm has special influence before the quasi-judicial board? Will other board members inevitably be favorably disposed to a case brought by a member's law firm, even where the interested member recuses himself or herself? Or on the other hand, will the other board members be predisposed against cases brought by a colleague's law firm in order to avoid the appearance of undue influence? The Committee believes that these questions cannot be resolved to the satisfaction of all parties appearing before a quasi-judicial board and the general public, absent a prophylactic rule.
In addition, the Committee believes the administration of justice is impaired by the potential of frequent recusals of board members. Circumstances requiring disqualification may require cumbersome motions and substantial expenditure of judicial resources. Moreover, frequent disqualifications may unnecessarily increase the number of cases which must be decided by an equally divided board. We are not inclined to endorse the practice of appointing lawyers to quasi-judicial bodies where frequent recusals may be required because the lawyer and his or her firm are unable or unwilling to minimize the risk of conflicts of interest by refraining from practice before that body.
For similar reasons, the Committee holds that the proposed conduct would violate Rule 8.4(d) of the Model Rules of Professional Conduct, as adopted by the American Bar Association. Rule 8.4(d) provides that it is professional misconduct "for a lawyer to...engage in conduct that is prejudicial to the administration of justice fn3.
The Committee is aware that its opinion may have broad implications affecting the make-up of a wide variety of quasi-judicial boards, authorities and commissions at both the state and local level. However, we are convinced that it is not impossible to obtain qualified lawyers who are in a position to sacrifice their practice before the body which they serve. We are satisfied that the harm from permitting a board member's law firm to continue its practice before the board far outweighs the good resulting from having a larger pool of attorneys qualified to sit on the board. Moreover, in the instant case we believe that a $34,000 salary for a part-time board member is sufficient to attract qualified candidates who are able to restructure their law practice to avoid potential conflicts.
Although the proposed salary was a factor in the Committee's deliberation, the Committee was inclined to reach a similar result where little or no pay was at issue. However, since that specific issue was not before the Committee it does not reach a decision on this question at this time. Nevertheless it is worth noting that service on the Disciplinary Board, which is a voluntary, non-compensated position, prohibits the type of practice before the Disciplinary Board which is the subject of this inquiry. Section 89.48 of the Disciplinary Rules provides that members of the Board, partners or employees of any firm in which a member of the Board practices, and members of hearing Committees shall not appear as counsel for a respondent attorney".
For the foregoing reasons, the Committee concludes that available remedial measures are inadequate to deal with the potential ethical problems arising from an attorney or his or her law firm practicing before a quasi-judicial body of which the attorney is a member. Accordingly, we conclude that lawyers should not serve as members of quasi-judicial bodies while their law firms continue to practice before that body fn4. This opinion does not cover those situations when lawyers sever their relationships with their former law firms before assuming a quasi-judicial post.
1. The Worker's Compensation Appeal Board has jurisdiction of appeals from the decisions of referees who sit as fact-finders and award or disallow compensation under the Pennsylvania Worker s Compensation Act, 77 P.S. et seq. The Board is a departmental administrative board exercising its powers and performing its duties as an appellate board independently of the Secretary of Labor and Industry and any other official of the department 77 P.S. §701. The Board's decisions are subject to appeal to the Commonwealth Court. The Board is composed of five members who ordinarily sit in panels of two to four to consider appeals that come before the Board. They are appointed by the Governor and serve at his pleasure. The members of the Board are paid approximately $34,000 annually and ordinarily serve the Board approximately one to two weeks per month. Accordingly, it has been the practice that Board members maintain additional employment.
2. The Committee offers no opinion as to whether the proposed conduct violates Section 403 of the Ethics Act, 65 P.S. §402, which provides that "no public official or public employee shall use his public office or any confidential information received through his holding office to obtain financial gain other than compensation provided by law...." However, it should be noted that the Supreme Court has held that the Ethics Act is unconstitutional insofar as it applies to former judges because it infringes on the Supreme Court's inherent and exclusive power to govern those privileged to practice law in this Commonwealth. Walert v. State Ethics Comm. 491 Pa. 255, 420 A.2d 439 (1980). It is likely, however, that the Supreme Court will ultimately broadly construe relevant provisions of the Code of Professional Responsibility to deal with the mischief that the Ethics Act attempts to redress.
3. In the event that Inquirer seeks a formal opinion regarding the application of the Code of Judicial Conduct, an inquiry should be addressed to the Judicial Ethics Committee of the Pennsylvania Conference of State Trial Judges.
4. The Committee notes that the loyalty of a member of a quasi-judicial board is divided when his law firm continues to practice before the board. On the one hand, he has an obligation to perform his judicial duties impartially. On the other hand, he has an obligation of loyalty to the clients of his firm. Accordingly, the proposed conduct would undermine these obligations, as set forth in Canon 4 and Canon 5 of the Code of Professional Responsibility.