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Wisconsin Attorney General Opinions
Opinion # OAG 30-86,
25 August 1986
Attorneys;
Public Officials;
State Bar;
The State Bar of Wisconsin is a
state agency
created by the constitutional authority
of
the supreme court.
The authorized functions of the
State Bar may
come under the "State Action" exemption
to
the antitrust laws and the procedures
employed by the Unauthorized Practice
Committee and the Ethics Committee
appear
to provide due process but specific
opinions
in this regard must be given on
a
case-by-case basis.
Volunteer lawyers giving free legal
advice in
the "Lawyer Hotline" program are
agents of
the State Bar and are entitled
to common law
immunity and indemnification under
section
895.46(1)(a), Stats.
FRANKLYN M. GIMBEL,
President State Bar of Wisconsin
Your predecessor requested my opinion
regarding possible liability of
the State Bar
(Bar) or individual committee members
because
of the "activities" of the State
Bar
Unauthorized Practice of Law Committee
and the State Bar Ethics Committee
especially as it relates to antitrust
law and denial of due process.
He also sought my opinion regarding
the
"activities" of the Lawyer Referral
and
Information Service, more popularly
known
as the "Lawyer Hotline," where
volunteer
lawyers talk by telephone to members
of
the public and give legal advice
on
simple legal questions.
Since the "activities" are not fully
described in the opinion request
in terms of
a factual setting, this opinion
is limited to
activities authorized by the supreme
court.
I.
Our discussion appropriately begins
with
an examination of the nature of
the Bar.
The Bar is an integrated bar, that
is, it was
created "as a state agency to serve
a public
purpose" by constitutional authority
of the
supreme court.
Lathrop v. Donahue,
10 Wis.2d 230, 243,
102 N.W.2d 404 (1960), aff'd,
367 U.S. 820 (1961).
The court has the exclusive authority
to
determine the functions of the
Bar and
has the exclusive authority to
determine
its existence or demise.
Its supervisory function over the
Bar was
explained by the court in Lathrop,
10 Wis.2d at 240:
However, as we pointed
out in our
opinion in the 1958
In re Integration
of Bar Case, this
court will exercise
its inherent power
to take remedial
action should the
State Bar engage
in an activity not
authorized by
the rules and bylaws
and not in
keeping with the stated
objectives
for which it was created.
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The Bar's status as a state agency
was explained in
Lathrop, 10 Wis.2d at 243:
The State Bar is a
public agency the
same as the judicial
council.
One has been created
by the court and
the other by the legislature
but each
was created by state
action as a state
agency to serve a
public purpose.
It appears clear, therefore, that
the
Bar is a state agency as created
by
the constitutional judicial power
of the supreme court.
However, the supreme court expects
"the bar to act freely and independently
on all matters which promote the
purposes for which the bar was
integrated"
provided such acts are
"within the framework of
its rules and by-laws,"
Axel v. State Bar,
21 Wis.2d 661,
124 N.W.2d 671 (1963).
It is thus instructive to examine
the
functions of the Bar as authorized
by rules
and bylaws in the fields of unauthorized
practice, ethics and the "Hotline,"
and
then determine whether those functions
are
"in keeping with the stated objectives
for
which it [the Bar] was created."
Lathrop, 10 Wis.2d at 240.
The Unauthorized Practice Committee
derives
its authority under Article IV,
Section 10 of
the bylaws which were originally
approved by
the supreme court in connection
with the
official integration of the Bar.
Section 10 reads as follows:
SECTION 10 Committee
on
Unauthorized Practice
of Law.
This committee shall
keep the membership
informed with respect
to the illegal
practice of law by
unlicensed laymen,
and shall endeavor
to eliminate the
exposure of the public
to the hazards of
unskilled and unauthorized
practice of
law by those who have
not met the
education and moral
standards and who
are not subject to
the ethical standards
or disciplinary regulation
required for
those licensed to
practice the
profession of law.
In Lathrop, 10 Wis.2d at 248, the
court
explained the duties of the Committee
on
Unauthorized Practice:
Discouraging Unauthorized
Practice of
the Law. One of the
standing committees
of the State Bar is
that of unauthorized
practice of law.
The primary purpose
of such committee is
to protect the public
from incompetent
laymen attempting
to offer or perform
legal services which
they are not
competent to render.
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This is a constant
program since
numerous trades and
occupations keep
expanding their services
and frequently
start offering services
which constitute
the practice of the
law.
As a result of integration
the income
from dues has enabled
the State Bar to
employ an additional
lawyer on its staff
whose major assignment
is to investigate
complaints made with
respect to
instances of unauthorized
practice of
the law, and to cause
any unauthorized
practices so discovered
to be
discontinued through
persuasion
or legal action.
Briefly stated, the committee, with
the help
of the staff attorney, reviews
complaints
received from the public, government
agencies, judges and attorneys
concerning
unauthorized law practice.
If the committee, after investigation,
concludes that the complained of
activities are the practice of
law and
unauthorized, efforts are made
to secure
voluntary compliance, usually by
letter.
If those efforts are successful
the
matter is closed.
In those cases where compliance
is not
forthcoming by "persuasion," the
matter
is referred to the Board of Governors
with a recommendation for "legal
action."
Lathrop, 10 Wis.2d at 248.
If the board agrees, a request is
sent
to this office for appropriate
legal action.
If we agree that legal action is
justified, we determine whether
to bring
a civil action or criminal action
and,
if the latter, we usually refer
the
matter to the district attorney
of the
county involved.
Since integration, the Bar has been
involved as a complainant or party
in
several cases involving the unauthorized
practice of law.
State ex rel. State Bar v. Keller,
16 Wis, 2d 377,
114 N.W.2d 796,
116 N.W.2d 141 (1962), vacated,
374 U.S. 102 (1963);
State ex rel. State Bar v Bonded
Collections,
36 Wis.2d 643,
154 N.W.2d 250 (1967);
State ex rel. Baker v. County Court,
29 Wis.2d 1,
138 N.W.2d 162 (1965);
and
State ex rel. Reynolds v. Dinger,
14 Wis.2d 193,
109 N.W.2d 685 (1961).
The supreme court has recognized
in those
cases that the Bar has been acting
within the
delegated authority specified in
Lathrop.
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The second function to be discussed
is
the Ethics Committee which is also
created by the State Bar Bylaws.
Article IV, Section 5 reads as follows:
Section 5.
Committee on Professional Ethics.
This committee shall
formulate and
recommend standards
and methods for the
effective enforcement
of high standards
of ethics and conduct
in the practice of
law; shall consider
the "Code of
Professional Responsibility
and
Disciplinary Rules
as adopted by the
Wisconsin Supreme
Court" and the
observance thereof,
and shall make
recommendations for
appropriate
amendments thereto.
The committee shall
have authority to
express opinions regarding
proper
professional conduct,
upon written
request of any member
or officer
of the State Bar.
However, the committee
shall not issue
opinions as to the
propriety of past or
present conduct of
specific member
attorneys unless requested
to do so by a
grievance committee
of the State Bar or
by the Board of Governors
of the State
Bar.
In those latter instances
of requests
relating to a specific
member, they
shall be treated as
confidential and
shall not be open
to public inspection.
In such cases, the
opinion of the
committee shall not
disclose the names
of any parties, but
such opinion shall
be open for inspection
in the same
manner as other opinions
of the
committee.
The supreme court acquiesced in
the
establishment of this committee
when it
approved the bar's original bylaws.
The purpose of the committee was
the
promotion of high standards of
ethics
and conduct in the practice of
law.
The committee is authorized to express
opinions interpreting chapter SCR
20
known as the "Code of Professional
Responsibility."
The opinions which are authorized
by the
committee can interpret whether
specific
conduct meets with the provisions
of
chapter SCR 20.
However, as is the case with the
unauthorized practice of law, whether
certain conduct violates specific
ethical standards is, in the final
analysis, the responsibility of
the
supreme court.
An opinion of the Ethics Committee
to a
member or officer of the Bar serves
an
advisory function but is not binding
on
the Board of Attorney's Professional
Responsibility and the supreme
court.
The intent is to provide guidance
to the
profession and, as is explained
in SCR
20.002: "The code is adopted by
the Wisconsin
supreme court both as an inspirational
guide
to the members of the profession
and as a
basis for disciplinary action when
the
conduct of a lawyer falls below
the required
minimum standard stated in the
disciplinary
rules."
The Ethics Committee may not, however,
issue
opinions as to the propriety of
past or
present conduct of an attorney
unless
requested to do so by a grievance
committee
of the State Bar (now called Professional
Responsibility Committee) or by
the Board of
Governors.
In those cases, the request and
opinion are
confidential and are not to be
open to public
inspection.
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Finally, it should be noted that
the supreme
court rejected in 1983 and again
in 1985
State Bar petitions seeking the
supreme
court's direct authorization of
the Bar's
ethics and unauthorized practice
activities.
In December of 1983, the Bar petitioned
the court to set up the State Bar
as
an "official arm" of the court,
acting
in a quasi-judicial capacity.
The Bar would have been "charged
by the court
with the duty of advising and educating
State
Bar members on matters pertaining
to the
standards of professional conduct."
A reconstituted standing committee
on
professional ethics would have
had the
power and "responsibility" to issue
advisory opinions.
The supreme court denied the petition
by order dated February 7, 1985.
The court observed that the petition[1]
was
"substantially the same" as petitions
filed
by the State Bar in April of 1982,
which were
denied by the court in January
of 1983.
The 1985 order provided in part as follows:
In the 1983 order,
the court stated that
it was of the opinion
"that it is not
proper for the court,
as final arbiter
in unauthorized practice
of law and
professional ethics
matters, to
participate in the
giving of advisory
opinions by State
Bar committees."
The court continued
to be
of that opinion.
. . . The State Bar
is not the proper
entity to render formal
advisory
opinions having any
binding effect for
the reason that it
neither promulgates
the rules of professional
ethics or the
rules prohibiting
the unauthorized
practice of law nor
enforces them.
. . . The regulation
of the practice
of the law is a judicial
power and is
vested exclusively
in the Supreme court,
although we have recognized
the
Legislature's authority
to place
additional penalties
upon those who
engage in the authorized
practice of the
law . . . . Consequently,
it is not
proper that this court
participate to
any extent in the
rendering of advisory
opinions on either
issue.
Notwithstanding the
State Bar's concern
with the rules of
professional ethics
and the unauthorized
practice of law and
its desire to assist
its membership in
dealing with these
matters, we decline
to give it the authority,
quasi-judicial
or otherwise, to issue
advisory opinions
that either are binding
on the court and
its Board of Attorneys
Professional
Responsibility or
are subject to review
by the court. [2]
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The third activity on which you
seek
advice is the Lawyer Referral and
Information Service, commonly
known as the "Lawyer Hotline."
You explain that the "Hotline" makes
volunteer lawyers available to
talk
by telephone to members of the
public
who have simple legal questions.
The service is offered totally
without charge to the caller.
If the person needs more assistance
than can
be provided during a short five
minute
telephone conversation, the caller
is urged
to consult an attorney of his or
her choice.
The volunteer lawyer does not give
his or her
name to the caller and is not available
to
perform services for a fee.
There is no specific bylaw or supreme
court
rule which directs the Bar to provide
this service.
It was originally conceived, I understand,
by the State Bar Foundation and
proved
to be an extremely popular program.
Eventually it became a joint function
of the
Foundation and the Bar and is included
in
the Bar budget which is submitted
to the
supreme court each year for approval.
Supreme Court Rule 10.02(2)
is entitled "PURPOSES."
The last three lines of that
paragraph read as follows:
"to promote the innovation, development
and improvement of means to deliver
legal services to the people of
Wisconsin; to the end that the
public
responsibility of the legal profession
may be more effectively discharged."
The functions of the "Hotline" seem
to fall
within the meaning of the above
purposes of
the Bar as approved by the supreme
court.
That the court approves of this
function is
fairly inferred from its knowledge
that sums
for this function are included
in the budget
and the function itself is part
of an annual
report and audit provided to the
court.
II.
The first question posed is whether
this
office would provide legal counsel
in case
of a lawsuit against the Bar and
individual
lawyers performing authorized functions
in
connection with these three State
Bar
activities.
Historically, this office has represented
the
integrated bar in connection with
lawsuits
brought against the Bar, members
of the Board
of Governors, and employes and
agents of the
Bar when such lawsuits arise out
of the
official state agency functions
of the Bar.
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We will continue to provide such
representation where the law requires
that we provide the representation.
We have also provided legal services
in the
form of formal and informal opinions
and
consultations with members of the
staff,
the board and committees in regard
to the
Bar's state agency functions and
will
continue to do so where appropriate.
However, we may decline to provide
representation in accordance with
section
895.46(1)(a), Stats., where we
conclude that
the act complained of did not grow
out of or
was not committed in the course
of an
individual's state agency duties
or is
beyond the supreme court delegation.
Also, where the Bar has an insurance
policy
covering liability asserted against
the Bar,
its officers, employes or agents,
we may
choose not to provide representation
where
the insurance company is obliged
to do
so and the claim is not in excess
of
the policy limits.
Obviously, each case would be
considered on its own merits.
In those situations where there
is a claim
for declaratory and/or injunctive
relief
based on allegations of unconstitutionality
of statutes or rules administered
by the Bar,
we have and will continue to provide
legal
representation without cost where
appropriate.
This position, of course, assumes
that this
office does not have a more compelling
duty
not to provide such representation
in a
particular case.
For instance if it was determined
by this
office that the Bar, its officers,
employes
or agents had exceeded the authority
delegated by the supreme court
and our advice
to cease such conduct was ignored
we would
probably seek supervisory action
against the
Bar in the supreme court.
Moreover, this office's duty to
enforce the
antitrust laws, see secs. 133.17,
165.065,
Stats., might compel this office
to act to
remedy violations of the antitrust
laws.
III.
The next question is in regard to
possible
antitrust actions being successfully
maintained against the Bar because
of the operation of the Unauthorized
Practice and Ethics Committees.
No specific cases are mentioned,
but your
predecessor indicates that
several observers have voiced concern
that the activities of these two
committees as presently constituted
might raise antitrust law or
constitutional due process of law
problems.
There is no further elaboration
as to what
the "observers" contend is the
antitrust
danger as the committees are presently
constituted.
Assuming that the contention is
that the
committees could potentially participate
in
anti-competitive activities, the
question is
whether the delegation from the
supreme court
described above is adequate to
provide
blanket "state action" antitrust
immunity
within the meaning of
Parker v. Brown, 317 U.S. 341 (1943).
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Any analysis of the state action
doctrine
must revolve around the two-pronged
test
articulated by a unanimous court
in
California Liquor Dealers Ass'n
v. Midcal
Aluminum, Inc., 445 U.S. 97 (1980).
Midcal provided that for the
immunity to apply
(1) the state must have clearly
articulated
and affirmatively
expressed a state
policy compelling
the displacement
of competition
in the area of
the economy
at issue, and
(2) the state must actively supervise
this displacement.
Although Midcal's teaching appears
superficially straightforward,
reconciling
it with three other Supreme Court
decisions
dealing with state action immunity
in the
context of state bar activities
is no mean
feat.
For example, both prongs of the
Midcal test
appear to have been diluted in
Hoover v. Ronwin,
104 S.Ct. 1989 (1984),
and
Bates v. State Bar of Arizona,
433 U.S. 350 (1977).
In neither Hoover nor in Bates did
the state
supreme court in question "compel"
the
specific conduct at issue.
In Hoover, the Bar committee appointed
by the
supreme court was not compelled
to adopt the
grading system it adopted.
The plaintiff's primary claim against
the
committee was that it had adopted
a
grading scale on the February
examination with reference to the
number
of new attorneys it thought desirable,
rather than with reference to some
"suitable" level of competence.
104 S.Ct. at 1994.
The plaintiff claimed that the state
action
doctrine did not apply because
the supreme
court had not directed the committee
to artificially reduce the
number of lawyers in Arizona.
Id. at 1999.
The Court rejected plaintiff's argument
stating that it largely ignored
the facts
surrounding the delegation of authority
by
the Arizona Supreme Court to the
committee
and, most importantly, the fact
that the
Arizona Supreme Court retained
ultimate
authority to grant or deny admission
to
the practice of law in the state.
Id. at 1999-2000.
In Bates v. State Bar Arizona, 433
U.S. 350
(1977), the Court found that the
state action
exemption was applicable because
the Arizona
Supreme Court had in effect ratified
and
adopted the State Bar rule limiting
advertising by attorneys.
The plaintiff argued that because
the state
bar had not been compelled to recommend
the
advertising rule to the Arizona
Supreme
Court, the Court should follow
Cantor v. Detroit Edison Co.,
428 U.S. 579 (1976), and
reject state action immunity.
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The Court, however, found state
action
immunity and distinguished Cantor
on the
basis that a "utility could not
immunize
itself from Sherman Act attack
by embodying
its challenged practices in a tariff
approved
by a state commission."
Bates at 360.
In addition to not being required
to file the
challenged practices in a tariff,
the Court
held that the state commission
had never
passed on the challenge practices,
and hence,
there could be no antitrust immunity.
Id.
In short, the court in Bates held
that the
advertising restriction was the
action of the
court and the mere fact that it
was adopted
without compulsion was not significant.
Similarly, it does appear to be
fatal to a
claim of state action immunity
that the state
has not clearly articulated and
affirmatively
expressed a state policy to replace
competition with regulation as
it relates to
a specific action by a state agency.
At one level, it is clear that the
State of
Wisconsin through both the Legislature
and
the Supreme Court has clearly articulated
and
affirmatively expressed a state
policy to
replace open competition in the
market for
legal services with barriers to
entry in the
practice of law (e.g., penalties
for
practicing without a license, Section
757.30,
Stats.) and ethical constraints
on how those
competing in the market operate
their
practices (e.g., authorization
of Article IV,
Section 5, of the State Bar Bylaws
creating
the Committee on Professional Ethics).
Hoover, Bates and Goldfarb v. Virginia
State
Bar, 421 U.S. 773 (1975), collectively
suggest further that where a state
bar or
state bar committee acts to effect
a state
supreme court's policies on setting
appropriate limits on competition
among those
seeking to provide legal services
to the
public, the court will find those
actions
which are in furtherance, to some
unclear
degree, of those policies to be
exempt.
The issue, of course, is to what
degree must
the supreme court "guide" or "direct"
the
actions of the bar for the exemption
to
apply.
On this point, the contrast between
Hoover
and Goldfarb is instructive.
In Goldfarb,
state law did not refer to lawyers'
fees, the Virginia Supreme Court
rules
did not direct the State Bar to
supply
fee schedules, and the Supreme
Court
rules did not approve the fee schedules
established by the State Bar.
Hoover, 104 S.Ct. at 2001 n. 32.
Consequently, even though the Virginia
State
Bar was a state agency, the Court
concluded
that the actions of the State Bar
were not
immune under the state action doctrine.
Although no state law or supreme
court
directive told the Arizona Bar
committee what
its grading formula ought to be,
the Court in
Hoover impliedly held that the
grading
formula adopted was "consistent
enough" with
the general policy of limiting
admission to
the market for legal services to
those
reaching a certain degree of competence.
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In short, when one attempts to reconcile
Goldfarb with Bates and Hoover,
the test
that emerges is no longer one of
the
traditional two-prong test of "compulsion"
and "clearly articulated and affirmatively
expressed state policy."
Rather, it seems that the exemption
applies
if a Bar or Bar committee acts
pursuant to or
consistent with the state supreme
court
guidelines Ä even if much
discretion is left
to the Bar committee (e.g.. Hoover),
even if
the Supreme Court did not initiate
the action
(e.g., apparently in Bates), and
even if the
court did not specify in detail
how the Bar
committee should carry out its
functions
(e.g., Hoover).
Where the State Bar acts on its
own without
any guidelines from the state supreme
court,
state action immunity will not
apply even
though the actions of the State
Bar are
arguably consistent with the general
policy
of the state supreme court to temper
competition among lawyers (e.g.,
Goldfarb).
Ultimately, the dividing line between
Goldfarb, on the one hand, and
Hoover and
Bates, on the other hand, seems
to hinge on
the specific activity of the Bar
or Bar
committee involved in light of
the specific
directions given by the state supreme
court.
For example, in Goldfarb, the State
Bar had
issued two ethical opinions indicating
that
the fee schedules could not be
ignored.
421 U.S. at 777.
Arguably, the fee schedules could
be
rationalized as consistent with
some state
supreme court policy affecting
competition.
Whether or not the activity of the
Bar is
connected enough to supreme court
guidelines
and directives would seem to be
an issue that
has to be decided on a case-by-case
basis
with reference to the specific
setting of the
Bar activity.
However, this dependency on the
facts of the
specific situations creates considerable
confusion in dealing with the question
of
whether state action immunity is
available
for all actions of the two Bar
committees at
issue.
Simply stating that the committees
are acting
"within their authority" does not
resolve the
question.
For example, in Goldfarb the Supreme
Court
had delegated to the State Bar
the
"authority" to regulate the legal
profession.
But the Court determined that that
was
not enough direction to activate
state
action immunity with regard to
the adoption of fee schedules.
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If the Virginia Supreme Court had
articulated
a general policy that attorneys
should price
their services in a "reasonable
manner,"
would that have been sufficient
to give the
State Bar state action immunity
to adopt a
specific fee schedule? What if
the Bar had
asked the Virginia court for more
explicit
authorization and had been rejected
as was
the case with the Wisconsin Bar?
My reading
of these cases suggests that the
answer to
these questions in the context
of the state
action doctrine are largely factual
and ought
to be dealt with on a case-by-case
basis.
Hence, although I tend to believe
that much
of what the two State Bar committees
in this
case do may fall within the state
action
exemption, I share what I think
is the Bar's
concern that there may be situations
where
the actions of either committee
may not be
within the immunity.
[For example, what if the Unauthorized
Practice Committee decides a particular
use
of paralegals by an aggressive
firm
constitutes "unauthorized practice"
in the
absence of any specific supreme
court policy
thereby dampening the use of paralegals?
Or
what if the Ethics Committee rules
that such
use of paralegals is unethical?]
My concern
in this regard is not tied to any
specific
fact pattern, but rather relates
to my
conclusion that ironclad guarantees
are
impossible in the face of a rather
unsettled
situation caused by three supreme
court
opinions within the last ten years
which are
more than a little difficult to
reconcile.[3]
I suggest that if you have
specific actions that either of
the two
committees intends to take that
may be a
cause for concern, that you frame
those
questions to us for an opinion
on the state
action doctrine at that time.
IV.
The next question relates to the
likelihood
of success of a claim against the
Bar or
individual committee members based
on denial
of property without due process
of law.
Due process is one of those terms
in the law
which is not easily defined except
as it
applies to specific situations.
The constitutional provision, of
course,
prohibits denial of life, liberty
and
property without due process.
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To find a violation of due process
where it
concerns property, we have to determine
first
that it is property within the
constitutional
meaning, that there was a deprivation,
and
that the process afforded did not
meet
constitutional standards.
The United States Supreme Court
pointed out
in Board of Regents v. Roth, 408
U.S. 564
(1972), in a case arising out of
the
University of Wisconsin-Oshkosh,
that a
nontenured professor whose one-year
appointment was not renewed had
no property
interest in reappointment.
The Court pointed out that property
interests
do not arise under the constitution:
"Rather,
they are created and their dimensions
are
defined by existing rules or understandings
that stem from an independent source
such as
state law Ä rules or understandings
that
secure certain benefits and that
support
claims of entitlement to those
benefits."
Board of Regents v. Roth, 408 U.S. at 577.
Frankly, it is difficult to identify
property
interests that might be affected
by the
Unauthorized Practice Committee
in the
abstract.
It would be difficult to show "entitlement"
and, therefore, difficult to show
a property
interest in the unauthorized practice
of law.
However, if the committees acted
against
other professionals, e.g., public
accountants
or paralegals, a protectible property
interest may be a present.
Again, it is difficult to answer
the question
you pose in the abstract.
Perhaps a more useful way to approach
this
question is with regard to the
overall
process of initiating unauthorized
practice
investigations and the prosecution
thereof,
whether civil or criminal which
I outlined
above.
The Bar committees, in carrying
out its
unauthorized practice functions,
merely
requests this office to initiate
the
complaint process.
This office decides whether to initiate
an
action and the type of action.
In the case of the Ethics Committee
which
deals with licensed attorneys who
have a
property interest in the license,
there
appears to be no due process problem
in
connection with the issuance of
requested
opinions relating to future conduct.
In the case of opinions relating
to past or
present conduct being investigated
by a
professional responsibility committee
(formerly grievance committee of
the State
Bar) or by the Board of Governors,
there
would appear to be a property interest
involvement which would require
appropriate
due process at some stage prior
to any
sanctions.
But if such opinion led to a hearing
before a
professional responsibility committee,
and
subsequently before the Board of
Attorneys
Professional Responsibility in
accordance
with chapter SCR 22, the procedures
afforded
before those two bodies appear
to provide
adequate due process.
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If the Board of Governors reported
directly
to the Board of Attorneys Professional
Responsibility concerning ethical
conduct,
again it appears that due process
would be
provided by a hearing before the
Board of
Attorneys Professional Responsibility
and
ultimately consideration by the
supreme
court.
Disciplinary Proceedings Against
Eisenberg,
117 Wis.2d 332, 336 (1984).
V.
The final question relates to whether
indemnification would be available
from the
state if a successful claim were
made against
the Bar, the board, members of
the committees
and the volunteer lawyers operating
the
"Hotline," assuming that "all action
was in
good faith and within the parameters
established by State Bar Rule and
Bylaw."
Your question apparently assumes
that
liability has been established
or is
conceded.
There are, of course, defenses which
should
be considered whenever claims for
money
damages are made against the state,
its
agencies, officers and agents.
One of these defenses, the immunity
afforded
public officers with respect to
the
performance of their official functions,
deserves some discussion.
This common law immunity has been
recognized
by our supreme court as protecting
individuals who perform governmental
functions from substantive liability
for
damages.
The court listed the public policy
considerations for such immunity
in Lister v.
Board of Regents, 72 Wis.2d 282,
299, 240
N.W.2d 610 (1976).
These considerations
have been variously
identified in the
cases as follows:
(1) The danger of influencing
public
officers in the performance of their
functions by the threat of lawsuit;
(2) the deterrent effect
which the threat of
personal liability might have on those
who are considering entering public
service;
(3) the drain on valuable
time caused by
such actions;
(4) the unfairness
of subjecting officials
to personal liability for the acts of
their subordinates; and
(5) the feeling that
the ballot and removal
procedures are more appropriate methods
of dealing with misconduct in public
office.
This common law immunity is available
only
where the act complained of was
within the
scope of the official authority
of the
individual and in line with official
duty and involves the exercise
of
some discretion and judgment.
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The negligent performance of purely
ministerial duties would not entitle
the
individual to common law immunity.
There are various other exceptions
to the
rule which are determined by judicial
balancing of the need of public
officers to
perform their functions freely
against the
right of an aggrieved party to
seek redress.
The question of indemnification
of volunteer
lawyers who perform services in
connection
with the operation of the "Hotline"
involves
a determination as to whether such
volunteers
are agents of the state within
the meaning of
section 895.46(1)(a).
That statute provides in part:
Agents of any department of the
state
shall be covered by this section
while
acting within the scope of their
agency.
A similar question was raised in
regard to
the members of the professional
responsibility committees appointed
by the
Bar who assist the Board of Attorneys
Professional Responsibility in
the
investigation of lawyer conduct.
I concluded in an unpublished opinion,
OAG 48-78, that the committee members
are
"public officers" within the meaning
of
then Sections 895.45 and 895.46.
At that time, the statute covered
agents of
any department of the state where
there was a
written agreement entered into
prior to the
occurrence of any act.
Chapter 20 of the Laws of 1981 adopted
the
present language in regard to agents
which
eliminates the requirement of a
written
agreement.
If the volunteer members of the
professional
responsibility committees are considered
to
be "public officers," one might
argue that
"Hotline" volunteers are "agents."
If so, indemnification would be
appropriate
subject to the limitations set
out in section
895.46(1)(a) and subject to the
limitations
of section 893.82.
However, this issue may be moot
given that
Article VII of the bylaws of the
Bar provides
for indemnification of officers,
employes and
agents of the Bar and subsection
5
specifically authorizes the Bar
to purchase
and maintain insurance on behalf
of any
"State Bar Person" against any
liability
incurred in any capacity as a "State
Bar
Person."
Article VII, section 1
defines a "State Bar Person."
I understand that the Bar has errors
and
omissions insurance to cover the
general
liability of officers, committees,
employes
and agents of the Bar.
Indemnity under section 895.46 would
be
available only to the extent that
such
liability is not covered by any
insurance
which might be applicable, including
such
person's own malpractice liability
insurance.
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Section 893.82 contains both a notice
of
claim requirement and a limitation
of damages
provision which apply to state
officers,
employes or agents.
Section 893.82(3) provides that
a claimant
must serve the attorney general
with notice
of claim within 120 days of the
event causing
the injury.
The amount recoverable by any person
is
limited by section 893.82(6) to
$250,000 and
no punitive damages may be recovered.
The notice of claim and limitations
on
damages statutes do not apply to
civil rights
actions brought under 42 U.S.C.
Section 1983.
Doe v. Ellis,
103 Wis.2d 583,
309 N.W.2d 375 (Ct. APP. 1981);
Thompson v. Village of Hales Corners,
115 Wis.2d 289,
340 N.W.2d 704 (1983).
BCL: KJO
In the matter of the amendment of
SCR Chapter
10 State Bar Rules (February 7,
1985).
Id. at 1-2.
Note that the vote in Goldfarb was
8-0, the
vote in Bates was 9-0 on the state
action
issue (5-4 on the first amendment
issue),
and in Hoover the vote was 4-3
with two
abstentions and a vigorous dissent
by
Justice Stevens.
The fact that Justice Rehnquist
voted with
the majority in both Bates and
Goldfarb,
while abstaining in Hoover, together
with
O'Connor's addition to the court
after Bates
and Goldfarb and her abstention
in Hoover,
makes it even more difficult to
predict how
the court would decide future such
state
action cases.
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