Agencies Are Barred From Using Two Attorneys From The Same Private Law Firm Where One Acts As Advocate And One As Advisor In A Contested Administrative Matter

A police officer claimed his due process rights were violated when a partner in a law firm advocated on behalf of a department within a city at a non-binding arbitration.  Subsequently a partner from the same law firm advised the city’s decision making body when it reviewed the arbitrator’s award.  The court of appeal held that the principles of due process prohibited the decision maker from being advised on the personnel matter by a partner from the same law firm as a partner that advocated on behalf of the department in the non-binding arbitration.  (Sabey v. City of Pomona (--- Cal.Rptr.3d ----, Cal.App. 2 Dist., April 16, 2013).

Note

While Sabey involves a hearing in the employment context, the holding of the case should apply to any public agency administrative hearing where one attorney from a private firm acts as an advocate and another attorney from that same firm acts as advisor to the decision maker in the same matter.

Facts

Glenn Sabey (“Sabey”) was employed by the Pomona Police Department (“Department”).  The Department’s internal affairs office conducted an investigation and concluded that Sabey violated various provisions of the Department’s policies and procedures.  The Department notified Sabey that it intended to terminate his employment. 

Sabey requested a non-binding arbitration to determine whether the Department properly discharged him for cause.  Debra L. Bray (“Bray”) from Liebert Cassidy Whitmore (“LCW”) advocated on behalf of the City of Pomona (“City”) at the arbitration.  The arbitrator sustained all of internal affairs’ findings and set out its decision in an Advisory Opinion and Award (“Award”).  However, the Award provided that Sabey should be suspended without pay and benefits instead of terminated.

Peter Brown (“Brown”), also a partner at LCW, was City’s chief labor negotiator.  Brown regularly met with the City Council in closed session.  After the City Council received the Award, it asked Brown to be its legal advisor in the matter.  LCW implemented an ethical wall between Brown and Bray.  Brown and Bray did not talk to each other about the Sabey matter and they could not access each other’s files.  Brown presented on the Sabey matter to the City Council in closed session.  Counsel for Sabey objected to Brown and Bray acting as an advocate for the Department and legal advisor to the City Council.  However, the City Council rendered a decision that adopted the factual findings of the arbitrator but rejected the recommendation that Sabey’s termination be converted to a suspension.  Sabey’s termination was made final.

Sabey filed a petition for writ of mandate in superior court asserting that he was denied due process and a fair hearing because the City Council received legal advice regarding his termination from Brown, the law partner of Bray, who advocated on behalf of the Department prior to and at the arbitration.  The superior court denied Sabey’s petition for writ of mandate.

Decision

The court of appeal reversed the decision of the superior court.  The court announced the following rule “that when a partner in a law firm represents a department within a city at an advisory arbitration regarding a personnel matter, and when the city’s decisionmaking body later reviews that arbitrator’s award for confirmation or rejection, the principles of due process prohibit the decision maker from being advised on the matter by a different partner from the same law firm.”

The constitutional guarantee of due process of law requires a fair tribunal when an administrative agency conducts adjudicative proceedings.  “A tribunal is not fair unless ‘the judge or other decision maker is free from bias for or against a party.’”  Case law holds that an attorney cannot act as an agency advocate and then give advice to a decision maker who reviews the result achieved by the advocate.

However, in an earlier case (Howitt v. Superior Court (1992) 3 Cal.App.4th 1575, 1586) the court of appeal had held that “[p]erformance of both roles by the same law office is appropriate . . . if there are assurances that the adviser for the decision maker is screened from any inappropriate contact with the advocate.”  (Emphasis added.)  The law office performing the dual roles has the burden of providing the assurances.  The Sabey court noted, however, that the Howitt rule has been applied only in cases involving government lawyers.  The question before the court of appeal was “whether the Howitt rule applies to partners from a private law firm who are fulfilling the advocacy and advisory roles of government lawyers on a particular case.”  The court of appeal held that it does not.

As an LCW partner, Brown owed a fiduciary duty to both Bray and LCW.  When Brown advised the City Council on the Sabey matter, he was reviewing the result achieved by Bray, who was his fiduciary.  The court concluded that the situation creates an appearance of bias and unfairness.  The court opined that “the risk of Brown providing the City Council with biased advice and thereby tainting its decisionmaking process was too high to be acceptable under constitutional principles.”  The court noted that it was not suggesting that “Brown intentionally skewed his advice” to the City Council.  Instead, the court acknowledged “that bias can be unwitting” and “that whenever a person serves two masters who have potentially conflicting interests, it is impossible to peer into the depths of that person’s soul to determine the purity of his or her words and actions.”

The court rejected City’s argument that the Howitt rule should apply because, in this case, there was “no difference between government lawyers and partners from a private law firm acting as government lawyers.”  The court of appeal disagreed because, in the case of government lawyers, they do not owe each other fiduciary duties.  If the government lawyers “are properly screened from each other, there is no reason to suspect that the advisor to the decision maker will try to promote the result desired by the advocate.”  The same cannot be said of private law firm partners because they are fiduciaries. 

The court concluded, “Agencies are barred from using a partner in a law firm as an advocate in a contested matter and another partner from the same law firm as an advisor to the decision maker in the same matter.”  The court of appeal remanded the case back to the City Council and it “must obtain independent legal advice to eliminate the taint of Brown’s involvement.”  If the City Council fails to obtain independent legal advice and fails to review the arbitration in light of the new legal advice it receives, the Award will become final.

Questions

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Bruce A. Scheidt, Laura Izon Powell, David W. Tyra, Kristianne T. Seargeant or Jeffrey L. Massey | 916.321.4500