City Attorney's Advice re Conflicts of Interest: A New California Supreme Court Decision

The Supreme Court of California has handed down a decision that could have a significant impact on conflicts of interest cases. In The People v. Chacon, S125236 (February 8, 2007), the court found that Chacon, a former council member charged with a conflict of interest, could not use the defense that she had acted upon the advice of the city attorney. The advice concerned her entering into an employment contract as city manager. The city had a rule that one cannot be appointed to a position within a year after having been a member of the council. The council passed a statute deleting this rule from the municipal code, and this was done with Chacon's participation and vote (and the statute was written by the city attorney himself; he also wrote the employment contract). The city attorney's advice to Chacon, that no state law prevented her from taking the job, appears to have been wrong, however, because state law makes it illegal to have a financial interest in a contract made by a board of which one is a member (the court did not decide the correctness of the city attorney's advice).

At the trial, Chacon made an entrapment by estoppel defense: a government cannot actively provide assurances that conduct is lawful and then prosecute that conduct. The court pointed out that the defendant was not an ordinary citizen confronting the power of the government, but a government official 'obligated to discharge her responsibilities with integrity and fidelity.' Officials should know, the decision said, that they have a duty as trustee not to engage in self-dealing. 'Recognizing entrapment by estoppel in such circumstances is antithetical to the strong public policy of strict enforcement of conflict of interest statutes and the attendant personal responsibility demanded of our officials.'

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In addition, the court pointed out that the city attorney is hired by and responsible to the council. 'An official cannot escape liability for conflict of interest violations by claiming to have been misinformed by an employee serving at her pleasure.'

It is good to see a court focusing on an official's fiduciary duties and requiring strict enforcement of conflict of interest statutes. However, it is tough to make an official responsible even if she has been given bad advice by a city attorney. Bad advice from city attorneys seems to be at the core of a majority of the ethical violations I have seen and read about (in many other cases, city attorneys defend the conduct after the fact, and the defense often leads to ethics proceedings that should never have been necessary).

In many cases, as in this one, it appears to have been ignorance or laziness that caused the bad advice. But in many cases, the advice is political and fully intentional, meant to confuse the issue and exonerate the official whom, after all, the city attorney is working for. Since the intention is all but impossible to prove, it is hard to make a distinction in treatment. The California Supreme Court determined simply that the city attorney was working for Chacon, and that, therefore, his advice should not hinder prosecution for conflict of interest.

At least in California, officials will have to look elsewhere for advice, for example, to ethics commissions or, if they exist, ethics officers. Or to a private attorney. Most ethics codes make it clear that an ethics commission's advisory opinion can be depended on. But would this hold up under the new California decision? After all, most ethics commission are appointed by city councils; in fact, they're probably more likely to be appointed by councils than city attorneys are. This is yet another argument in favor of an independent ethics commission. No one could argue that an official could not depend on the advisory opinion of an ethics commission not selected by officials.

One important matter is not dealt with in this decision: the responsibility of city attorneys for their advice. It appears that the former council member will be fined for her conduct, and that the city attorney will not. And yet the city attorney either was negligent, was told what advice to give (Chacon is said, by the L.A. Times, to have been the city's most powerful politician), or was in cahoots with Chacon.

This is one of the reasons it is so difficult to be a city or county attorney. Because the client isn't clear (and the adversary is even less clear), there are many potential conflicts. And because the position is partisan or personally political, one is not simply a lawyer or an official, but both.

Do you feel city attorneys should be held responsible for their formal advice, even if they might have been pressured into giving it? In other words, must a city attorney in this situation make a clear choice between representing a council member with conflicting interests or the public interest as stated clearly in state and local laws? How would a city attorney be held responsible in this situation? Do you know of instances where someone has sued a lawyer in such a situation or in which a lawyer has been disciplined?

Robert Wechsler
Director of Research-Retired, City Ethics