Can two law partners each represent a different municipality when the municipalities take opposing positions in the same county-tax litigation?

Plain-English summary

A third municipality sued, alleging that certain municipalities in its county were not properly assessing personal property, so that the plaintiff municipality paid a disproportionate share of county taxes. Among the defendants were a municipality represented by the inquirer, a municipality whose attorney was the inquirer's law partner, and others that engaged the partner or firm as special counsel. As first filed, the complaint did not necessarily put the inquirer's municipality in conflict with the others, but after an amendment the inquirer's municipality stood to have its county tax reduced, and perhaps obtain a refund, while the municipalities represented by the partner would have to pay additional taxes.

The inquirer had recently become attorney for his municipality after a change in the political alignment of the municipal council. The Committee noted that neither partner contributed his municipal salary to the firm account, but found that fact had no bearing on the problem.

Because of the importance of resolving the matter quickly, the Committee gave an immediate opinion that a conflict of interest existed so the inquirer could withdraw and have substitute counsel appear, with a formal opinion to follow. It concluded unanimously that a conflict did exist, advised the inquirer to withdraw, and noted that he did.

Currency note

This opinion was issued in October 1964, before New Jersey's September 13, 1971 adoption of the Disciplinary Rules (Code of Professional Responsibility), and well before the 1984 Rules of Professional Conduct and all later revisions. It applied Canon 6 of the former Canons of Professional Ethics; concurrent conflicts and their imputation within a firm are now governed by RPC 1.7 and RPC 1.10. Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific rule or requirement mentioned here.

Common questions

Q: What created the conflict between the two municipalities?

A: An amendment to the complaint. After it, the inquirer's municipality could have its county tax reduced or refunded, while the municipalities represented by his partner would have to pay additional taxes, putting the two municipal clients in direct opposition.

Q: Did it matter that neither partner shared his municipal salary with the firm?

A: No. The Committee said that fact had no bearing on the problem; the conflict arose from the opposing interests of the two municipal clients, not from how the partners handled their salaries.

Q: What did the inquirer have to do?

A: Withdraw. The Committee gave an immediate opinion that a conflict existed so substitute counsel could be appointed, and the inquirer withdrew.

Background and rules framework

The opinion applied Canon 6 of the former Canons of Professional Ethics, which forbade representing conflicting interests. Because the lawyers were partners, the conflict reached both. Today the concurrent-conflict analysis appears in RPC 1.7, and imputation within a firm in RPC 1.10.

Citations and references

Rules of Professional Conduct (as in effect at the time):

• Canon of Professional Ethics 6 (adverse influences and conflicting interests)

See also

• NJ ACPE Op. 59: Municipal and School-Board Attorney Partners
• NJ ACPE Op. 65: Conflict of a Municipal Tax Attorney
• NJ ACPE Op. 52: Attorney to a Municipal Parking Authority

Source

• Landing page: https://law.justia.com/cases/new-jersey/advisory-committee-on-professional-ethics/2004/acp54-1.html

Original opinion text

Reproduced from the official source for research purposes. The linked source is authoritative.

87 N.J.L.J. 689
October 29, 1964

OPINION 54

Conflict of Interest
Municipalities

This inquiry presents the problem of two partners representing two different municipalities in litigation involving a county tax situation where the interests of the municipalities are in conflict.

The facts are these: A third municipality not represented by either partner instituted a suit alleging that certain municipalities in its county were not properly assessing personal property, as a result of which the plaintiff municipality was paying a disproportionate share of county taxes. The other municipalities in the county which were made parties defendant included the one represented by the attorney posing the inquiry, the one of which his law partner was attorney, and certain others which engaged the partner, or the firm, as special counsel.

As the complaint was first filed, it did not necessarily indicate that the position of the municipality represented by the inquirer would be in conflict with those of the other defendants represented by his partner or the firm. However, plaintiff's cause of action was amended, as a result of which if plaintiff's theory of law was correct, the municipality represented by the inquirer would be in a position not only to have its current county tax reduced, but perhaps to secure a tax refund for a prior year or years. On the other hand, the municipalities represented by the partner, and some of those specially represented, would have to pay additional taxes because it was charged that some of them under-assessed the properties within their boundaries.

The inquirer had recently become attorney for his municipality as a result of a change in the political alignment of the municipal council. When the divergent positions of the two municipalities developed, questions were raised as to the ability of the inquirer to represent his municipality in a situation where his partner was supporting a position for at least one other municipality which appeared to be in conflict with the best interests of the municipality represented by the inquirer.

The inquirer states that neither he nor his partner contributes his municipal salary to the firm account, but that each retains his own and does not share in the salary of the other. This fact, we believe, has no bearing on the problem involved.

At the time the inquiry came to this Committee, it was important that the Committee give an immediate opinion as to whether a conflict of interest existed, so that if it did the inquirer could promptly withdraw from the suit and have other counsel substituted for him. It was the unanimous conclusion of this Committee that a conflict of interest did exist and the inquirer was advised that he should withdraw and that a formal opinion would be filed in due course. The inquirer did withdraw.