Source: http://www.dsd.state.md.us/comar/comarhtml/advisoryo/advisoryo.1983.04.htm
Timestamp: 2017-12-17 08:07:07
Document Index: 97321182

Matched Legal Cases: ['§11', '§3', '§3', '§3', '§3', '§3', '§3', '§3', '§3', '§3']

An opinion has been requested concerning whether the Executive Legal Assistant to the Secretary of State (the Requestor) may, for private reimbursement, conduct seminars on the Maryland Condominium Law for private legal entities, or have a private practice serving as counsel to condominium councils of unit owners. The Requestor believes that he may receive future requests for this type of employment and wishes to be able to respond to these requests in a way consistent with the purposes and intent of the Public Ethics Law.
The Executive Legal Assistant to the Secretary of State serves as Administrator of the Division of Condominium Registration. The position appears to be of significant responsibility. In it the Requestor develops and carries out policies and procedures for implementing the Maryland Condominium Law (Real Property Article, Title 11, Annotated Code of Maryland, the Condominium Law). This Law requires registration of all residential condominiums with the Secretary of State before any units may be sold. The Public Offering Statement (the Statement), which is submitted as an application for registration, requires substantial information concerning the condominium sales contract; its declaration, by-laws, rules and regulations (including information about the council of unit owners (the Council), and its governing instrument); an operating budget; contracts and leases to which the Council would be a party; expansion plans; physical information about the structure itself; a statement regarding any judgments against the Council; and a statement regarding condominium control. The Requestor's official duties also include service as counsel to the Governor's Commission on Condominiums.
The Requestor indicates that he himself personally completes the required Secretary of State review of Public Offering Statements submitted to the office, "often asking for changes. ..or requesting additional materials." He states, however, that the primary function of the Secretary of State's office under this program is to review and accept registrations submitted by developers. Enforcement of the substance of the Public Offering Statement is generally by the Consumer Protection Division in the Office of the Attorney General, or as a private matter between a unit owner and a condominium council of owners. However, the Condominium Law does require that the Secretary of State work in cooperation with the Consumer Protection Division in the enforcement of the Law (§11-128).
The Requestor states that he may answer questions of a general nature, such as providing general information on what kind of insurance a condominium needs, but he does not do any enforcement or work in his official capacity directly with councils of unit owners. This description is supported by the Secretary of State and also by the Chief of the Attorney General's Consumer Protection Division, who indicates, however, that his office has taken the position that the Secretary of State's responsibilities under the Condominium Law are more than mechanical. That office, he says, substantively reviews the Statements and is not merely a repository; to the extent that information on a Statement is patently incorrect, the reviewer in the Secretary of State's office refers the matter to the Consumer Protection Division for investigation or appropriate enforcement action. The Secretary's office appears to have little independent enforcement authority either as to failures to file, incomplete filings, or complete but incorrect filings.
The Requestor was approached by a private law firm to conduct a seminar on drafting the many documents required to be a part of the registration and Public Offering Statement. The seminar was to address the specifics of the information required in the documents, the format, and the various kinds of things the Secretary of State's office looks for in reviewing Statements. The law firm involved was not at the time representing a condominium developer, or otherwise involved in the program, though presumably the request for the seminar reflected an intention to undertake such efforts in the future. The firm offered the Requestor private remuneration for the seminar. He has inquired about whether he could accept compensation from this firm or others presenting similar requests, and also whether he could provide such a service, for compensation, through the Maryland Institute for Continuing Practical Education of Lawyers (MICPEL).
Commission advice is also requested as to whether he could have a private practice as counsel to councils of unit owners in established condominiums. He indicates that this would involve general advice on compliance by the Councils with the Condominium Law, such as complying with requirements for submission of annual reports to the Department of Assessments and Taxation and procuring required insurance. The Requestor says that he would not be soliciting business, that it would largely be a matter of people coming to him. He states that he is becoming known around the State as an expert on the Condominium Law. He notes that the experience in this field was developed solely through his State job.
The Secretary of State, who is the Requestor's immediate supervisor, indicates that when the request for a seminar was first presented, they discussed it and agreed that it should be done by him on State time as part of his official duties. Both noted that his doing this in his private capacity probably could be a problem, even though a firm may not be currently involved in a registration, since certainly any future registration would be reviewed by him. The initial request was handled by his doing the seminar as part of his official duties, and the Requestor in both this and his potential practice situation has been very sensitive to the goals and purposes of the Ethics Law. He has therefore requested our formal advice in order to deal with future requests and possible MICPEL work. The Secretary of State has stated her belief that such seminars should be done through the office, as she sees this as part of his role as Administrator of the Division of Condominium Registration. She views the agency role as being a service office whose responsibility is to help members of the public who must submit registrations to be able to do it right.
Though the Secretary of State recognizes that the Office has shared responsibilities under the Condominium Law, she also has reservations about the Requestor's engaging in a private law practice as proposed. She thinks that individuals should not have outside employment regarding matters that are job related, and believes that service to councils of unit owners regarding implementation of Condominium Law requirements would present this type of situation even though apparently no direct Secretary of State authority exists over the Councils.
The situations presented by the Requestor raise potential issues under §§3-103(a) and 3-104 of the Public Ethics Law (Article 40A, §§3-103(a) and 3-104, Annotated Code of Maryland, the Ethics Law). Section 3-103(a) prohibits an employee or official from 1) being employed by or having a financial interest in an entity that is under the authority of or has contractual dealings with his agency (subsection 3-103(a)(1)(i)), and 2) having any other employment relationship that would impair his impartiality or independence of judgment (subsection 3-103(a)(1)(ii)). Section 3-104 bars an employee or public official from using the prestige of his office for his own private gain or that of another. As to the proposal to conduct seminars for private firms or for MICPEL, it is questionable whether either of these entities would be directly or currently under the authority of the Secretary of State's Office, at least as to its implementation of the Condominium Law. While we have generally considered the matter, we are not convinced that the likely potential coverage of a particular law firm, or the possible authority over particular attendees of a MICPEL course (as opposed to MICPEL itself) would justify finding an authority relationship under §3-103(a)(1)(i).
However, we do not believe that resolution of this question is necessary, as we conclude that even if these circumstances do not meet the technical criteria of subsection (a)(1)(i), they are conclusive in determining that the activity would be prohibited by the inconsistent employment provision of subsection (a)(1)(ii). Some attendees at a MICPEL course, for example, could be attorneys or developers who would currently be involved in condominium registration activities. Also, a law firm sponsoring such a seminar would be expected to be involved in the process in the future, and thus anticipate presenting the documents to the Requestor for review. These circumstances, along with the fact that the seminar subject specifically has to do with his official duties, require a conclusion that these activities would constitute employment that would impair his impartiality or independence of judgment as set forth in subsection (a)(1)(ii).
The relationship of the seminar activities to the Requestor's official responsibilities is also relevant to consideration of the application of the §3-104 prestige provision. We have generally applied this section to bar acceptance of fees for services rendered to private entities that are directly and immediately related to an official's or employee's State duties. (Opinions No. 80-7 and No. 80-8.) We also advised a former employee of the Community Development Administration that acceptance by him of a private fee for work that might have been done by him in his official duties was inconsistent with the proscription of §3-104 (Opinion No. 81-44). Though this request for a seminar may not have been made through official office channels, the Secretary of State has expressly stated that this type of information service is properly part of the agency's mission and the employee's official duties. Based on all these circumstances we conclude that the Requestor's acceptance of private reimbursement for these activities would be prohibited by §3-104 of the Law as discussed in Opinions No. 80-7 and No. 80-8.
Consideration of the Requestor's proposed private practice as a council of unit owners attorney raises different issues. The question of agency authority or potential authority over the Councils is unclear, given the mandate that the agency cooperate with the Consumer Affairs Division in enforcement matters. Given the primary enforcement jurisdiction of the Attorney General, the councils of unit owners may not technically come under the authority of the Requestor or his agency as contemplated by subsection (a)(1)(i). On the other hand, as these Councils operate under the law administered by the Requestor, and were established and operate pursuant to papers specifically reviewed and approved by him, we believe that this situation raises problems under subsection 3-103(a)(1)(ii) of the Law.
We have considered subsection (a)(1)(ii) on several occasions, originally in our Opinion No. 81-28. We have generally read the provision narrowly, applying it where the relationship of private and official duties gives rise to clear and serious concerns about an employee's ability to carry out his State duties impartially and with independence of judgment. This section has to some extent been viewed as a general inconsistent employment provision, looking to the official duties of a particular requestor to determine whether they would be impacted by his outside activities. We believe that these principles apply to bar the Requestor's proposed private practice under the circumstances presented here, notwithstanding the absence of any enforcement authority in the Secretary of State. As private counsel to councils of unit owners, the Requestor could very likely be representing his clients in matters involving developers who continue to have applications pending before his office. His advice would be sought in connection with actions by the unit owners implementing the very provisions approved by him in his official capacity.
Also, it appears to us that the Requestor, as Administrator of the condominium registration program, plays a significant role involving substantial discretion, expertise and judgment. We do not believe he should risk being impacted in these duties by other, private, relationships with developers directly involved in an application, or by the expectation of future duties as private counsel to parties responsible for implementing the documents he is reviewing. Moreover, the Requestor also serves as counsel to the Condominium Commission, whose advisory authority extends to condominiums' operations as well as their establishment. Though this entity's duties are primarily to make legislative recommendations, rather than to exercise any actual governmental authority, we believe that §3-103(a)(1)(ii) still operates to bar its legal advisor from private employment involving significant relationships with parties to the programs being addressed by the Condominium Commission. Based on all of these circumstances we advise the Requestor that he is barred by this section of the Ethics Law from having a private law practice directed to condominium councils of unit owners.1
1 As we believe that §3-103(a)(1)(ii) is dispositive of the question of the Requestor's having a private practice, we do not address the application of the §3-104 prestige of office provision to these circumstances.