LEGAL ETHICS (v.2)
TABLE OF CONTENTS
ETHICS IN THE LEGAL PROFESSION ................................................................................................................. I
CHAPTER ONE ..........................................................................................................................................................1
DEFINITION OF “ETHICS” ........................................................................................................................................... 1
RULES OF PROFESSIONAL CONDUCT .............................................................................. 2
TYPES OF ETHICS OPINIONS ..........................................................................................................................3
DETERMINE THE OPTIONS ......................................................................................................................................... 3
THE LAWYER’S RESPONSIBILITIES ................................................................................. 4
THE BAR ASSOCIATION ...................................................................................................... 4
ABA REPORT OF COMMITTEE ON CODE OF PROFESSIONAL ETHICS ....................................................6
Reasons for the Code ........................................................................................................................................................ 7
ETHICAL THEORIES ............................................................................................................. 8
DETERMINING ACTION IN LIGHT OF THE CONSEQUENCES OF THE ACT ...................................................... 9
Acting only from Desire ................................................................................................................................................... 9
ETHICS OF VIRTUE ......................................................................................................................................... 10
Determining the Proper Action ....................................................................................................................................... 10
DEALING WITH RIGHT OR WRONG .............................................................................................................. 11
Personal Responsibility ................................................................................................................................................... 11
SENSITIVE JUDGMENT ................................................................................................................................... 12
The Morals of the Lawyer ............................................................................................................................................... 13
INTEGRITY ........................................................................................................................................................ 13
Justification ..................................................................................................................................................................... 14
BELIEFS LEARNED AS A CHILD .................................................................................................................... 15
IS THIS GOOD FOR ME? ................................................................................................................................. 15
HOW DOES THE ACTION AFFECT SOCIETY? ............................................................................................. 16
IS IT FAIR, JUST AND PROPER? .................................................................................................................... 16
IS THERE A RIGHTS VIOLATION INVOLVED? ............................................................................................. 16
HAS THERE BEEN A PROMISE MADE? ......................................................................................................... 17
IGNORANCE IS BLISS? .................................................................................................................................... 18
OR GREED? ...................................................................................................................................................... 18
CHARACTER ..................................................................................................................................................... 19
QUANDARIES ................................................................................................................................................... 20
TRYING TO RESOLVE DILEMMAS ................................................................................................................. 20
Collect pertinent information .......................................................................................................................................... 20
Discover all of the players............................................................................................................................................... 21
Determine the Options .................................................................................................................................................... 21
Estimate the Effect of the Options .................................................................................................................................. 21
ETHICAL BEHAVIOR ....................................................................................................................................... 21
Moral Behavior ............................................................................................................................................................... 22
EQUITY.............................................................................................................................................................. 23
STUDY QUESTIONS ............................................................................................................................................... 24
CHAPTER TWO ........................................................................................ ERROR! BOOKMARK NOT DEFINED.
NEUTRAL PARTISANSHIP ........................................... ERROR! BOOKMARK NOT DEFINED.
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JUSTIFICATION OF NEUTRAL PARTISANSHIP ............................................. Error! Bookmark not defined.
OBJECTIONS TO THE ADVERSARIAL SYSTEM ...... ERROR! BOOKMARK NOT DEFINED.
CONFLICTS BETWEEN CLIENT OBLIGATIONS AND OBLIGATIONS TO OTHERS .. Error! Bookmark not
defined.
LEGAL FICTION ................................................................................................. Error! Bookmark not defined.
ZEALOUS ADVOCACY—REPRESENTING A GUILTY PARTY ...... ERROR! BOOKMARK
NOT DEFINED.
SANCTIONS AGAINST ABUSE OF THE ADVERSARIAL SYSTEM................... Error! Bookmark not defined.
THE MORALITY OF ZEALOUS ADVOCACY ............ ERROR! BOOKMARK NOT DEFINED.
CONFIDENTIALITY....................................................... ERROR! BOOKMARK NOT DEFINED.
RULE 4-1.6 CONFIDENTIALITY OF INFORMATION ERROR! BOOKMARK NOT DEFINED.
(a) Consent Required to Reveal Information.................................................................... Error! Bookmark not defined.
(b) When Lawyer Must Reveal Information. ................................................................... Error! Bookmark not defined.
(c) When Lawyer May Reveal Information. .................................................................... Error! Bookmark not defined.
(d) Exhaustion of Appellate Remedies. ............................................................................ Error! Bookmark not defined.
(e) Limitation on Amount of Disclosure. ......................................................................... Error! Bookmark not defined.
Authorized disclosure ........................................................................................... Error! Bookmark not defined.
Disclosure adverse to client ................................................................................. Error! Bookmark not defined.
Withdrawal ........................................................................................................... Error! Bookmark not defined.
Waivers of Privilege ........................................................................................................ Error! Bookmark not defined.
THE CRIME-FRAUD EXCEPTION .................................................................... Error! Bookmark not defined.
PRECEDENCE OF PROTECTING THE GUILTY OVER CONVICTING THE GUILTY . Error! Bookmark not
defined.
STUDY QUESTIONS ................................................................................................ Error! Bookmark not defined.
CHAPTER THREE .................................................................................... ERROR! BOOKMARK NOT DEFINED.
DISCOVERY .................................................................... ERROR! BOOKMARK NOT DEFINED.
LEGAL TACTICS USED DURING DISCOVERY ................................................ Error! Bookmark not defined.
BILLABLE HOURS .............................................................................................. Error! Bookmark not defined.
FLORIDA RULES OF PROFESSIONAL CONDUCT—FEES ...... ERROR! BOOKMARK NOT
DEFINED.
RULE 4-1.5 FEES FOR LEGAL SERVICES ................... ERROR! BOOKMARK NOT DEFINED.
(a) Illegal, Prohibited, or Clearly Excessive Fees. ........................................................... Error! Bookmark not defined.
(b) Factors to Be Considered in Determining Reasonable Fee. ........................................ Error! Bookmark not defined.
(c) Consideration of All Factors. ...................................................................................... Error! Bookmark not defined.
(d) Enforceability of Fee Contracts. ................................................................................. Error! Bookmark not defined.
(e) Duty to Communicate Basis or Rate of Fee to Client ................................................. Error! Bookmark not defined.
Division of fee ................................................................................................................. Error! Bookmark not defined.
Disputes over fees ............................................................................................................ Error! Bookmark not defined.
Referral fees and practices ............................................................................................... Error! Bookmark not defined.
ATTORNEY-CLIENT RELATIONSHIP ........................ ERROR! BOOKMARK NOT DEFINED.
FOR ORGANIZATIONAL CLIENTS ................................................................... Error! Bookmark not defined.
ABA MODEL RULE 1.13(D) ............................................................................... Error! Bookmark not defined.
FLORIDA’S RULE OF PROFESSIONAL CONDUCT, ORGANIZATION AS CLIENT
................................................................................................. ERROR! BOOKMARK NOT DEFINED.
UPJOHN v. UNITED STATES ............................................................................. Error! Bookmark not defined.
IF A CORPORATE CLIENT REFUSES TO FOLLOW LEGAL ADVICE ........... Error! Bookmark not defined.
STUDY QUESTIONS ................................................................................................ Error! Bookmark not defined.
CHAPTER FOUR ...................................................................................... ERROR! BOOKMARK NOT DEFINED.
WHISTLE-BLOWERS..................................................... ERROR! BOOKMARK NOT DEFINED.
FLORIDA RULE OF PROFESSIONAL CONDUCT, REPORTING MISCONDUCT ERROR!
BOOKMARK NOT DEFINED.
RULE 4-8.3 REPORTING PROFESSIONAL MISCONDUCT ............................ Error! Bookmark not defined.
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(a) Reporting Misconduct of Other Lawyers.................................................................... Error! Bookmark not defined.
(b) Reporting Misconduct of Judges. ............................................................................... Error! Bookmark not defined.
(c) Confidences Preserved................................................................................................ Error! Bookmark not defined.
(d) Limited Exception for LOMAS Counsel. ................................................................... Error! Bookmark not defined.
AMBULANCE CHASERS AND OTHER PERSONAL INJURY LAWYERS ......... Error! Bookmark not defined.
AS BAD AS AMBULANCE-CHASERS ................................................................ Error! Bookmark not defined.
ADVERTISING ................................................................ ERROR! BOOKMARK NOT DEFINED.
THE PROS AND CONS OF LEGAL ADVERTISING .................................................. Error! Bookmark not defined.
Deceiving Ads ............................................................................................................ Error! Bookmark not defined.
Cost............................................................................................................................. Error! Bookmark not defined.
Professionalism ........................................................................................................... Error! Bookmark not defined.
The Effect of Advertising on the General Public ........................................................ Error! Bookmark not defined.
ETHICAL PROBLEMS WITH ADVERTISING ............................................................ Error! Bookmark not defined.
INSURANCE LAWYERS ...................................................................................... Error! Bookmark not defined.
NOW APPEARING BEFORE THE JURY - .................... ERROR! BOOKMARK NOT DEFINED.
BEHAVIOR OF TRIAL LAWYERS .............................................................................. Error! Bookmark not defined.
RACISM ............................................................................................................... Error! Bookmark not defined.
WRONGFUL OBEDIENCE ............................................ ERROR! BOOKMARK NOT DEFINED.
ADVISING A CLIENT OR ASSISTING IN A FRAUD ......................................... Error! Bookmark not defined.
THE SAVINGS AND LOAN SCANDAL ............................................................... Error! Bookmark not defined.
CAN LYING BE JUSTIFIED BECAUSE JUSTICE IS BEING SERVED? ........... Error! Bookmark not defined.
STUDY QUESTIONS ................................................................................................ Error! Bookmark not defined.
CHAPTER FIVE ........................................................................................ ERROR! BOOKMARK NOT DEFINED.
CORPORATE WARFARE .............................................. ERROR! BOOKMARK NOT DEFINED.
JUDGES DISCRETION IN PROTECTED INFORMATION ............................... Error! Bookmark not defined.
THE PROZAC CASE ........................................................................................... Error! Bookmark not defined.
CLASS ACTION SUITS .................................................. ERROR! BOOKMARK NOT DEFINED.
DETERMINATION OF WHO IS THE CLIENT? .......................................................... Error! Bookmark not defined.
EQUITABLE RELIEF ..................................................................................................... Error! Bookmark not defined.
MULTIPLE LAWSUITS ON THE SAME ACTION ..................................................... Error! Bookmark not defined.
RIGHTS OF THE INDIVIDUAL CLASS ACTION MEMBER .................................... Error! Bookmark not defined.
CLASS ACTION LAWSUIT SETTLEMENTS .............................................................. Error! Bookmark not defined.
MASS INJURY CASES .................................................................................................. Error! Bookmark not defined.
SETTLEMENTS............................................................... ERROR! BOOKMARK NOT DEFINED.
DEFENDING (?) TRIAL LAWYERS .............................. ERROR! BOOKMARK NOT DEFINED.
STUDY QUESTIONS ............................................................................................... Error! Bookmark not defined.
CHAPTER SIX........................................................................................... ERROR! BOOKMARK NOT DEFINED.
FACTS AND TRUTHS .................................................... ERROR! BOOKMARK NOT DEFINED.
“LEGAL” LYING ............................................................. ERROR! BOOKMARK NOT DEFINED.
THE KODAK-BERKEY CASE ...................................................................................... Error! Bookmark not defined.
Postmortem ...................................................................................................................... Error! Bookmark not defined.
WRONGFUL OBEDIENCE (CONTINUED) ....................................................... Error! Bookmark not defined.
RULE 4-8.3 REPORTING PROFESSIONAL MISCONDUCT ...... ERROR! BOOKMARK NOT
DEFINED.
(a) Reporting Misconduct of Other Lawyers. ....................................................... Error! Bookmark not defined.
NEGOTIATIONS ............................................................. ERROR! BOOKMARK NOT DEFINED.
COERCION.......................................................................................................... Error! Bookmark not defined.
LYING IN NEGOTIATIONS ........................................... ERROR! BOOKMARK NOT DEFINED.
LYING DURING SETTLEMENT TALKS ..................... ERROR! BOOKMARK NOT DEFINED.
CORRECTING A SCRIVENER’S ERROR ........................................................... Error! Bookmark not defined.
MISLEADING REPRESENTATIONS NOT NECESSARILY FALSE ................... Error! Bookmark not defined.
“BARGAINING” .................................................................................................. Error! Bookmark not defined.
CHAPTER SEVEN .................................................................................... ERROR! BOOKMARK NOT DEFINED.
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TAX PRACTICE .............................................................. ERROR! BOOKMARK NOT DEFINED.
ACCURACY-RELATED VIOLATIONS ....................................................................... Error! Bookmark not defined.
PENALTIES FOR PREPARERS OF TAX RETURNS .................................................. Error! Bookmark not defined.
SANCTIONS ................................................................................................................... Error! Bookmark not defined.
GOOD FAITH ................................................................................................................. Error! Bookmark not defined.
CHANCE OF AUDIT ...................................................................................................... Error! Bookmark not defined.
REASONABLE BASIS OR REASONABLE POSSIBILITY OF SUCCESS................. Error! Bookmark not defined.
TAX RETURNS NOT ADVERSARIAL PROCEEDINGS ............................................ Error! Bookmark not defined.
TAX AVOIDANCE ......................................................................................................... Error! Bookmark not defined.
ETHICS IN TAX AVOIDANCE DEVICES ................................................................... Error! Bookmark not defined.
REPORTING OF MISDEED BY ANOTHER ATTORNEY .......................................... Error! Bookmark not defined.
GIVING ADVICE OR ACTIVE PARTICIPANT ........................................................... Error! Bookmark not defined.
ETHICS RULES ................................................................................................... Error! Bookmark not defined.
Comment .................................................................................................................... Error! Bookmark not defined.
LIMITS OF CONFIDENTIALITY ........................................................................ Error! Bookmark not defined.
Withdrawal ........................................................................................................... Error! Bookmark not defined.
PERSONAL CHARACTER AND MORAL FITNESS.... ERROR! BOOKMARK NOT DEFINED.
PUBLIC PERCEPTION AND SUMMARY .................... ERROR! BOOKMARK NOT DEFINED.
STUDY QUESTIONS ................................................................................................ Error! Bookmark not defined.
BIBLIOGRAPHY AND REFERENCES ......................... ERROR! BOOKMARK NOT DEFINED.
iv
ETHICS IN THE LEGAL PROFESSION
In law a man is guilty when he violates the rights of another.
In ethics he is guilty if he only thinks of doing so.
Immanuel Kant (1724-1804) Lecture at Konigsberg, 1776
CHAPTER ONE
“There is no profession in which moral character is so soon fixed as in that of the law;
there is none in which it is subjected to severer scrutiny by the public. It is well that it is so.
The things we hold dearest on earth – our fortunes, reputation, domestic peace, the future
of those dearest to us, nay, our liberty and life itself, we confide to the integrity of our legal
counselors and advocates. Their character must be not only without a stain, but without
suspicion.”
(George Sharswood, An Essay on Professional Ethics 4th Ed. 1876 – as quoted in Legal Ethics, Third Edition)
DEFINITION OF “ETHICS”
(Webster says) Ethic(s) is the “discipline dealing with what is good and bad and with moral
duty and obligation.” “A set of moral principles or values, the principles of conduct governing
an individual or a group.” “Ethical” is defined as “of or relating to ethics, and conforming to accepted professional standards of conduct.”
The law sets minimum standards,
whereas ethical behavior is the highest standard.
From the strictly legal point of view, “ethics” as it relates to the legal profession can be compared to a handful of Jell-O – when a little pressure is applied, it has a tendency to go off in several directions. In the legal profession, ethics is part of the professional responsibility of the attorneys, which also includes statutes, case law, court rules and articles. When one attempts to
determine the ethical obligations for himself or others in the law firm, the rules of conduct and
ethics opinions which interpret these rules as they refer to the applicable jurisdiction – either
state or federal- must be used.
There appears to be no other profession that is so aware of ethical conduct as is the legal profession and there seems to be no other profession that is so often accused of lacking ethics – with
the possible exception of used-car salesmen. Ethical questions can now be resolved nearly instantaneously through the miracle of the Internet. Of course, there are volumes and volumes of
texts on legal ethics available to the interested scholar, many of which are well worn with voluminous notations in the margins.
You will note that the first Chapter discusses “Ethics” as a concept that can be applied to the
individual or to a business, and not specifically the legal profession. It is well understood that
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the ethical problems of the legal profession are unique and the remaining chapters discuss only
those unique problems. In many of the important ethical dilemmas, there may not be only one
answer – the legal profession in particular has this problem. Therefore, there are not always one
specific answer to a legal ethical situation discussed in this text, as there may be differences between the courts, the American Bar Association Model Code of Ethics, and those ethical Rules
within a particular jurisdiction. When possible, all sides will be explored as much as is possible
within the constraints of this text.
The legal profession is comprised of those who offer differing opinions on nearly every subject, as this is the raison d'étre of lawyers. What would appear to be a simple, straightforward
situation for laypersons and other professionals would generally consist of a wide variety of
opinions from lawyers (and courts). Therefore, it is impossible to provide a textbook that covers
all possible ethical responses to the many legal problems of today. The only recourse is to simply discuss the basics of ethics and how they apply broadly to the legal profession.
You will also note that this text is gender-neutral inasmuch as personal nouns and pronouns
are in the male gender as it is much easier and less confusing than to use “his/her,” “she/he,”
“himself/herself,” etc. Incidentally, the history of the profession shows that at one time influential attorneys and legal scholars publicly declared that women could not and should not function
as lawyers. There are few, if any, professions that have come so far in recognizing the ability of
women to function very well in their chosen profession.
Also, it should be noted that the terms “lawyer” and “attorney” are used interchangeably in
this text, except “attorney” is generally used when a lawyer is specifically designated to represent an individual in a particular matter.
RULES OF PROFESSIONAL CONDUCT
Every jurisdiction that admits lawyers to practice maintains ethic rules for these lawyers.
Many states have rules that are based upon the American Bar Association Model Rules of Professional Conduct (often quoted in this text) but since these are “model” rules, the rules of the
particular jurisdiction will always govern. State rules of professional conduct can be located at
various places, such as in a state’s rules of court or its annotated states.
Through the Internet, these rules of professional conduct can be obtained through Lexis,
Westlaw, court and bar association websites, and sites with links to states’ rules include the Association of Professional Responsibility Lawyers (http://www.aprl.net/); Cornell Law School
Legal Information Institute (http://www.law.cornell.edu/ethics/listing.html), and the American
Bar Association Center for Professional Responsibility
(http://www.abanet.org/cpr/links.html#States).
State supreme courts publish cases disciplining lawyers for misconduct; civil cases and criminal cases address ethics issues. These can be located through the West Digest System, and case
laws regarding ethics can be found through Westlaw, Lexis, Loislaw
(http://www.loislawschool.com) and Versuslaw (http://www.fcsl.edu/Library/versuslaw.htm)
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TYPES OF ETHICS OPINIONS
Ethics opinions interpret and apply the rules of conduct to specific situations, which are issued by a state Supreme Court for instance, but more generally by a committee of a state or local
bar organizations. Some of these opinions are advisory only and do not have the force of law,
but are still considered persuasive authority. Some opinions are binding, particularly if issued by
state supreme courts.
Generally, the rules are both imperatives, as indicated by the verbs “shall” and “shall not”
and are used to define proper conduct within the parameters of professional discipline. Others
use permissive verbs, such as “may,” or “should,” which indicate that the lawyer has professional discretion. If the rule is permissive, then there should be no disciplinary action if an attorney
decides to act, or not to act, within the bounds of this discretion.
In a study of ethics, those rules that are permissive are normally those that are of interest. As
later discussed, ethical situations arise in most cases where there is a dilemma. If a rule were
imperative, then there would usually be no dilemma. This is not to say that there cannot be a
quandary in respect to imperatives – indeed, some of the more interesting ethical situations arise
when there is a flagrant misuse of ethical standards regarding a “shall not” type of rule. But for
purposes of this text, permissive rules or situations are more applicable to the study of ethics.
A quandary or dilemma occurs when in a certain situation, the person is not
sure as to what to do, as there is good reasons for the action and good reasons against it.
Conflicting responsibilities often arise in the practice of law and ethical problems are frequent because of the conflict between a lawyer’s responsibilities to a client and the attorney’s
own personal honor and his perceived obligations to society and the legal profession. These are
the most common and the most trying of ethical problems, and are most frequently addressed in
the Rules of Professional Conduct (or similar rules).
DETERMINE THE OPTIONS
Some ethics “consultants” maintain that since a dilemma (or quandary) must have at least
two options, in order to determine the proper option, a third option is necessary. The reasoning
seems to be that if one has not spent enough time and thought to the problem without coming up
with at least a third option, then they simply haven’t thought enough about the problem.
Practically speaking,
in order to solve a dilemma, there MUST be another choice, other than just two.
In this text, the Florida State Bar Association Regulations, Chapter 4. Rules of Professional
Conduct will be referenced frequently for illustrative purposes. For those who practice law outside of the State of Florida, this must be kept in mind as there can be, and often are, differences
in the various jurisdictions as to ethics and ethical situations. In many situations, it is not as important as to what the rules are, as the procedure used to arrive at the particular rule.
3
THE LAWYER’S RESPONSIBILITIES
A good place to start this discussion is by quoting the first line of the above-mentioned Rules
of Professional Conduct, “Preamble: A Lawyer’s Responsibilities:”
A lawyer is a representative of clients, an officer of the legal system, and a public citizen having special responsibility for the quality of justice.
Since lawyers are officers of the court, they are responsible to the judiciary for their professional activities and therefore, lawyers are granted powers of self-government. This has been
criticized by laypersons as granting too much power to the legal profession, but in actual practice, any abuse of the system is challenged more readily when members of the profession are not
dependent upon the other branches of government (executive and legislative) for the right to
practice their profession.
In addition to the rules, a lawyer is guided by his conscience and by the approval of his professional peers, as is often stated in various “rules.” While everyone would agree to this simplistic statement, it must also be recognized that one person’s conscience is another person’s dare –
and in many cases, who is to say what is “right.” If everyone’s conscience were alike, there
would not be the need for many lawyers. And in respect to “peers,” it often appears that the
most highly regarded, and generally the highest-paid, attorneys don’t really seem to “give a
hoot” about what others think. The general public accuses attorneys of many things, but usually
being a “lemming” is not one of those things.
If there are indeed at least two (or more) sides to nearly every story, and the law is not clear,
or is clearly unfair, in the particular situation the deciding factor must then be the most ethical.
And for the law practitioner, it should be remembered:

When ethics are discarded, those affected are generally those who will suffer the
most and who can ill afford the consequences.
THE BAR ASSOCIATION
Bar associations were formed during colonial times, but faded away with the exodus of the
Tories. They were revitalized in the late 19th century because of a variety of reasons.
It was (and still is) believed that public service could be developed and maintained only
through organizations. High educational standards that can assure high standards for a profession can be obtained only through such an organization, and only such organizations can create
and maintain high standards of ethical conduct with clients and with the courts. The general
public has a substantial interest in such an organization and their ability to administer justice,
particularly in fact of every-changing and complex society.
4
Lawyers were among the most individualistic members of society after the American Revolution, but gradually, starting in the most populous areas, bar associations were formed for social
and/or disciplinary reasons and took on the appearance of a “guild.”
In 1870, a group of the best known and highest-regarded lawyers in New York City formed
the Association of the Bar of the City of New York, principally to fight the Tweed organization.
Four years later in Chicago, because of the activities of a number of unlicensed legal practitioners, the Chicago Bar Association was formed. By 1925, all the states and territories had bar associations; however most of them had been formed for social purposes, which continued until the
1920s. For some 50 years after the associations were formed, it was a given that the individual
lawyer had neither the right nor the duty to join a bar association as membership was a privilege
and new members had to be voted in by present members. By 1935, 60% of the lawyers belonged to some bar associations.
The strongest supporters of the Association of the Bar of the City of New York were, according to some historians, Yale, Harvard and Protestantism.
After a rather timid start, during the second half of the 20th century, the American Bar Association came of age and became more assertive. The purpose of the American Bar Association,
it was stated, was to preserve its own exclusiveness (and social status thereof), and to exert professional leverage upon the political process. One item that drew national attention was when
the American Bar Association admitted three black lawyers (by error, it was claimed) in 1912,
when it then changed its admission practices so that only white men could be members. This
remained unchanged for nearly 50 years.
They also fought hard against the nomination of Louis D. Brandeis to the Supreme Court,
mostly because the members of the bar considered him as a threat to their professional world.
They were not successful as Brandeis had a brilliant record at Harvard Law School and Brandeis
was confirmed by a vote of 47-22.
The American Bar Association is the world’s largest voluntary professional organization
with over 400,000 members representing about 40% of the practicing attorneys. It is governed
by a House of Delegates who has adopted the following statement of objectives:
1. Promote improvements in the system of justice;
2. Improve the delivery of legal services;
3. Provide leadership in the improvement of the law;
4. Increase understanding of the legal system;
5. Assure the highest standards of professional competence and ethics (our emphasis);
6. Serve as the national representative of the legal profession;
7. Enhance the professional growth of its members.
5
ABA REPORT OF COMMITTEE ON CODE OF PROFESSIONAL ETHICS
The first book specifically addressing legal ethics was Fifty Resolutions in Regard to Professional Deportment, written by David Hoffman in 1836. Hoffman was as concerned with etiquette as he was with ethics. In 1854, George Sharswood (a Pennsylvania judge) wrote Essay on
Professional Ethics that was a major influence on the first state bar’s Code of Professional Ethics
(Alabama) and the ABA's first Canons of Ethics. His writing was noted for stressing the differences between personal and professional morality.
The ABA that recommended such a code received a shot in the arm by President Theodore
Roosevelt, who had rebuked corporation lawyers for helping powerful clients to evade regulatory
legislation. In 1906, the ABA’s president authorized a committee to determine whether the ethics of the ABA rose to the “high standards, which its position of influence in the country demands.” Rather than be subjected to the reading of the entire report certain statements within the
report of still of interest today. (Emphasis in following text in bold is ours)
“And here in America, where justice reigns only by and through the people under forms of
law, the lawyer is and must ever be the high priest at the shrine of justice.” Colorful and well
put.
“Our profession is necessarily the keystone of the republican arch of government….We
know it cannot be so maintained unless the conduct and motives of the members of our profession, of those who are the high priests of justice, are what they ought to be….A code of
ethics, adopted after due deliberation and promulgated by the American Bar Association, is one method in furtherance of this end.”
“With the influx of increasing numbers, who seek admission to the profession mainly for its
emoluments; have come new and changed conditions. Once possible ostracism by professional brethren was sufficient to keep from serious error the practitioner with no fixed ideals
of ethical conduct; but now the shyster, the barratrously inclined, the ambulance chaser, the
member of the Bar with a system of runners, pursue their nefarious methods with no check
save the rope of sand of moral suasion so long as they stop short of actual fraud and violate
no criminal law. These men believe themselves immune; the good or bad esteem of their colaborers is nothing to them provided their itching fingers are not thereby stayed in their eager
quest for lucre. Much as we regret to acknowledge it, we know such men are in our
midst….Such men are enemies of the republic; not true ministers of her courts of justice
robed in the priestly garments of truth, honor and integrity. All such are unworthy of a place
upon the rolls of the great and noble profession of the law.”
“Members of the Bar, like judges, are officers of the courts, and like judges should hold office only during good behavior. 'Good behavior' should not be a vague, meaningless or
shadowy term devoid of practical application save in flagrant cases…Such standards may be
crystallized into a written code of professional ethics, and a lawyer failing to conform thereto
should not be permitted to practice or retain membership in professional associations….Such
a code in time will doubtless become of very great practical value by leading to action
through the judiciary, for the courts may, as conditions warrant, require all candidates for the
Bar to subscribe to suitable and reasonable canons of ethics as a condition precedent to ad6
mission. If this were done, the courts will be in an indisputable position to enforce,
through suspension or disbarment, the observance of proper ethical conduct on the part
of members of the Bar so admitted. Action by the national Association will also tend to
develop uniformity between the various states, not only inform and method of statement but also in application, and this we deem of practical importance…”
“….(M)any men depart from honorable and accepted standards of practice early in their careers as the result of actual ignorance of the ethical requirements of the situation. Habits acquired when professional character is forming, are lasting in their effects….an American Bar
Association Code of Ethics should prove a beacon light on the mountain of high resolve to
lead the young practitioner safely through the snares and pitfalls of his early practice up to
and along the straight and narrow path of high and honorable professional achievement.”
Following this report, the ABA committee drafted 32 Canons of Ethics, approved by the
membership in 1908 with little changes or debate and which all but 13 states and D.C. adopted
with small local modifications. In the other states, the Canons were treated as guides. However,
there were substantial problems in enforcement, mostly because of the brevity and generality of
the rules, and also because they attempted to combine moral exhortation and disciplinary mandates. The Canons increased in number and there were so many variances, that in 1969 a new
Code of Professional Responsibility was created. These Canons were divided into Canons, Ethical Considerations, and Disciplinary Rules. In respect to the Ethical Considerations, the drafters
of the Code explained, “The Ethical Considerations are aspirational in character and represent
the objectives toward which every member of the profession should strive.”
REASONS FOR THE CODE
Some commentators on legal ethics raise the question as to why there seems to be a need for
ethics. They simply state what decent people already know and practice, while those who are not
“decent” ignore these codes and who, it is suggested, find the naiveté of believing that a code of
ethics would make a difference laughable.
A logical answer to these concerns is that even if it is true that they are simply naïve reiterations of what is already known, there are not as many virtuous people as one might think. Even
those who are normally considered as above the fray are often confronted with situations with
which they are not familiar and need guidance. Particularly in a profession where success is often measured on a monetary scale, temptation rears its head quite often. Even if there are no
sanctions involved, just the printed guidelines can be used to persuade a person to do what they
may not have done without guidance.
But perhaps the most persuasive reason against a code of ethics raised by some “professionals” who guard their individual autonomy jealously is that the pronouncements are just too controversial and which require behavior about which reasonable people can disagree – therefore the
threat to the autonomy.
Even though an individual’s adherence to a stated principle may be inconsequential, when
everyone acts in the same way, then the results are significant. Codes of ethics encourage, and in
some cases, require, standards of behavior among a group of people with similar needs and inter7
ests, can have a significant influence on both their motivation to act, and by the very nature of
the acts. Add the encouragement of sanctions when the Code is violated and the effects on the
principles will be greater.
Let’s face it. The general public, which is comprised of clients and future clients, is not impressed with the general ethical conduct of the legal profession at this time. While one may not
care what “anybody thinks of them,” the only way that one can build and maintain a reputation
that will influence the public and the lawmakers is to abide by strict rules of ethics. Can you imagine what the public would think if there were no Code of Ethics?
ETHICAL THEORIES
Simply put, an ethical theory lays the foundation for a principle, which in turn
constitutes the most important justification for pursuing or following a course of action.
These principles of fairness, consistency and beneficial to the proper parties as discussed
above, plus such things as “morality” and other such items to consider, may be called “ethical
theories” that form the basis for ethical rules. But as one would suspect, very rarely is there a
clear-cut situation where such rules can be applied with no hesitation and with knowledge that
the ethical solution has been reached – no ifs, ands or buts.
What if you promised your family to take them to Disney World this summer? However,
just a few days before the planned trip you are informed that your daughter, who has a learning
disability, must be tutored during the summer months in order for her to be admitted to the next
grade with all of her friends. This presents a dilemma as the tutoring will be expensive and you
are not sure that you can afford it and keep another promise to your son to buy him a new bicycle
so that he can go to and from Little League practice and games in the Fall. Also, if you took a
week to visit Disney World, your daughter would lose that much tutoring and the information
that she did not learn could be crucial to her final grade and for her moving to the new class.
This is called a “real” dilemma as more than pure reasoning is involved; obviously there are
emotions involved too.
Without going into a technical discussion as to the “types” of moral dilemmas, let it just be
mentioned that
there are those who appeal to fairness and rights over the consequences, and
then there are those who appeal to consequences over fairness and rights.
No discussion of dilemmas would be complete without bringing up the decision that was
made by President Truman to use atomic bombs in Japan, and by doing so, ending World War II.
Those who agreed with his decision say that it was worth taking the estimated 80 or 90 thousand
Japanese lives in order to bring this bloody war to an end, and otherwise, in all probability, it
8
would have cost millions of lives if the country of Japan had been invaded. On the flip side,
there are those who (still) maintain that dropping the bombs was immoral and not just because of
the loss of innocent lives.
These dilemmas cry for solutions, and multitudes of such dilemmas arise every business day.
Solving these dilemmas is what gives us “ethical theory” and which requires more study.
In determining whether an action is ethical – or not – will depend upon “who is asking?” to a
great extent. There are those who prescribe an action for ethical reasons as to whether it benefits
more people than it harms. Those who automatically look at every situation as whether or not it
is “fair” regardless of the consequences might look at a situation differently than one who always
looks at every situation in the light of what benefit it would be to him (her).
A few words in respect to each of these groups of people who usually look at the same situation differently: Those that look for the benefit to themselves find that problems arise when what
is good for them can only be accomplished at the expense of another. This is the key for whether
such consideration is selfish, or just self-concern. Selfishness would indicate that the extreme of
ignoring how an action would affect others is the most common example of unethical behavior.
In many professions, the code of ethics requires one to act in a way that will best serve the public interest.
DETERMINING ACTION IN LIGHT OF THE CONSEQUENCES OF THE ACT
Another type of person will always determine an action in light of the consequences of the
act and they will then always compute the benefits and the harm of every action. Therefore,
an action may be justified if it brings more happiness than unhappiness for
more people.
This seems rather straightforward, but the problem is determining whether an action brings
out the maximum amount of good, or whether it is good to a maximum number of people. If it
brings out the good to a maximum number of people, then the problem becomes as to how these
“goods” are to be distributed. Next problem is how one decides as to what counts as “good?”
Sometime “good” is defined as to what satisfies the desires of the individual the best – actually defining “good” as pleasure and happiness. Happiness is considered by many as the ultimate
“good.” This discussion can (and does) fill page after page in textbooks, but it is presented just
as an example of how professional ethical theorists can determine whether a specific action is
ethical or not.
ACTING ONLY FROM DESIRE
As far as the other approach that one may take to an action in determining if it is ethical, if a
person acts strictly from desire, then he is acting more like an animal inasmuch as there is no
moral reason to take the course of action. The question should be not what action will fulfill the
inclinations, but what fulfills the sense of duty or obligation.
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ETHICS OF VIRTUE
There is one more class of person, or perspectives used by a person, in determining whether
an action is ethical, and what has been called the ethics of virtue, or as some prefer, ethics of
character. The first word that comes to mind to most is “honesty.” While the classical sense of
virtue is not necessarily confined to honesty, it is most descriptive for this discussion. Accountants, for instance, have the responsibility to always respond truthfully and there is little doubt
that this is a virtue that is mandatory for a professional accountant.
Another virtue can be loyalty. However, is loyalty compatible with good, solid (some say
“hard-nosed”) auditing practices? This points out that some “virtues” can conflict. How much
loyalty to a client should an attorney have? Should an in-house attorney report malfeasance of
the President of the company to the Board of Directors before discussing it with the President –
or should he report it at all? (This is discussed at length later in this text.) It is easy to see the
magnitude of this problem.
While it certainly would not hurt any professional to spend the time to become better educated in philosophical studies of ethics with its many ramifications, as a practical matter, most people do not think about the principles to be used in determining whether an action is ethical. Most
people in their private lives simply go by their “gut-feelings,” their intuition or their own personal feelings. Many in their professional lives simply go completely by what their training has
provided them to consider.

Since people in the same vocation or endeavor have various reasons and motives for acting as they do, there must be a published code of ethics for any profession— if
for no other reason than uniformity of action or reaction.
DETERMINING THE PROPER ACTION
Once these steps have been taken, then the options available must be evaluated to determine
which would be correct. To oversimplify this evaluation, there are several ways to determine the
right action, but many experts break it down into only four steps:
1. Is the action that appears correct, beneficial to the parties concerned? Sometimes at this
point it would be helpful to use the “smell” test, i.e., if the action doesn’t “smell” right, then
it probably isn’t.
2. Is the action to be taken, fair to the parties involved?
3. Is there a responsibility to perform the action because of a prior commitment or promise
made?
4. Is it legal?
The proper evaluation of these options is the heart-and-soul of “Ethics” and is discussed below in more detail.
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DEALING WITH RIGHT OR WRONG
Obviously, “Ethics” can be said to deal with right or wrong. Believe it or not,
nearly everyone has a(n) (ethical) set of beliefs as to what is right or wrong and
these beliefs do not necessarily remain the same among all persons.
For instance, abortion, capital punishment, and adultery can be good or bad, right or wrong,
or acceptable or unacceptable, to a person or a group of like-minded persons.
Cheating, stealing, and not keeping promises, or abusing children, elderly persons or animals
are usually considered as “wrong” or “bad.” These all constitute moral beliefs, and if one were
to write down all their similar beliefs, they would, in essence, create a personal code of ethics.
The primary subject of “ethics” is human actions, referring specifically to any action that is
deliberately taken. If a person thinks about a particular action and then chooses to take this action, then it is a deliberate action and if the person has any control over this (these) action(s) –
then they are held responsible for their actions.
PERSONAL RESPONSIBILITY
In today’s society, this “personal responsibility” is becoming an “ancient” belief that is not
“relative” to today’s situations. A mother drowns her children, but it is “not really all her fault!"
A sniper kills innocent people at rest stops, but it was only because of the (fill in your own reason)… A corporation goes bankrupt, leaving many vendors, employees and investors with empty pockets, because an accountant employed by the company “went along” with the desires of the
company President to over-inflate the value of high-end inventory items in order to show the
profit to the Board of Directors that the President had promised—but the accountant is not at
fault because he was just doing what his boss wanted him to do. And then there are attorneys
who have so many responsibilities that it is sometimes just an ethical question as to which attorney is most responsible.
True, the actions of individual humans are not the only subject regarding ethics that must be
considered. The activities of a group of individuals can be called “social practices” if one delves
deeply into the study of Ethics. A practical example would be an individual using insider information to buy certain stock or in the case of a stockbroker, to notify his clients of a probable decrease or increase in the value of their stock because of “insider information.”
In the 1970s, in California, a life insurance company, Equity Funding, “created” thousands of
phony policies, complete with phony records, reports of medical examinations, underwriting data, etc. They reinsured this business with several reinsurers who gave them first year and renewal allowances for the reinsured amount – into the millions of dollars. This scam went on for
months with the full knowledge of the top management, in-house attorneys, accountants, underwriters and other select top & middle management. It was finally discovered when an Underwriting Vice President reported this situation to a stock analyst who had been touting the stock.
The stock analyst who was first made aware of this situation also faced an ethical problem. The
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analyst was informed of the situation over lunch with an executive of Equity Funding. The analyst did some quick checking and as a result, was convinced that the executive was telling the
truth. He contacted many of his clients and recommended that they get rid of their Equity Funding holdings. As a result of this action, the New York Stock Exchange charged the analyst with
violating exchange rules with information about Equity Funding before regulatory authorities
made it public.
Ethical questions arose, naturally. Insider trading is a “general practice” and his using this
information was an individual action. One question that could be asked—and frequently was:
“What was the analyst to do?” When he became aware of this information he was not able to
completely verify the information, but he felt that it was his duty to his clients to pass on the information that he possessed, just in case… Ethically, was it not his duty to protect his clients? If
he had not notified his clients and it later was disclosed that he had known of the situation, would
he not be susceptible to legal action? And another related ethical question could be “Why did
the executive wait for three years before exposing this situation.”
This particularly situation is discussed to show how ethics can sometimes create a “Catch22” situation, not unlike attorneys who are bound by rules of confidentiality which would be violated if they reported misdeeds by their clients to the authorities; but on the other hand, if they do
not report it, others could be injured and the attorney may be in violation of the Rules of Professional Conduct—discussed at length later in this text.
SENSITIVE JUDGMENT
“Sensitive” judgment is often used in Code of Ethics of some professions, but should be used
for all professions, including the legal profession. It simply refers to the total of all factors involved in ethical judgments, i.e., the professional should be aware of all matters pertaining to the
morals and judgments of all actions that may arise during any personal or general action.

Every person has some sort of moral beliefs, which usually includes the simple
belief that “everyone should do their own job.” Therefore, a person must determine
whether they should do their job under every situation and circumstance.
Many Codes of Ethics state that the members of the organization should accept the obligation to act in a way that will serve the public interest, honor the public trust, and demonstrate
commitment to professionalism.” This sounds good, but is very difficult to achieve at times. Is
an attorney, for instance, to place his (or his family’s) interest above that of the public? What if
his needs conflict with the needs of the client, or as importantly, the public?
There are always situations where there are conflicts between one’s profession and their job
or between either and their personal life. What to do – what to do? How does one know what is
acceptable and what is not, what action is acceptable, etc? Thus, the Code of Ethics (or Principles, etc.) has been created by nearly all “professions” and by most businesses of any size.
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THE MORALS OF THE LAWYER
There are those of society who lump all lawyers together and then come to the conclusion
that it is not possible for an attorney to be “moral.” Is an attorney nothing but a hired gun that
left his morals on his dresser when he graduated from law school and frankly, does not care, because who ever heard of a lawyer with a conscience? What other profession allows its members
to lie and misrepresent material facts when in negotiation with another party? This may seem
extreme at the least, but this is how many lawyers are perceived.
Some point to the fact that a lawyer has no moral responsibility for representing a particular
client, or for lawful means used or the end achieved for the client. This is one way of saying that
the lawyer’s role in society is amoral.
Actually, a lawyer’s role is very moral. True, the lawyer’s choice of client is not subject to
moral scrutiny – otherwise there are many, many criminals who would never be represented in
court – but the lawyer does have control of his client’s morality by imposing his morals on the
client (e.g., a person who would not ordinarily lie, will stretch the truth if his attorney says that it
is OK) as the attorney controls both the ultimate goal and the means for obtaining that goal. Actually, the lawyer can stop the client from using unlawful means to obtain lawful results as the
lawyer can threaten to withdraw if the client does not perform as the lawyer requests and represents as a moral or correct course of action. There are strict rules as to withdrawal from a case,
however, discussed in the last chapter.
Even by choosing the client, the morality of the lawyer is obvious. It is moral for the client
to make the important decisions about their (the client’s) goals. The client must approve any settlement, for instance—and the client can dictate any lawful means to obtain those goals. However, it cannot be denied that the attorney does not have to accept a client (unless appointed by
the court) so any choice of the client is a moral choice and the attorney can be held morally liable.
In the eyes of some of the public, a “moral attorney” may be an oxymoron. Lawyers are
members of a profession with a monopoly granted by the federal government and furthermore,
lawyers are essential to the administration of justice. This should indicate to most lawyers that
they do owe the public an explanation of what they do and why they do it.
Perhaps the most important reason that there is so much “lawyer-bashing” today—which,
remember, this is not new—is that
the legal profession has failed to explain and justify the true nature and importance of the lawyer’s role in the American society.
INTEGRITY
The Code of Ethics for any profession will state in some fashion or other, that the member
should perform with the highest sense of “integrity,” of words to that effect.
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The acknowledged definition of integrity is “firm adherence to a code of especially moral or artistic values.”
One could look at the way this principle is stated and then ask, “Am I showing integrity in
the way that I am performing?”
It is important for the student of Ethics to realize that accepting just anyone’s beliefs does not
make it correct – think of suicide bombers, slavery, annihilation of a race of people, etc. Therefore, beliefs must be regarded in the sense of morality, and moral beliefs involve emotions, desires, preferences, and entrenched values. One thing for sure, they are intangibles – one cannot
touch, see, feel, etc., morality.
Many simply ask, “Are there any good reasons” for doing a certain thing, or are there good
reasons why one does NOT want to do a certain thing?
Many “old-timers” would ask, “Is it proper?” when deciding what to do in many situations.
When asked how a person could know if it was “proper,” the answer usually was, “You just
know.
JUSTIFICATION
Suppose you were 16 with a driver’s license, and you had been looking forward for months
to taking Susie (or Ralph) to the movies in the family car, all by yourself. Your father had
agreed to let you use the car for transportation to the movies when you got your license. When
the day came and Susie (Ralph) had agreed, you asked your father for the car keys, but he says
that you cannot have the car. You are understandably upset, and you cannot understand how he
can go back on his word. You father can then say that he is not obligated to give you the car,
therefore his belief is not justified or he should justify it to you. Maybe he just doesn’t feel like
it right now.
This justification probably wouldn’t fly to your satisfaction, because he did “promise.” And,
people should always honor their promises (a basic of Ethics). This could mean that any promise
is not worth much – business deals will fail, marriage will come apart, and the world will go to
wherever in a hand basket.
However, what if he said that the “XX@&$!)**&%” thing blew the carburetor today when
he was driving home and he can’t get the parts until Monday. Now, there’s a reason for not honoring the promise. In other words, there is justification. This proves that:
moral beliefs are right or wrong, correct or incorrect, and they can be justified
if there are good reasons.
This is an important precept in understanding ethics and ethical behavior.
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BELIEFS LEARNED AS A CHILD
In order to better understand moral beliefs, a good exercise is to list those beliefs that you
learned as a child. For many, this could start with the Ten Commandments. Nearly everyone
will agree that one should not lie, steal, cheat, harm, kill, and one should live by the Golden Rule
– “Do unto others as you would have them do unto you.”
As the younger generation may say, “Now, get real!” The overwhelming reason for taking
an action for many (too many) today is that is best to do anything that is good for me. Or, it is in
my interest to do a certain thing, or perhaps more importantly, will it benefit me. Better reasons
are that by doing something, it is just or fair (or “proper”), you promised to do it and it will not
do harm to others. And, one does not break promises.
Take this one more step, and take a look at the action that one is considering.
IS THIS GOOD FOR ME?
It is not coincidental that this consideration would be the first to be discussed, as typically
that is the first thing that goes through the average person’s mind. This is not always true—
Mother Theresa probably never thought of herself first. For the rest of us who are not approaching Sainthood, if you can actually perform an action that benefits yourself, can you think of a
better reason for doing it?
Of course, this is applicable only if it is “meaningful” work – usually defined as work that
can be beneficial to the person. Most people have a need to be productive and to work towards
that end (some don’t, but they wouldn’t be professionals), so therefore, work is good for us all.
Conversely, if an action hurts oneself (not necessarily physically) then that is a great reason
for not doing it. This can be overdone frequently, as some people seem to think that any actions
that are beneficial to them must therefore, not be the right thing to do. Of course, this is silly, as
if a person doesn’t consider or concern him or herself with an action that benefits them, then who
will? You cannot go through life without looking out for yourself.
This concept can be overdone, as evidenced by taking a walk down the mall and note how
many large, overweight people are in evidence. Not in every case, of course, but generally it can
be accepted that when it comes to food, some of them look out for themselves just a little too
well.
A good rule to follow in determining if an action is good for you is that in most cases,
there can be justification that an act can be good simply by showing that it is
good for you.
15
HOW DOES THE ACTION AFFECT SOCIETY?
The next step is actually to take a step back and look at the “big picture.” Is this action not
only going to be good for me, but is it going to be good for everyone (society) as a whole?
One outstanding example of determining what is good for society, as often quoted in such
discussions, involves Tylenol and Johnson & Johnson. When Johnson & Johnson were made
aware that some of their Tylenol bottles had been tampered with and it was nearly impossible to
determine just how many bottles were involved, they immediately made the judgment call to recall ALL Tylenol from the shelves of the many stores and warehouses, costing the corporation
untold millions of dollars in profit. This was a decision based upon whether the action would
affect society, and fortunately for Tylenol users, this was the right decision.
An interesting point is that the business press solemnly but loudly (in some instances),
prophesized that Tylenol would never regain its market prominence. It did.
IS IT FAIR, JUST AND PROPER?
Remember as a child, the many times that things would happen that just weren’t “fair?”
Even as an adult, a situation will arise that just does not seem “fair.” When voiced, the objection
was usually overcome with the statement (in some fashion of other) that “life just isn’t fair.”
While this may seem logical to an adult to some degree, for a child it still is not “fair.”
Of course, all people should be treated equally unless there is some relevant difference. This
can be illustrated by the way that a large (actual) European company was managed for many
years. It had only one stockholder, who was designated as CEO and Chairman. In an effort to
appear “Democratic,” the CEO designated a “Manager” in charge of each major division within
the international firm (this would be equivalent to a Chief Operating Officer in most corporations) as a member of the Operating Management. Great pains were taken to make sure that each
Manager was equivalent. However, there always has to be a decision-maker, so all Managers
were considered as equal, but they would then elect one Manager as “more equal than the others.” This system survived for many years but upon the death of the sole shareholder, his heirs
transformed the operation into a more-typical company-management style.
Just like “cream always rises to the top,” there always seems to be one person who is “moreequal” than others. And that is probably a good thing.
IS THERE A RIGHTS VIOLATION INVOLVED?
Every American has the right to be treated “equally.” And, we all have the right to life, liberty and the pursuit of happiness, and, to be technically correct, to property. However, the government grants us certain rights and when these rights are infringed upon, then we are protected
by laws and regulations. The use of coercive marketing techniques and deceptive advertising is
considered as a violation of our rights to liberty. Even the laws that enforce the rights are often
considered as a violation of a business entrepreneur to do business.
16
Certain rights have become known as “entitlements.” These entitlements include the right of
a child to be educated, for instance, but the means for this education must come from others who
are obligated to provide this right. Healthcare for everyone, jobs for everyone, housing for everyone, etc., are not “rights” per se, but in certain situations, these rights could be assumed. If
they are so assumed, it is the right of the taxpayer to know whom, how and how much these
“rights” can affect the rights of the taxpayer to keep and hold property.
More pertinent to this discussion is the right of a purchaser of stock in a corporation to be
provided with accurate financial information regarding the corporation and to be notified of any
illegal action taken by the corporation.

If a proposed action treats all persons involved equally and fairly and there is
no violation of their rights, then this is a reason to continue with the action. Conversely, if
the rights of another would be violated, even to a small degree, then this is a big reason not
to take the action.
HAS THERE BEEN A PROMISE MADE?
A promise is a commitment, and if one has made such a promise/commitment, and then one
should do all in their power to honor the promise/commitment. This is an inescapable reason to
pursue the course of action contemplated.
In a discussion of ethics, however, this must be taken a step further. Is there any promise/commitment beyond those that were agreed upon by the parties involved? Implied promises
are generally a distinct and very important part of most transactions. For instance, if one purchases a set of golf clubs, there is an implication that the club shaft will not break or bend if the
club is used properly and for the task for which it is designed. Those who purchase insurance
products do not expect that when the insurance is needed, the “small print” will void their
agreement with the insurer.
It is an inherent trait of civilization that promises between persons are kept and most of the promises are implied. What would happen to commerce if there were no implied agreements between an employee and an employer that the employee would show up for
work every working day?
But what if you borrow some anti-freeze for your car from your neighbor with the promise to
return what is not used. He later then asks for you to return what was not used as he had discovered that a cat would readily drink anti-freeze, and that when they do, they assume room temperature. And further, the cat belonging to the person across the street has been intimidating his
poodle, and he is going to solve that problem, “once and for all.” Do you break your promise in
this situation, knowing what the result of keeping your promise will be, that harm that will come
of returning the anti-freeze would outweigh the promise? (This may be arguable with some that
really, really, hates cats – but you get the point.)
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IGNORANCE IS BLISS?
“Ignorance” of ethics has universally been understood to start at early childhood. This is obvious in those situations where the parents have been involved in unethical and/or illegal activities as the child soon learns to accept such action as the “norm.” If they are exposed to such activities, not only from family but also by others with whom they associate, they will soon develop the attitude that “it must be right because everyone does it.” Obviously a child that grows up
in such an environment will not know what’s right or what’s wrong.
Bad ethics are often taught by example.
There is a true example of Ethics in an actual situation involving the sale of water softeners.
(OK, they are not the most highly respected salespeople in the world…) In this actual case, the
salesman called on a lead (generated by telemarketing) to sell a water softener. When he walked
into the rather modest home, he noticed an organ standing in the corner next to the bookcase that
held the latest Encyclopedia Britannica – indicating that they were “suckers for a good sales
pitch.” The salesman performed his sales tasks of “testing the water,” which in reality is just an
illustration of how certain chemicals interact with H2O. The prospects were eager to buy not only the unit, but also the most expensive unit. The prospects talked about dipping into their savings and taking an advance on wages to make the payments on the unit.
Again, this actually happened – the salesman just couldn’t do it. He said he had not been
raised to take advantage of people like that. He was fired from his job, and on a hunch a couple
of weeks later, he called the people, who thanked him for sending the “nice young man” to their
house to “make sure they bought the right unit.”
This same salesman swears (verified by others that worked for this sales firm) that the Manager had a picture of a water softener sitting next to a run-down house, that he had sold to a man
who had to get his water from a well. He would take buckets of water and pour it into the water
softener…

If a person’s early training taught that one could get away with wrongful acts
and make money; then the individual needs re-training and re-education as to what is right
and what is wrong and WHY it is right or wrong.
OR GREED?
While some people act only out of ignorance when making ethical decisions, the ugly green
monster, greed prompts others. The demon that perches on everyone’s shoulder is more active
with some than with others. Nearly everyone will admit to having done a “wrong” at some time
or other (or else they are lying) and psychologists have discovered that people respond positively
to rewards but negatively to punishment – no startling discovery, even Adam in the Garden of
Eden knew that, or should have.
In business, companies will reward the high producers with bonuses, gifts, commission increases, trips to exotic places, and whatever other rewards seem to ring the bells of the produc18
ers. Productivity is rewarded, often regardless of how it was achieved. It is no shock to discover
that quality of the sales is worse on business sold during a company promotion, “President’s
Club” qualification period, or some other such contest period.
If only productivity is rewarded, any business suffers in quality when increasing
in quantity.
No one is perfect – even Mother Theresa admitted to imperfections (but not many or of much
importance). Often quoted in these types of discussions is the situation when Abraham Lincoln
threw a man out of his office for attempting to bribe him. When he was asked as to why he had
thrown the man out, Lincoln replied that the man “was getting too close to his price.” This simply points out that nearly everyone has his price. The old story of the man, who approached a
well-dressed lady and asked her if she would go to bed with him for a million dollars, to which
she gave considerable consideration, and when assured that he could pay that much, she agreed.
He then asked her if she would go to bed with him for $20, to which she indignantly refused and
asked, “What kind of a girl do you think I am?” He answered, “We have already determined
that, now we are just trying to determine price.”
Since realistically we probably all have our “price,” the smart person will simply not put themselves in situations where they are tempted.
CHARACTER
We have all heard the word “character” in referring to certain individuals. Some seem to
have it, and some don’t. Actually, those who have overcome temptation tend to have developed
a stronger character as a result. So – what is character? The dictionary has about 50 lines (in
small print) of definition, but the most applicable would be: “one of the attributes or features that
make up and distinguish the individual.” Therefore,
the goal of an ethical individual is to develop a strong character.
Many scholars, authors, and others, consider virtue as the telling factor in a strong character.
Simply put, virtue is like a habit to do good things, such as “honesty is a virtue.” Virtue is not
something that anyone is born with, but it must be developed. Children go through a phase when
they come up with some “whoppers” and while this upsets many parents, it is a natural part of
growing up and it is the responsibility of the parents to teach honesty (a virtue) to the child.
On the flip side, people can develop habits of doing “bad” things – this would then be called
a “vice.” People usually don’t state doing “bad” things all at once—like virtue, it must be developed. Normally it is not taught by parents, but by others in the environment, associates, friends
and those to whom a child respects. This usually starts with something small, like a “little white
lie” that gradually develops into falsehoods so rampant that people simply no longer believe
them. Unfortunately, it is easier to develop “vice” than it is “virtue,” as virtue demands continu-
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al attention and it must be exercised frequently. Since it is harder to be virtuous, virtue is praised
more by others.
People, nearly all people, at some time in their life face situations where they can easily succumb to temptation to do something that they know is wrong, even though they know that another action would be right. Unfortunately, many people take the low road. The importance of ethics training comes into play here, so that the person will do what is right and will be therefore,
working towards building a strong character.
QUANDARIES
When a “What to do, what to do?” situation arises, it is called “a quandary, dilemma, or just
“a gray area.” This situation comes into play when it is just not clear as to what is right and what
is wrong.
A quandary or dilemma occurs when in a certain situation, the person is not
sure as to what to do, as there are good reasons for the action and good reasons against it.
Recently, the CEO of the New York Stock Exchange decided to cash in his retirement funds
accumulated over the past 16 years, for estate planning purposes. This totaled some $120 million and caught the eye of the press, making the headlines for a couple of days. He maintains
that it has all been collected legally and under the provisions of his contract with the Stock Exchange, and at this point, there is no evidence to the contrary. But it is obvious that with the hue
and cry of the self-appointed guardians of the press, his days are numbered. It may have been
legal, but was this ethical?
He evidently found himself in a quandary as to how to collect these funds, and one must suppose that there were good reasons for taking it in one lump sum as he did, or to spread it out in
some fashion so that it could be more easily understood. Was it ethical for him to take it in one
lump sum, considering the fact that during his reign, the stock market (probably through no actual fault of his) had fallen drastically and many investors, including retirees, who had invested in
stock handled by the NYSE—lost their nest eggs. Was this right, or wrong, or just in a “gray
area?”
TRYING TO RESOLVE DILEMMAS
These decisions are not easy, and as the world of business become more complex, so do the
ethics decisions. But before a dilemma can be solved, there are certain steps to be taken before
one can start applying ethical theories or ethical principles.
COLLECT PERTINENT INFORMATION
Every effort must be made to collect all of the information possible that pertains to the “dilemma.” In the situation previously discussed, it would be easier to make the proper and ethical
decision if it were known that the client is not incompetent. It may be surprising to learn that
many quandaries are solved when all of the information is collected.
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DISCOVER ALL OF THE PLAYERS
Before it can be determined as to what is fair; those that are involved in the
dilemma must be discovered.
Sometimes this is not easy and will require a lot of “digging,” but as they say, “You can’t determine the program until you know the players.” Sometimes there are hidden agendas discovered when all participants are known. Also, sometimes there are those with “shady” reputations
on one side of the question, which would raise red flags and which alone could determine the
proper ethical decision.
DETERMINE THE OPTIONS
Some ethics “consultants” maintain that since a dilemma (or quandary) must have at least
two options, in order to determine the proper option, a third option is necessary. The reasoning
seems to be that if one has not spent enough time and thought to the problem without coming up
with at least a third option, then they simply haven’t thought enough about the problem.
Practically speaking,
in order to solve a dilemma, there MUST be another choice, other than just two.
There would not even be a dilemma if there were not two choices – a right choice and a
wrong choice—and the dilemma is trying to figure out which is correct. Sometimes the third
choice is an acceptable combination of the other two, sometimes it is completely different, but in
any case, it usually is not easy to discover.
ESTIMATE THE EFFECT OF THE OPTIONS
If the action under consideration is fair to all parties, benefits the client, and is consistent with
such actions in other situations, then there really is no reason not to choose that action. Conversely, if taking such action requires that a commitment is broken, it is harmful and unfair, then
that action would not be proper.
Of course, it is really not that easy in “real life,” primarily because of the conflict that occurs
when an action is beneficial but it is still not fair—hence the quandary/dilemma.
ETHICAL BEHAVIOR
Ethical behavior almost seems like a religious term—actually religion is closely entwined as
ethics, by its very nature, relates to moral behavior. So does religion and faith of the individual
as in the balance of things, they both are higher than the law. As with ethics, faith has a higher
standard of behavior than the law.
One identifying factor of ethical behavior is that the person takes
responsibility for his actions.
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People and organizations that do take responsibility for their actions are showing high ethical
behavior. The Tylenol situation is an excellent example of taking responsibility, indeed, the
company already had procedures in place for recalling a product long before the tampering with
Tylenol occurred.
Opinions as to what behavior is “moral” vary and what one may think is an ethical situation,
may not appear so to another. The news media is full of situations that may or may not be “ethical.” Sometimes a well-intentioned situation can get out of hand. Recently parents and the
school board of a community in Florida were concerned about the student’s dress code. While
students in Florida usually wear shorts all year, the teen styles seemed to be dictating shorter and
shorter shorts, and due to the influence of some entertainers, the exposure of the navel of young
girls was a fashion note. Young men were copying “jail birds” that had their belt removed before they went into a cell, therefore their pants habitually drooped—this was copied as a fashion
statement for the young—and the exposure of the top of their underwear was added.
Parents, teachers and the school board adopted a zero-tolerance position with a mandatory
expulsion of one day as a minimum. As expected, one of the honor students with an impeccable
reputation, showed up for school with a shirt-type blouse that folded over the top of her shorts,
which was not allowed—even if there was no “skin” showing in the mid-section.
Is it truly ethical of the authorities to make such tight restrictions? Was it ethical for the
young lady to show up with a blouse that did not make the requirements? Actually, her attitude
turned out to be very ethical, as she stated that she should have known that this blouse did not
meet the standards established by the school so she took full responsibility. The parents did not
agree – were they therefore “unethical?” The situation was “fanned” by the news media—were
they being ethical? (This might be a rhetorical question.)
MORAL BEHAVIOR
In determining whether an action is ethical, it must be approached as whether it
is or would be “moral” behavior.
As a matter of fact, ethical behavior can usually be called moral behavior, and an action to
the contrary would not only be unethical, it would also be immoral.
Take the situation of an automobile accident where a person in the other car is injured. Does
the uninjured driver offer emergency help even though they may not be qualified? If there is no
one else around immediately, of course a party is obligated to offer assistance, and in some cases
may be so required by law. If the injured party is bleeding badly, and the other person has had
no medical training, but elects to wait for the medics or someone who is professionally trained as
they feel that they are not qualified – is this an immoral act, and an unethical act as well?
What most would consider as immoral/unethical behavior is considered by some as just good
business practice. A nurse may not stop at an accident and render medical help, as she is afraid
that she could be subjected to a malpractice suit even if protected by a “Good Samaritan” law. A
used car salesman may represent an auto as being safe and in good working condition, knowing
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full well that the brakes are about gone. In the eyes of most of the public, used car salesmen are
way down the chart of ethics.
Most people have had bad experiences in business matters where the company and/or its representatives did not behave in an ethical manner—from small matters to large matters. In an actual situation that illustrates this point, recently a young mother had her son’s trumpet repaired
prior to the school year, and was charged $100 for the service. She thought this was fair and she
recommended the company to a close friend whose son also needed the same trumpet repair.
Her friend was charged $30. When this was discovered, the first mother called and represented
herself as another person, and asked over the telephone what it would cost to do (what she had
paid $100 to do). The reply was that it would cost $45.
When the owner of the business was confronted with this situation, the alibi was that they
send the instruments out to individual repairmen on a contract basis, and some charge more than
others do. This business has existed for over 15 years, member of the Better Business Bureau,
and is the largest seller and repairer of band instruments in the county. Just because a business is
a member of the BBB is no sign that they are an ethical company.
On a more extreme basis, ethics have been missing in recent years when the stock market
was booming. It always seemed inconceivable to anyone with any business experience, that a
person with no background or experience in a business could start a new “dot.com” business.
People could not seem to get their money invested fast enough in these nebulous, to say the least,
enterprises. Then, as everyone knows, the market bottomed out and a lot of people lost their nest
eggs or their retirement funds. At the very least, the question must be asked as to whether it is
ethical to prey on the gullible?
Some businesses find themselves in a growth spurt and they take on more business than they
can handle. Sensibly, they would hire more people, but that would mean more paperwork, more
benefits and fewer profits, so they simply keep piling it on their existing staff. Another example
of a business being legal but unethical.
The lesson is that some people consider something just as good business, when actually it is
either immoral or unethical behavior, or both.
Character of the lawyer and legal “morals” are discussed in more detail later in this text.
EQUITY
“Equity” and “equitable” crop up often in any discussion of ethics. Black’s Law Dictionary
defines equity as “fairness, impartiality, evenhanded dealing, such as ‘the company’s policies
require managers to use equity in dealing with subordinate employees.’” Also, “the body of
principles constituting what is fair and right” (with reference to the Declaration of independence). The next definition is of particular interest:
“(Equity is) the recourse to principles of justice to correct or supplement the law
as applied to particular circumstances.”
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This falls in with the definition of ethics in the statement that “law establishes standards, equity establishes higher standards.” Keep in mind, however, that “Equity” is also a legal term, so
for purposes of discussing ethics in “non-legal language,” equity means natural justice.
The basic fundamental ethical duty of attorneys is to represent clients “zealously.” Often attorneys, when taking a deposition, will make sure that the deposition location is at considerable
distance from the residence of the person to be deposed, will set a limited time for the deposition,
and, in essence, hold the person’s “feet to the fire.” Some attorneys may have mixed feelings
about this type of behavior—even though most would say that the action is proper and is simply
using a legal procedure to gain an advantage for the client. Ethics doesn’t even enter the picture.
However, most nonlawyers would say that something wrong has happened, justice has not been
served in these cases but has been denied.
Many Americans regard lawyers with suspicion and criticism as evidenced by the fact that
polls show that public confidence in lawyers has never been lower. Many of the rules of legal
ethics originated many years ago as moral precepts used to govern human affairs. Today, nearly
150 years after rules were first established as “the Aims and Duties of the Profession of Law,”
these rules are questioned by both the public and the press as to whether the ethical behavior of
attorneys is even related to ordinary moral concepts.
STUDY QUESTIONS
1. The law sets minimum standards, whereas ethical behavior
A. is the minimum standard.
B. has no relativity to standards.
C. is of little value.
D. is the highest standard.
2. Ethics opinions interpret and apply rules of conduct
A. to specific situations.
B. to the state Supreme Court.
C. which are only meaningful in religious settings.
D. which have no value in commerce.
3. In order to solve a dilemma, there must be
A. only one choice.
B. another choice other than just two.
C. a plethora of choices.
D. litigation.
4. When ethics are discarded, those affected are generally those who
A. can care less.
B. have little regard for laws because they are wealthy.
C. will suffer the most and who can ill afford the consequences.
D. have good legal representation.
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5. Even though an individual’s adherence to an ethical principle may be inconsequential,
A. when everyone acts the same way, the results are significant.
B. when everyone acts the same way, the results are meaningless.
C. ethics have no place in the practice of law.
D. members of a recognized profession are not required to adhere to ethical principles.
6. An ethical theory lays the foundation for
A. a religious Canon.
B. common law.
C. a principle.
D. meaningless and mindless mental wanderings.
7. An action may be justified by many if it brings more ___________ than ___________ for
more people.
A. confusion – clarification
B. happiness – unhappiness
C. wealth – poverty
D. thought – money
8. Nearly everyone has an ethical set of beliefs as to what is right or wrong, and those beliefs
A. are accepted by all civilized nations.
B. vary by sex.
C. are universal in the United States.
D. do not necessarily remain the same among all persons.
9. The definition of integrity is
A. firm adherence to a code of especially moral or artistic values.
B. the ability to tell right from wrong.
C. doing what just feels right.
D. cheering for the same team.
10. It is an inherent trait of civilization that promises between persons
A. are universally ignored.
B. are modified according to each individuals desires.
C. are legal contracts.
D. are kept, and most promises are implied.
ANSWERS TO STUDY QUESTIONS
1D
2A
3B
4C
5A
6C
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7B
8D
9A
10D
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