Prof. Brant
Legal Profession
Final Examination
December 17, 1991
GRADE POSTING: If you do not wish to have your grade posted (by exam number) in this course, please place an X by your number on the exam and blue books.
DIRECTIONS
I. What you may bring into the examination:
II. Canned briefs, Gilberts, Emmanuals, Nutshells & the like may not be brought into the final examination room.
III. Two hours will be allotted for the examination. Blue books will not be passed out for the first 15 minutes. This time should be spent reading and thinking about the questions before you begin writing your responses. You may use scratch paper to begin outlining your answers during this initial 15 minute period.
IV. There will be two essay questions on the final examination.
V. In answering the essay questions, you should rely upon case law from the textbook and handouts, our class discussions, and EITHER the ABA's Model Rules OR the Model Code of Professional Responsibility. You will not be expected to use both the Code and the Rules in your answer.
VI. Students who wish to compare and contrast the Model Rules and the Model Code in their answers may do so, and will receive additional points for accurate & thoughtful analysis. However, you should try to fully discuss all the issues raised by both questions before attempting to gain extra points by comparing the Model Code and the Model Rules.
VII. DO NOT CITE A CASE WITHOUT FURTHER DISCUSSION! There is no presumption that use of a case name results from knowledge of its contents. Discuss and analyze any case law you plan to use in your answer.
VIII. Individuals planning to graduate in January should place a large "S" (for senior) on the front cover of their blue books.
IX. Write on only one side of each page in the blue books.
DO YOUR BEST TO WRITE LEGIBLY. FAILURE TO WRITE LEGIBLY WILL RESULT IN AN IRATE GRADER READING YOUR EXAMINATION.
GOOD LUCK!
QUESTION ONE (70%) (approx. 1 hour, 10 minutes)
Austin Healy Associate III had been an attorney with Big, Huge & Behemoth (BH & B) for seven years, and was up for partnership consideration in BH & B's Real Estate Division. One fine Saturday morning, while Austin was at his desk, he received a call from the President of Consolidated Conglomerate Corp. ("Tri-C") one of BH & B's leading clients. The President of Tri-C was in a panic. A leading Vice-President of Tri- by the name of Sam Sleaze had just been indicted by the SEC for insider trading in the stock of Hapless Corporation. The SEC had scheduled expedited hearings on the matter for that very afternoon, and in-house counsel was not prepared to represent Sam. Austin reluctantly promised Tri-C's President to accompany Sam Sleaze to the SEC hearings, and spent the intervening two hours before the hearing desperately skimming through his bar review materials on securities regulation.
As Austin and Sam walked over to the SEC offices, Austin told Sam that since BH & B had been retained to represent the interests of Tri-C Corp., the firm could not represent Sam in his individual capacity. Nevertheless, when the hearings began, Sam introduced Austin as his attorney, and the SEC examiners wrote Austin's (full) name down as Sam's attorney of record.
During a lull in the proceedings, Sam and Austin had a whispered conversation, out of earshot of the SEC examiners. Sam told Austin that in fact he had engaged in illegal insider trading, but that the SEC would never be able to prove it. Sam mentioned several companies in addition to Hapless, whose stock he boasted of having traded at great profit based on illegal insider information. Sam also told Austin that he was going to testify to the SEC examiners that he had never done anything wrong, and had never traded on the basis of illegal insider information. Austin protested, but Sam insisted that he was going to testify as he saw fit.
Sam got on the stand, and testified that he was innocent of all charges. He was a convincing witness, and after the hearing, the SEC lawyers came up to offer Austin a deal. They agreed to close the investigation of Sam and Tri-C Corp., so long as both Sam and Tri-C agreed to cooperate in pending investigations of other companies. Austin was unable to discuss this agreement with Sam, since Sam had left the building directly following his testimony. Austin tried to call the in-house counsel at Tri-C, Arnold Putter, to approve the settlement, but Putter was in Palm Springs for the week, watching the William Smith trial and catching up on his golf game. Under pressure from the SEC, Austin decided to go ahead and agree to the proposed settlement. The SEC attorneys immediately drew up the settlement papers, which were signed by both the SEC attorneys and by Austin, as counsel for Sam and Tri-C Corp.
The next day, Sam received a copy of the settlement agreement and became completely enraged. Sam called an emergency meeting of Tri-C's Board of Directors that same morning. At the meeting, Sam told the Board, with great emphasis and frequent snide remarks directed toward attorneys in general and especially Austin, that the SEC had introduced no credible evidence against him at the hearing, that the charges against him would certainly have been dismissed and that there was therefore no need for Tri-C to be bound by this settlement agreement. The Chairman of Tri-C's Board promptly notified the SEC that Austin had been given no authority to settle the matter, and that Tri-C had no intention of abiding by the settlement agreement.
After passing this message on to the SEC, the Board of Directors contacted Austin, and asked him to appear at the meeting and account for his actions. Austin did so, and during the course of that meeting he told the Board of Directors everything Sam had said during the SEC hearings, including the conversation in which Sam had admitted to illegal trading in the stock of several corporations besides Hapless. The Board of Directors conferred amongst themselves after this meeting, and decided to fire Sam to protect the interests of Tri-C Corp. The Board further decided to adhere to its earlier decision regarding the settlement agreement with the SEC.
Sam promptly filed a civil suit against Austin & BH & B, alleging professional malpractice, breach of fiduciary duty and breach of the duty of confidentiality. The SEC filed a complaint with the Disciplinary Board of Austin's state. The Disciplinary Board, which had been hungrily searching for attorneys in need of discipline, launched an investigation into Austin & BH & B's conduct, promising to pursue all possible ethical violations.
Discuss and resolve all issues.
QUESTION TWO (30%) (approx. 35 minutes)
Ricardo Angelo Mancini (RAM) had been an Assistant United States Attorney in their Queens office for seven years. He was beginning to tire of the low pay, long hours and his government-issue metal desk. Since RAM had just won a huge jury verdict in a RICO action against the Gambino family and other members of the New Jersey mob, he decided that it was a good time to leave the government and go into private criminal defense work. Then he too could enjoy the expensive clothes, fine apartments and state-of-the-art cellular telephones that all the successful criminal defense attorneys he knew seemed to possess.
RAM's first months in private practice were not a success. He had alienated many criminal defense attorneys during his years with the government, and those attorneys took pleasure in referring only poor, grimy, and in some cases pathologically unstable defendants to his door. RAM decided that he was going to have to reach a more sophisticated clientele. He began to distribute his business cards to the most expensive hookers in the city, promising them a percentage of whatever fee he was able to derive from the clients they brought him.
Early in May, L.D. Silver, the husband of Lucy Gambino and a bit player in the New Jersey mob, showed up at RAM's office with his card, saying he had been given the card by one of the hookers. Mr. Silver told RAM that he was under indictment by the Queens office of the U.S. Attorney for money laundering, drug running, wire fraud, mail fraud, and RICO violations. Mr. Silver freely admitted to having committed each and every one of these offenses, and more besides. RAM remembered seeing investigative reports from the file against Mr. Silver during his tenure with the U.S. Attorney, but another attorney had been handling the matter, and RAM could not remember any specific information from the file.
RAM took the case, demanding payment of a substantial, nonrefundable fee in advance. Mr. Silver paid this fee on the spot, taking the money from a suitcase filed with cash, in sequentially numbered stacks. Some of the money appeared to have been dusted with a fine, white powder. RAM also required Mr. Silver to sign a complex, lengthy contract of employment which, among other things, limited RAM's liability to Mr. Silver for any matter arising out of the representation.
RAM filed an answer to the indictment on Mr. Silver's behalf which unconditionally and expressly denied all the allegations in the indictment, and raised the affirmative defenses of insanity, intoxication, lack of capacity to form the requisite intent to commit the crime, mistake of law, mistake of fact, and self-defense. The U.S. Attorney's office filed a motion to disqualify RAM based on his conflict of interest, and a second motion for Rule 11 sanctions.
Discuss and resolve all issues presented by the facts.