Advisory Opinion No. 97-144

Re: Honorable Francis A. Gaschen

QUESTION PRESENTED

The Petitioner, Mayor of the Town of Cumberland, a municipal elected position, requests an advisory opinion as to whether he may negotiate with a Plaintiff in a lawsuit against the Town of Cumberland given that the Petitioner's law firm has an unrelated claim against the Plaintiff in Bankruptcy Court.

RESPONSE

It is the opinion of the Rhode Island Ethics Commission that the Petitioner, Mayor of the Town of Cumberland, a municipal elected position, may not take part in negotiations with the Plaintiff in a lawsuit against the Town of Cumberland given that his law firm would likely receive some payment on the law firm's claim against the Plaintiff in Bankruptcy Court. The Petitioner represents that he formerly represented the Plaintiff in a variety of matters over the years and that his law office was not paid in full for those services. The Plaintiff filed for bankruptcy and the Petitioner's law firm filed a claim for $15,000. Independent of all that, the Plaintiff filed a lawsuit against the Town of Cumberland and after protracted proceedings, the Supreme Court upheld a judgment against the Town. The case has been remanded to Superior Court. Although the Petitioner sent the case to outside counsel to determine if the Town of Cumberland should try to settle it, he is proposing to negotiate the settlement on behalf of the Town. The Town Council has the authority to accept or reject the settlement. The Bankruptcy Court will approve any settlement and the funds will be deposited for distribution.

Since the Petitioner is still the sole shareholder of his law firm and his law firm will likely receive some payment on its claim which is related to, in part, the settlement/claim against the Town, the Petitioner must recuse from participation as Mayor of Cumberland in the negotiations. See R. I. Gen. Laws § 36-14-5(a). The fact that the Petitioner characterizes a potential payment to the firm as earmarked exclusively for operating expenses of the law firm does not alter this analysis. The Petitioner is the sole shareholder of the law firm and any monies flowing to it, however targeted, benefit him.

Code Citations:

36-14-5(a)
36-14-6

Related Advisory Opinions:

94-26
95-61
95-114

Keywords:

Business interest
Litigation