By Thomas P. McGarry and Thomas P. Sukowicz
Hinshaw & Culbertson
Rule8.4(c) of the Rules of Professional Conduct states, rather self-evidently, that it is professional misconduct for a lawyer to "engage in conduct involving dishonesty, fraud, deceit or misrepresentation."
How expansive is the conduct contemplated by this rule? The Supreme Court has interpreted the rule very broadly, holding in In re Yamaguchi, 118 Ill.2d 417 (1987), that Rule 1-102(a)(4) of the Code of Professional Responsibility, prohibited "dishonest, deceitful or fraudulent conduct" and explained that, under the rule, "[f]raud includes anything calculated to deceive, including the suppression of truth and the suggestion of what is false."
The court has held that fraud includes "any conduct, statement or omission that is calculated to deceive," including the "suppression of truth and the suggestion of what is false." In re Gerard, 132 Ill. 2d 507, 528 (1989). In In re Gerard, the court expanded the scope of Rule 1-102(a)(4) to include constructive fraud, holding that the scope of the rule encompasses constructive fraud, which "does not require as an element that the actor have a dishonest purpose or an intent to deceive and constructive fraud can be inferred from the parties' relationship and the circumstances."
Quoting In re Estate of Neprozatis, 62 Ill.App.3d 563, 568, 378 N.E.2d 1345 (1978), the Gerard court adopted the definition of constructive fraud as "any act, statement or omission which amounts to positive fraud or which is construed as a fraud by the courts because of its detrimental effect upon public interests and public or private confidence. … [It is] a breach of legal or equitable duty which, irrespective of the moral guilt of the wrongdoer, the law declares fraudulent because of its tendency to deceive others."
In 2009, the court in In re Cutright, 233 Ill. 2d 474 (2009), observed that where the court found violations of Rule 8.4(a)(4), "there was some act or circumstances that showed the respondent's conduct was purposeful" and that where a violation was not found, there was a determination that "there was no evidence the misconduct in that case was intentional." In that case, the court upheld the Attorney Registration & Disciplinary Commission Hearing Board's finding that there's no violation of Rule 8.4(a)(4) because there was insufficient evidence of dishonest intent.
The attorney in Cutright was charged with failing to disclose to opposing counsel in cases before a judge that he prepared that judge's tax returns. The court upheld the hearing board's finding that the lawyer didn't intend to deceive when he failed to disclose his relationship with the judge to opposing counsel and was unaware of his ethical obligations.
The court cautioned: "There is essentially no way to define every act or form of conduct that would be considered a violation of Rule 8.4(a)(4). Each case is unique and the circumstances surrounding the respondent's conduct must be taken into consideration."
In In re Thomas, No. 113035, 2012 IL 113035 (Ill. Jan. 20, 2012), the court revisited its interpretation of Rule 8.4(a)(4). In Thomas, a suspended attorney was found to have engaged in the unauthorized practice of law. His unauthorized practice of law was found to have involved dishonesty or misrepresentation in violation of Rule 8.4(a)(4) because the attorney "willfully ignored every attempt to inform him that his actions violated his suspension and chose, instead, to continue to engage in the practice of law." The attorney asserted that he believed his suspension had been stayed and his belief precluded intentional dishonesty. The court rejected that defense, explaining that "the fact that he may have convinced himself that his suspension was stayed does not alter the underlying dishonesty because his belief, even if sincere, was entirely unreasonable." In other words, an attorney's state of mind is important in determining whether he has engaged in dishonest conduct within the meaning of Rule 8.4(c), but the attorney's state of mind must be objectively reasonable.
The court in Thomas disagreed with the board's interpretation of In re Cutright, 233 Ill. 2d 474 (2009), that an attorney's "mere indifference" as to the truth of a matter could not constitute a violation of Rule 8.4(a)(4) because Cutright meant that "a violation of Rule 8.4(a)(4) requires evidence that the conduct was intentional." The court acknowledged that in past cases it had found a violation of Rule 8.4(a)(4) with a showing that the attorney's conduct was "purposeful," but explained that it did not intend in Cutright to hold as a general rule that Rule 8.4(a)(4) may be violated only by intentional dishonesty. The court stated that it "left open the possibility that a violation of Rule 8.4(a)(4) could be found without evidence that the underlying misconduct was intentional," but found that the evidence in that case established that the attorney's acts were intentional, citing In re Gerard, 132 Ill. 2d 507 (1989).
The court in Thomas did not create a bright line for when conduct violates Rule 8.4(c), but seems to have left attorneys with its comment in Cutright that it would not define every act that would violate the rule, but would look at each case as unique. Also, the analysis not only includes consideration of the attorney's subjective state of mind, but an objective standard of reasonableness for that state of mind.