On Jan. 22, 1999, Kathleen K. Shaulis retired from her position as an attorney with the Office of Chief Counsel, Pennsylvania Department of Revenue.
Prior to her retirement, Shaulis sent a letter to the State Ethics Commission requesting advice as to what extent the Employee Ethics Act imposes restrictions, if any, upon an attorney following retirement from the revenue department in publishing articles or books on the subject of Pennsylvania state taxes.
“In the letter, Shaulis stated that she understood that the act may not be applied to restrict an attorney’s conduct insofar as it constitutes the practice of law,” Kelley said in the opinion.
In Advice of Counsel No. 99-511, the commission opined that in applying the act to the “narrow question which you have posed … such activities would not involve representation before your former governmental body” and thus would not be prohibited.
But the commission added, “In light of your comment regarding the practice of law, it is noted that the Pennsylvania Supreme Court’s decision in P.J.S. … may have a broadening effect insofar as the application of the [act] to attorneys is concerned. While not material to this particular advisory, the P.J.S. decision may be a factor in considering other activities.”
Shaulis sent a letter to the commission requesting it to clarify its reference to P.J.S. and asking to what extent Section 1103(g) of the act imposed restrictions upon an attorney who is entering private practice following retirement from the Department of Revenue.
The commission concluded, on the basis of its review of the P.J.S. decision, that the restrictions set forth in Section 1103(g) of the act apply to restrict a former public official/public employee even as to the practice of law before the former governmental body.
Therefore, the commission ruled that although Shaulis could represent clients before the Board of Finance and Revenue because that agency is within the treasury department and not the revenue department, she was prohibited from:
* Representing clients before the Board of Appeals because that agency is part of the Department of Revenue.
* Participating in negotiations in a case in the Commonwealth Court on behalf of a client where the Department of Revenue would be participating.
* Requesting, in her capacity as an attorney representing a client, an interpretation of a tax matter from a representative of the Chief Counsel of the Department of Revenue.
Shaulis filed a petition with the Commonwealth Court seeking review of the commission’s opinion, which she alleged unconstitutionally regulated her practice of law.
Attorney Regulation
The Ethics Commission defends its opinion on the basis of the January 1999 Supreme Court decision in P.J.S., in which the high court held 6-0 that the commission could investigate an alleged conflict of interest by an Erie lawyer who was a part-time city solicitor.
“In P.J.S., this court set forth in clear and certain terms the parameters of permissible regulation of persons who happen to include attorneys, …” State Ethics Commission Attorney Robin M. Hittie wrote in the petition.
The justices explicitly allowed the regulation of attorneys in limited circumstances, the lawyer claims.
“‘The jurisdiction of this court is not infringed when a regulation aimed at conduct is applied to all persons, and some of those persons happen to be attorneys,’” Hittie wrote, quoting P.J.S.
P.J.S. expressly permits regulation of attorneys in this instance, the petition says.
“Section 1103(g) is not targeted at attorneys as a class, but rather, it applies to all former public officials/public employees. It is not targeted at legal representation specifically, but rather it prohibits any form of representation for compensation before the former governmental body during the first year following public service.”
But the Commonwealth Court in Shaulis said the commission was incorrectly interpreting P.J.S.
“It is clear that the Supreme Court in P.J.S. was not setting forth a new precedent whereby a former public official/public employee may be prohibited by Section 1103(g) of the act from representing a client before his or her former governmental body, even if that person is an attorney engaged in the practice of law,” Judge James R. Kelley wrote for the majority. “To the contrary, the Supreme Court in P.J.S. merely held that a current governmental employee is not shielded or protected from an investigation into his ethical conduct by the commission because of his status as an attorney.”
The court also rejected the commission’s claim that, because its prohibition applies to attorneys and non-attorneys alike, it does not regulate the practice of law.
“All the activities that the commission ruled that Shaulis, as an attorney, could not perform involve the direct practice of law,” the court said.
Kelley appeared to be particularly concerned with the effect the commission’s opinion would have on the practice of law.
In a footnote, the judge wrote: “Upholding the commission’s opinion would result in recent law school graduates or attorneys considering employment in the public sector from thinking twice about accepting such employment. …”
Judge Gardner Colins and President Judge Joseph T. Doyle joined Kelley in the majority opinion.
