California Supreme Court Approves New Rule Compelling Attorneys to Report Misconduct by Other Attorneys

The California Supreme Court has approved a new rule of professional conduct, rule 8.3 of the California Rules of Professional Conduct, that requires California attorneys to report any lawyer who commits a criminal act, engages in fraud, misappropriates funds or property, or engages in conduct involving “dishonesty, deceit, and reckless or intentional misrepresentations.”

The new rule will go into effect August 1.

The court’s decision was based on one of two recommendations (Alternative Two) approved for submission to the court by the Board of Trustees of the State Bar of California on May 18. The court modified the State Bar’s proposal by adding additional provisions and comments to the proposed rule, including:

• Adding the courts as an additional avenue to report misconduct. When misconduct occurs during litigation, the court may have the power to investigate or act upon the alleged misconduct and to take appropriate corrective action.
   
• Adding commentary to the new rule to note that a court’s finding of misconduct may be used as evidence to facilitate subsequent State Bar disciplinary proceedings.
   
• Requiring attorneys to report others if their misconduct “raises a substantial question as to that lawyer’s honesty, trustworthiness, or fitness as a lawyer in other respects,” which is the same standard employed by other states with a similar reporting rule.
   
• Citing another rule of professional conduct that requires a lawyer to take remedial measures if the lawyer knows someone who has or will engage in criminal or fraudulent conduct related to pending litigation.
   
•  Adding commentary to the new rule to make clear that a false report to the court, like a false report to the State Bar, can subject the lawyer to discipline or other criminal penalties.

The new rule follows several other directives from the court for the State Bar, including on noticing about attorney suspensions; updating its conflict of interest code for the Board of Trustees; and to develop new rules requiring candidates for the Board of Trustees and State Bar Court be screened for potential conflicts of interest.