Cooner v. Alabama State Bar
2010 Ala. LEXIS 199, 2010 WL 3937918, 59 So. 3d 29 (2010)
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Rule of Law:
For the purposes of Rule 1.8(c) of the Alabama Rules of Professional Conduct, which prohibits a lawyer from preparing an instrument that gives the lawyer a substantial gift from a client, the exception for when the 'client is related to the donee' includes relationships by affinity (marriage) as well as by blood, and such an affinity relationship does not terminate upon the death of the spouse who created the connection.
Facts:
- Douglas H. Cooner, an attorney, was the nephew-by-marriage of William B. Riley; Riley was married to Cooner's blood aunt.
- After Riley's wife died in 1998, Cooner began managing Riley's finances.
- In May 2000, Cooner drafted an 'Irrevocable Living Trust' for Riley, naming himself as the trustee and as one of thirteen beneficiaries of the trust's residuary assets.
- Following the trust's creation, Riley conveyed his real estate and his automobile to the trust.
- Cooner allegedly took Riley's house keys, would not let him in his own home, and sold Riley's house without providing a full accounting of the proceeds.
- Cooner also used a special power of attorney, which Riley did not recall signing, to purchase a residence in Riley's name using nearly $30,000 from Riley's trust as a down payment, and then deeded that property to himself a month later.
- When Riley became concerned, he repeatedly asked Cooner for information about his finances and property but received no response.
- In late 2001, Riley hired another attorney, Alan Furr, to investigate Cooner's actions and demand an accounting of the trust.
Procedural Posture:
- The Disciplinary Board of the Alabama State Bar (the Board) initiated formal disciplinary proceedings against attorney Douglas H. Cooner.
- Following a hearing, the Board issued an order on February 17, 2010, finding Cooner guilty of violating multiple Alabama Rules of Professional Conduct.
- The Board's order mandated that Cooner be disbarred from the practice of law.
- Cooner filed a post-judgment motion for a new trial or to open the judgment with the Board.
- The Board summarily denied Cooner's motion.
- Cooner (appellant) appealed the Board's decision to the Supreme Court of Alabama, with the Alabama State Bar as the appellee.
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Issue:
Does the term 'related' in Rule 1.8(c) of the Alabama Rules of Professional Conduct, which creates an exception to the prohibition on lawyers receiving substantial gifts from clients via instruments they prepare, include a relationship by marriage (affinity) that persists after the death of the linking spouse?
Opinions:
Majority - Stuart, Justice
Yes, the term 'related' in Rule 1.8(c) of the Alabama Rules of Professional Conduct includes relationships by affinity (marriage), and such relationships do not terminate upon the death of the linking spouse. The court first reversed the Disciplinary Board's disbarment order on procedural grounds, finding it lacked specific findings of fact and conclusions of law for most charges, which prevented meaningful appellate review. However, as the attorney conceded the record was sufficient to review the Rule 1.8(c) charge, the court addressed its merits. The court looked to the plain meaning of 'related,' defining it as a connection by 'blood or affinity.' Citing precedent, the court defined 'affinity' as the tie created by marriage between a spouse and the blood relatives of the other spouse. Therefore, the relationship between Cooner and his uncle-by-marriage falls within the exception. The court rejected the State Bar's argument that this affinity relationship ended with the death of Riley's wife (Cooner's aunt), distinguishing precedent on that issue as a narrow interpretation of a specific adoption statute not applicable to the general term 'related' in ethics rules. Consequently, the Board's finding that Cooner violated Rule 1.8(c) was reversed.
Analysis:
This decision provides a significant clarification of the conflict-of-interest rules for attorneys in Alabama, specifically regarding gifts from clients. It establishes a broad definition of 'related' under Rule 1.8(c), confirming that relationships by marriage (affinity) are included and that they persist for ethical purposes even after the death of the connecting spouse. This creates a clearer, more permissive standard for attorneys drafting instruments for their in-laws, protecting them from discipline under this specific rule. Procedurally, the case also reinforces the mandate that disciplinary bodies must produce detailed orders with specific findings of fact for each charge to ensure their decisions can withstand appellate scrutiny.
