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Ethics Advisory Opinion 07-06

April 13, 2007

South Carolina Bar Ethics Advisory Opinion 07-06

SC Rules of Professional Conduct: Rule 4.5

Date: August 24, 2007

Facts
Lawyer's client owns and operates a small business. Client requests that Lawyer assist with the collection of several dishonored checks that have been returned as insufficient funds or were drawn on an inactive account. Lawyer is contemplating sending a letter on client's behalf, in compliance with S.C. Code §34-11-70, 1976, as amended, which would state, in part, "[u]nless this amount is paid in full within the specified time above, the holder of the check or instrument may turn over the dishonored check or instrument and all other available information relating to this incident to the solicitor or other appropriate officer for criminal prosecution." Lawyer is mindful of the language contained in Rule of Professional Conduct 4.5 which prohibits a lawyer from threatening to present criminal or professional disciplinary charges solely to obtain an advantage in a civil matter.

Question
If Lawyer sends collection notices on behalf of Client pursuant to S.C. Code §34-11-70, is Attorney in violation of Rule 4.5 of Professional Conduct, which prohibits threats of criminal charges solely to gain advantage in a civil matter?

Summary
There is no violation of Rule 4.5 of Professional Conduct, SCACR, Rule 407, for Lawyer to prepare and send out a collection notice letter on Client's behalf pursuant to S.C. Code §34-11-70.

Opinion
Rule 4.5 of Professional Conduct for Lawyers, SCACR, Rule 407, prohibits a lawyer from threatening to present criminal or professional disciplinary charges solely to obtain an advantage in a civil matter. This Rule is not included in the Model Rules of Professional Conduct. The language of this Rule is based upon DR 7-105 of the Code of Professional Responsibility. South Carolina Rule 4.5 and its comments have no equivalent in the Model Rules. This committee issued a prior opinion regarding Rule 4.5. S.C. Bar. Ethics Adv. Op. 99-05 (stating it was a violation of Rule 4.5 for lawyer for employer to notify federal or state taxing authorities to be present at workers’ compensation hearing where employee will testify about lost earnings).

However, the current issue is based on a statutory requirement pursuant to S.C. Code §34-11-70(a)(1), 1976, as amended, that “notice must be given by mailing the notice with postage prepaid addressed to the person at the address as printed or written on the instrument.” Such conduct constitutes “threatening to present criminal... charges,” but because the statute requires the notice, the threat is not made “solely to obtain an advantage in a civil matter” as prohibited by Rule 4.5. Therefore, there is no violation of Rule 4.5 of Professional Conduct for Lawyer to prepare and send out a collection notice letter on Client's behalf pursuant to S.C. Code §34-11-70.

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