S51209 Grossman and Grossman

SUPREME COURT CASES

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State: Oregon

Docket No: none

Case Date: 02/17/2005

FILED: February 17, 2005

IN THE SUPREME COURT OF THE STATE OF OREGON

In the Matter of the Marriage of
LINDA A. GROSSMAN,

Respondent on Review,

and

RICHARD M. GROSSMAN,

Petitioner on Review.

(CC 9909-69143; CA A116358; SC S51209)

En Banc

On review from the Court of Appeals.*

Argued and submitted November 9, 2004.

Leslie M. Roberts, of Josselson, Potter & Roberts, Portland, argued the cause and filed the briefs for petitioner on review.

Barbara Gay Canaday, Lake Oswego, argued the cause and filed the brief for respondent on review.

BALMER, J.

The decision of the Court of Appeals and the judgment of the circuit court are affirmed.

*Appeal from Multnomah County Circuit Court, Keith Meisenheimer, Judge. 191 Or App 294, 82 P3d 1039 (2003).

BALMER, J.

This marital dissolution proceeding requires us to consider the continuing legal effect of a document that, at the time that it was drafted, was intended to be a marital settlement agreement. Husband and wife separated after seven years of marriage, considered dissolution of the marriage, and, in contemplation of that dissolution, entered into an agreement regarding the distribution of their property. They later reconciled and lived together for 10 years before seeking dissolution. In that later dissolution proceeding, husband sought to enforce the agreement that the parties had made, while wife argued that the trial court should divide the property, without enforcing the agreement, in a manner that was "just and proper" under ORS 107.105(1)(f). The trial court agreed with wife, as did the Court of Appeals. Grossman and Grossman, 191 Or App 294, 82 P3d 1039 (2003). Husband filed a petition for review, which we allowed. We limit our review to questions of law. ORS 19.415(4). For the reasons that follow, we agree with the Court of Appeals and the trial court and, therefore, affirm.

We take the facts from the Court of Appeals opinion and the record. The parties were married in 1981. They had no children together, although wife had a child from her previous marriage. Husband was the primary wage earner, and wife was the primary homemaker, as well as the caregiver for her daughter and, later, her elderly mother. Wife also worked part time as a chiropractic assistant. The parties filed joint tax returns from 1981 through 1998. The parties maintained a joint bank account, and husband also had a separate bank account.

Husband has a degree in computer science and worked as a software engineer. Before the marriage, husband had started a company, Pacific Dataware, that sold computer software and hardware. Pacific Dataware went through a Chapter 11 bankruptcy in the late 1980s but emerged successfully and was sold in 1997. Husband retained a minority interest in a spin-off company of Pacific Dataware, 800 Support (later named 900 Support). After wife filed for dissolution, 900 Support was sold, and husband's share of the proceeds was $2.1 million.

During their marriage, the parties disagreed about whether -- and, if so, when -- to have children. In 1988, the disagreement became so serious that wife consulted a lawyer to discuss possible dissolution of the marriage. Husband also consulted a lawyer, and his lawyer prepared an agreement regarding the division of the parties' property (the agreement). The parties discussed and negotiated the agreement over several days before they signed it. Wife's lawyer reviewed the agreement before she signed it.

The agreement was titled "Post-Nuptial Property Agreement," and it contained a detailed list distributing between the parties the real and personal property that they owned at the time. Husband was to receive his business, three parcels of real property, and certain designated personal property. Wife was to receive certain personal property and $20,000 to be paid by husband over the next 24 months. Husband also agreed to pay wife's health insurance for a year. The agreement provided that wife waived any claim to spousal support and that the payments specified in the agreement "are to be husband's only obligations to wife by way of property settlement or spousal support in any dissolution or divorce decree." The agreement also contained the following paragraph:

"5. The parties now contemplate that they will physically separate within the next week or so and that they may thereafter seek a dissolution of their marriage. In contemplation of a dissolution, the parties desire to make a complete and final settlement of all their property rights, support and maintenance of Wife, and claims of any kind and character between them. The parties have agreed upon the terms of this agreement in contemplation of the Court granting a Decree of Dissolution and the parties desire to reduce their agreement to writing."

Immediately after the agreement was signed, wife left for a month to attend a family reunion. When she returned, she lived with husband for three months, and the parties then separated in November 1988 for approximately one year, during which wife took a three-month trip to India. During the two-year period after the agreement was signed, husband made the monthly payments identified in the agreement, whether or not the parties were living together, and wife accepted them. Sometime after the parties resumed living together in 1989, they decided to have children. Wife underwent two in vitro fertilization procedures between 1997 and 1999. Those procedures were unsuccessful, and, as noted, the parties had no children together.

The parties acquired additional property after they began cohabiting again following the 1988-89 separation, and their other assets increased in value. In particular, as previously noted, husband's stock in 900 Support appreciated, and, while this action was pending, the company was sold, with husband's share of the proceeds exceeding $2 million. Wife filed this dissolution proceeding in September 1999. There is no evidence that either party filed for dissolution or instructed a lawyer to prepare a petition for dissolution in the more than 11 years between the time that the parties signed the agreement in June 1988 and the time that wife filed this action. In her dissolution petition, wife sought an equitable division of the parties' property. Husband responded that the 1988 agreement was binding and that wife was not entitled to any property distribution other than as provided in that agreement. As the Court of Appeals stated, "If husband were correct, [husband] would receive more than $1 million worth of property, and wife would receive assets valued at less than $100,000." Grossman, 191 Or App at 298. (1)

The trial court rejected husband's argument that the agreement should be enforced. The court construed the agreement as a "marital settlement agreement" intended to divide property in an imminent dissolution proceeding, rather than as a "post-nuptial property agreement" entered into by parties not intending to divorce but for the purpose of avoiding disputes in the event of a possible later dissolution. The court found that the agreement was fair at the time that the parties signed it but that it should not be enforced in the dissolution proceeding before the court, which occurred after the parties had reconciled and more than 10 years after the agreement had been signed. The court stated:

"This agreement was intended to resolve the then-existing property in contemplation of divorce. It was not intended to cover, and neither party was then intending to give up rights in the event of reconciliation, of living together for years, additionally, * * * as husband and wife."

The trial court further concluded that, although the agreement had been valid when the parties executed it, the parties' "subsequent reconciliation [was] a repudiation that's inconsistent [with] * * * the basic premises [of the] agreement, and constitutes a rescission of the agreement." The trial court instead entered a judgment dividing the property in a manner that the court determined to be just and proper under the circumstances, as ORS 107.105(1)(f) permits.

Husband appealed, arguing, inter alia, that the trial court erred in declining to enforce the agreement. He asserted that, because the agreement was fair when executed and was not the result of inequitable conduct, it should be enforced like any other contract. Husband claimed that, as a matter of law, the property division in the agreement was "just and proper" for purposes of ORS 107.105(1)(f) and, therefore, that the trial court was required to enforce it. (2) The Court of Appeals rejected husband's arguments, holding that ORS 107.105(1)(f) and cases interpreting that statute authorize a court to make a property division that is "just and proper in all the circumstances," even if that division requires the court to decline to enforce an agreement such as the one at issue here. Grossman, 191 Or App at 299-302.

On review, husband similarly argues that an agreement for the distribution of marital property on dissolution is enforceable on the same basis as any other contract. He again asserts that the trial court was obligated to enforce the terms of the agreement, because, as the trial court found, the agreement was fair at the time that the parties executed it and neither party engaged in inequitable conduct in the negotiation or execution of the agreement, and also because the parties partially had performed the agreement. Husband acknowledges that statutes and case law play an important role in the distribution of marital property in a dissolution, but he advances several reasons why Oregon law requires a court to enforce the marital settlement agreement at issue here. We consider those reasons in turn.

Husband first argues that this court must reconsider and overrule its decision in Hill v. Hill, 124 Or 364, 264 P 447 (1928), which held that a marital settlement agreement "is enforceable in equity only to the extent that it is just." 124 Or at 377. Husband argues that the three cases that Hill cited in support of that proposition were based on the outdated notion that a married woman lacks the legal capacity to enter into a contract with her husband, a rule that already had been abrogated in Oregon by statute at the time that this court decided Hill.

We see no reason to reconsider Hill. The cases cited in Hill to which husband refers may have been based on legal principles or attitudes regarding women that no longer are correct or appropriate, if they ever were; however, the analysis and holding in Hill are not subject to the same objection. (3) The result in Hill had nothing to do with whether a married woman had the legal capacity to contract with her husband. Rather, it was based on the court's view that the marital settlement agreement in that case should not be enforced because it gave one party (wife, who was supporting the parties' three unmarried daughters, a widowed daughter, two grandchildren, and a niece) an unfairly small portion of the marital property. Hill, 124 Or at 377-78. Moreover, this court has not cited Hill in more than 40 years and, as the Court of Appeals recognized, instead has upheld the rule against enforcing unfair marital settlement agreements on the basis of "modern equitable principles and legislative mandate." Grossman, 191 Or App at 300. See, e.g., Norris and Norris, 302 Or 123, 126, 727 P2d 115 (1986) (stating rule that "the court is not bound by property settlement agreements between the parties"). Finally, as the Court of Appeals also pointed out, the rule that marital settlement agreements are unenforceable in a dissolution proceeding if they are unfair is "gender neutral," Grossman, 191 Or App at 302, and Oregon courts have relied on that rule to prevent a wife, as well as a husband, from enforcing such an agreement. See, e.g., Bach and Bach, 27 Or App 411, 555 P2d 1264 (1976) (refusing wife's request to enforce property settlement because doing so would be inequitable).

Husband next argues that the statute that applies to marital dissolution judgments, ORS 107.105, does not prevent the enforcement of the agreement. He asserts that, as a matter of law, a marital settlement agreement is "just and proper" for purposes of that statute unless it was obtained by duress or in breach of one party's fiduciary duty to the other. Wife responds that ORS 107.105(1)(f) requires the trial court to make a property division in a dissolution proceeding that is just and proper in all the circumstances.

ORS 107.105 provides, in part:

"(1) Whenever the court renders a judgment of marital annulment, dissolution or separation, the court may provide in the judgment:

"* * * * *

"(f) For the division or other disposition between the parties of the real or personal property, or both, of either or both of the parties as may be just and proper in all the circumstances."

Wife does not rebut persuasively husband's argument that an agreement that was fair at the time it was entered into necessarily is "just and proper" for purposes of ORS 107.105(1)(f). Her position would allow the trial court to rely upon that statute and ignore arm's-length agreements between parties merely because the trial court determined that some other distribution of property was "just and proper." To allow the trial court to exercise such broad discretion despite an otherwise valid marital settlement agreement between two parties in a dissolution proceeding would be inconsistent with this court's cases that encourage settlement of such proceedings, see, e.g., McDonnal and McDonnal, 293 Or 772, 779, 652 P2d 1247 (1982) ("[t]he parties' own resolution of their dispute should be accorded great weight"), and with the legislature's stated policy of "encourag[ing] the settlement of suits for marital annulment, dissolution or separation," ORS 107.104(1)(a). (4) Rather, because in many cases a range of possible property divisions likely would be just and proper, a trial court ordinarily should accept a marital settlement agreement that provides for a division of property within that range.

Husband, for his part, does not come to grips fully with wife's argument that ORS 107.105(1)(f) authorizes a court to reject an agreement, if enforcement of the agreement would be inequitable, and instead to make a just and proper distribution based on the court's assessment of all the circumstances. This court, while emphasizing the critical importance of settlement agreements, repeatedly has recognized the authority of the trial court in a dissolution proceeding to make a just and proper distribution of marital property. See, e.g., Norris, 302 Or at 126 ("Application [of the just and proper standard in ORS 107.105(1)(f)] is ultimately the duty of the court, not of the parties.").

This case, however, does not require us to accept either of the parties' competing interpretations of the relevant statutes and case law. That is because, as we discuss below, the parties did not intend the agreement here to apply to this dissolution. Rather, the parties intended the agreement to apply to a dissolution that they contemplated at the time that they executed the agreement in 1988, a dissolution that never occurred. Accordingly, even if husband were correct that a property agreement made in contemplation of dissolution is just and proper under ORS 107.105(1)(f) and should be the basis for the dissolution judgment, his argument fails here because the agreement at issue was not made in contemplation of the parties' 1999 dissolution.

As noted previously, in this case we review the trial court's decision for errors of law, and we therefore accept the trial court's findings of fact regarding the agreement. The trial court heard testimony from both parties and from the lawyers who were involved in the drafting and execution of the agreement, and the court considered the terms of the agreement in detail. The trial court found that the agreement was made in "contemplation of an imminent, if not immediate" divorce. The trial court further stated that the agreement "was intended to resolve the then-existing property in contemplation of divorce." On the other hand, the trial court found that the agreement "was not intended to cover, and neither party was then intending to give up rights in the event of reconciliation, of living together for years, additionally, * * * as husband and wife." For that reason, the trial court determined that the agreement was not enforceable under the circumstances.

Based on the trial court's findings, we conclude that the parties intended the agreement to divide their marital property for purposes of dissolution within a short period of time after the agreement was signed in 1988. The parties did not dissolve their marriage within that time. The parties did not intend the agreement to divide their marital property for purposes of the dissolution that wife sought in 1999. The agreement is evidence of the parties' intentions regarding the division of property had they dissolved the marriage in 1988, but it does not demonstrate their intentions regarding property division in 1999. (5)

Finally, husband argues that ORS 107.105 cannot be read to permit the court to disregard a fairly negotiated settlement on the ground that it results in a disproportionate division of property without undermining the validity of prenuptial agreements. Husband asserts that "[t]here is no principled basis to distinguish between pre- and post-marital agreements under ORS 107.105(1)(f)."

The short answer to husband's argument is that ORS 108.700 to 108.740, the Uniform Premarital Agreement Act, provides that premarital agreements that meet the statutory requirements are enforceable, while the legislature has adopted no similar statute regarding agreements made between persons who already are married. (6) The Uniform Premarital Agreement Act requires the courts to enforce such an agreement in certain circumstances, and, as the more specific statute regarding property settlement in a marital dissolution proceeding, it controls to the extent that it is inconsistent with the general "just and proper" distribution requirement of ORS 107.105(1)(f). ORS 174.020(2) (specific statute controls general statute when two conflict). Husband does not challenge the validity of the premarital agreement statute, and we consider the legislature's adoption of that statute to be a complete response to husband's assertion that there is no principled basis to distinguish between a premarital agreement and a marital settlement agreement.

Husband identifies a number of policy reasons that would support the enforcement of any agreement entered into during marriage to the same extent that premarital agreements are enforced. However, given the legislature's choice to establish a statutory framework respecting premarital agreements, while also leaving the "just and proper" standard in place for property division in a marital dissolution, we cannot agree with husband that marital settlement agreements have the same status under Oregon law as premarital agreements.

With the foregoing understanding of the trial court's findings of fact and the parties' legal arguments regarding marital settlement agreements and the effect of ORS 107.105(1)(f), we return to husband's claims. Each of husband's assignments of error turned on a different aspect of his assertion that the trial court committed error in not enforcing the agreement. Because we conclude that the parties did not intend the agreement to apply to this dissolution proceeding, the trial court did not err in declining to enforce the agreement, and each assignment of error therefore fails. (7) As previously noted, except for his legal arguments that the trial court was required to enforce the agreement, husband did not argue, either in the Court of Appeals or in this court, that the trial court's division of the property was not "just and proper" within the meaning of ORS 107.105(1)(f). Accordingly, having rejected husband's legal arguments, we agree with the Court of Appeals that the trial court did not err in its division of the property.

The decision of the Court of Appeals and the judgment of the circuit court are affirmed.

1. The trial court stated that, if the agreement were enforced, husband would "end up with over 3 million dollars and [wife would] end up with $38,000[.]" It is unclear whether the trial court, in making that comment, failed to take into account the capital gains tax that husband would have had to pay on the proceeds of the stock sale or what other assets he was including in those totals. No one disputes, however, that, if the agreement were enforced, the value of husband's share of the property would be at least 10 times the value of wife's share.

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2. Husband, however, did not offer any other argument that the property division that the trial court made, and that was included in the dissolution judgment, failed to divide the property in a manner that was "just and proper in all circumstances." Grossman, 191 Or App at 299.

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3. Husband's position is similar to arguing that the United States Supreme Court's decision in Muller v. Oregon, 208 US 412, 28 S Ct 324, 52 L Ed 551 (1908), upholding a statute setting maximum working hours for women, should be overruled because the Court's rationale for upholding the statute was based, in part, on discredited views regarding the roles and abilities of women. As with this court's decision in Hill, the legal analysis (the scope of the state's authority to set maximum hours legislation) and the result (sustaining the state law against constitutional challenge) in Muller undoubtedly remain correct notwithstanding the Court's quaint (or even offensive) discussion of gender roles.

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4. The legislature enacted ORS 107.104 in 2001 to overturn this court's decision in Webber v. Olsen, 330 Or 189, 998 P2d 666 (2000), in which this court declined to enforce as a contract an agreement embodied in a stipulated judgment of dissolution. As we already have described, ORS 107.104(1)(a) announced a state policy of encouraging settlement of dissolution and similar cases. ORS 107.104(1)(b) and (2) specifically direct courts to enforce the terms of judgments, including stipulated judgments signed by the parties and judgments incorporating marital settlement agreements. Neither party relies on ORS 107.104, presumably because the agreement here never was incorporated into a judgment and therefore does not fall within the terms of ORS 1

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5. We emphasize again that that trial court found that the parties did not intend for the agreement to control the division of property in the event that they lived together as husband and wife for some period of years and later divorced under different circumstances. If the agreement in this case had been what the trial court called a "post-nuptial property agreement" -- that is, an agreement not entered into in contemplation of an imminent divorce -- then our analysis would be different.

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6. As noted previously, ___ Or ___ (slip op at 10 n 4), the legislature in 2001 enacted ORS 107.104, regarding the enforcement of settlements and particularly settlements incorporated in judgments in dissolution cases. Neither party asserts that ORS 107.104(2) covers the agreement at issue here.

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7. Four of husband's assignments of error assert that the trial court erred in not enforcing the agreement. The fifth assignment of error asserts that the trial court erred in failing to enforce the agreement partially. The Court of Appeals rejected husband's fifth assignment of error without discussion, 191 Or App at 302 n 3, and husband did not discuss that assignment in this court.

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Filed: June 30, 2011 IN THE SUPREME COURT OF THE STATE OF OREGON In Re: Complaint as to the Conduct of J. MARK LAWRENCE, Accused. (OSB 08-115; SC S058778) En Banc On review of the decision of a trial panel of the Disciplinary Board. Argued and submitted May 2, 2011. Paula Lawrence, McMinnville, argued and cause and filed the briefs for accused. Stacy Hankin, Assistant Disciplinary Counsel, Tigard, argued the cause and filed the brief for the Oregon State Bar. PER CURIAM The complaint is dismissed. PER CURIAM The issue in this lawyer disciplinary proceeding is whether the accused, by releasing a partial transcript of a juvenile hearing to the press, violated Rule of Professional Conduct (RPC) 8.4(a)(4), which prohibits a lawyer from engaging in conduct that is prejudicial to the administration of justice. A trial panel found the accused guilty of violating RPC 8.4(a)(4) and suspended him for 60 days. We review the decision of the trial panel de novo. ORS 9.536(2); BR 10.6. Because we conclude that

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the Bar failed to prove by clear and convincing evidence that the accused's conduct caused prejudice to the administration of justice, we dismiss the complaint. The facts are straightforward and largely undisputed. In 2007, the accused represented a juvenile male who, along with another male friend, allegedly had touched or swatted several female classmates on the buttocks and had danced in front of the females in a lascivious manner. The incident occurred at the students' middle school. After being informed of the youths' behavior, the vice principal and a police officer interviewed the victims. Based on those interviews, the accused's client and his friend were arrested by a McMinnville Police Officer on February 22, 2007. On February 23, the Yamhill County Juvenile Department filed a delinquency petition alleging that the accused's client had committed acts that, if done by an adult, would have constituted five counts of first-degree sexual abuse and five counts of third-degree sexual abuse. At an initial detention hearing that same day, the court ordered the youths to remain in custody. The events giving rise to this disciplinary action arose out of a second detention hearing held on February 27, 2007, before Judge John Collins. The accused called two of the victims to testify on behalf of his client. The female victims testified that the youths were their friends and that they did not find the youths to be threatening in any way. Regarding the alleged sexual abuse, the female victims testified that the touching or swatting was not sexual in nature but rather was mere horseplay. The victims also testified that they felt pressured by the vice principal and the police officer to make the touching sound hurtful and uncomfortable when it was not. By the second detention hearing, the case was receiving substantial media 2

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attention. Judge Collins allowed the press to attend the detention hearing, but prohibited the press from recording the proceedings. The parties dispute whether the judge prohibited only video recordings or also prohibited audio recordings.1 A number of newspaper and television stories reported the events and testimony at the hearing. After the hearing, the accused obtained a copy of the official audio recording of the hearing and had a partial transcript prepared that contained the victims' testimony. In March 2007, a reporter contacted the accused about the February 27 hearing. The reporter, who was not present at the hearing, expressed disbelief that the female victims had felt pressured by the vice principal and the police officer to make the youths' actions seem sexual. The accused offered to give the reporter a copy of the partial transcript when it was available. The accused believed that it would have been improper to give the reporter the official audio recording of the hearing but thought that the transcript could be released. The accused contacted Deborah Markham, the deputy district attorney handling the case, to see if she objected to releasing the transcript. Markham told the accused that she believed that the court would have to consent. The accused then released the transcript to the reporter without obtaining permission from Judge Collins. Deputy District Attorney Deborah Markham testified that Judge Collins prohibited video recording. Judge Collins testified that he might have prohibited the press from recording the detention hearing, but that he did not remember whether he did so or not. He did remember allowing video recording at a later hearing in the proceeding. The accused testified that Judge Collins prohibited video recording but that he could not remember if the judge prohibited audio recording.
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When Judge Collins learned that the transcript had been released -following news reports that cited the transcript -- he called a meeting with Markham and the accused and told them to release no other transcripts. The testimony from the accused, Markham, and Judge Collins differs regarding that meeting. The accused described the meeting as relaxed and said that Judge Collins had stated that the release of the transcript was permissible. Markham testified that Judge Collins was "very concerned" about the release of the transcript and that Judge Collins said that the accused's disclosure violated the law. Judge Collins testified that the accused did not get his consent to release the transcript, but that he was not sure if the accused needed to do so under the circumstances of the case, particularly given the presence of the press at the hearing. In Judge Collins's description, the meeting was not contentious; although he requested that the parties refrain from releasing any additional transcripts, he did not "feel like [he] needed to be firm" and so did not issue an order barring further releases. In April 2008, several months after the juvenile case was resolved, Tim Loewen, director of the Yamhill County Juvenile Department, reported the accused's action of releasing the transcript to the Bar. After investigating the matter, the Bar charged the accused with violating RPC 8.4(a)(4)2 by releasing to the press "information
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RPC 8.4(a) provides, in relevant part: "It is professional misconduct for a lawyer to: "* * * * * "(4) engage in conduct that is prejudicial to the administration of

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appearing in the record" of a juvenile case without court consent, in violation of ORS 419A.255(1) and (3).3 The Bar alleged that the accused had "usurped" Judge Collins's authority to control the proceeding by not seeking the court's consent before releasing the transcript, and thereby had caused prejudice to the administration of justice. In the proceeding before the trial panel, the accused argued that his release of the transcript did not violate ORS 419A.255 for each of three independent reasons: (1) the transcript that he had prepared was not a part of the record of the case and so was not subject to ORS 419A.255; (2) Judge Collins had consented to the release of the information contained in the transcript when he allowed the press to attend and report on

justice[.]"
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ORS 419A.255 provides, in relevant part:

"(1) The clerk of the court shall keep a record of each case, including therein the summons and other process, the petition and all other papers in the nature of pleadings, motions, orders of the court and other papers filed with the court, but excluding reports and other material relating to the child, ward, youth or youth offender's history and prognosis. The record of the case shall be withheld from public inspection but is open to inspection by the child, ward, youth, youth offender, parent, guardian, court appointed special advocate, surrogate or a person allowed to intervene in a proceeding involving the child, ward, youth or youth offender, and their attorneys. The attorneys are entitled to copies of the record of the case. "* * * * * "(3) Except as otherwise provided in subsection (7) of this section, no information appearing in the record of the case or in reports or other material relating to the child, ward, youth or youth offender's history or prognosis may be disclosed to any person not described in subsection (2) of this section without the consent of the court * * * ."

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the hearing; and (3) the information in the transcript could be released under ORS 419A.255(5)(b) and (d), which list certain exceptions to the confidentiality of juvenile records. Even assuming that he did violate ORS 419A.255, the accused asserted, he did not violate RPC 8.4(a)(4), because his conduct was not prejudicial to the administration of justice. That was so, according to the accused, because the defendant and the victims supported releasing the transcript and because the information contained in the transcript had already been made public as a result of the press attending and reporting on the hearing. Thus, in the accused's view, no harm -- actual or potential -- resulted from his conduct. The trial panel found by clear and convincing evidence that the accused had violated RPC 8.4(a)(4) and suspended the accused from the practice of law for 60 days. The trial panel first determined that ORS 419A.255(3) prohibited the accused from releasing the partial transcript to the press without the consent of the trial court and that the accused had violated the statute in doing so. With little discussion, the trial panel then found that the evidence that the accused had violated the statute also was sufficient to show prejudice to the administration of justice and thus that the accused had violated RPC 8.4(a)(4). The accused sought review in this court. To prove a violation of RPC 8.4(a)(4), the Bar must prove (1) that the accused lawyer's action or inaction was improper; (2) that the accused lawyer's conduct occurred during the course of a judicial proceeding; and (3) that the accused lawyer's conduct had or could have had a prejudicial effect upon the administration of justice. See In re Kluge, 335 Or 326, 345, 66 P3d 492 (2003) (citing In re Haws, 310 Or 741, 746-48, 6

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801 P2d 818 (1990)) (so stating for identically worded former DR 1-102(A)(4)). Because we find the issue to be dispositive, we begin by examining the third element -- whether the accused's conduct had or could have had a prejudicial effect on the administration of justice -- and assume, without deciding, that the accused's conduct violated ORS 419A.255(3) and otherwise satisfied the test set out in Kluge and Haws. Prejudice to the administration of justice "may arise from several acts that cause some harm or a single act that causes substantial harm to the administration of justice." Kluge, 335 Or at 345. This court has identified two components to the "administration" of justice: "1) The procedural functioning of the proceeding; and 2) the substantive interest of a party in the proceeding." Haws, 310 Or at 747. "A lawyer's conduct could have a prejudicial effect on either component or both." Id. The Bar argues that the accused's conduct, a single act, resulted in prejudice to the administration of justice because it had the potential to cause substantial harm to the procedural functioning of the court. The Bar asserts, "Substantial potential harm to the administration of justice occurs whenever a lawyer interferes in or usurps the court's ability to do its job in a proceeding pending before it." The Bar states that the accused "usurped" the court's authority by not seeking Judge Collins's consent prior to releasing the transcript. The Bar cites three disciplinary cases to support its position that the accused's conduct resulted in substantial potential harm to the administration of justice. First, in In re Eadie, 333 Or 42, 36 P3d 468 (2001), this court found a violation of former DR 1-102(A)(4) where the accused lawyer submitted a proposed order containing a 7

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misrepresentation that was intended to influence the judge in changing the trial date. Id. at 58. That conduct substantially harmed the procedural functioning of the court because it resulted in the judge acquiescing to a trial date preferred by the accused and made it necessary for the judge to resolve a dispute resulting from the accused's misrepresentation and to redraft an order. Id. Second, in In re Morris, 326 Or 493, 953 P2d 387 (1998), this court concluded that the accused lawyer had engaged in a single act of conduct that had the potential to cause substantial harm, either to the procedural functioning of the court or to the substantive interests of the parties, when she knowingly filed a notarized document that she had altered. Id. at 502-03. Third, in In re Thompson, 325 Or 467, 940 P2d 512 (1997), this court found a violation of former DR 1-102(A)(4) where the accused lawyer physically confronted a judge after receiving an adverse decision. That conduct caused substantial harm to the administration of justice because the accused's ex parte communication with the judge "unfairly attack[ed] the independence, integrity, and respect due a member of the judiciary." Id. at 475. The conduct also had the potential to cause substantial harm, because it could have influenced the judge to change her decision or to recuse herself from the case. Id. In each of the preceding cases, the accused lawyer engaged in conduct that had the potential to disrupt or to improperly influence the court's decision-making process, Thompson, 325 Or at 475; that created unnecessary work for the court, Eadie, 333 Or at 58; or that had the potential to mislead the court, Morris, 326 Or at 503. Moreover, in Eadie and Morris, the accused lawyers made knowing misrepresentations to the court. Similarly, in Kluge, the accused lawyer's conduct in knowingly filing an 8

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untimely motion to disqualify the trial judge and then failing to serve the motion on opposing counsel caused prejudice to "the procedural functioning of the judicial system by imposing a substantial burden upon both opposing counsel and [the trial judge] to undo the accused's actions." 335 Or at 346. In this case, the Bar has made no showing, as required by Kluge and Haws, that the accused's conduct harmed the procedural functioning of the judicial system, either by disrupting or improperly influencing the court's decision-making process or by creating unnecessary work or imposing a substantial burden on the court or the opposing party. Nor has the Bar shown that his conduct had the potential to result in any of the above. Certainly, Judge Collins did not testify that the accused's actions interfered with Judge Collins's conduct of the juvenile proceeding. Although the Bar correctly asserts that ORS 419A.255 gives the trial court control over the release of protected information in a juvenile record -- and, as noted, we assume without deciding that the accused acted improperly in not seeking the trial court's consent -- the Bar's theory fails to take into account the fact that the information contained in the partial transcript that the accused released was presented in open court and had already been reported by the press.4 It is difficult to see how the accused's release of the same information, in the context of this case, had the potential to cause any harm to the proceeding, much less substantial harm.

Article I, section 10, of the Oregon Constitution grants members of the public, including the press, the right to attend juvenile hearings. State ex rel Oregonian Pub. Co. v. Deiz, 289 Or 277, 284-85, 613 P2d 23 (1980).

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See Kluge, 335 Or at 345 (prejudice to the administration of justice may arise from "several acts that cause some harm or a single act that causes substantial harm"). Indeed, the Bar makes no effort to show that the accused's conduct could have resulted in new information being made public or that the release of the partial transcript itself had any potential impact on the proceeding. In fact, after the press attended the hearing and the accused released the transcript, Judge Collins allowed members of the press to listen to the official audio recording of the hearing. Nevertheless, the Bar asserts that Judge Collins was sufficiently "concerned" about the release of the information to call the accused and Markham to his chambers to discuss the incident. The fact that Judge Collins was "concerned" and met with the accused and Markham does not, by itself, demonstrate the potential for substantial harm to the procedural functioning of the court. Judge Collins himself stated that, although "in a perfect world," he probably would not have wanted the transcript released, in the context of this case and the open court provision of Article I, section 10, of the Oregon Constitution, the release of the partial transcript was likely permissible without his consent because "if [the press is] * * * going to know the information and report the information, at least get it right." Judge Collins's testimony, then, does not demonstrate that the accused's conduct impacted the procedural functioning of the court, even if the accused's conduct was cause for "concern." Nor does the Bar offer any evidence to prove that the release of the partial transcript harmed the substantive interests of the accused's client, the victims, or the state. The accused released the transcript, with the support of his client, in response to an 10

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inquiry from the media and in order to respond to inaccuracies appearing in some media reports. The accused maintained the confidentiality of the victims' names in the transcript, referring to them by their initials, consistent with an earlier order by Judge Collins. In this proceeding, the accused also submitted letters from the two victims who testified (and their parents) that stated their support for the release of the partial transcript. Finally, there was no testimony from the Yamhill County Juvenile Department that the release of the partial transcript had any effect on its substantive interests or its ability to prosecute the case. The Bar appears, instead, to take the position that virtually any violation of a statute, rule, or court order that occurs during the course of a court proceeding and relates to the conduct or any procedural aspect of that proceeding necessarily is prejudicial to the administration of justice. The Bar asserts, in effect, that "substantial potential" harm is implicit in the accused's conduct. Our cases, however, require proof by clear and convincing evidence that an accused's conduct in a specific judicial proceeding caused actual or potential harm to the administration of justice and, when only one wrongful act is charged, that actual or potential harm must be "substantial." Kluge, 335 Or at 345; Haws, 310 Or at 748. Here, the Bar's evidence did not prove that substantial harm resulted or could have resulted from the accused's conduct. We conclude that the Bar has not proved by clear and convincing evidence that the accused violated RPC 8.4(a)(4). The accused's conduct did not result in such prejudice, because there is no evidence that the release of the partial transcript, which contained solely information already presented in open court and reported by the press, 11

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harmed the procedural functioning of the judicial system. Nor is there any evidence that the substantive rights of the accused's client, the other juvenile defendant, the victims, or the state were harmed. "Prejudice to the administration of justice" requires such a showing. Haws, 310 Or at 747-48. The complaint is dismissed.

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