[SOLVED] Martin Pilzmaker was a young, aggressive lawyer

Martin Pilzmaker was a young, aggressive lawyer from Montreal who was invited in 1985 to join the law firm Lang Michener in Toronto. It was expected that his immigration law practice “could enrich the (firm’s) coffers by $1 million a year catering to the needs of Hong Kong Chinese already start- ing to panic over the crown colony’s 1997 return to China’s control.”
Although rumors of Pilzmaker’s questionable practices began to surface and were reported to the firm’s executive committee in December, it was not until early February 1986 that a senior colleague, Tom Douglas, “drew aside Ament and Wiseman (Pilzmaker’s junior colleagues) and grilled them on their boss’s activities. They told him that Pilzmaker not only smuggled regularly but that he was running a double-passport operation. The scam involved the false reporting of lost Hong Kong passports by his clients, which, in fact, would be kept by Pilzmaker in Canada. On their replacement passports, the clients could travel in and out of the country at will. When the time came to apply for citizenship—which requires three years’ residence—they could supply the original ‘lost’ passports to show few if any absences from Canada.”
Douglas told the executive committee of this activity, by memo, on February 10. The executive committee “speculated that Pilzmaker’s admissions may have constituted only knowledge of wrongdoing on the part of certain clients and not active complicity. The committee decided to send (two members) Don Wright and Donald Plumley back to Pilzmaker to ask him, in the words of Farquharson’s instructing memo, ‘if he would be willing to agree’ not to participate in any client violation of the Immigration Act.”
Early in June 1986, angered that Pilzmaker had not been expelled, Tom Douglas sought advice from Burke Doran, “a colleague he regarded as a personal friend but moreover, one who was a bencher, or governor, of the Law Society. Doran went on to advise him to keep his head down and his mouth shut—a caution Doran later said he had no recollection of giving.”
While mulling over this advice and some from another lawyer, Brendan O’Brien, a foremost authority on professional conduct, Douglas discovered a further problem. “This was a proposal by Pilzmaker to Brian McIntomny, a young associate lawyer, who was in the market to buy a house. The idea was that McIntomny would put up $50,000 for a $200,000 house, the balance supplied by a Pilzmaker client in Hong Kong. The client would officially own the house, have the phone and utilities registered in his name, while McIntomny lived in it and held a secret deed. After three years, he would pay the client the interest-free $150,000, register the deed to place title in his own name and benefit from the accrued increase in value. The client, meanwhile, would have ‘proof ’ of having resided in Canada for the three years required for citizenship.” Douglas arranged for Bruce McDonald, a member of the firm’s new executive committee, now consisting of McDonald, Don Wright, Albert Gnat, Donald Plumley, and Bruce McKenna, to be informed.
An investigation was begun, and “at a July 28th Executive Committee meeting, a vote was taken on whether or not to expel Pilzmaker.” The vote was three to two in favor of his staying. Douglas was allowed to address the meeting only after the vote was finalized, and he was enraged.
“On August 6, the night before McKenna’s report was submitted but in partial knowledge of what it would likely contain, Douglas had dinner with Burke Doran again, this time in the company of a mutual colleague, Bruce Drake. Drake and Douglas subsequently claimed that when he was asked whether the firm had an obligation to report at least Pilzmaker’s double-passport scam to the Law Society, Doran said no, ‘because no white men have been hurt.’ (Neither man took this as a racist remark but as meaning it was a victimless crime, with the clients knowingly involved.) The following morning at the office, Drake said he asked Doran if his remarks of the night before could be taken as official advice from the chairman of the Law Society. Doran said yes.”
Doran has always denied that, confining his explanation to the dinner and not the morning after: “It’s far-fetched to say I was sitting at a social dinner in my capacity as chairman of discipline.” Don Wright would later testify, however, that it was Doran’s view throughout the period “that we did not have any obligation to report to the Society.”
On August 7, McKenna filed a scathing fifteen-page report to the executive committee, listing fifteen breaches of unethical behavior both inside and outside the firm by Pilzmaker, noting that “I am not aware of any material statement of fact made by him to me that I have checked out and has proven to be true.” Furthermore, “I am concerned that I now have a personal responsibility, as a member of the Law Society and an officer of the court, to report the situation. If each of you review the facts closely, you will have similar concerns about your own obligations.” “On August 20, the executive committee did finally decide Pilzmaker had to go, subject to confirmation by the entire partnership.”
After this, events proceeded at a faster pace:
September 4: Brendan O’Brien, hired to counsel the firm, advised that “they couldn’t afford not to report to the Society.”
September 5: A general meeting of the firm’s partners is called to review the matter.
September 18: The requisite two- thirds of the 200 votes were obtained to force expulsion.
September 26: Pilzmaker’s files were secured at the firm.
October 1: The Executive Committee debated the impact on the reputation of the firm and of high- profile partners “such as Jean Chretien (who became the Prime Minister of Canada) and Burke Doran.”
November 6: Douglas wrote Don Wright, urging the firm to report to the society.
November 18: Pilzmaker’s lawyer filed suit to have Pilzmaker’s files transferred to him.
November 21: The Law Society received a report from O’Brien “that
(a) Pilzmaker had been expelled,
(b) that he had been wrongly billing into the general, not trust, account and (c) that there was more than $300,000 in unpaid fees where Pilzmaker had either not done the work or had not even been retained in the first place.” The society’s investigator, Stephen Sherriff, began his investigation and subsequently called for a fuller report from the firm.
December 5: Pilzmaker’s request for his files was granted by Justice Archibald Campbell, who “was given no hint that the files contained evidence that at some point might need to be looked at by the Law Society.”
December 8: A fuller report is presented to the Law Society.
Twenty-five months later, “in January, 1989, Sherriff filed a lacerating 138-page confidential report that recommended a professional misconduct charge be laid against Burke Doran for placing himself in a conflict-of-interest situation in which he chose the interests of the firm over his responsibility as the Society’s then chair- man of discipline. Separate charges of pro- fessional misconduct were recommended against eight others in the firm. Sherriff contended that
(a) they had failed to inform clients that Pilzmaker had likely given them unethical advice and to seek independent counsel and
(b) they had failed to report in a timely manner what they knew about his behavior, indeed they reported only when Pilzmaker’s lawsuit gave them no alternative.”
An Ottawa lawyer, David Scott, was retained to help the society by analyzing what to do about Sherriff ’s recommendations. His report of March 2, 1989, was presented to Paul Lamek, the new chair of discipline for the society. “The ball was now in Lamek’s court. He says he saw his job as twofold: To define who Scott meant by ‘Managing partners and/or group’ and to decide whether a charge could be made against Doran on a basis different from Sherriff ’s—namely, that as a bencher and chair of discipline, Doran had a ‘higher duty’ to report than did his colleagues. Although it wouldn’t be officially disclosed until this spring, Lamek initially did opt to charge all eight, subject to clarifying just who exactly was on the executive committee from the crucial time on—a period Lamek pinned at June, 1986. That clarification consequently dropped several senior people out of the picture. As for Doran, ‘after agonizing analysis’ Lamek concluded that no complaint of any kind should be issued.”
What was the outcome of these charges/ events?
In the Spring of 1989, when it became obvious that Douglas would have to testify against his colleagues that fall, he finally did resign—three years after he’d first threatened to.
On October 31, without waiting for the panel’s ruling, a disillusioned Sherriff resigned from his job: “What could have been a testament to the integrity of the Society had ended up sullying it. I had no choice but to quit.” His departure, coupled with growing media speculation that there might be a “whitewash of a cover-up” in process, had many other members of the Society adding to the chorus of concern.
At a convocation meeting of the benchers last September [1989], lawyer Clayton Ruby, who’d been given a copy of the investigation report by Sherriff, presented a motion that Lamek’s decision be set aside and the original recommendations adopted. Ferrier ruled the motion out of order. “Douglas and Sherriff are right wingish, not my kind of guys,” [said] the notoriously left-leaning Ruby. “But I really felt that Lamek’s decision to charge only five made it look as if we (the Society) were covering something up.”
At a general members meeting the following month, former bencher Paul Copeland tried to table a motion demanding simply an explanation for why only five had been charged. He says he too was “cut off ” by Ferrier.
On January 5 of this year [1990], the five who’d been charged were found guilty of professional misconduct for not reporting their concerns about Pilzmaker three months earlier than they did, specifically at the time McKenna made his damning report.
The panel, however, found that the same concerns had not “imposed a duty on them” to inform clients that Pilzmaker had been expelled or that he might have given them unethical advice or that they should get independent legal advice.
Due to the ensuing controversy, on February 7, “the Society hired retired Manitoba former Chief Justice Archibald Dewar to review its handling of the entire affair.” But his findings did not please everyone. “Dewar did not find any evidence of impropriety or favouritism in Lamek’s charges. The Doran decision was a judgment call, he wrote, and while debatable, to proceed with a charge now would only satisfy critics but ‘Not be seen as adding lustre to the discipline process.’”
What he did find, however, was a catalog of complaints against Sherriff. Sherriff was incensed. “The big deal, first,” says Sherriff, “is that the real bad guy (Pilzmaker) almost went free. The big deal, second, is that the self-governing ability of this profession was compromised. ‘Lawyers have special privileges, therefore, special responsibilities. Protecting the public is chief among them. That’s the big deal. If you’re a man of principle, you won’t walk away from it.’”1
Questions
1. Are professionals bound to meet a higher standard of ethical behavior than nonprofessionals? If so, why?
2. In what respects were the actions of the lawyers involved in the Lang Michener affair not up to the ethical standard you would expect? Consider
a. Pilzmaker’s conduct;
b. the conduct of members of the executive committee at Lang Michener—in particular, Burke Doran; and
c. the investigation and proceedings by the Law Society.
What obligations did each owe to clients, the legal profession, the Law Society, and the public?
3. Do the same considerations apply to other professionals as to lawyers?
4. Is the self-regulation of a profession on ethical matters effective from the perspective of
a. the members of the profession?
b. the public?
c. clients?
5. Would you agree with the argument, which was used to exonerate members of the management team, that “when a professional makes a serious mistake, the error is of no consequence, if it is honestly made”? (Bud Jorgensen, The Globe and Mail, February 5, 1990, B9).

Question: Martin Pilzmaker was a young, aggressive lawyer