City attorneys object to questions about their ethics

Patrick Gilligan, the Assistant City Attorney, speaks during the Ocala City Council meeting at Ocala City Hall in Ocala, Fla. on Tuesday, Jan. 4, 2022. [Bruce Ackerman/Ocala Gazette] 2022.

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Posted March 4, 2022 | By Jennifer Hunt Murty
jennifer@ocalagazette.com

The Ocala City Council was poised to decide Tuesday night whether to create an in-house legal department or continue to use an outside firm when they gave the floor to the three lawyers representing the city, who spent an hour expressing outrage that their professional ethics have been brought into question.

Although Robert Batsel, Jr. and Jimmy Gooding had indicated they were splitting away from the city attorney firm–and would not seek a new contract when the current one is up at the end of September, city attorney Patrick Gilligan told the council the firm would like to continue to serve the city’s legal needs. On one point the three agreed: After 30 years of serving in the role, for which the firm historically has been paid $1 million a year, they were hurt and frustrated that they weren’t being consulted more in the council’s decision for future legal services.

Gilligan asked to address the council before they voted on the matter. An hour later, the council members decided to table their vote and set another workshop to explore more details about what each option would entail.

The main point of contention from the attorneys focused on a presentation given during a Feb. 1 city workshop on legal services by City Manager Sandra Wilson. The presentation outlined the pros and cons of having an in-house legal department vs. an external one.

The attorneys took special exception to two areas of the presentation: first, that it included a cited staff concern about the firm’s billing practices; and, second, that it referenced a December article by the Gazette about potential conflicts of interest with the firm.

The workshop presentation  

Wilson’s presentation included complaints several city departments had made to city management about working with the law firm. The Gazette, through a public records request, obtained the written statements usedin Wilson’s summary.

The complaints ranged from concerns the firm was taking cases to court rather than seeking a settlement because doing so would increase billable hours to long waits for document and contract reviews and unanswered emails and phone calls, delays that department heads said hurt their units’ efficiency.

Christopher J. Watt, the director of Human Resources & Risk Management, who also is an attorney, compiled staff feedback and wrote in an email to Wilson: “I would like to see the relationship between Risk and the City Attorney become directional where the City decides the most economical and efficient way to proceed with a case, including early settlement in some cases. The city attorney’s office would then carry out the city’s instructions in a manner that is most economically sound from the city’s perspective.”

The feedback from the department Watt oversaw indicated that cases were going to mediation “without first completing depositions” or other legal discovery mechanisms such as written interrogatories or requesting documents from the other side and was not aggressive in settling claims.

“There is no incentive for the city attorney’s office to settle claims as taking claims to court increases their revenue,” the email from Watt read.

The risk management department had the most to say about how the firm handled litigation, complaining that there was very little communication regarding the status of cases, and that the attorneys did not seek city input in their litigation strategy.

Another email memo that seemed to originate from the Risk Management department stated, “Sometimes I believe the city attorney is too aggressive defending actions and ordinances which it has been involved drafting. It would be easy to allege a conflict in cases like this, and the public likely feels that way.”

The Ocala Electric Utility Department said in its memo, “Several of these issues go back many months and years without being updated or resolved. There really needs to be some method of getting updates from the City Attorney office on status of open requests (at least monthly), so we know where each request is in the queue.”

Also included in the complaints were concerns of “questionable billing practices” related to the way attorney conferences were billed, as well as work including scheduling or review of medical records that could be performed by a paralegal instead of a lawyer.

Concerns about conflicts of interest were also raised by city staff in the city manager’s presentation, citing the Gazette report published in December about how the firm inserted a conflict-of-interest waiver that had not been in any of the prior city attorney contracts.

The conflict-of-interest clause was not discussed with the council or city manager when the contract was signed and only recently became a public concern because of the Gazette report. The clause said the city attorney had advised the city, and the city is aware that the firm also represents “private persons and entities” that include “developers or contractors” who “have relationships with, or seek approvals from, [the] city.”

In preparing for the workshop, a memo surfaced that was written a year ago by another attorney, Daphne Robinson, who works in the city’s Procurement Department.

At the top of the memo, Robinson presented two questions she intended to answer:

1. Whether there were certain legal services provided by the city attorney’s office that could be handled in-house by her and/or the Procurement Department.
2. Whether there will be a substantial savings of attorney time and costs if the City of Ocala utilized an in-house legal department.

Robinson outlined several legal services she has already provided to the city, outside the city attorney firm’s sphere, such as “drafting of responses to bid protests; contract termination letters; mediating contractual disputes between vendors and department heads; researching novel issues of importance to upper management; and providing other routine legal advice for lower-level issues.”

Robinson volunteered to do more, stating, “I have no problem making myself available to the City Attorney’s Office to assist in the capacity of in-house legal counsel where needed for litigation-based projects.”

She also acknowledged areas of law where she did not have sufficient experience to comfortably handle.

Her memo raised questions about how the city attorney’s office did its billing and gave advice on how creating stricter guidelines for outside attorney billing could “reduce waste and costs.”

Robinson pored through hundreds of pages of city attorney bills and created notes about what she thought were inappropriate billing practices, such as passing along a firm overhead cost of research to the city or multiple attorneys charging the city for talking to each other or staff.

Robinson’s memo was never presented to the council and only resurfaced as a result of preparing for the workshop, said Wilson.

A snapshot of the volume of contracts managed by the department Robinson works in was found in her end of the report to her department head, Tiffany Kimball, in an email dated Jan. 7. Robinson reported increased efficiencies in the year 2021, despite the increased volume of contracts, namely reducing contract processing by 14 days.

According to Kimball, the department currently has 1,340 open contracts for the city, which requires “ongoing actions for contract deficiency, terminations, renewals, and other management tasks involved in the upkeep of them.”

The lawyers’ objection 

At Tuesday’s meeting, the city attorneys told the council that the report by Robinson was evidence that the city manager, Wilson, had been conspiring to undermine them for almost a year.

Wilson acknowledged during the meeting that she understood how some of the information presented could be taken out of context. However, she explained the reason Robinson created the memo was to explore efficiencies and the potential for handling only certain legal services in-house. Wilson also indicated that Batsel was aware that the city was exploring the issue.

In specific responses to the presentation, the city attorneys focused on the firm’s billing practices and skirted the other staff complaints.

For nearly an hour, however, the city attorneys complained to the council about how the media reports and the city manager’s presentation had hurt their feelings. At one point, Gilligan pointed out his wife and staff members from his firm who were sitting in the front row, saying they also were hurt and embarrassed through association by any insinuations that Gilligan had participated in any unethical behavior.

They also described Gazette reports about potential conflicts of interest as factually inaccurate. Batsel said even including the news reports in the workshop presentation gave them legitimacy.

Batsel recalled an example Council Member Barry Mansfield had used to explain why he was uncomfortable about the potential for conflicts: “I just can’t imagine a world where I’m a contractor and my attorney is also representing the subcontractor.”

“If I was the contractor’s attorney,’’ he said, “then I would tell the subcontractor, no, I have a conflict.  And if the subcontractor later said I’m going to start a restaurant [and] do something totally independent of what I do with you, and they wanted me to represent them, then I would have to get your consent and make sure you both consented and only do so with that understanding. And if they ever had anything that involved the contractor then they would have to be put on notice just like all of our private clients are that there is no way I’m going to represent you and prior to my representation to you on anything else you’re going to have to consent that when you do have something adverse to that contractor, I’m representing the contractor. So, that is the way we do things.”

The Gazette, however, found this is not how the firm always does things.

Batsel explained to council that the rules require both clients to give informed consent in the case of an attorney continuing representation despite a potential conflict of interest. In the Gazette’s investigation it took at face value the attorneys explanation of how they navigated conflicts with their private clients, but found through extensive interviews with city management, city employees, and the city council the attorneys have never asked the city for its informed consent to continue representation despite potential conflicts for interest between their private clients and the city.

In one instance, Gooding was drafting a form Annex Agreement in 2020 for the city to use with developers outside of city limits to hook up to water services. Gooding did not inform the city that he also represented some of the developers who would be signing the agreement just two months after it was approved by the council, did not explain the risk, or inform them of other options including hiring a different lawyer to handle the  matter.

In 2020, when the city was negotiating with Marion County and the World Equestrian Center for potential water hook up for the WEC developer, Batsel did not ask the city to waive the conflict of interest that existed as his firm represented both the WEC developer and the city.

Batsel told the council and the Gazette that when the firm does represent the developer in other matters, they always tell the city staffer.  This raises questions of which city employees are authorized to weigh and waive conflicts of interest for city attorneys.

Rule4-1.7 of the Florida Bar Rules & Standards, related to professional conduct of lawyers, states that a lawyer must not represent a client if 1. The representation of one client will be directly adverse to another client; or 2. There is a substantial risk that the representation of one or more clients will be materially limited by the lawyer’s responsibilities to another client, a former client or a third person, or by a personal interest of the lawyer.

The exception to that rule is if the lawyer “reasonably believes that the lawyer will be able to provide competent and diligent representation to each affected client” and “each affected client gives informed consent, confirmed in writing or clearly stated on the record at a hearing.”

According to the rules, “informed consent” denotes the agreement by a person to a proposed course of conduct after the lawyer has communicated adequate information and explanation about the material risks of and reasonably available alternatives to the proposed course of conduct.

In the case of the city attorneys’ conflict-of-interest waiver, no specific clients were identified, only industries–development and contractors and no separate, more specific conflict memos could be identified by the attorneys or city staff.

In a legal memo to city council last week, Gooding said the Gazette’s report contained “a number of misstatements and, more importantly, a defective analysis of the ethical rules that govern attorneys.”

Gooding said the Gazette article “mischaracterized” work he had done for Golden Ocala or World Equestrian Center related to the city. Instead, he said his partner Batsel had been the one negotiating for the city in business with WEC. But Gooding gave no explanation as to why his representation of the WEC developer did not create a conflict of interest that applied to his partners.

Gooding wrote in the memo, “One of the things that I am most proud of (and that I think speaks highly of the work we have done for the City) is the absence – until the Gazette article – of publicity (good or bad) directed at the City Attorney’s office during our long tenure. Rather than showing (as I suspect the Gazette may contend) how well we have concealed our misdeeds, I think it shows that our goal has been to serve as good attorneys only and not get involved in political issues for which we were not hired. And obviously prior City Councils thought we were doing something right by continuously providing us with favorable reviews and re-hiring us. It is unfortunate that unfounded charges against us have been dragged into the more important issue of how the City should meet its legal needs in the future.”

Neither of the three attorneys have reached out to the Gazette requesting retractions or corrections following the December report. During a follow-up interview with the Gazette in February, Gooding made no comment about inaccurate reporting or analysis.

The Gazette has also not received any requests for factual corrections from the city for the article.

Council’s response 

Most of the council members indicated that they leaned toward creating an in-house legal department during the city council workshop.

However, upon objection that the city attorneys were not being included in the process, the council asked the city manager to set another workshop.

This time, city staff was directed to bring more details of what an in-house legal department would look like but also give an opportunity for Gilligan to pitch what it would look like for the city to stay with his firm minus contributions from his old partners, Batsel and Gooding, who are now only officemates with the Gilligan firm.

Council Member Kristen Dryer reminded Gilligan of something he had taught her prior to being elected: “If you are explaining, you are losing.” Dreyer indicated she had adopted the motto and gave credit to Gilligan every time she used it herself.