CN 1996-314
Created By: Tobie Ronkartz on 08/28/1998 at 10:55 AM
Category: Ethics Rulings
Caption:


LOUISIANA BOARD OF ETHICS


DATE: July 27, 1998 OPINION NO.: CN 96-314

RE: In the matter of Emile Schneider.

The Louisiana Board of Ethics (the “Board”), pursuant to the provisions of Section 1141 of the Code of Governmental Ethics (the “Code”), conducted an investigation into information received indicating that violations of Sections 1111C(1)(a) and 1111C(2)(d) of the Code may have occurred by Emile Schneider, a contract attorney for the Orleans Levee District (“OLD”), receiving compensation for notarial services performed for public works contractors of OLD.
On the basis of the information obtained during the course of the investigation and with the consent of Emile Schneider, the Board now makes the following essential:
I.
FINDINGS OF FACT
1.
Mr. Emile Schneider has had a contract with OLD since June 1, 1992 entitled “Retainer Agreement for Legal Services” to serve as OLD’s part-time Associate General Counsel and “[t]o perform any legal services as may be requested by the President of OLD personally or through the office of the General Counsel.”
2.

Mr. Schneider is also the notary chosen by OLD to execute the notarial contracts for OLD’s public work projects, for which he is paid by the contractor according to a notary fee schedule that is based on a percentage of the amount of the contract award.
3.
Richard McGinity was General Counsel and notary for OLD from 1972 to July 1993; and, he was the creator and the author of the notary fee schedule.
4.
In July of 1993, when Richard McGinity exited the General Counsel position, Mr. Schneider became the notary for OLD.
5.
All project manuals provided by OLD to prospective bidders include a statement that says “The fee of the notary, who will be selected by the Board, will be paid by the Contractor. See fee schedule.”
6.
Since 1994, Mr. Schneider was paid the following notarial fees by the successful low bidder of the public works project each time a contract was executed: Total $72,530.
7.
No official action was ever taken by OLD President or Board to appoint Mr. Schneider as the notary for the public works contracts; however, the Board is satisfied that he was either instructed and/or designated by the President of OLD or through its legal department, to notarize the contracts.
8.
Mr. Schneider’s duties as the notary for OLD included the review of the contract and specifications for accuracy and compliance with the Public Bid Law; the verification of the bid bond for legality and amount, the execution of the contract before the parties and witnesses; the recordation of the documents in Orleans Parish; and, when the project was complete, the recordation of an “Acceptance of Contract” and the verification that no liens had been filed before the retainer was released. Mr. Schneider also stated that depending on the size of the project and the complexity of the specifications, the time involved could be from 2 to 15 hours.
9.
The practice of the OLD attorney likewise serving as Notary has been in place for years, perhaps decades, preceding the occurrence of the events involving Mr. Schneider.
10.
The Board has received no evidence to suggest that Emile Schneider intentionally violated any provision of the Code of Governmental Ethics.
II.
APPLICABLE LAW
Section 1111C(1)(a) of the Code prohibits a public servant from receiving a thing of economic value for services which are substantially related to the responsibilities, programs or operations of his agency and in which he has participated. This Section provides in pertinent part:
* * *
C. Payments for nonpublic service.
* * *
Section 1111C(2)(d) of the Code prohibits a public servant from receiving any thing of economic value for services rendered to a person from whom he is not allowed to receive a gift. This Section provides in pertinent part:
* * *
C. Payments for nonpublic service.
* * *
(2) No public servant and no legal entity in which the public servant exercises control or owns an interest in excess of twenty-five percent, shall receive any thing of economic value for or in consideration of services rendered, or to be rendered, to or for any person during his public service unless such services are:
* * *
(d) Neither performed for nor compensated by any person from whom such public servant would be prohibited by R.S. 42:1115(A)(1) or (B) from receiving a gift.


Section 1115 of the Code prohibits a public employee from soliciting or accepting a thing of economic value from a person who has a contractual, business or financial relationship with his agency, who is regulated by his agency or who has a substantial economic interest that may be affected by the performance of the public employee’s duties. This Section provides in pertinent part:
1115. Gifts

(1) Has or is seeking to obtain contractual or other business or financial relationships with the public servant’s agency, or
* * *
B. No public employee shall solicit or accept, directly or indirectly, anything of economic value as a gift or gratuity from any person or from any officer, director, agent, or employee of such person, if such public employee knows or reasonably should know that such person:
(1) Conducts operations or activities which are regulated by the public employee’s agency.
(2) Has substantial economic interests which may be substantially affected by the performance or nonperformance of the public employee’s official duty.

The following terms are defined in Section 1102 of the Code and are relevant when analyzing the above Sections:
III.
OPINION

It is the opinion of the Board that Emile Schneider violated Sections 1111C(1)(a) and 1111C(2)(d) of the Code by receiving compensation for performing notarial services for OLD at a time when he had a contractual relationship with OLD as an Associate General Counsel. In 1992, Mr. Schneider entered into a contract with OLD to provide “any legal services as may be requested by the President of OLD personally or through the office of the General Counsel.” Between 1994 and 1997, in addition to compensation he received pursuant to his contract to perform legal services to OLD, Mr. Schneider received approximately $72,530 for notarizing the public works contracts of OLD. The fact that Mr. Schneider was performing the notarial services and receiving the fee pursuant to the notary fee schedule in the OLD public works project bid manual is irrelevant to the fact that Mr. Schneider’s actions constitute a violation of the Code of Ethics.

The Louisiana Board of Ethics is authorized to impose penalties of up to $10,000 for each of the above violations of the Code. In this particular situation, given the facts outlined above, along with the fact that Mr. Emile Schneider was performing the compensated services on behalf of OLD and that Mr. Schneider did not intentionally violate any provision of the Code, it is the conclusion of the Board that a fine of $5,000 be imposed upon Emile Schneider for violating Section 1111C(1)(a) of the Code, of which $4,000 will be suspended, pending Mr. Schneider’s future compliance with the operational provisions of the Code and Mr. Schneider’s refraining from performing notarial services for OLD while he has a contract with OLD to provide legal services. Also, it is the conclusion of the Board that a fine of $5,000 be imposed upon Emile Schneider for violating Section 1111C(2)(d) of the Code, of which $4,000 will be suspended, pending Mr. Schneider’s future compliance with the operational provisions of the Code and Mr. Schneider’s refraining from performing notarial services for OLD while he has a contract with OLD to provide legal services.
In a broader sense, it is manifest to the Board that while this practice may have been long standing and tolerated, if not orchestrated by OLD, it nevertheless represents a violation of applicable provisions of the Code. The Board encourages OLD to take such remedial action as may be necessary under the circumstances to insure this event does not reoccur.
IV.
DECREE AND ORDER
IT IS DECREED that Emile Schneider violated Section 1111C(1)(a) of the Code by receiving income as the notary for OLD at a time when he had a contract with OLD to perform legal services.

IT IS ORDERED that a fine of $5,000 is hereby imposed upon Emile Schneider, of which $4,000 will be suspended, conditioned upon Mr. Schneider’s abiding by the provisions of the Ethics Code in the future and his refraining from performing notarial services for OLD while he has a contract with OLD to provide legal services.
IT IS FURTHER DECREED that Emile Schneider violated Section 1111C(2)(d) of the Code by receiving income as the notary for OLD at a time when he had a contractual relationship with OLD to perform legal services.
IT IS FURTHER ORDERED a fine of $5,000 is hereby imposed upon Emile Schneider, of which $4,000 will be suspended, conditioned upon Mr. Schneider’s abiding by the provisions of the Ethics Code in the future and his refraining from performing notarial services for OLD while he has a contract with OLD to provide legal services.
BY ORDER OF THE BOARD, this 27th day of July , 1998.

s/Robert L. Roland s/Harry Blumenthal, Jr.
Robert L. Roland, Chairman Harry Blumenthal, Jr., Vice-Chairman


s/Robert P. Bareikis s/Carole Cotton Winn
Dr. Robert P. Bareikis Rev. Carole Cotton Winn


s/E.L. Guidry, Jr. s/Virgil Orr
Judge E.L. Guidry, Jr. Dr. Virgil Orr


Absent and did not participate s/T.O. Perry, Jr.
Justice Revius O. Ortique, Jr. T.O. Perry, Jr.


s/Ronald L. Sawyer Absent and did not participate.
Ronald L. Sawyer Nathan J. Thornton, Jr.


s/Edwin O. Ware
Edwin O. Ware



CONSENT

The undersigned (a) stipulates to the facts found by the Board; (b) waives the procedural requirements contained in Section 1141 of the Code; (c) admits that his conduct, as described above, violated Sections 1111C(1)(a) and 1111C(2)(d) of the Code; (d) consents to the publication of this opinion; (e) agrees to comply with the conditions and orders set forth in this opinion; and, (f) agrees not to seek judicial review of the findings and actions taken in this opinion.


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