April 9, 1997


FACTS:


You are a state official. You also are an attorney in private
practice. In your law practice, you represent individuals who have
been injured in the course of their employment. Your clients, who
are not state employees, seek to obtain workers' compensation
payments from their employers' insurers or from their employers.
You represent these individuals in adjudicatory proceedings before
the Division of Industrial Accidents ("DIA"). You state that,
while you remain an elected state official, you will not represent
injured state employees before the DIA.

The Commonwealth's Workers' Compensation Statute, G.L. c. 152,
s. 1-86, among other things, permits covered employees who have
sustained an injury arising out of and during the course of their
employment to collect monthly payments for weekly wage loss, as
well as medical care and vocational rehabilitation. See 29 L.
Nason & R. Wall
, Massachusetts Practice, s. 1 (1995 Supplement).
In exchange for waiving their rights to sue their employers in tort
for work-related injuries, employees receive the possibility of
obtaining compensation for a loss of earning capacity caused by a
work-related injury, "regardless of the fault of their employers or
the foreseeability of harm." Murphy v. Commissioner of the
Division of Industrial Accidents
, 415 Mass. 218, 222 (1993). The
workers' compensation system is a type of wage loss protection,
"based on the legislative judgment that `human loss directly
arising out of commercial and industrial enterprises' is part of
the operating cost of a business." Id.; see also Neff v.
Commissioner of the Dep't of Industrial Accidents
, 421 Mass. 70, 75
(1995); Ahmed's Case, 278 Mass. 180, 183 (1932).

Within seven days of receipt of a notice of an injury alleged
to have arisen out of and in the course of employment and which
incapacitates a worker from earning full wages for a period of five
or more calendar days, an employer must notify its insurer, the
injured employee and the DIA. G.L. c. 152, s. 6. Within fourteen
days of receipt of a report of injury, the insurer must commence
payment to the injured worker or notify the DIA, the employee and
the employer that it refuses to commence payment. G.L. c. 152, s.
7. After an insurer's denial of benefits, an injured worker may
file a claim for benefits with the DIA. Similarly, an insurer may
file a complaint for modification or discontinuance of benefits.
G.L. c. 152, s. 10.

When a claim or complaint has been received by the DIA there
is an initial informal conciliatory proceeding before a DIA
conciliator who attempts to resolve the dispute. G.L. c. 152, s.
10; see also, Neff, 421 Mass. at 74. If conciliation is not
successful, the parties may elect to submit the case to binding
arbitration before an independent arbitrator. G.L. c. 152, s. 10,
10B. If arbitration is not sought, the conciliator refers the case
to the Industrial Accident Board. G.L. c. 152, s. 10, 10A; see
also, Murphy
, 415 Mass. at 223. When the

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contested case is referred to the Board, it is assigned to an administrative
law judge who initially schedules a conference. Id. At the conference the
parties must identify the issues in dispute, summarize anticipated testimony,
and may present oral arguments and documentary evidence. Id. The administrative law judge, within seven days after the conference, must issue
a written order stating whether and to what extent relief should be granted.
G.L. c. 152, s. 10A (2); Murphy, 415 Mass. at 224. A party aggrieved by a
conference order may seek an adjudicatory hearing of his claim.
Based on the evidence presented at the hearing, the administrative
law judge renders a decision. G.L. c. 152, s. 11. Any party
aggrieved by the hearing decision may first appeal to a three
member Industrial Accident Review Board and finally to the Appeals
Court. G.L. c. 152, s. 11(C), 12. To enforce an order of the
administrative law judge, a party in interest must initiate an
action in the Superior Court. G.L. c. 152, s. 12. If an insurer
fails to make all compensation payments due to an injured employee
under a DIA order or decision, the insurer will be liable for
penalties, payable to the employee. G.L. c. 152, s. 8.

You characterize the DIA as a "forum" to hear workers'
compensation disputes between two private parties - the injured
worker and the private compensation insurance carrier, and you draw
an analogy between the function of the DIA in hearing a claim and
a court which litigates disputes between private parties.


QUESTION:


While you hold a position as a state official may you, in your
private law practice, represent clients, who are not state
employees, in workers' compensation proceedings before the Division
of Industrial Accidents?


ANSWER:


Under G.L. c. 268A, s. 4, you may represent a client, who is
not a state employee, in workers' compensation proceedings against
an insurer, provided that the Commonwealth does not become a party
to the proceedings and provided that the outcome of the proceedings
does not affect any direct and substantial legal, pecuniary, or
property rights or liabilities of the Commonwealth.


DISCUSSION:


G.L. c. 268A, s. 4(a) provides that "no state employee shall
otherwise than as provided by law for the proper discharge of
official duties, directly or indirectly receive or request
compensation from anyone other than the Commonwealth or a state
agency, in relation to any particular matter in which the
Commonwealth or a state agency is a party or has a direct and
substantial interest." Further, G.L. c. 268A, s. 4(c) provides
that "no state employee shall, otherwise than in the proper
discharge of his official duties, act as agent or attorney for
anyone other than the Commonwealth or a state agency for
prosecuting any claim against the Commonwealth or a state agency,
or as agent or attorney for anyone in connection with any
particular matter in which the Commonwealth or a state agency is a
party or has a direct and substantial interest." Section 4 is
based on the principle that "public officials should not in general
be permitted to step out of their official roles to assist private
entities or persons in their dealings with government." Perkins,
The New Federal Conflict Law, 76 Harv. L. Rev. 1113, 1120 (1963).
In discussing s. 17(a), the municipal counterpart to s. 4(a), we
have stated

[The section] seeks to preclude circumstances leading to
a conflict of loyalties by a public employee. As such,
it does not require a showing of any attempt to
influence--by action or inaction--official decisions.
What is required is merely a showing of an economic
benefit received by the employee for services rendered or
to be rendered to the private interests when his sole
loyalty should be to the public interest. EC-COI-92-36.
See also, Commonwealth v. Canon
, 373 Mass. 494, 504
(1977).

As a state official,[1] you are a state employee for purposes
of the conflict of interest statute.[2] Additionally, proceedings
to determine workers' compensation benefits are particular
matters.[3] You recognize that G.L. c. 268A, s. 4 will prohibit
you from representing a state employee who has been injured during
the course of her state employment because the Attorney General
will be a party to the proceedings and the Commonwealth will be
required to pay any benefits that may be awarded during the
proceeding. However, you contend that, in a workers' compensation
proceeding in which the Commonwealth is not a party, the
Commonwealth does not have a direct and substantial interest in the
proceeding between a claimant employed in private industry and a
compensation insurer.[4] You request that this Commission re-
consider its opinion in EC-COI-91-10, where the Ethics Commission
concluded that the Commonwealth has a direct and substantial
interest in all workers' compensation matters.

Page 673

In EC-COI-91-10, the Ethics Commission considered whether a
former manager of the DIA was prohibited in his private law
practice from representing private sector employees and private
sector employers on matters before the DIA in which he may have
participated or over which he had official responsibility in the
two years before he left state service. We concluded that the
Commonwealth has a direct and substantial interest in all workers'
compensation matters based on "the Department's specific
institutional interest in the enforcement of the workers'
compensation law, and on the broad interest that the Commonwealth
has in workers' compensation matters generally." Therefore, we
determined that the former DIA employee was restricted in his
private law practice from representing clients in all matters
before the DIA. In reaching our decision, we relied on the
regulatory and administrative role played by the Commissioner of
Insurance and the DIA within the system of workers' compensation.

Subsequently, in EC-COI-93-5, in a discussion regarding s. 4,
the Commission modified its position concerning whether extensive
regulation of a matter, without more, was sufficient to find that
the Commonwealth had a direct and substantial interest in the
matter, stating "regulatory authority and oversight of an activity
alone are not sufficient to find a particular matter in which the
Commonwealth has a direct and substantial interest. Rather we
must determine whether the regulated activity itself involves a
"particular matter"... in which the employee is likely to become
involved...is a particular matter in which the Commonwealth has a
direct and substantial interest." In light of this discussion in
EC-COI-93-5 and in light of the fact that the Commission's
decision, in EC-COI-91-10, focused on the general institutional and
regulatory interests of DIA, rather than on the particular
proceeding at issue, we will re-consider our prior EC-COI-91-10
decision in order to answer the specific question of whether a
proceeding before the DIA to consider a claim for benefits brought
by a private sector employee against a private compensation insurer
is a particular matter of direct and substantial interest to the
Commonwealth.

When construing statutory language, we begin with the plain
meaning of the statute. Int'l Organization of Masters, etc. v.
Woods Hole, Martha's Vineyard & Nantucket Steamship Authority
, 292
Mass. 811, 813 (1984); O'Brien v. Director of DES, 393 Mass. 482,
487-88 (1984). The relevant dictionary definition of "interest"
from Webster's Third New International Dictionary (unabridged) is
"right, title or legal share in something; something in which one
has a share of ownership or control." In legal parlance, the term
"interest" is "the most general term that can be employed to denote
a right, claim, title, or legal share in something." Black's Law
Dictionary. Within the context of G.L. c. 268A, s. 4, interests of
the Commonwealth would include proceedings affecting the
Commonwealth's legal rights or liabilities, pecuniary interests,
property interests or proceedings where the Commonwealth would have
a stake in the proceedings. See EC-COI-91-10 (Commonwealth has
interest if outcome would require expenditure of public funds,
exposure to liability, implicate government's rights and
responsibilities); EC-COI-88-6 (Town has direct and substantial
interest in Ethics Commission proceedings against Town official as
outcome may subject town to liability); EC-COI-80-23 (Commonwealth,
as a property abutter, has direct and substantial interest in a
zoning change).

By using the modifying phrase "direct and substantial", the
Legislature intended that the Commonwealth's interest in the
proceedings or the outcome be significant and direct to the
Commonwealth itself as an institution. As the Supreme Judicial
Court noted, in deciding that a city does not have a direct and
substantial interest in a criminal prosecution for a crime
committed in the city, any interest of the city in the prosecution
of a defendant for a violation of state law was not separate and
distinct from the interests of the citizenry as a whole and was
therefore not sufficiently direct to meet the standards under G.L.
c. 268A. Commonwealth v. Mello, 11 Mass. App. Ct. 70, 73 (1980);
see also Burton v. United States, 202 U.S. 344, 391-396 (1906)
(direct interest of government must be more than government's
interest as "parens patriae" or interest government shares with all
citizens).

Under G.L. c. 268A, s. 4, within the context of litigation
matters, the Commission has found that the Commonwealth is a party
to and has a direct and substantial interest in all criminal
matters and in all civil matters where the Commonwealth is named a
party. See EC-COI-89-31; 88-1; 82-31. Full time state employees
who are also attorneys may not represent private clients in
particular matters which "bring the financial interest of the state
into play" and in regulatory or adjudicatory proceedings in which
the state is a party. EC-COI-82-33.

In comparison, the Commission has found that, although
lawsuits between private parties pending in the Commonwealth's
courts are particular matters, they are not generally of direct and
substantial interest to the Commonwealth, absent a specific showing
that the

Page 674

Commonwealth would be directly affected. See EC-COI-88-1;
80-54
. For example, in EC-COI-80-16, a Commonwealth attorney also
served as a conservator in his private capacity. As conservator he
was required to file a probate court accounting with the Department
of Mental Health. The Commission stated that "while the
Commonwealth has an interest in protecting legally incapacitated or
incompetent persons and their property, that interest would be
direct and substantial only where the Commonwealth is owed money."
Similarly, in EC-COI-83-67, a consulting attorney to a city was
asked to assist, in his private law practice, with the preparation
of a brief in a lawsuit against another Massachusetts town.
Although the city was not a party to the litigation, it was likely
to file an amicus curiae brief because the potential decision in
the suit, as precedent, could affect future cases brought against
the city. The Commission determined that the city's interests in
this litigation were not sufficiently direct because the outcome in
the case would not have a direct effect on the city, rather, any
precedential effect was indirect and only a potentiality.[5] See
also, EC-COI-83-120 (filing of amicus curiae brief by Secretary of
State, without more, does not give Secretary's Office a direct and
substantial interest in outcome).

After considering the facts of your situation and our
precedent, we are persuaded that the Commonwealth's interests in a
benefits claim under G.L. c. 152, made by a private claimant
against a private insurer or employer before the DIA, are not
sufficiently direct and substantial to implicate G.L. c. 268A, s.
4.[6] In such a proceeding before the DIA, the real parties in
interest are the injured worker, the insurer and the employer. The
claimant's rights and the employer's and insurer's obligations
arise from the private employment relationship, and not from any
benefits awarded by the government, such as social security
disability or other general welfare assistance benefits. As one
well-known commentator has described the rights and obligations
under G.L. c. 152, "although the rights of employees and the duties
of employers and insurers are created by the compensation act, they
are essentially private rights, not sounding in contract or tort,
but growing from the status of the parties in the employment
relation." 29 L. Locke, Massachusetts Practice, s. 10.

Generally, the Commonwealth does not have a stake in its
determination whether or not a claimant receives benefits. The
role of the Commonwealth in a benefits dispute is to provide
an objective and impartial forum and to make a determination whether
the requirements in the statute have been met for receipt of
benefits. 29 L. Nason & R. Wall, Massachusetts Practice, s. 1.0
(1995 Supplement) (Division of Dispute Resolution at the DIA serves
as "quasi-judicial tribunal for adjudicating contested claims").
We do not consider that the resources spent by the DIA to hear a
benefits claim are sufficient to create a direct and substantial
interest by the Commonwealth. We have never found, in the
analogous situation of civil litigation, that the judicial
resources expended in deciding a lawsuit constitute a direct and
substantial interest on the part of the Commonwealth. Nor do we
find that the Commonwealth's interest is sufficiently direct and
substantial because, if benefits are denied, an injured worker may
potentially require some government assistance benefit.

Thus, under G.L. c. 268A, s. 4, you may, while you continue to
be a state employee, privately represent parties in benefit claims
before the DIA because we conclude that such proceedings are not of
direct and substantial interest to the Commonwealth. Our
conclusion in this case is limited to the situation where a private
claimant and a private insurer (or employer) have a benefits
dispute before the DIA. If the Commonwealth, through the Attorney
General or other state agency counsel, enters the dispute at any
stage in the proceeding, including a future appeal, you will be
prohibited from continuing your legal representation because the
Commonwealth would become a party to the action, and therefore, s.
4 would become implicated. Furthermore, if your proposed legal
representation involves a challenge to the DIA's procedures or
regulations, you may not undertake this representation because a
state agency has a direct and substantial interest in its
procedures and rules.[7] See e.g., EC-COI-87-34; 81-34. Also, if
the benefits dispute involves the Workers' Compensation Trust Fund,
G.L. c. 152, s. 65, such as the case of an uninsured private
employer, you may not undertake that representation because any
payment will be made from a Commonwealth fund, and the Commonwealth
will be a party in interest. See McLean's Case, 93 N.E.2d 233, 235
(1950). For example, if before or during your representation of a
client, it becomes apparent that the employer is uninsured or that
the insurer will be unable to pay any claim, you must decline
representation or withdraw because the Workers' Compensation Trust
Fund will become a party.

---------------

[1] (text of footnote deleted)

Page 675

[2] "State employee," a person performing services for or
holding an office, position, employment, or membership in a state
agency, whether by election, appointment, contract of hire or
engagement, whether serving with or without compensation, on a
full, regular, part-time, intermittent or consultant basis,
including members of the general court and executive council ...
G.L. c. 268A, s. 1(q).

[3] "Particular matter," any judicial or other proceeding,
application, submission, request for a ruling or other
determination, contract, claim, controversy, charge, accusation,
arrest, decision, determination, finding, but excluding enactment
of general legislation by the general court and petitions of
cities, towns, counties and districts for special laws related to
their governmental organizations, powers, duties, finances and
property. G.L. c. 268A, s. 1(k).

[4] Briefly, in support of your contentions, you argue that
the DIA is a "forum" similar to the courts in which to decide the
rights of private parties, and the agency has no stake in the
outcome. You urge us to consider a proceeding for benefits before
the DIA to be analogous to a civil litigation trial between two
private parties. The Commission has, in prior precedent, found that
the Commonwealth does not have a direct and substantial interest in
such litigation. See EC-COI-80-54. Moreover, you argue that state
officials should be accorded the same treatment under the conflict
statute as legislators to whom s. 4 applies less restrictively.
Under G.L c. 268A, s. 4, para. 5, legislators may represent private
parties for compensation if the proceeding is "quasi-judicial"
which is defined as: (l) the action of the state agency is
adjudicatory in nature; and (2) the action of the state agency is
appealable to the courts; and (3) both sides are entitled to
representation by counsel and such counsel is neither the attorney
general nor the counsel for the state agency conducting the
proceeding." The Ethics Commission has found that workers'
compensation proceedings meet the definition of "quasi-judicial"
within the meaning of s. 4 and has permitted legislators to
represent private parties before the DIA. EC-COI-85-82. Finally,
you argue that your clients are not "doing business with the
Commonwealth" when they seek workers' compensation benefits and
most of your clients, when they seek your assistance, are not aware
of your public position.

[5] According to the Commission, "the decision in this case
will not have a direct effect on the city or any cases in which it
is involved. Like any other court case to which it is not a party
but which involves a law applicable to the city, the city has a
(sic) indirect interest in the resolution of the case. However,
such a potential effect does not give the city a direct and
substantial interest for the purposes of s. 17. For example, the
city would not have a direct and substantial interest in every
United States Supreme Court case concerning police search and
seizure procedures, despite the impact such a case may have on the
City Police Department."

[6] Our conclusion in this opinion modifies the conclusion
reached in EC-COI-91-10, to the extent that it applies to a
workers' compensation proceeding between an employee who is not a
state employee and a private insurer or self-insured employer. Our
opinion today does not re-consider the conclusion in EC-COI-91-10
that the Commonwealth has a direct and substantial interest in
other types of DIA matters. See, e.g., G.L. c. 152, s. 25; s.
25(c).

[7] The examples given are representative only and are not
intended to be all-inclusive. The Commission's Legal Division is
available for further advice if you have questions about specific
situations.


Page 676

End of Decision