Hays v. Wood ( 1979 )

MOSK, J.

I concur in the judgment but I cannot subscribe to the majority’s stilted equal protection analysis.

In my concurring opinion in Hawkins v. Superior Court (1978) 22 Cal.3d 584, 595 [150 Cal.Rptr. 435, 586 P.2d 916], I described the two-tier system of reviewing equal protection claims as a rigid and artificial structure. The vice of the binary theory, I pointed out, is that it applies either a standard that is virtually always met (the rational relationship test) or one that is almost never satisfied (the strict scrutiny test). (Id. at p. 598.) Once the test is selected, the result of its application is foreordained—a process that Justice Marshall has justly condemned as “outdated and intellectually disingenuous” (Beal v. Doe (1977) 432 U.S. 438, 457 [53 L.Ed.2d 464, 479, 97 S.Ct. 2366] (dis. opn.)).

There are additional developments not discussed in Hawkins. (See a study of Justice Stevens’ critical views of the two-tier test in Comment, The Emerging Constitutional Jurisprudence of Justice Stevens (1978) 46 U.Chi.L.Rev. 155, 206-217.) Justice Brennan writing for himself, Justices White, Marshall and Blackmun, declared that the equal protection problem he saw in University of California Regents v. Bakke (1978) 438 U.S. 265, 324 [57 L.Ed.2d 750, 792, 98 S.Ct. 2733], could not be measured by either the strict scrutiny or the rational relationship test and thus he applied an intermediate test. Now by current count no less than five Supreme Court justices have on appropriate occasion found that cases do “not fit neatly into our prior analytic framework.” (Id., at p. 358 [57 L.Ed.2d at p. 814]). By some analyses the number is higher.¹ The Idaho Supreme Court, in a thoughtful opinion by Justice Shepard, also added an intermediate dimension to equal protection. (Jones v. State Board of Medicine (1976) 97 Idaho 859 [555 P.2d 399, 410], cert. den. 431 U.S. 914 [53 L.Ed.2d 223, 97 S.Ct. 2173].)

In its initial stages, this case was a textbook illustration of the result-orientation of the two-tier test of equal protection. The trial court employed a “rational basis” standard and ruled the legislation valid. The Court of Appeal measured the discriminatory legislation against the “strict scrutiny” standard and, finding no compelling state interest to justify the disparity between requirements imposed on attorneys and brokers and those imposed on all other occupations, invalidated the statute. My Hawkins prophecy—select the test, select the result—was once again vindicated.

Now my colleagues revert to the rational relationship test and, curiously, find every conceivable justification for the act to be wholly irrational. That is a heavy indictment of a legislative measure adopted by the people of the state and found to be valid by an able trial court. That its underlying bases are at least arguable should immunize the measure from rational relationship attack. “It is not within the competency of the courts to arbitrate in such contrariety.” (Rast v. Van Deman & Lewis (1916) 240 U.S. 342, 357 [60 L.Ed. 679, 687, 36 S.Ct. 370].)

My Hawkins concurrence proposed that we refine the current simplistic approach by applying a third, or intermediate, tier of equal protection analysis. As explained by Professor Tribe, “intermediate scrutiny has been triggered if important, though not necessarily ‘fundamental’ or ‘preferred,’ interests are at stake” or “if sensitive, although not necessarily suspect, criteria of classification are employed.” (Tribe, American Constitutional Law (1978) pp. 1089-1090.)

Application of this intermediate level of scrutiny was urged because of my belief that “This wide chasm between levels of review is entirely unjustified, given the broad spectrum of rights and classifications that demand equal protection analysis.” (Hawkins, at p. 602 of 22 Cal.3d.) In light of this spectrum, it is apparent that coherent judicial decisions are most effectively promoted by a focus on “such factors as the importance of the rights involved, the extent to which the classification at issue interfered with their exercise, and the significance of the state interests advanced in support of the classification.” (Id. at p. 599.) Such a focus permits courts to discuss candidly the considerations that ultimately determine whether a statutory scheme will withstand equal protection challenge; it thereby avoids the use of artificial labels that may mask the true justifications for judicial decisions. (Id. at p. 598.)

Analysis of the interests at stake in this case illustrates the inadequacy of our rigid two-tiered approach to the equal protection clause. The Court of Appeal properly held attorneys and brokers are not a “suspect class” and for that reason do not trigger the strict scrutiny test. But in examining “the importance of the rights involved,” it ruled that the disclosure provisions affect the fundamental right of privacy and the right to seek office, relying on City of Carmel-by-the-Sea v. Young (1970) 2 Cal.3d 259 [85 Cal.Rptr. 1, 466 P.2d 225, 37 A.L.R.3d 1313], and for that reason it applied the typically fatal strict scrutiny standard. By contrast, the majority here sidestep a strict scrutiny analysis and descend, as if there were no other alternative, to what Justice Marshall recently referred to as “the glancing oversight of the rational-basis test.” (Vance v. Bradley (1979) 440 U.S. 93, 115 [59 L.Ed.2d 171, 187, 99 S.Ct. 939] (dis. opn.).)

I doubt that rights so fundamental as to require strict scrutiny are involved here. No serious contention is made that public officials should not be required to report details of income that exceeds $10,000. For such sums, all persons are treated equally. The objection is to singling out lawyers and brokers² and as to them alone requiring disclosure of income over $1,000. Thus the vice of the unequal statutory command is not qualitative but quantitative discrimination, and thus lacks the fundamental nature to compel strict scrutiny. It does not follow, however, that the rights at stake should ipse dixit be declared so unimportant that they are subject merely to the minimal judicial scrutiny of the rational basis test, even if they are found by the present majority to be irrationally affected.

We should determine the constitutionality of the statutory classification in this case by considering the rights involved and the classification’s impairment thereof in light of the state interests advanced in its support. The analysis leads to the conclusion that the scheme cannot withstand equal protection attack.

The first right—call it privilege or confidentiality—is cavalierly brushed aside by the majority. Yet it cannot be gainsaid that confidentiality is the bedrock upon which the attorney-client relationship rests. Confidentiality is of vital significance to the client who entrusts protection of his liberty, his fortune and his security to the counselor whom he consults. Confidentiality is of equal consequence in maintaining the professional stature and competence of the attorney whose advice has been sought. Any statute which invades this essential characteristic of a profession is assuredly of significant importance to the individuals in the class.

Justice Story said it all a century and a half ago when he wrote, “Notwithstanding the sneers of ignorance, and the gibes of wit, no men are so constantly called upon in their practice to exemplify the duties of good faith, incorruptible virtue, and chivalric honor, as lawyers. To them is often entrusted the peace and repose, as well as the property, of whole families; and the slightest departure from professional secrecy, or professional integrity, might involve their clients in ruin.” (Story, Story’s Miscellaneous Writings (1835) p. 452.)

But, argues the Fair Political Practices Commission, an administrative procedure has been adopted to permit nondisclosure of the name of a private client of a public official in certain cases of privilege. (Cal. Admin. Code, tit. 2, § 18740.) It is a cumbersome, time-consuming process, involving a written presentation of specific facts by the public official, a ruling by the executive director of the commission, a review by the commission with notice to the Attorney General and the local district attorney and city attorney, followed by a second ruling in the form of a written commission opinion. The short answer is that nothing in the statute gives to an administrative agency any authority to circumscribe or limit in any manner the precise provisions of the act. Indeed, the statute emphatically provides that the statement of income shall contain the detailed material. Thus it is not surprising that the commission cites no case law to support its unique theory that an invalid statute can be rendered valid by the later promulgation of an administrative agency regulation.

The right of members of the class to seek and hold public office must also be considered. While under the act attorneys are not barred from holding office, they clearly suffer significant detriment. Although it may be argued that the discrimination is merely an indirect, psychological restraint or deterrent to the exercise of protected political and associational interests, I cannot agree that such a burden, even if subtle, is an inconsequential encumbrance on rights of citizenship.

In considering the extent to which the classification scheme impairs these interests, one must initially observe that the statute requires lawyers, like all other persons similarly situated, to identify sources of personal income. It discriminates against lawyers, however, in that the amount triggering the reporting requirement for them is lower than for all other occupations save one. This discriminatory provision results in a greater relative infringement of lawyers’ rights, since they must disclose all sources of income above $1,000 rather than only those above $10,000. While it is difficult to measure the impairment of attorneys’ rights in absolute terms, in my view it is clear that the asserted state interest does not justify this relative impairment when considered in light of the importance of the rights at stake.

The purpose of the present statute is to obtain disclosure of financial interests material to the public decision-making process. To accomplish that purpose the act requires revelation not merely of the source of the attorney’s income—his law practice—but the identity of his clients. This is justified, according to the commission, because the clients “present the greatest potential source of conflicting obligations.”

If we assume arguendo that the fact a client pays a fee of $1,000 to a lawyer, who serves part-time on a local city council, creates a potential conflict of interest, can it be said that any less potential conflict is created by the patient who pays a $1,000 medical bill to his physician who also serves on the council, by the businessman who pays a $1,000 fee to his accountant, or by the builder who pays $1,000 to an architect or engineer for services rendered? If the physician-patient privilege is protected for fees under $10,000, can any justification be advanced for breaching the attorney-client privilege where an identical fee is involved?³ I suggest no such state interest can be advanced, unless we are willing to indulge in the assumption that attorneys are more venal, more prone to divided loyalty, more oblivious to their public responsibilities or more likely to succumb to unethical financial practices, than physicians, accountants, architects, or engineers. Indeed, the commission implies this assumption when it argues in effect that a client’s business or professional relationship with the attorney may give rise to opportunities for divided loyalties and a resulting potential for improper influence over the conduct of public affairs. No persuasive justification, however, has been advanced to so denigrate the legal profession.

The $1,000 threshold reporting requirement imposed upon lawyers is thus underinclusive, in that it omits other professions similarly situated and equally likely to exercise influence upon the processes of government. By the same token the statute is overinclusive, in that it imposes a more onerous quantitative reporting obligation on lawyers than on all other public officials who have private sources of income.

The legal profession has been subject to a withering barrage of irrational criticism in recent years from a wide spectrum of commentators. Because of this demagogic tendency to cast the lawyer in the role of the villain responsible for most of society’s ills, the authors of the instant statute understandably yielded to the temptation to single out lawyers for discriminatory treatment. Although this result may be currently acceptable among those unfamiliar with the monumental contributions of lawyers to the development of our republic, such political or emotional motivation does not insulate this discriminatory statute from constitutional invalidation.

I do not find that the state’s meager interest in support of the sensitive classification herein outweighs the important right of petitioner and those similarly situated to be free from discriminatory treatment. Accordingly, the section must be invalidated insofar as it provides a lower threshold reporting requirement for lawyers and brokers.

1 The holding of Chief Justice Burger in Reed v. Reed (1971) 404 U.S. 71 [30 L.Ed.2d 225, 92 S.Ct. 251], has been viewed as an example of intensified scrutiny of legislative means and a concomitant insistence that such means “must substantially further legislative ends.” (Gunther, The Supreme Court—Foreword (1972) 86 Harv.L. Rev. 1, 20-34.) And in Trimble v. Gordon (1977) 430 U.S. 762, 767 [52 L.Ed.2d 31, 37, 97 S.Ct. 1459], Justice Powell adhered to the position that illegitimacy falls in a “‘realm of less than strictest scrutiny’” but the scrutiny applied “‘is not a toothless one.’”

2 Brokers are curiously undefined and their inclusion is mystifying. Does the statute encompass all brokers—real estate brokers, stock brokers, yacht brokers, pawnbrokers, insurance brokers, exchange brokers, et al.—or merely the most visible of the species? Since no brokers have appeared in this proceeding, we need not reach the question.

3 It cannot be doubted that the attorney-client privilege is involved in the mere payment of a legal fee, which may carry with it untoward implications. Certainly the town’s leading businessman who consults the town’s leading criminal lawyer and pays him a retainer expects the fact of the consultation and representation will not be disclosed. Under the statute confidentiality vanishes if the lawyer serves on the city council. Yet if the businessman consults a psychiatrist who also serves on the city council and pays him less than $10,000, the fact of the visits remains private. To a large segment of society, the implications of the two consultations are equally stigmatic.