Summary
In Greene v. Grievance Comm., 54 N.Y.2d 118, 444 N.Y.S.2d 883, 429 N.E.2d 390 (1981), cert. denied, 455 U.S. 1035, 102 S.Ct. 1738, 72 L.Ed.2d 153 (1982), the Court of Appeals of New York, while permitting direct mail solicitation generally, upheld a prohibition of direct mail solicitation to real estate brokers seeking to have such brokers refer their clients to the soliciting lawyer for real estate closings and other legal services.
Summary of this case from Spencer v. Honorable Justices of Supreme Ct. of Pa.Opinion
Argued September 8, 1981
Decided October 29, 1981
Appeal from the Appellate Division of the Supreme Court in the Second Judicial Department.
JEREMIAH S. GUTMAN for appellant. Richard E. Grayson for respondent.
Richard G. Collins for Four Anonymous Attorneys, amici curiae.
To the extent that section 479 of the Judiciary Law and DR2-103 (A) of the Code of Professional Responsibility proscribe advertising of attorneys' services by direct mail addressed to real estate brokers, those provisions regulate the manner rather than the content of commercial speech and, the regulations being reasonable and the State having a substantial interest in the protection of clients against potential conflict of interest, are constitutional regulations of such speech. Thus, we answer so much of the question left open in Matter of Koffler ( 51 N.Y.2d 140, 145, cert den 450 U.S. 1026) concerning third-person mailings as relates to mailings addressed to real estate brokers by holding regulations proscribing such mailings constitutional. The order of the Appellate Division should, therefore, be affirmed, without costs.
Respondent Greene was admitted to the practice of law in New York in 1960. He admitted in his answer to the disciplinary proceeding brought against him by the Grievance Committee for the Ninth Judicial District that "in or about August, 1978 and October, 1978, Respondent caused to be prepared and caused to be mailed approximately one thousand direct mail fliers to real estate brokers in Westchester County and portions of Putnam County" and concedes in his brief before us that he was "hoping by his mailings to move the recipients to remember his availability should the occasion arise when a buyer or seller sought a reference to an attorney in a real estate transaction." The flier read in pertinent part:
"ALAN I. GREENE offers your client full legal representation on any and all property transactions for just $335. Legal coverage begins with contract and continues through to closing. With 18 years experience, the office of ALAN I. GREENE is fully prepared to expedite all closings and offer competent advice to the buyer and/or seller. Your real estate office will be afforded our full cooperation. With just two hours notice, a contract and all legal documents can be prepared.
"By recommending the services of ALAN I. GREENE, you, the realtor, will save your client time and money — one of the main reasons they called on you!"
Testifying before the Referee, respondent stated that he got no business from the brokers to whom the flier was sent, indeed, that he had gotten a negative response from them.
The Referee, treating the issue as one of law to be decided on the basis of the undisputed facts, found respondent in violation of section 479 of the Judiciary Law and DR 2-103(A) of the Code of Professional Responsibility, but noted in his report that the fliers had been sent prior to the Appellate Division's decision in Matter of Koffler ( 70 A.D.2d 252) and were mailed in reliance on Bates v State Bar of Ariz. ( 433 U.S. 350), and that in Koffler the Appellate Division had imposed no sanction.
Petitioner moved for confirmation of the Referee's report and the disciplining of respondent. Respondent likewise moved "for an order confirming and adopting the report" but asked that he, as had been the attorneys in Koffler, be exonerated. The Appellate Division, noting our reversal in Koffler and reservation of the third-party mailing question, found that the fliers "directly solicited the real estate brokers to refer individuals to the respondent to use the respondent's legal services in connection with the sale or purchase of real property" as alleged in the petition, and held such a mailing proscribed and not constitutionally protected, but imposed no sanction. The appeal is before us on constitutional grounds (CPLR 5601, subd [b], par 1).
As we noted in Koffler (51 N.Y.2d, at p 143, n 1), the absence of sanction does not affect respondent's right of appeal from the confirmed finding of a violation. Petitioner argues, however, that the appeal should be dismissed as moot because respondent was on April 9, 1981 suspended from the practice of law, on the basis of incapacity, and for lack of aggrievement in view of respondent's motion to confirm. Respondent suggests that the record is not appropriate for decision, that the State interest sought to be protected is not sufficiently defined, and that his mailing is not in-person solicitation such as was condemned by the Supreme Court in Ohralik v Ohio State Bar Assn. ( 436 U.S. 447). In an amici brief filed on behalf of four attorneys against whom similar charges are pending in the Third Department, it is argued that what is regulated in this instance is not manner of distribution but content. We affirm, though upon somewhat different reasoning than that of the Appellate Division.
I
The arguments for dismissal require little comment. For the same reason that the absence of sanction does not foreclose appeal from the finding of violation, it cannot be said that respondent was not aggrieved by the Appellate Division's order. Though his motion paper could have been more carefully worded, it clearly asked for "exoneration", which is inconsistent with the legal conclusion suggested by the Referee. The reference was to hear and report and the facts being undisputed, we construe the motion paper to have requested confirmation of the factual conclusions of the Referee, but not of his conclusion of law.
Nor does respondent's suspension for incapacity after the Appellate Division decision moot the question, for that suspension, though indefinite in time, was made because of respondent's inability to participate in a formal disciplinary hearing. Though no sanction has been imposed in the instant proceeding, the finding of violation is a professional stigma that may be considered in determining the discipline to be imposed after formal hearing on the new charges should respondent recover from his incapacity and the result of such a hearing be against him. Even if that were not so, the pendency of four other similar proceedings against amici suggests that the controversy is of a recurring character and should be considered by us rather than dismissed for mootness.
II
The proscriptions, the constitutionality of which is in issue, are found in section 479 of the Judiciary Law and DR2-103(A) of the Code of Professional Responsibility. The former reads: "It shall be unlawful for any person or his agent, employee or any person acting on his behalf, to solicit or procure through solicitation either directly or indirectly legal business, or to solicit or procure through solicitation a retainer, written or oral, or any agreement authorizing an attorney to perform or render legal services, or to make it a business so to solicit or procure such business, retainers or agreements". The latter, as amended on April 29, 1978, provides: "A lawyer shall not solicit employment as a private practitioner of himself or herself, a partner or an associate to [ sic] a person who has not sought advice regarding employment of a lawyer in violation of any statute or court rule. Actions permitted by DR 2-104 and advertising in accordance with DR 2-101 shall not be deemed solicitation in violation of this provision." DR 2-104(C) permits a lawyer to "accept employment which results from participation in activities designed to educate the public to recognize legal problems, to make intelligent selection of counsel or to utilize available legal services", but the section is not otherwise germane.
As originally adopted by the New York State Bar Association, DR2-103(A) used the word "recommend" rather than "solicit" in its first line. Moreover, it did not include the present second sentence or the last eight words of the first sentence.
The petition refers also to the Rules of the Appellate Division without specific reference to any rule. Rule 691.22 (22 N.Y.CRR 691.22) deals with "Advertising and publicity by attorneys", but is not considered further because not referred to by either court below and not otherwise germane to the discussion which follows. DR2-101, referred to in DR2-103(A), is, except for the substitution of "lawyer" for "attorney", identical with rule 691.22.
The effect of our Koffler decision and of the Supreme Court decisions referred to in that opinion and in this is to leave the rule declared by the Legislature in section 479 of the Judiciary Law, free to operate in areas not affecting constitutionally free speech (Belli v State Bar of Cal., 10 Cal.3d 824, application for stay den 416 U.S. 965). Though amendment of the section might clarify the intention of the Legislature as a source, coordinately with the judiciary, of the public policy governing the conduct of lawyers, the absence of such amendment leaves no vacuum. The section remains effective except as constitutionally proscribed.
The Code of Professional Responsibility is, however, an enactment of the New York State Bar Association rather than the Legislature or any court. Its provisions have been incorporated by reference in the rule defining professional misconduct (22 N.Y.CRR 603.2, 691.2, 806.2, 1022.17) adopted by each of the Appellate Divisions pursuant to statute (former section 216 of the Judiciary Law) and continued in effect by section 13 of chapter 156 of the Laws of 1978. The specific provisions of the code dealing with advertising have also been adopted as a rule by each of the Appellate Divisions, with the minor change referred to in footnote 2 above (22 N.Y.CRR 603.22, 691.22, 806.15, 1022.16). But the code cannot, either directly or through incorporation in a court rule, amend or limit a statute adopted by the Legislature (People v La Carrubba, 46 N.Y.2d 658, 663; see Matter of Weinstock, 40 N.Y.2d 1, 6). Thus, even if DR 2-104 were broad enough in language to be deemed to authorize third-party direct mail generally (which, in our view, it is not), it would not limit the effect of section 479 of the Judiciary Law, as a bar to such advertising. In light of that fact and of the limiting phrase ("in violation of any statute or court rule") in the first sentence of DR 2-103 (A), the questions before us are, therefore, reduced to whether as a matter of statutory construction section 479 of the Judiciary Law, proscribes third-party mailings and, if so, whether such a proscription is constitutionally permissible.
The statutory construction question is answered, in essence, by our holding in Koffler (51 N.Y.2d, at p 146) that "[n]ot all solicitation is advertising, though all advertising either implicitly or explicitly involves solicitation" and by the words "directly or indirectly" contained in section 479. Direct mail advertising addressed to real estate brokers is, as respondent conceded and the Appellate Division found, direct solicitation of the brokers to refer clients to respondent, and, thus, indirect solicitation of clients by respondent.
III
Because overbreadth analysis does not apply to commercial speech (People v Mobil Oil Corp., 48 N.Y.2d 192, 199) and because laws regulating the time, place or manner of speech stand on a different footing from laws restricting speech because of its subject matter or content (Linmark Assoc. v Willingboro, 431 U.S. 85, 93; Police Dept. of Chicago v Mosley, 408 U.S. 92, 95), we turn first to consideration of respondent's flier.
Our conclusion is that it is the manner rather than the content of the speech in issue which brings it into conflict with the statute. While its last paragraph specifically asks that respondent be recommended to clients of the brokers receiving the flier, the necessary implication of the transmittal to the brokers of the information contained in the first quoted paragraph is that respondent seeks by sending the flier to the broker to have clients of the broker referred to him for legal work. This is conceded by respondent's brief and would, in any event, necessarily follow from the fact that a real estate broker is one "who, for another and for a fee * * * sells * * * exchanges, buys or rents * * * an estate or interest in real estate" (Real Property Law, § 440; see Executive Law, § 292, subd 14). In short, were the fourth sentence of the first quoted paragraph and the last paragraph of the flier omitted, the statute would proscribe it nevertheless. It is, thus, the manner of advertising the service to respondent's potential clients rather than the fact that the flier explicitly asks for recommendations that runs it afoul of the statute (see Eaton v Supreme Ct. of Ark. Committee on Professional Conduct, 607 S.W.2d 55 [Ark], cert den 450 U.S. 966).
Nor can it be said, as was held in Linmark (supra) that though as applied to respondent it restricts but one method of communication, the restriction is nonetheless related to content. Linmark's conclusion was based upon the ineffectiveness of alternatives to a "For Sale" sign, the absence of a prohibition of lawn signs bearing other messages, and the lack of a detrimental secondary effect on society. Here, respondent concedes that his letter to brokers, like the newspaper advertisement in Koffler, was ineffective, whereas direct mail to clients, permitted under Koffler and shown in that case to be productive, is the more fruitful option. Here, also, though under familiar principles of jurisprudence we limit our ruling to third-party mailings to brokers, the statutory language prohibits all third-party mailings, not just mailings to brokers. Finally, there is, as hereafter demonstrated, a detriment to society in the potential conflict of interest that may be generated when those in need of legal services are approached indirectly through a broker. The restriction imposed upon respondent neither is, nor should it be construed to be, one upon content. And as a regulation of the manner of speech, control of which in light of the governmental interest to be served, the lack of effectiveness of the medium and the more effective available alternatives, must be deemed reasonable, the statute as applied to respondent is constitutional (Matter of Koffler, supra, at p 150; Consolidated Edison v Public Serv. Comm., 447 U.S. 530, 535-536; Virginia Pharmacy Bd. v Virginia Consumer Council, 425 U.S. 748, 771).
The brief of amici states that their experience was the same.
But if we were to construe the statute as addressed to content, our conclusion would be no different. As we noted in Koffler (51 N.Y.2d, at p 147), Central Hudson Gas v Public Serv. Comm. ( 447 U.S. 557, 566) establishes four criteria: (1) Is the speech misleading or related to unlawful activity? (2) Is the governmental interest sought to be protected substantial? (3) How directly does the regulation advance that interest? (4) Is there a less restrictive alternative?
The Grievance Committee makes no contention that the flier is misleading. And though section 479 has its genesis in section 270-a of the Penal Law of 1909, it is not speech as activity but the activity to which the speech relates (here, legal services in relation to the purchase or sale of a house) with which this portion of the criteria is concerned. Neither deception nor unlawfulness can sustain application of the statute to respondent's flier, therefore.
There is, however, a substantial governmental interest in preventing conflicts of interest in attorney-client relationships which the statute directly protects and for which there is no adequately protective less restrictive alternative. The Supreme Court has many times recognized as a proper and substantial governmental interest the prevention of conflicts of interest (Matter of Primus, 436 U.S. 412, 436 ["serious likelihood of conflict of interest"]; Ohralik v Ohio State Bar Assn., 436 U.S. 447, 461, n 19, supra ["we cannot say that the pecuniary motivation of the lawyer who solicits a particular representation does not create special problems of conflict of interest"], and see id., at p 464, n 22; N.A.A.C.P. v Button, 371 U.S. 415, 443 ["serious danger * * * of professionally reprehensible conflicts of interest which rules against solicitation frequently seek to prevent"]; see, also, Mine Workers v Illinois Bar Assn., 389 U.S. 217, 223-224). Though the potential for conflict played a part in sustaining the speech limitation only in Ohralik, the reason it was held insufficiently present in the other cases was the absence of monetary stakes for the union or other community group, whose collective activity was undertaken to assure meaningful access to the courts.
Not only is there an absence of associational activity in the instant case, but also there are present the pecuniary interests of both the attorney and the broker. Moreover, since the broker is in direct contact with his prospect (the lawyer's potential client), there is present also the in-person solicitation element which Ohralik found sufficient to sustain regulation against constitutional attack. Of importance in Ohralik's determination were the lack of sophistication of the usual client, the pecuniary interest of the solicitor, the difficulty or impossibility of obtaining reliable proof of what occurred in such an encounter (436 US, at pp 464-466). Those factors made permissible "prophylactic measures whose objective is the prevention of harm before it occurs" ( id., at p 464). The same presumed lack of sophistication, pecuniary interest and difficulty of proof are present here. Moreover, in-person solicitation discourages the comparison shopping which is the very heart of the concept behind dissemination of information concerning legal services: to assure "informed and reliable decisionmaking" (Bates v State Bar of Ariz., 433 U.S. 350, 364, supra; see Reich, Preventing Deception In Commercial Speech, 54 NYU L REV 775, 801, 804; Worsham, Solicitation By Attorneys: A Prediction And A Recommendation, 16 Houston L Rev 452, 468-471).
Nor, as Ohralik makes clear (and Primus confirms [436 US, at p 434]), is it required that there be "actual proved harm to the * * * individual" (436 US, at p 464). "[T]he absence of explicit proof or findings of harm or injury is immaterial" (id., at p 468); "the potential for overreaching * * * inherent in * * * in-person solicitation" (id.) is enough to justify such a regulation (see Note, Attorney Solicitation Clients, 7 Hofstra L Rev 755, 773-774).
Measuring against that background, we conclude that even as content regulation section 479 should be held constitutional. The possibility that the lawyer's view of marketability of title may be colored by his knowledge that the referring broker normally will receive no commission unless title closes, the improbability that the attorney will negotiate to the lowest possible level the commission to be paid to the broker who is an important source of business for him (or suggest to the client that he do so), the probability that the lawyer will not examine with the same independence that he otherwise would the puffery that the broker has indulged in to bring about the sale are examples of the conflict potential to be protected against. Nor can we agree with the Supreme Court of Kentucky (Kentucky Bar Assn. v Stuart, 568 S.W.2d 933 [Ky]) that the filing with the overseeing agency of a lawyer's solicitation letter to brokers, adequate though it may be to protect against any evils of direct mail addressed to clients (Matter of Koffler, 51 N.Y.2d 140, 150, supra), is adequate protection against the conflict of interest problems involved in attorney mailings to brokers. It is one thing for a disciplinary system to police the language in client direct mail advertising and quite another to expect that anything approaching proper oversight can be accomplished simply by the filing of a copy of a broker letter when the client relationship results not from the letter but from the intermediation of the broker.
Accord Allison v Louisiana State Bar Assn. ( 362 So.2d 489 [La] [solicitation through employer of employee participants in a prepaid legal services plan]); contra State Bar Grievance Administrator v Jaques ( 407 Mich. 26 [solicitation of tort claims through union agent]); Kentucky Bar Assn. v Stuart ( 568 S.W.2d 933 [Ky] [attorney's letter to real estate broker]; and see Figa, Lawyer Solicitation Today And Under The Proposed Model Rules of Professional Conduct, 52 Col L Rev 393, 404). It is questionable whether Jaques would be applied to a situation such as the present (see Woll v Attorney-General, 409 Mich. 500, 550). Both Jaques and Stuart may be distinguished on the ground that neither discussed potential conflict of interest, but to the extent that they cannot be so distinguished we decline to follow them.
For the foregoing reasons, the order of the Appellate Division should be affirmed, without costs.
The petition of the Grievance Committee, respondent on this appeal, should be dismissed.
Whatever the prescriptions of professional "etiquette" and institutional preferences may have been in the past, the Supreme Court, final arbiter of First Amendment issues, has declared that the constitutional protection accorded commercial speech will no longer abide unreasonable restrictions on the advertising of information calculated to serve "individual and societal interests in assuring informed and reliable decisionmaking" concerning the price and availability of at least "routine legal services" (Bates v State Bar of Ariz., 433 U.S. 350, 364, 384; Virginia Pharmacy Bd. v Virginia Consumer Council, 425 U.S. 748). Essentially on this basis, in Matter of Koffler, sweeping aside the Appellate Division's "artificial distinction between solicitation and advertising", and undeterred by section 479 of our Judiciary Law, we upheld a lawyer's mail solicitation of potential clients ( 51 N.Y.2d 140, 143). Now, abandoning this high road, the majority, hypothesizing excesses and ignoring less restrictive means by which these may be avoided, upholds a total ban on a lawyer's mailings to realtors. In my view, on the analysis which follows, this absolute prohibition must be regarded as so unreasonable a restraint on communication as to constitute an abridgment of First Amendment rights.
"[S]uch speech should not be withdrawn from protection merely because it proposed a mundane commercial transaction * * * The listener's interest is substantial: the consumer's concern for the free flow of commercial speech often may be far keener than his concern for urgent political dialogue" (Bates, supra, at pp 363-364; cf. Fuchsberg, Commercial Speech: Where It's At, 46 Brooklyn L Rev 389, 391).
Section 479 of the Judiciary Law, effective September 1, 1967, anteceded Bates by 10 years and has not been amended in the intervening years.
Preliminarily, to move most quickly to the heart of the matter, it may be well to point to three considerations with which the majority perforce has had to agree. One is that the Code of Professional Responsibility is subordinate to the provisions of section 479 of the Judiciary Law and that this statute, in turn, must defer to our Constitutions, State and Federal. A second is that, since Bates, lawyer advertising, though it "implicitly or explicitly involves solicitation", may no longer be proscribed per se (Koffler, supra, at p 146); rather, in Koffler, in the course of upholding the validity of direct mail advertising of the nature and price of legal services offered to homeowners as prospective clients, we recognized the validity of this postulate. A third, this time factual, is that the contents of the appellant Alan I. Greene's fliers were not false, deceptive or misleading in any way.
Earlier, a similar conclusion was reached by the New York State Bar Association Committee on Professional Ethics in its opinion No. 507: "[I]t seems clear to us in this era of direct-mail advertising that an advertisement * * * does not become an improper solicitation merely because it is placed in the recipient's mail box by a postman rather than a newsboy".
These noted, we express disagreement, with the majority's reading of Ohralik v Ohio State Bar Assn. ( 436 U.S. 447) as an out-and-out "condemnation" of all in-person solicitation (p 122). True, it held that a State Bar could constitutionally discipline a lawyer for soliciting clients "in person, for pecuniary gain, under circumstances likely to pose dangers that the State has a right to prevent" (Ohralik, supra, at p 449). It is a mistake, however, to assume from this general language that the limitation was a wideranging one. For Ohralik's words are self-limiting and, significantly, were uttered in the context of a congerie of facts surrounding an extreme episode of oppressive and overreaching importuning of the hospitalized victim of an accident. That the court intended no blunderbuss declaration ruling out all direct solicitation, whether essayed in person or by mail, becomes apparent too from its concurrent determination in Matter of Primus ( 436 U.S. 412). Handed down with Ohralik, Primus held a solicitation letter dispatched by an attorney employed by the American Civil Liberties Union sheltered by the First Amendment. So deciding, the court did more than comment that the ACLU litigates both "as a vehicle for effective political expression and association, as well as a means of communicating useful information to the public" (Primus, supra, at p 431). It also made the point, relevant here, that, if anything, "the fact that there was a written communication lessens substantially the difficulty of policing solicitation practices that do offend valid rules of professional conduct" (Primus, supra, at pp 435-436).
In Koffler, we emphasized that interdiction of letters addressed to potential clients would cut across the "strong societal and individual interest in the free dissemination of truthful price information * * * in our free enterprise system" (Koffler, supra, at p 146). Oddly, the majority now recoils from this reasoning when letters are addressed to real estate brokers whom, after all, buyers or sellers of real property conceivably may be expected to consult on the choice of a lawyer. Absent any record data, empirical or otherwise, to warrant this departure from the spirit of our earlier declaration, it offers no more than direful speculation, which, I respectfully suggest, reflects perhaps unconscious, but nevertheless impermissible, obeisance to the tastes and traditions of a pre- Bates yesteryear. (See Kentucky Bar Assn. v Stuart, 568 S.W.2d 933 [Ky], supra [letters to real estate agencies merely stating the price of routine legal services and the qualifications of the attorneys not in-person solicitation].)
(See, generally, Kentucky Bar Assn. v Stuart, 568 S.W.2d 933 [Ky]; Bishop v Committee on Professional Ethics Conduct of Iowa State Bar Assn., 521 F. Supp. 1219; Andrews, Birth of A Salesman: Lawyer Advertising and Solicitation 61-68; Brosnahan and Andrews, Regulation of Attorney Advertising: In the Public Interest?, 46 Brooklyn L Rev 423; Comment, Three Years Later: State Court Interpretation of the Attorney's Right to Advertise and the Public's Right to Information, 45 Mo L Rev 562.)
It cannot be gainsaid that a mailing to third parties contemplates interaction between their recipients and potential clients. But, in principle, what Greene sought by resort to this more targeted, and presumably more cost-efficient, mail medium was simply to heighten the chances that the concededly fair and truthful message he wished to convey would come to the attention of those to whom it would be most useful, a perfectly sensible and acceptable, even "indispensable", objective (Bates, supra, at p 364).
Koffler's recognition of this characteristic (supra, at p 145, n 2) did not suggest a preordained result (compare our footnote with footnote 25 in Virginia Pharmacy, 425 U.S. 748, 773, supra, and the Supreme Court's ensuing holding in Bates).
Greene's fliers were mailed to all brokers in a circumscribed area — Westchester County, where he resided and practiced, and portions of adjoining Putnam County. It was no more than logical for him to reason that an untargeted mailing to the adult members of a population of well over a million would not only have been wasteful but prohibitively expensive.
Needless to say, any referral system is highly dependent upon the availability of information about an attorney. Moreover, a paramount reason for the Supreme Court's support of a lawyer's right to advertise was its recognition that, in a time when mobility and urbanization had become an integral part of our social climate, pre- Bates referral practices, attuned as they were to the far more fixed fashions of an essentially "small-town society", in which "reputational information" could be expected to be common knowledge, no longer was adequate (Bates, supra, at pp 374-375, n 30; see Cheatham, Availability of Legal Services: The Responsibility of the Individual Lawyer and of the Organized Bar, 12 UCLA L Rev 438, 440; Meserve, Our Forgotten Client: The Average American, 57 ABA J 1092; cf. Zaldin v Concord Hotel, 48 N.Y.2d 107, 112).
Consequently, I find it difficult to understand how the majority, in face of our prior acceptance of the right to advertise by direct mail, can equate Greene's restrained use of that medium with the vexatious in-person solicitation at which Ohralik strikes (see p 128). For, at its worst, Greene's conduct, even if we were to disregard its salutary candor and written form, cannot be said to have differed in spirit and intent, for instance, from the exposure to potential clients and potential recommenders that many lawyers, with full propriety, attempt to achieve by carefully structuring their social and community associations (see Bates, supra, at p 371). Nor can it be said that Greene's mode of communication suffers by comparison, in morality or accountability, with the far more amorphous collection of contacts with the coterie of friends, relatives, business or social acquaintances and former clients who constitute the main source to which most lawyers engaged in private practice look for referrals.
The venerability of referrals as a source of clients has been recognized also in Ohralik (supra, at p 465, n 24); the New York Code of Professional Responsibility (EC2-8); and the American Bar Association's Proposed Draft of Model Rules of Professional Conduct (rule 7.2, subd [c]).
Surely, whether a third party's recommendation of a lawyer to a consumer of legal services has been generated by personal cultivation of or a chance acquaintance with the recommender or whether the recommender's awareness of the lawyer's availability stemmed from the lawyer's correct employment of contemporary mail or media channels, common sense teaches that there is no basis for attributing greater risks of the occasional unprofessionalism or overcommercialization, which in this imperfect world will at times occur in any quarter, to the latter rather than the former. Little wonder then that the Supreme Court has dubbed arguments which focus on fears of this character too "dubious" to survive constitutional scrutiny (see Bates, supra, at pp 369-379).
Specifically, to recite them verbatim, the suppositions on which alone we are asked to conclude that the demons of conflict of interest will be let loose are that "the lawyer's view of marketability of title may be colored by his knowledge that the referring broker normally will receive no commission unless title closes" or that the lawyer will not make efforts to "negotiate to the lowest possible level the commission to be paid to the broker" or that "the lawyer will not examine with the same independence that he otherwise would the puffery that the broker has indulged in to bring about the sale" at p 129). But, even if these cynical conjectures reflected anything more than occasional vagaries, it would be outlandish for the fears the committee entertains to form the predicate for punishing facially innocent mail communications with brokers while ignoring the fact that, if the fears were founded, they would be at least as pertinent to lawyers who, enjoying personal or professional relationships with brokers, are far, far, more likely to become the beneficiaries of such referrals and the inheritors of the hobgoblins of client betrayal which, so unaccountably and so unevenly, appear to concern the committee. Artificial distinctions of this sort are not only indefensible, but are just the sort of things which unwarrantedly sap public confidence in the legal system.
In the same vein, the Grievance Committee, to justify its condemnation of the attorney, goes so far as to find cause for complaint in the argument that the respondent, whose fliers did not indicate the slightest inclination to split fees, would also "deceive the realtor, who will believe if a person is referred to the attorney, he, the realtor, will obtain something in return for the referral, when in fact he will not". To this, of course, the short answer is that frustration of any real estate agent (or any other referrer of a client) who may entertain such an expectation would be a testimonial to the unswerving probity and ethics of the lawyer, who in any event, is held to DR 2-103(B), which specifically states: "A lawyer shall not compensate or give anything of value to a person * * * as a reward for having made a recommendation resulting in employment by a client". It may not be remiss to add that even the realtors seem to be too freely belabored, since the record establishes that none of the recipients of the defendant's flier responded at all, much less improperly.
Since, from the record here, mail communications may not be very productive of referrals, the fears may be academic as well as groundless. Greene received no referrals in response to his flier. The four amici, from another part of the State, fared no better.
The nature of Greene's alleged assault on the ethical standards now seen in fuller perspective, we proceed to match the mailing of his fliers against the criteria so lately set out by the United States Supreme Court in Central Hudson Gas v Public Serv. Comm. ( 447 U.S. 557, 564-566). Reiterating the court's position that commercial speech is subject to a State's reasonable time, place and manner regulation (Consolidated Edison v Public Serv. Comm., 447 U.S. 530, 536), that case erected a four-part analysis for testing whether a particular State regulation goes too far.
Applying the test, initially we must say whether the speech in question is misleading or related to an unlawful activity, for then it is entitled to no protection. This hurdle it easily overcomes. As indicated earlier, it is agreed that the speech here did not offend either requirement.
Secondly, we must decide whether the regulation generally is in furtherance of a substantial State interest. This too need not detain us. Since the possibility of deceptive or unethical conduct always exists in the abstract at least, a legitimate State interest may be said to exist.
This brings us to the third level of inquiry, i.e., evaluation of "the directness of relation of regulation to purpose" (Matter Koffler, 51 N.Y.2d 140, 148, supra). For the reasons more fully detailed above, the regulation here did not measure up. Greene's mailings involved no professional trespass. Not all lawyer mailings invite the ethical departures the committee envisaged. Such departures certainly are not the inevitable result of all direct mail advertising. The one before us only concerned information about price and availability and, as such, was in accord with Ethical Consideration 2-8 of the Code of Professional Responsibility of the American Bar Association (see, also, New York's Code of Professional Responsibility EC 2-8 in McKinney's Cons Laws of NY, Book 29, § 500 to end, pocket part [1980-1981], p 45). Disseminating this information serves a useful rather than a harmful individual and societal function. The Supreme Court has "declined to uphold regulations that only indirectly advance the state interest involved" (Central Hudson Gas v Public Serv. Comm., 447 U.S. 557, 564, supra). The regulation here, therefore, was unreasonable, and, consequently, must fall on that account.
Finally, we determine whether less restrictive measures were available to the State. For the regulatory technique may not be disproportionate to the interest served. Obviously, since the communication here was not a transitory oral one, but made by mail, a filing requirement or one that calls for an appropriate disclaimer might have been an available and practical alternative (see Bates, supra, at p 384; Koffler, supra, at p 150; Kentucky Bar Assn. v Stuart, supra, at p 934; ABA Proposed Draft of Model Rules of Professional Conduct, rule 7.2, subd [b], and Comment). Yet, the committee offered no adequate explanation for failing to engage these or other lesser methods by which to assure that the regulatory scheme was not more extensive than necessary to serve the governmental interest at stake. Instead, imposing an unwarranted absolute prohibition, it chose a means unreasonably and insufficiently related to the purpose to be served.
This is not intended as an indorsement of the procedures mentioned, either in isolation or in preference to other methods. Rather, mention is made of these measures merely to demonstrate that less restrictive regulatory means are available or can be developed.
It follows that the order of the Appellate Division should be reversed and the petition dismissed.
Judges JASEN, GABRIELLI, JONES and WACHTLER concur with Judge MEYER; Judge FUCHSBERG dissents and votes to reverse in an separate opinion in which Chief Judge COOKE concurs.
Order affirmed.