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                                         107 N.J.L.J. 137
                                        February 19, 1981


Appointed by the New Jersey Supreme Court


Rental Agency Client - Warning
Letters to Defaulting Renters

    The inquiring attorney is local counsel for a rental agency which operates on a nationwide basis. The inquiry does not specifically indicate what the agency "rents" but it can be gathered from the facts presented that the client leases or rents items of personal property pursuant to the terms of rental or leasing agreements. It appears that the client had been informed that in several of the states in which it does business consumer protection legislation had been enacted which requires that a rental agency give notice on the face of the rental contract that the customer's failure to return the rental equipment in a timely manner could result in the imposition of criminal sanctions. The client, therefore, inquired of, the inquirer whether New Jersey had enacted similar legislation and whether there was a need to modify the rental agreement which was being used in New Jersey. The inquirer has apparently advised his client as to the status of the law in New Jersey with respect thereto and the inquirer does not pose a question for this Committee in that regard.
    The client, however, has requested that the attorney prepare
a form letter to be used with reference to defaulting lessees or renters advising as to the criminal sanctions that may be imposed under New Jersey law. In this regard reference is made to the fact that the recently enacted Criminal Code in this State, N.J.S.A. 2C:20-9, provides as follows:
    Theft by Failure to Make Required Disposition of Property Received. A person who purposely obtains or retains property upon agreement or subject to a known legal obligation to make specified payment or other disposition, whether from such property or its proceeds or from his own property to be reserved in equivalent amount, is guilty of theft if he deals with the property obtained as his own and fails to make the required payment or disposition...

The inquirer is aware of the provision of DR 7-105, which reads as follows:
    A lawyer shall not present, participate in presenting or threaten to present criminal charges to obtain an improper advantage in a civil matter.

He states in the inquiry "It was with this rule in mind that we initially hesitated to include the penalty provisions in our proposed warning letter." It is our considered opinion that it would be unethical for the inquirer to prepare a form letter to be used by the client in the event of a default by the client's customer which would include the threat to present criminal charges in the event the default was not cured. The preparation of such a letter would constitute a participation by the attorney in "presenting or threaten to present criminal charges."
    The inquirer additionally includes an alternate form letter which he has prepared for the client's use, in form substantially as follows:
    Our records show that you have failed to return the above-described rented property as agreed.

    If you continue, after receipt of this notice, to retain the rented property in violation of your agreement, we must interpret your failure to return the property as a knowing effort to deprive CANONS OF PROFESSIONAL ETHICS Rental Company of its ownership rights in this property. In appropriate cases, legal action may follow, without further notice.

    We would like to resolve this matter as quickly as possible, and your cooperation will help us.

    Please do not minimize the importance of this letter--let us hear from you today!

We see no impropriety in the attorney's preparing such a form letter to be used by the client under the circumstances inasmuch as there is no specific threat of criminal action but merely advice that resort may be had to the courts of this State for appropriate relief.
    We refer the inquirer to our Opinion 347, 99 N.J.L.J. 715 (August 1976), where we dealt with the same subject matter in detail as well as the cases cited therein which are pertinent to the present inquiry.

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