An attorney was charged with 35 counts of professional misconduct in the course of representing a client in a matrimonial matter. A New York hearing panel that reviewed a referee's report sustained 26 of the charges and recommended a suspension of 2 1/2 years plus restitution. A majority of the Appellate Division for the First Judicial Department accepted the proposed discipline:
"With regard to sanction, we note that the breadth of respondent's
misconduct is troubling, for at almost every turn throughout the
matrimonial matter, respondent committed some form of misconduct,
whether it be false notarizations, disregard of a court order, charging
an exorbitant fee, threatening her client to pursue that fee, or using
client funds that were in dispute. In light of this, we conclude that
respondent should be suspended from the practice of law for a period of
two and one-half years (citation omitted) and she is directed to make restitution to her client in the amount of $30,464.
We disagree with the dissent with regard to the severity of the
sanction to be imposed, and in that vein, note the mitigating factors
present, including respondent's 28-year legal career, which was
previously unblemished by any disciplinary history, and the fact that
she is 68 years old, suffering from a variety of ailments, and is the
sole means of support for her divorced daughter and grandson. We also
take into account the Referee's finding that respondent has accepted
responsibility for her actions and is remorseful. More importantly, and
as the dissent also notes, the Committee "did not characterize"
respondent's conduct as conversion; indeed, while the Referee's report
states that respondent's actions "could be deemed a conversion of
funds," no finding of conversion, or venality, was made, a fact
apparently not lost on the Referee, or the Hearing Panel, when their
recommendations for sanctions were made. Given the totality of the
circumstances presented and the absence of an opportunity to contest
the allegation of intentional conversion, we disagree with the
dissent's recommendation of disbarment."
The dissent finds misappropriation and would disbar:
"...respondent, over the course of approximately three years, made
multiple withdrawals totaling over $30,000 from two accounts containing
funds belonging to Mr. Tebbetts. Respondent knew that the money in
those accounts belonged to Mr. Tebbetts; two court orders and a
judgment clearly required that the funds respondent used for her own
purposes were to be given to Mr. Tebbetts to reimburse his 401(k) plan.
Thus, respondent repeatedly and intentionally used Mr. Tebbetts'
escrowed funds for her own purposes without Mr. Tebbetts' permission...and our rule requires disbarment absent "extreme mitigating circumstances" (citation omitted)
That the Committee did not characterize as "conversion"
respondent's conduct in misappropriating Mr. Tebbetts' money is
immaterial. No authority or principle of law requires such a
characterization or allegation to trigger our general rule that an
attorney who intentionally uses on multiple occasions a client's money
should be disbarred. Indeed, the applicable disciplinary rule, DR
9-102(A), does not itself use the term 'conversion' ('Prohibition
Against Commingling and Misappropriation of Client Funds or Property. A
lawyer in possession of any funds or
other property belonging to another person, where such possession is
incident to his or her practice of law, is a fiduciary, and must not
misappropriate such funds or property or commingle such funds or
property with his or her own').
Until now, the determinative inquiry, as we stated in Matter of Nitti (268 AD2d at 42), has been whether the lawyer 'repeatedly and intentionally
use[d] clients' escrowed funds for h[er] own purposes without
permission' (emphasis added). When that misconduct is committed, '[t]his Court has clearly established that, as a rule, disbarment is
called for' (id.). Unfortunately, the majority forsakes this
substantive inquiry and stresses that a particular label was not used
by the Committee. Similarly focusing on form instead of substance, the
majority disregards the fact that respondent knew she was being charged
with misappropriating Mr. Tebbetts' money and relies on 'the absence of
an opportunity to contest the allegation of intentional conversion.'
Moreover, no extreme mitigating circumstances are present warranting a departure from the typical penalty of disbarment..."
February 1, 2008 in Bar Discipline & Process | Permalink
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