Saturday, April 18, 2009

When It Rains It Poors: Now Texas Has Revoked License of Solo Practitioner For Unpaid Student Loan Debt

Posted by Alan Childress

As a follow-up to Mike's story Thursday on the New York bar applicant who was denied admission for student load debt, consider that even existing law licenses are at risk.  The National Law Journal's Leigh Jones reports Monday (found here at on this harrowing tale:

An appeals court in Texas has revoked the license of a Houston attorney for failing to repay his student loans and other debts. ... The three-judge appeals panel in Austin found that, because Santulli, a Houston solo practitioner, did not adhere to a previous order requiring him to pay his debts, he lacked the trustworthiness necessary to represent clients.

He had been granted conditional admission in 2001 and an extension later, but still owed some $67,000.

A year later, the board found that he had not taken care of his debt and recommended the revocation of his license. A trial court later affirmed the decision.

In arguing against the revocation of his license in the appeals court, ... [he] argued that the boardMarshalsea4 erred in finding that he lacked good moral character. The appeals panel was not persuaded ... Santulli, who represented himself, said that he plans to hire a lawyer to appeal the decision.

As Mike has pointed out many times on this site, based on his experience as a bar prosecutor, there's wisdom to that last sentence.  And in other news, PBS is just finishing up its Masterpiece Classic's presentation of Dickens' Little Dorrit.

Compare Mike's post last month on an Illinois hearing board that "concluded that a lawyer's license should be 'monitored rather than revoked' in a case where the attorney had diverted to himself over $30,000 in fees, half of which were due to his firm." The lawyer's explanation:  behind on house note and bills, from paying debts including "repaying about $65,000 in student loans" and credit cards.  Hmmmm.  Not repay loans = untrustworthy = revoke license.  Repay loans by stealing from firm = worthy of redemption = nine month suspension then probation.  But do not try this at home.  Especially if the home sits in Texas.

Bar Discipline & Process, Current Affairs, Economics | Permalink

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Interesting find Alan! I couldn’t agree with your reasoning more.

I do note one small difference though. In this case, wisely or unwisely, the attorney accepted an arrangement to gain admission which called for him to comply with a court order. He did not comply with that order. This adds a slightly different dimension to the case.

On the other hand, the reasoning of the board as reported by was that “because of the debt he was carrying, [the attorney] would be tempted to ‘short-shrift’ his clients or ‘convert money’ from his clients to cover his debt.” seems to me that this argument plays in favour of *not* putting his license at risk for the very reasons that Alan cites.

Although these debts are not generally subject to the fresh start provisions of the bankruptcy code, these cases have me wondering, would the attorneys now be able to use a bankruptcy filing to prevent the withdrawal of their law licenses in the same way as a debtor can use a bankruptcy filing to prevent a state from withdrawing his driver’s license? If the complaint is the one made here – that the lawyer is carrying too much debt – then surely yes.

There is a fundamental dishonesty to all of these cases. What is claimed is that a legal ethical code of conduct is being applied. In truth, what is really being applied are the morals of a small group of powerful individuals who unilaterally believe that their positions of power provide them with the authority to dictate those moral beliefs to those who practice before them. One might not respect someone who fails to pay their student loans, but does that make it a violation of our ethical code of conduct? I think not.


Posted by: FixedWing | Apr 18, 2009 11:51:21 AM

Give the guy a break....

Posted by: Debt Help TX | Nov 12, 2009 6:26:27 AM

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