Friday, July 17, 2009
The Kansas Supreme Court found that an attorney who had "retired" and sold his practice to another attorney had violated prohibitions against unauthorized practice and imposed disbarment. The key facts:
Perhaps the best evidence against [the accused attorney] came from his own characterization of what he was doing after his "retirement." He told Hesse [the bar's investigator] that he was a "paralegal." Some years ago, this court opined that a disbarred or suspended attorney could act as a paralegal. However, the activities of such a paralegal are limited.
"The consensus is that an attorney suspended from the practice of law may obtain employment as a law clerk, providing there are certain limitations upon the suspended attorney's activities. Regarding limitations, we are persuaded the better rule is that an attorney who has been disbarred or suspended from the practice of law is permitted to work as a law clerk, investigator, paralegal, or in any capacity as a lay person for a licensed attorney-employer if the suspended lawyer's functions are limited exclusively to work of a preparatory nature under the supervision of a licensed attorney-employer and does not involve client contact. Any contact with a client is prohibited. Although not an inclusive list, the following restrictions apply: a suspended or disbarred lawyer may not be present during conferences with clients, talk to clients either directly or on the telephone, sign correspondence to them, or contact them either directly or indirectly." In re Wilkinson, 251 Kan. at 553.
[His] first problem is that he was not actually employed by a licensed attorney. Granted, he had an agreement with Kjorlie [who purchased his practice] to sell his client base in which he agreed to provide "administrative assistance" to the buyer. However, the only compensation provision of that agreement involved splitting the future legal fees from [his] "client base." In fact, Lloyd made his fee payments directly to [the accused attorney], rather than to Kjorlie.
Moreover, Kjorlie's testimony clearly refuted that he was acting as [his] supervising attorney-employer in the matter. For instance, he appeared to be completely unaware of the particulars of the quitclaim deed preparation and was quite confused as to the nature of Lloyd's $3,500 payment to [the acussed attorney]. [His] activities went far beyond "work of a preparatory nature." Rather, [he] was operating as an independent paralegal who even employed his own paralegal, McConnell.
Further, as [the accused attorney] told Hesse, the client base of the post-retirement consulting firm was the same as the law firm's client base. Clearly, [he] made the majority, if not all, of the contacts with the clients. He even acknowledged that he would go to court with a former client and the new attorney to assist with the case. In short, the only change in [his] activities following retirement is that he would only "second chair" in court and that he would tell his clients he was a "retired attorney." [He] was practicing law.
[His] attempts to avoid the rules set forth in Wilkinson by asserting that a retired attorney is different from a suspended or disbarred attorney. He intimates that a retired attorney has more leeway to engage in some sort of limited practice of law than an attorney who has been suspended. We disagree. The reasons for applying the Wilkinson rule–e.g. to avoid the appearance of impropriety, to avoid confusion among laypersons, or to avoid the temptation for law-trained clerks (or paralegals) to go beyond mere preparatory work–apply as equally to retired attorneys as to suspended or disbarred attorneys. See In re Wilkinson, 251 Kan. 549-51.
[His] situation is particularly akin to that of a suspended attorney because he avoided the potential of being placed on that status by agreeing to retire and cease practicing law. He was just as obligated to refrain from the practice of law as if he had been formally suspended.
The Maine Supreme Judicial Court dismissed an interlocutory appeal in an action brought by a corporation against its former president but commented on a claim of attorney-client privilege in its order. The former president had been convicted of violating federal export control laws and sought reimbursement from the corporation for the fine in the criminal case. He had sought advice from his daughter, a Maine lawyer, and was referred to a law firm.
The firm produced a memorandum stamped as privileged that set forth the pros and cons of his indemnification claim, which was emailed to the president (who was still in office) at his corporate email address. The corporation did not prohibit use of the office laptop for personal purposes but had a written policy waiving any right to privacy in the contents. Federal agents arrived at his home and took a mirror image of the hard drive of his corporate laptop. He resigned two days later. in-house counsel was able to secure the return of the laptop.
The corporation's in-house counsel and the chairman caused the hard drive to be examined. The privileged memo was located and reviewed. In-house counsel considered the document to be privileged and sought help with respect to her ethical obligations. She called the ABA, consulted bar rules and spoke to an Assistant Bar Counsel. She turned the laptop containing the memo to the chairman and another attorney before obtaining an opinion of Maine Bar Counsel.
The court here concluded that the in-house lawyer should have waited for advice from Bar Counsel ("one of the best sources for ethical advice for Maine attorneys") before delivering the memo to others. The court also expresses concern about the corporation's present lawyers "dismissive attitude and preemptive approach to [the former president's] claim of privilege." The lawyers should have sought to resolve the privilege before making the memo a matter of public record. The dismissal of the appeal "should [not] be interpreted as suggesting that the Court endorses or otherwise condones the approach taken by [the corporation's] attorneys to the assertion of privilege in these proceedings." (Mike Frisch)
Thursday, July 16, 2009
A Conference Sponsored by the
Center for the Study of the Legal Profession
Georgetown University Law Center
March 22-23, 2010
Law firms have been affected to an unprecedented degree by the current economic downturn. Many have made deep cuts in lawyers and staff. Others have reduced salaries and hours, rescinded outstanding offers of employment, frozen hiring, delayed start dates for incoming lawyers, and even paid graduates to forgo the positions they earlier were offered. Many have lost clients as entire sectors of the economy have disappeared or have been radically realigned. Practices that historically served as countercyclical buffers, such as litigation and bankruptcy, often have not been sufficiently robust to balance the loss of other work in the current downturn.
Challenges for law firms also come directly from clients, many of whom operate on a global scale. Corporate counsel enjoy increasing influence in relationships with outside lawyers and law firms. They pressure firms to reduce fees and make them more predictable, and to share with clients a greater amount of the risk in engagements. They also have asserted more control over which law firm lawyers do their work. In addition, some clients are drastically reducing the number of firms in their provider networks, which may generate new forms of relationships between clients and law firms that blur the boundary between them.
Are the dramatic steps that firms have taken temporary adjustments to market conditions, which will have limited long-term effect after economic recovery? Or do they reflect fundamental changes in the business model of law firms that are likely to transform the market for legal services? Is an economic recovery likely to reestablish the law firm hierarchy and competitive conditions that existed before the downturn? Or will it usher in a novel landscape with new winners and losers and different stresses and opportunities?
We are soliciting papers from scholars that address the myriad issues raised by these questions from a variety of disciplinary perspectives. Among many others, these issues may include:
How has the structure of competition in the law firm services market been evolving? Do changes in the market suggest that firms will fare differently in the market depending on their size, organizational structure, the type of clients they serve, or the kinds of work they do? How will the transformation of investment banking clients affect law firms?
What skills are necessary to succeed in law practice, have these changed as a result of the downturn and restructuring of law firms (if any), and how can legal professionals acquire them? Working in a large law firm has often been an entrée to other positions, whether in boutique firms, in corporate legal departments, or in firms with alternative business models. Will this role of Big Law continue, or are there likely to be new arrangements for training and development that impart these skills? If firms increasingly rely on contract lawyers to operate more efficiently, how will these lawyers gain the skills necessary to advance and remain flexible in charting their careers?
Are firms adopting different strategies for global practice? Has the global market for legal services changed as a result of the economic downturn and response of clients and law firms? What formal and informal regulatory systems are likely to evolve in response to these developments? Is there an increased need for a global regulatory approach? Will differences in national responses to the economic crisis in general, and financial market instability in particular, influence the path of law firm evolution in the global economy? Is a set of skills distinctive to global law practice likely to emerge?
Is increasing client insistence on cost-efficiency leading to new models of service delivery? If so, how will these models affect firms’ risk profiles, the ways in which work is organized, career paths available to lawyers, compensation, opportunities for advancement within firms, and lawyers’ understanding of their professional obligations?
Do lawyers still need connections to large law firms in order to engage in high-end work? Will law firms be able to induce commitment and sustain coherent organizational cultures under emerging market conditions? What forms of management, leadership, and guidance will be necessary in order to do so?
If clients are likely to require firms to collaborate with each other in providing services, what impact might this have on the law firm market? Will law firms create collaborative and/or ownership networks and relationships (akin to corporate parent-subsidiary or joint venture relationships) to help manage relationships with clients and lawyers.
Is the way that firms finance their operations changing as a result of the credit crisis?
Will new financial performance metrics emerge that supersede profits per partner, and will other standards arise that take account of non-financial considerations?
Have the challenges facing law firms during the credit crisis eliminated the concern for work-life balance? For diversity initiatives? What are the implications of law firm evolution for legal education?
What lessons might law firms draw from the experiences of other professional service firms?
Submission of Abstracts
Please send an abstract of approximately 1000 words to Carole Silver, at firstname.lastname@example.org by Septmber 15th, 2009.
The conference will take place on March 22nd & 23rd, 2010, at the Georgetown University Law Center in Washington, D.C. We anticipate that the formal program will begin the morning of March 22nd and run through early afternoon on the 23rd.
Carole Silver, Mitt Regan & Jeff Bauman
Center for the Study of the Legal Profession
Georgetown University Law Center
An interesting case from the Washington Supreme Court concluded that disbarment was the appropriate sanction in a matter involving a felony conviction for willful failure to file a currency report. The attorney ("respondent") was asked by a (now former) lawyer to represent a defendant in a drug conspiracy. The former lawyer represented the interests of the defendant's superior in the conspiracy chain of command. Respondent received two $10,000 unreported cash payments from the former lawyer. One payment was left in a court chambers where they both served as judges pro tempore; the other in a parking lot. The client that Respondent purported to represent was a cooperating witness, a fact of which respondent was unaware. The former lawyer later was busted and cooperated against the respondent in the criminal investigation. The underlying facts are pretty ugly, with respondent actively selling out his client for the benefit of the former lawyer's client.
A hearing officer had recommended a three-year suspension. The Disciplinary Board favored disbarment. A dissent concludes that willful failure to file does not involve active deception and thus does not involve dishonesty. The dissenting justice would suspend rather than disbar. (Mike Frisch)
Not a legal profession case, but of possible interest, is a decision filed on July 14 by the Court of Appeals of Tennessee. At issue were the rights of three parties in a charitable gift to Fisk University of 101 pieces of art that Georgia O'Keeffe had donated to the University. Four of the pieces (including the painting Radiator Building - Night, New York) were her property; the other 97 were part of the collection of her husband Alfred Stieglitz and had been gifted to the school by Ms. O'Keeffe as executrix of his estate and/or as owner of a life estate in those pieces of art.
The gift was subject to several restrictions that included a prohibition on sale of the art and a requirement that the pieces be displayed as a single collection. Fisk sought a declaratory judgment to permit the sale of two pieces because it could no longer afford to maintain the collection under the 50 year old terms of the donation. The Georgia O'Keeffe Museum and the Tennessee Attorney General intervened. The court here held that the museum had no reversionary interest in the art and thus lacked standing to intervene. The matter was remanded to the trial court with instructions to determine whether cy pres relief is available to the University and, if so, to fashion appropriate relief. (Mike Frisch)
An attorney who joined a law firm had an agreement that the firm would pay him additional compensation for fees generated on matters he referred to the firm. He thereafter referred a case to the firm. When he left the firm and returned to his former firm (Wilson Elser), he did not receive compensation for the referral. The matter had come from Wilson Elser and was referred due to an apparent conflict of interest. The departing attorney brought an action against the law firm and prevailed in arbitration. The law firm appealed the arbitration award.
The Connecticut Appellate Court affirmed the award. The court rejected the suggestion that payment to the referring attorney violated the Rules of Professional Conduct because of the conflict of interest of Wilson Elser:
There never was a finding that the plaintiff had ever represented the client in the [referred] matter for his new firm. Compensation was owed to the plaintiff on the basis of the plaintiff's referring the...matter to the defendant, not for representing the client.
The arbitrator had correctly concluded that the ethics rules do not prohibit payment under circumstances where the lawyer receiving the fee later rejoins the firm that sent the case along due to a conflict. (Mike Frisch)
Wednesday, July 15, 2009
The Virginia State Bar is accepting comments on a proposed ethics opinion that considers the propriety of the use of undercover tactics by officials responsible for the regulation of unauthorized practice. The opinion is summarized as follows:
This opinion addresses the ethical propriety of staff counsel to the UPL Committee supervising an undercover investigation to determine whether someone is engaging in the unauthorized practice of law. The staff counsel are not conducting the covert investigation, but have directed a lay staff investigator, regularly employed by the VSB, to perform the covert investigation. The tactics or techniques used by the investigator would involve some form of deception, i.e., misrepresentation of identity or purpose, in order to catch the suspect engaging in conduct that is unlawful or criminal. The Committee observes that one who engages in the unauthorized practice of law is committing a criminal act. It is generally known and very well accepted that law enforcement authorities, including government lawyers, are authorized to conduct or supervise undercover operations using deception to gather information about criminal conduct. The Committee believes that use of an undercover or “sting” operation by a lay investigator, under the direction of staff counsel, does not violate the Rules of Professional Conduct. The Supreme Court of Virginia has specifically approved a legal ethics opinion that recognizes a “law enforcement” exception to Rule 8.4 (c). The Committee also believes that, although undercover investigations involve some elements of misrepresentation and deceit, the conduct does not reflect adversely on the fitness or character of the lawyer directing or supervising a lawful criminal investigation.
The District of Columbia Court of Appeals condemned the use of such tactics in a bar discipline case where Bar Counsel had "deputized" two lawyers to pursue information about a possible scheme to "sell" a witness in a medical malpractice case. The lawyer under investigation had been approached by a nurse with highly useful information and had approached the lawyers to be retained as co-counsel.
The court majority held that Bar Counsel had exceeded its authority "by encouraging the two attorneys...to continue to negotiate with [the attorney] in order to determine whether the situation would unfold into a more clear-cut violation. Bar Counsel has a responsibility to educate the bar with the hope of preventing violations, if possible, not of encouraging them." A concurring opinion would not exclude the evidence obtained by covert means and takes issue with the suggestion that the proper role of Bar Counsel is to educate the target lawyer: "This is an important policy statement to which the entire court should speak by way of its rules."
The case is In re Sablowsky, 529 A.2d 289 (D.C. 1987).
Update: As the comment notes, the opinion has been adopted. (Mike Frisch)
Tuesday, July 14, 2009
An Illinois hearing board has found that an attorney had breached fiduciary obligations in accepting a series of gifts from a now-deceased client with whom she had developed a close friendship. The hearing board, however, rejected the Administrator's proposed one-year suspension and recommended a reprimand. The board's key findings show that it did not agree that the misconduct was as ill-motivated as the Administrator had argued:
In this case we find the evidence established that Respondent did not take advantage of Mary [the client] or induce her to provide the checks at issue to Respondent. Respondent was a credible witness and her testimony clearly demonstrated that there was a close friendship between her and Mary which was corroborated by the testimony of Respondent’s mother and Mary’s caregiver, Ms. Nurse. Respondent testified in detail about the circumstances surrounding each gift and the reasons why Mary was insistent upon helping Respondent financially. Additionally, the testimony demonstrated that Mary was an intelligent, highly educated woman who was self-aware, engaged with other people and who actively participated in decisions concerning her health and her personal estate.
The fact that Respondent did not try to isolate Mary when she was diagnosed with a terminal illness also rebuts the presumption of undue influence. The phone records show that Respondent called Mary’s relatives when Mary returned home from the hospital to start hospice. The evidence further established that Respondent told Mary’s relatives that Mary was dying from cancer and urged them to be with Mary in the final days of her life.
Additionally, although there was substantial medical evidence presented which showed Mary suffered from common diseases of advancing age, there was no testimony that connected her health or moments of temporary confusion to her incapacity to express her desires on any of the dates Respondent received the checks from her. Dr. Littman did not offer any medical opinion in his testimony regarding Mary’s capacity or mental ability and declined to express an opinion on these subjects. Ms. Nurse testified about her observations that Mary was alert, talkative and in her usual state of humor during the first few days after she came home from the hospital. Respondent’s mother and Mary’s cousins also testified that they were able to converse with Mary and that she maintained her wit during this time period.
We note that there were no independent witnesses to the gifts Mary gave Respondent and that in Schuyler, 91 Ill. 2d at 17, the Court stated that "a totally private transaction, inadequately documented, clearly fails to rebut the presumption of undue influence which arises when the attorney benefits during the attorney-client relationship." However, we find the transactions between Mary and Respondent are clearly distinguishable from those between the attorney and client in Schuyler. The attorney in Schuyler received money from an elderly client who was living in a retirement home, but there was no evidence of a personal relationship between the attorney and the client. There was also evidence that after the client died the attorney in Schuyler was not candid with representatives of the client’s estate who were trying to locate the funds the attorney had received from the client.
The uncontradicted testimony and evidence in this case showed that Respondent was a relatively young woman who was befriended by an older woman and that Respondent and Mary had a close and mutually supportive relationship. This does not excuse Respondent’s misconduct, but it does rebut the presumption of undue influence.
There was also no evidence Respondent tried to hide the gifts she received from Mary. Respondent was candid with her mother about all the checks she received from Mary when Sandra asked her about the $40,000 check to the U.S. Department of Education. The Administrator’s argument that Respondent made the $40,000 check out to U.S. Department of Education to hide the fact that it was a gift to Respondent was not convincing because Respondent’s social security number was on the check which clearly designated her as the beneficiary of the money. Additionally, once Sandra informed Respondent she should not have accepted the checks from Mary the money was immediately repaid to Mary’s estate and the reimbursement was disclosed to Mary’s half brother and his wife.
Finally, the Administrator’s argument that Respondent was not candid about whether she was a signatory on the account the $10,000 check made payable to Orlando Williams was drawn on was not persuasive. Respondent testified that she could not remember whether she was a signatory on the account before or after Mary’s death and the Administrator failed to present any definitive evidence regarding whether or not Respondent was a signatory on the account at the time she signed the check. Therefore, we can not conclude Respondent was not candid in her testimony.
A few additional interesting facts. Respondent has repaid the gifts to Mary's estate. Respondent's mother (who is referred to in findings of fact above) is an attorney. Respondent was for a time an attorney employed in her mother's law office. The name of the attending nurse who testified in the trial was Thora Nurse. (Mike Frisch)
Pennsylvania is a jurisdiction that takes a particularly dim view of the unauthorized practice of law by inactive attorneys. A case in point involves a consent suspension for six months approved by the Pennsylvania Supreme Court. The attorney had been placed on inactive status for failure to complete his CLE obligations. According to the Disciplinary Board's report, he "did not fully understand the consequences of being an inactive attorney until he retained...counsel." While inactive, he had "performed a limited amount of legal services in his role as General Counsel" for a corporation:
The legal duties which he performed were limited to answering minor legal questions [the corporation] had regarding approximately 6 business contracts. [He] answered [the corporation's] questions while it was waiting for outside counsel to complete the revisions to the contracts, and while it was receiving outside counsel's advice regarding significant legal issues.
The attorney was restored to active practice in late 2008 but had agreed to refrain from offering legal advice until the disciplinary case was concluded. He no longer is identified as general counsel to the corporation on its website and elsewhere. All legal work is being handled by outside counsel. (Mike Frisch)
The Pennsylvania Supreme Court accepted a consent disposition of a three year suspension in a matter in which the attorney pled guilty to felony mail fraud. The criminal case involved an FBI sting operation in which the agents set up a fake chiropractic clinic called Injury Associates ("IA"). IA provided no medical treatment; rather, it generated phony paperwork to support injury claims. The attorney was targeted based on information from a chiropractor who had been prosecuted for fraud.
The lawyer agreed to represent two agents posing as clients. He forwarded claims to insurers after the agents disclosed (captured on video and audiotape) that they had not received any treatment from IA. Nonetheless, the lawyer settled the two matters with an insurance company for a total of $15,000.00, predicated at least in part on treatment records from IA.
The lawyer made the following statement in a post-settlement meeting with the agents:
Just want to let you know, I'm, you know, it all makes sense to me now and we'll just leave it at that....But in the future when you have a legal problem or an injury...let's, you know, do it in a different way...No one's gonna know about it because they closed the file here...I'm not going to let anybody use my good reputation again like this, but I'm not going to let it go for naught. I did all the proper record keeping. You never got this, so...it makes no difference.
The lawyer was busted after he handed the settlement checks to the agents. (Mike Frisch)
The Wisconsin Supreme Court has held that a lawyer who had drafted a series of wills for his client that contravened a judgment in a prior divorce case may be liable to third party beneficiaries who did not benefit from the will to the extent ordered in the divorce case. The court rejected claims asserted by the lawyer of good faith and qualified immunity. The court affirmed the dismissal of related claims that were predicated on a theory of negligence. The key facts:
Robert Tensfeldt and his first wife, Ruth, had three children——Christine, Robert William, and John. When Robert and Ruth divorced in 1974, they entered into an agreement stipulating to various terms of the divorce. The divorce court determined that the stipulation was "fair and reasonable" and incorporated the stipulation into the divorce judgment.
One of the terms of the stipulation provides that Robert would make and maintain a will leaving two-thirds of his net estate to the children:
Will in Favor of Children: Simultaneously with the execution of this Stipulation, [Robert] shall execute and shall hereafter keep in effect, a Will leaving not less than two-thirds (2/3) of his net estate outright to the three adult children of the parties, or to their heirs by right of representation. Except as herein provided, [Robert] shall have the right to make such disposition of his estate as he may desire, except as limited herein, and further, except as limited by the requirements set forth in [the provision dealing with unpaid alimony.] As used herein, the term "net estate" shall mean [Robert's] gross estate passing under his Will (or otherwise, upon the occasion of his death), less funeral and burial expenses, administration fees and expenses, debts and claims against the estate, and Federal and State taxes.
Robert married his second wife, Constance, in 1975. They remained married until Robert's death in 2000. Robert and Constance had no children together, although Constance had three children from a previous marriage. In 1978, Robert executed a will that was compliant with the stipulation and order——one-third of the net estate went to Constance, and two-thirds of the net estate went to his children or their issue.
In 1980, Robert retained Attorney...to provide estate planning services. It is undisputed that Robert made [the attorney] aware of his obligation to his children from the outset. When Robert initially met with [him], he gave the attorney a copy of the divorce judgment and stipulation. [The attorney] told Robert that he had three choices: comply with the stipulation; negotiate with the children to alter his obligation; or ignore the stipulation, knowing that the children might contest Robert's will upon his death. Robert chose the third option, and in 1981, [the attorney] drafted an estate plan that did not leave two-thirds of the net estate outright to the Tensfeldt children.
After Robert executed the non-compliant estate plan, [the attorney] received a letter from Robert's divorce attorney, J.M. Slechta. Attorney Slechta wrote:
Since you have drafted a will for Mr. Robert Tensfeldt of Oconomowoc, I recalled that in his divorce in 1974 in which proceedings I represented him, it was agreed in the Stipulation made part of the judgment, some restrictions on the disposition of his estate . . . . Realizing this might have some effect upon the disposition which you have proposed I am enclosing a copy of such stipulation for your examination. There does not seem to be any sanction against disposition of assets during his lifetime.
[The attorney] wrote back:
Your letter . . . asks whether Mr. Tensfeldt's most recent Will . . . violates his obligations under that decree . . . .
In my opinion, Mr. Tensfeldt's present Will needs some revision in light of the obligations under the divorce decree, of which I was unaware until receipt of your letter. On the other hand, the so-called "Economic Recovery Tax Act of 1981" does, as you know, offer significant new estate and gift tax advantages which may be available to Mr. Tensfeldt to some extent despite the decree.
Robert and [the attorney] never changed the estate plan to bring it into compliance with the divorce stipulation and judgment. Even though Robert and Constance moved to Florida in 1985, they continued to retain the attorneys at [the attorney's firm] the planning. Over the course of 12 years, [the attorney] drafted and executed a series of revisions to the plan for Robert, including 92 plan that was in effect when Robert died. None of the revised plans left at least two-thirds of his net estate outright to the three adult children of his first marriage.
A concurring/dissenting opinion would hold:
I write separately for three reasons: (1) I conclude that the plaintiffs' claim against [the attorney], based on aiding and abetting Robert in allegedly violating a provision of a 1974 divorce judgment that required him to will two-thirds of his net estate to his three adult children, fails to state a claim on which relief can be granted because the estate planning provision of the divorce judgment exceeded the circuit court's subject matter jurisdiction; (2) I conclude that [the attorney] was immune from liability in drafting Robert's 1992 will because [the attorney] proceeded in a good faith belief that the provision in the 1974 divorce judgment that required estate planning in favor of the adult children was void from its inception, as a judgment; and (3) I conclude that even if I were to assume, arguendo, that the directive to make a will in the 1974 divorce judgment were enforceable when made, Wis. Stat. § 893.40, a 20-year statute of repose, precluded actions on the divorce judgment after December 5, 1994. Therefore, the divorce judgment had no effect, as a judgment, in 1999 when Robert reaffirmed the will that he made in 1992, and it had no effect at his death in 2000. As a result, the aiding and abetting claim against [the attorney] must be dismissed. Because the majority opinion concludes otherwise, I respectfully dissent from that portion of the majority opinion that addresses the aiding and abetting claim.
The South Carolina Supreme Court imposed a nine-month suspension in a bar discipline matter involving a series of ethics violations in a number of matters. Among the violations was the failure to pay a fee arbitration award to a client and failure to respond to the inquiries. The court did note some rather compelling circumstances in mitigation:
At the May 2008 hearing, respondent testified to the Panel about his background and several extenuating circumstances that led to his misconduct. In 2005, his 79-year-old father committed suicide in front of his mother by using a .22 pistol to shoot himself in the head. Respondent’s mother called him. When he arrived, his mother was refusing to let EMS take the body away from her. Respondent was the person who cleaned the blood off the walls.
Three days later, respondent and his wife found out she was pregnant. Because of a miscarriage a few months prior, they soon had an ultrasound and discovered she was pregnant with twins. Respondent described the pregnancy as “tumultuous.” The twins were born in January 2006. According to respondent, his wife suffers from depression and experienced severe post-partum depression. He stated that he was trying to “juggle” his wife’s depression, the care-taking of the twins, the after-effects of his father’s suicide, the needs of his 11-year-old stepdaughter, and his solo practice.
Some time after he was served the formal charges, he called his mother and requested that she take care of the two-year-old twins at her home. Additionally, after he met with disciplinary counsel for an interview, he went to a physician and found out he had type two diabetes. He was placed on medication for the diabetes, as well as anti-depressants.
Respondent also made a statement at the second hearing, which occurred in October 2008, approximately four months after he was placed on interim suspension. He told the Panel that after the first hearing, he began seeing a psychiatrist. He stated that with counseling and medication, he had “regained his strength” and he asked that he be allowed to continue to practice law.
Respondent submitted an affidavit from his treating psychiatrist, Dr. Steude. Dr. Steude began treating respondent in August 2008 and diagnosed him with Major Depressive Disorder. Dr. Steude stated that with medication and therapy, respondent’s depression has gone into remission. He noted respondent has been cooperative, interactive and honest during his treatment. Dr. Steude opined that respondent’s personal and marital issues, although not fully resolved, should have “minimal impact, if any, on his ability to competently practice law."
The court rejected the possibility of a lesser sanction in light of the pattern of non-response to the bar. (Mike Frisch)
Monday, July 13, 2009
The Louisiana Attorney Disciplinary Board agreed with a hearing committee that charges of ethics violations had not been proven. The Office of Disciplinary Counsel had appealed the proposed dismissal of charges that the attorney had violated the business transaction with a client rule and engaged in dishonest conduct.
The attorney and complainant were childhood friends. The complainant was a partner in a barbeque restaurant business that operated under the name Podnuh's, Inc. The attorney and complainant became reacquainted in 1986. They regularly ate lunch together and were frequent golfing partners. The attorney had provided a variety of legal services to the complainant over the years.
The attorney drew up a will for the complainant. When the complainant came in to execute the will, the attorney secured his agreement to make an investment in a billiard parlor named Clicks. The bar charges alleged that the arrangement violated Rule 1.8(a). The board here agreed with the hearing committee that the evidence did not establish that there was an attorney-client relationship with respect to the Clicks investment. Even if there was such a relationship, the hearing committee and board found that the deal was fair and reasonable, and that the complainant (whose credibility was found lacking) was given the opportunity to seek independent legal advice. (Mike Frisch)
The Louisiana Attorney Disciplinary Board has recommended permanant disbarment of a former judge of the Civil District Court of Orleans Parish. The judge had been convicted of conspiracy to commit public payroll fraud and claimed that the disciplinary system did not have jurisdiction over him as a former judge. The board disagreed, noting that the Supreme Court had granted a motion for interim suspension and had thus resolved any question as to jurisdiction. The bar charges alleged that:
As found by the Louisiana Supreme Court, the Respondent's misconduct included personally selling tickets to a fund raising event for his reelection campaign; requiring members of his court staff to sell tickets to the event; instructing his staff to deliver tickets to lawyers and law firms on court time and to prioritize their campaign work over their court work; telling staff that if they were unwilling to do what he asked, he would find people to replace them who were more enthusuastic; and lying to the Judiciary Commission during the course of its investigation.
The complainant was a court reporter who had been terminated for her refusal to sell her allotment of tickets and run the judge's personal errands. The judge was unaware that she had audiotapes that incriminated him. (Mike Frisch)
The Tennessee Supreme Court rejected a variety of procedural and substantive objections and suspended a lawyer admitted in 1990 for two years. The court summarized the contentions:
In this direct appeal of a lawyer disciplinary proceeding involving three separate complaints, we are asked to determine whether the trial court correctly affirmed the hearing panel’s order suspending attorney Jes Beard from the practice of law for two years. Mr. Beard argues that the hearing panel erred in: (1) denying his motion to sever and continue the scheduled hearing; (2) finding that he violated several disciplinary rules; (3) applying the Rules of Professional Conduct, when those rules took prospective effect after his conduct occurred; (4) denying him the opportunity to present mitigating evidence; and (5) imposing punishment that was not comparable with punishments imposed in similar cases. Mr. Beard also asserts that the trial court erred in granting the Board of Professional Responsibility’s motion to quash his subpoena duces tecum and abused its discretion in denying his motion for recusal. We affirm the judgment of the trial court.
The court found that the evidence had established violations both before and after the effective date of the rule changes. the trial court had acted within its discretion in denying the motion to sever.
My own view is that a motion to sever disciplinary charges should rarely, if ever, be granted. The broader the picture of an attorney's practices that can be developed in a hearing, the better. (Mike Frisch)
A petition for reinstatement of an attorney who had been suspended for a year and a day in 2006 was denied by the Pennsylvania Supreme Court. The "essence of [the] misconduct was a conflict of interest with her client," a mentally incompetent person for whom the Petitioner had power of attorney. The attorney had drafted and executed an indenture and mortgage in the amount of $275,000 to finance her own purchase of land in New Mexico.
The attorney had decided to retire before the prior discipline was imposed but continued to act under the power of attorney and did not notify the client victim or her beneficiaries of her suspended status. When the client passed away, she was appointed executrix of both estates. Petitioner also failed to advise a second client for whom she had power of attorney of her suspended status. The Pennsylvania Attorney General's office is investigating aspects of the power of attorney account for the client victim.
The Disciplinary Board had opposed reinstatement:
Petitioner demonstrated poor judgment and motive in her decisionto continue as [the client]'s agentand to serve as executrix for the estate following her suspension, instead of dissociating herself from the original source of the conflict of interest. This behavior indicates that Petitioner has no greater appreciation of her wrongdoing and has not rehabilitated herself from her original misconduct, which involved the same lack of judgment and foresight as to the implications of her actions.
Sunday, July 12, 2009
From the California Bar Journal:
[The attorney] was suspended in 2006 for failing to comply with MCLE requirements. Shortly before the suspension, he began a job with a law firm without informing anyone at the firm of his status. When his employers learned he was not entitled to practice, [he] falsely told them he was unaware of his suspension and that he had received no notice from the bar. He was fired.
He stipulated that he held himself out as entitled to practice when he was not active and he committed acts of moral turpitude.
In mitigation, [he] has no record of discipline and no clients were harmed.