June 25, 2012
Two Lawyers, One Apartment, Two Sanctions
A recent opinion from the New York Appellate Division for the First Judicial Department:
Defendant, a lawyer involved in his divorce proceedings, submitted an affidavit to the court that was intentionally misleading in that he stated that he opposed renting out an apartment that was a disputed marital asset because he needed to use it at times for work purposes. He failed to disclose that, at that time, he was renting the apartment to the daughter of his lawyer (Bloom) for an amount that was substantially below market rate. This deliberately misleading representation concerning marital assets was properly found to be sanctionable, as it related to material facts on a pending motion.
The court also properly found that Bloom had engaged in sanctionable conduct
since he submitted the misleading affidavit, signing the certification on its
back. The evidence also showed that Bloom proceeded to engage in frivolous
conduct, including calling the police when plaintiff wife entered the apartment
unaware that anyone might be there, and found Bloom's daughter there, and
accusing plaintiff of trespass and violation of criminal laws. When plaintiff's
counsel reminded Bloom that the apartment was held in plaintiff's name and that
she was unaware of the secret rental arrangement, Bloom wrote letters to
plaintiff's counsel that were insulting, legally incorrect, and characterized by
the court as "shockingly unprofessional" and "unethical." Under the
circumstances, the court properly found Bloom's conduct to be frivolous within
the meaning of 22 NYCRR 130-1.1. Moreover, Bloom, who testified on his own behalf at the sanctions hearing, was afforded a reasonable opportunity to be heard.
The amount of the sanctions imposed was not an abuse of discretion. (citations omitted)
The Louisiana Supreme Court has ordered a fully-deferred suspension of a year and a day of an attorney who had overdrawn her trust account.
The account was overdrawn by $186.54 when the attorney wrote a $250 check to a client. There were funds avaiable when the check was written, but the client delayed presenting it for awhile. tHe bank honored the check and the attorney made a deposit into the account to cover it.
The account had other issues. The attorney wrote a $93 check for a divorce filing without getting the matching funds. Her husband had inadvertantly used a truct account debit card to pay his cell phone bill. (Mike Frisch)
What, Me Worry?
The majority opinion consists of one word in all caps- AFFIRMED.
A dissent would reverse, concluding that defense counsel engaged in misconduct throughout the trial. Among the lowlights was a suggestion to the jury that plaintiff's expert looked like Alfred E. Neumann and was the "Costco of experts."
In closing argument, defense counsel not only demeaned the plaintiff's expert but "pointed out to the jury that he knew things about the case that they did not know." (Mike Frisch)
Start Spreading The News...
The New Jersey Appellate Division has held that, under the "most significant relationship" test, the New York statute of limitations applies to a tort action brought by an attorney against his former firm. Accordingly, the litigation was dismissed.
Plaintiff was a partner in a New York firm with a Newark satellite office. He was terminated as a result of charges that he had sexually harassed female employees. He sued the firm in New York for defamation. The firm sued him, also in New York, based on allegations of improper conduct as a firm partner. The New York Supreme Court dismissed both actions. The Appellate Division affirmed the dismissals.
After a second action filed by the plaintiff in New York was dismissed, he sued the firm in New Jersey for malicious prosecution. The action was time barred in New York but not in New Jersey.
Here, the court applied the New York limitations rule, concluding that the Empire State was "the locus of all the claims and counterclaims between the parties." (Mike Frisch)
Another Day, Another Three Disbarments, In Maryland
Each of the cases involve various forms of client-related misconduct such as neglect of matters and failure to communicate with clients. (Mike Frisch)
Georgia Withdraws Dual-Role Ethics Opinion
The Georgia Supreme Court has accepted a petition by the State Bar to withdraw a 1986 formal advisory opinion.
The opinion held that the dual employment of an attorney as both a state legislator and a part-time solicitor "does not necessarily create an ethical confklict of interest."
The court concluded that the opinion at issue "creates confusion by being internally inconsistent, and by addressing matters that are better addressed by our Georgia Constitution and Georgia statutes." (Mike Frisch)
Strict Liability For Practice While Suspended For Non-Payment Of Dues
In a case that it described as involving the "problems that can arise when office management practices are inqadequate to ensure timely payment of State Bar membership fees," the California State Bar Court has recommended a one-year suspension, with all but 60 days stayed, and two years probation for an attorney who has practiced for 28 years without discipline.
The suspension was only in effect for a period of 18 days. During that time, the attorney provided legal services in two matters and accepted a fee of over $10,000. When she realized she had been suspended, the dues were promptlt paid and she was reinstated.
The attorney failed to return the legal fee and file to the client.
The State Bar Court noted that there no finding that the attorney was aware of her suspension, but that such proof is not required.The recommendation would require her to make restitution of the fee prior to reinstatement.
The attorney also had failed to cooperate with the investigation and had minimized the misconduct.
A corrected order was entered. (Mike Frisch)
Unpaid Sanction And Costs Does Not Prevent Reinstatement
The Wisconsin Supreme Court has reinstated, with conditions, an attorney who was suspended for six months in 2003.
The reinstatement is conditioned on a payment plan to satisfy a sanction imposed for frivolous litigation (which led to the suspension) and disciplinary costs.
An earlier attempt at reinstatement had failed, in part because he did not admit that his conduct was improper.
The court noted concerning payment of the civil sanction and disciplinary costs:
The referee determined...that Attorney W. had provided a satisfactory explanation for his failure to pay the costs of the prior proceedings and the sanction judgment. Specifically, the referee found that Attorney W. had not earned sufficient income to make additional payments. The referee found that Attorney W.'s annual income since 2004 (the first full year of his suspension) had been quite meager, ranging from a low of $1,864 to a high of $9,086. During his suspension Attorney W.'s primary source of income came from part-time work as a musician in a band. In addition, in the first few years following his suspension, he had also received a limited amount of income from his family's real estate business, but that income had ceased due to the difficult real estate market and the death of his father.
The referee found that Attorney W. has not had a permanent residence for a number of years. He has lived with his parents, various friends, and his girlfriend. He has a two-year-old child, for whom he pays child support, but Attorney W. is in arrearage on his child support obligations due to his lack of income.
Here, the court concluded regarding the unpaid obligations:
There is a difference...between choosing to disobey this court's orders to pay costs and being unable to do so because of a lack of funds. The OLR's positions regarding these requirements for reinstatement are all premised on a view that Attorney W. made a conscious decision not to earn money in order to avoid paying his legal obligations. There is nothing in the referee's report, however, to indicate a deliberate choice by Attorney W. to avoid paying his creditors. The referee found that Attorney W. has not been living a comfort-filled life while stonewalling his creditors. Rather, the referee described Attorney W.'s life since his suspension as a "Spartan like" existence with no frivolous spending or unreported income. Attorney W.'s income simply has not covered even his most basic needs, and he has apparently been forced to live off the kindness of his family and friends. Given the referee's findings, we cannot conclude that Attorney W. chose to violate this court's orders or to avoid paying the civil sanction judgment against him.
The court's order includes a payment schedule. (Mike Frisch)