Friday, August 1, 2014
An Illinois Hearing Board has recommended a suspension of nine months of an attorney who used a power of attorney to write himself checks from the account of an elderly woman.
Respondent, who had power of attorney for the property of his client, Eleanor Smith, acknowledged he used funds from Eleanor Smith's bank accounts but asserted he cannot be found to have committed misconduct because there was no attorney-client relationship between him and Eleanor Smith. He further asserted he was entitled to the funds as his fees. The Hearing Board rejected both of these assertions.
The committee concluded
Respondent admittedly met with Eleanor and her family, obtained information from them, accepted fees from Eleanor and advised Eleanor regarding the best method to protect her assets from further dissipation by her husband. Respondent also recommended that Eleanor sign the Agreement and give Respondent power of attorney for property. The Illinois Supreme Court has held that all of these activities constitute the practice of law...
Respondent admits he took money from Eleanor's accounts but claims he was entitled to it as fees. We find no evidence to support this assertion. Respondent was paid in full for the invoices he prepared for Eleanor. Even if he performed legal services after the last invoice date of October 2010, he has no documentation upon which to ascertain the amount of fees purportedly due to him. He did not produce work product or time records after October 2010, nor did he testify as to any work he performed for Eleanor after October 2010. Thus, there was no reasonable basis for the purported fees Respondent paid himself. At the time of hearing, more than two years after his representation of Eleanor ended, Respondent had yet to determine the amount of fees he claims he earned. This reinforces our determination that he has no basis for asserting he was entitled to the funds as fees. By converting the funds, Respondent failed to keep property in his possession in connection with a representation separate from his own property, in violation of Rule 1.15(a).
As to sanction
Respondent's misuse of his client's funds constitutes serious misconduct that warrants a period of suspension. There are several factors in aggravation. Respondent abused his position of trust for his own benefit at a time when he was in a precarious financial position and his elderly client was vulnerable and in poor health. We also consider the harm Respondent caused by his misconduct. He caused financial harm to Eleanor by dissipating the assets he was hired to preserve. He also caused Eleanor's family, who was dealing with Eleanor's failing health, to experience anxiety and stress when they learned of her unpaid bills. Additionally, Respondent's misconduct was not an isolated incident but a pattern of misconduct over a period of several months.
We must note Respondent was less than cooperative with discovery in this matter. He did not identify witnesses with knowledge of the subject matter of the proceeding, as required by Commission Rule 253, nor did he respond to the Administrator's Request to Produce Documents. An attorney is obligated to cooperate with the Illinois Supreme Court and its agency, the Attorney Registration and Disciplinary Commission, in connection with a disciplinary proceeding.
The Hearing Committee also found that the attorney's conduct was dishonest.
In a recent comment, my colleague Alan Childress noted that we ethics professors teach our students that misuse of entrusted funds gets an attorney disbarred.
If that ever was true, it surely no longer is.
Here, the Administrator sought a suspension of twelve to eighteen months. The attorney, based on his defenses, sought dismissal of the charges. (Mike Frisch)