Tuesday, October 10, 2017

Generations

An opinion of the California State Bar Court Review Department

 Michael Christopher Bennett appeals a hearing judge’s decision recommending disbarment because Bennett defrauded and intentionally misappropriated $13,860 from his employer, forged signatures, and misused the seals of two notaries public. Bennett does not contest culpability but requests discipline less than disbarment. Principally, he argues that he did not intend any harm, has implemented safeguards against future violations, and has otherwise been rehabilitated. The Office of Chief Trial Counsel of the State Bar (OCTC) does not appeal and requests that we affirm the disbarment recommendation.

Upon independent review of the record (Cal. Rules of Court, rule 9.12), we affirm the hearing judge’s findings of fact and law with minor modifications. The applicable disciplinary standard calls for disbarment absent compelling mitigation that clearly predominates. Bennett has not established this level of mitigation. To the contrary, his mitigation is far outweighed by his egregious, dishonest misconduct, which caused significant harm to his former employer, his clients, the public, and the administration of justice. Thus, we affirm the hearing judge’s disbarment recommendation as appropriate discipline.

 The attorney was admitted in 2005.

He engaged in "off-the-books" representation of 18 clients while at the Generations law firm.

On January 2, 2013, Bennett informed the [employer attorney Trudy and office manager Tom] Nearns that he was leaving the firm that day for another job. Afterwards, Tom searched Bennett’s computer and discovered emails referencing a client matter not in the firm’s database, which had been forwarded to Bennett’s home email address. Tom also found an engagement letter directing the client to make a prepayment to Bennett and assuring that the prepayment would be placed in the firm’s trust account.

On January 11, 2013, Trudy [Nearns] wrote to Bennett that Generations was aware that he had engaged a client and accepted a prepayment on the firm’s behalf without notifying it. On January 15, 2013, the Nearns confronted Bennett, who misrepresented to them that he had personally received payment in only one matter. On January 17, 2013, Tom [Nearns] emailed Bennett, informing him that he and Trudy knew Bennett had improperly engaged other clients, and identifying four more matters. Bennett then responded that those four were the only ones. Bennett knew, however, that he had worked on and received funds for additional matters.

Ultimately, the Nearns discovered evidence of other "off-book" work. Trudy testified that she concluded Bennett took fees in 18 matters. Bennett admits that, while employed by the firm, he "provided legal services on sixteen (16) matters and billed a total of $13,860, separate and apart from the work billed from Generations; i.e.[,] [he] met with 16 people, performed legal work on their behalf, and had them pay him directly." He performed this off-book work without the firm’s knowledge or authorization, instructed clients to pay him directly, misled clients that he was providing their payments to Generations, and used firm resources, including letterhead and computers, while being compensated by the firm to perform full-time work on its behalf. Bennett did not notify Generations that these clients had retained the firm for new or additional legal services, or that they had paid for the services.

His effort to blame the firm failed.

Bennett contends that Trudy potentially committed misconduct by providing privileged and/or confidential documents to the State Bar without receiving clients’ written permission to do so. He also claims that the State Bar, in turn, potentially committed misconduct by accepting those materials, filing a public NDC that included clients’ names, and posting the NDC with those names on the State Bar’s website. Bennett provides no authority for his contentions. And although he acknowledges that OCTC filed a motion to dismiss the original NDC without prejudice about two weeks after it had been filed, he fails to note that OCTC promptly returned the documents when it realized the materials were arguably privileged and/or confidential. Bennett responded to OCTC’s motion by requesting that the NDC be dismissed with prejudice, which was rejected. He fails to show that this was an error, or that he was denied a fair hearing.

Sanction

Bennett’s overall misconduct is rife with dishonesty. He created and hid an off-book practice from his employer and then lied about the extent of this practice when confronted. Moreover, he lied to clients, committed multiple forgeries, and used two notary seals without authorization. This dishonesty goes directly to his fitness to practice. And honesty is absolutely fundamental in the practice of law; without it, "the profession is worse than valueless in the place it holds in the administration of justice." (Tatlow v. State Bar (1936) 5 Cal.2d 520, 524.)

We acknowledge Bennett’s and several witnesses’ contention that his wife’s severe depression and the resulting stress upon Bennett were a cause of his misconduct. We also note that Bennett and his wife have taken steps to lessen the chance of such pressures arising again. Yet many attorneys experience emotional and physical difficulties comparable to those that Bennett faced. "While these stresses are never easy, we must expect attorneys to cope with them without engaging in dishonest activities, as did [Bennett]." (In the Matter of Spaith (Review Dept. 1996) 3 Cal. State Bar Ct. Rptr. 511, 522.) "Misappropriation . . . simply cannot be excused or substantially mitigated because of an attorney’s needs, no matter how compelling." (Hitchcock v. State Bar (1989) 48 Cal.3d 690, 709.).

(Mike Frisch)

http://lawprofessors.typepad.com/legal_profession/2017/10/an-opinion-of-the-california-state-bar-court-review-department-michael-christopher-bennett-appeals-a-hearing-judges-decis.html

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