Monday, July 23, 2018

From Expert To Respondent

A matter docketed for investigation in 2007 has led to a 206 page report and recommendation of an Ad Hoc District of Columbia Hearing Committee.

The case involved a respected practitioner who had frequently served as an expert witness for Bar Counsel. 

Respondent Evan J. Krame is charged in a four-count Specification of Charges with multiple violations of the Rules of Professional Conduct for the District of Columbia (“Rules”). The charges arise out of Respondent’s actions in the course of administering three trusts, known as Special Needs Trusts (which are explained in Section III. B of this Report), in the Probate Division of the Superior Court of the District of Columbia between approximately January 15, 1997 and November 19, 2010. Respondent is charged with one or more violations of Rules 1.15(a) and (c) and D.C. Bar Rule XI, §19(f) (misappropriation of trust funds, mishandling of disputed funds, commingling, and/or failure to maintain complete records of entrusted funds), 1.5(a) (unreasonable fee), 3.3(a)(1) (knowingly making a false statement of material fact to a tribunal or failing to correct a false statement of material fact or law), 3.4(c) (knowingly disobeying an obligation under the rules of a tribunal without an open refusal based on an assertion that no valid obligation exists), 8.4(c) (dishonesty), and 8.4(d) (serious interference with the administration of justice).

As fully discussed hereinafter, the Hearing Committee unanimously recommends that the  Board conclude that Respondent violated Rule 3.4(c) in two instances in connection with a fee request in one of the trusts, violated Rules 3.3(a)(1), 8.4(c), and 8.4(d) in one instance in an appellate brief in the same trust, and violated Rules 8.4(c) and 8.4(d) in four time entries filed in post-appeal fee requests in two of the trusts. The Hearing Committee, either unanimously or through a majority, concludes that Disciplinary Counsel has not met its burden of proving by clear and convincing evidence any additional charges beyond those unanimously agreed upon.

One member of the Hearing Committee would find more numerous and extensive instances of violations of Rules 3.3(a)(1), 3.4(c), and 8.4(c), and also a violation of Rule 1.5(a). See Separate Statement of Hal Kassoff. A different member of the Hearing Committee would find two violations of Rule 1.15(a) (negligent misappropriation). See Separate Statement of Buffy Mims.

Editors note: District of Columbia hearing committees consist of two lawyers and a non-lawyer. Mr, Kassoff -who took the harshest view of the facts - is the non-lawyer. 

In light of the Hearing Committee members’ differing conclusions concerning which and how many rule violations were proven, and despite consensus on much of the sanctions analysis, there is no majority consensus with respect to a recommended sanction. Warren Anthony Fitch, the Chair, would recommend a six-month suspension with either four months or all of the suspension stayed depending upon the Board’s view of one mitigation issue discussed hereinafter. Ms. Mims would recommend a fifteen-month suspension with three months of that suspension stayed. Mr. Kassoff would recommend an eighteen-month suspension with six months of that suspension stayed. All three members recommend a narrow supervisory condition. 

Notably

Respondent is an experienced practitioner and recognized expert in the Probate Division of the District of Columbia Superior Court. DX A4 at 2; DX B73 at 2; DX C27 at 9; DX I5 at 6-7. He has handled hundreds of cases as a trustee, guardian, conservator, or personal representative in D.C. Superior Court and Maryland Circuit Courts. AA; DX A25 at 1, 6-7; DX C27 at 7-8, ¶¶ 12-13; DX E38 at 36. The Office of Disciplinary Counsel retained Respondent to testify as an expert in the following matters: In re Fair, 780 A.2d 1106 (D.C. 2001); In re Ford, 797 A.2d 1231 (D.C. 2002) (per curiam); In re Long, 902 A.2d 1168 (D.C. 2006) (per curiam); In re Alexander, 865 A.2d 541 (D.C. 2005) (per curiam); In re Hoage, Bar Docket No. 433-99 (BPR July 29, 2005), disability suspension, matter pending before the Court; In re Edwards, 990 A.2d 501 (D.C. 2010); In re Bach, 966 A.2d 350 (D.C. 2009). DX C27 at 9; DX D3 at 24; Tr. 1888.

On the delay

We independently have looked for, but not found, any information suggesting that Disciplinary Counsel either dithered or purposely moved unreasonably slowly during the nine years preceding the filing of the Specification of Charges, and we see ample indication that Respondent and his legal team were responsible for significant portions of that passage of time. See supra at 3-4. Accordingly, we do not consider the very long pendency of this matter to be a mitigating factor.

Chair Fitch on sanction

Respondent’s extraordinary record of professional and other public service, the extreme circumstances that surrounded the violations,  the absence of any material financial loss by or any other prejudice to any beneficiary or other person, the apparent absence of any problems in the intervening seven years and the unlikelihood of any future danger to clients or others all counsel to me a substantial reduction of the presumptive sanction in order to remain consistent here, under all the circumstances, with other dispositions in roughly similar overall circumstances while also deterring other attorneys from engaging in similar misconduct. I therefore recommend that Respondent be suspended from the Bar of the District of Columbia for a period of six months and that at least four months of that suspension be stayed.

Public Member Hal Kassoff would find numerous other serious violations

In conclusion, I find that the majority has erred in not taking into full consideration the unanimously agreed-upon factual findings as described in points two through eight under Section IV-O of the Hearing Committee Report, where all seven points provide an additionally strong basis for the clear and convincing evidence that Respondent’s dishonesty and inflated billing extended well beyond the few examples adopted by the majority. Respondent failed to rebut Disciplinary Counsel’s clear and convincing PCLaw expert testimony that established that Respondent altered the billing entries, and indeed, Respondent admitted that the alterations resulted in a significant increase in payment to himself.

And notes the context of the misconduct

I do find that Respondent’s conduct involved more instances of dishonesty and deceitful behavior generally and a lack of candor with the courts, but I do not find by clear and convincing evidence that Respondent testified falsely. In my view, Disciplinary Counsel did not prove that Respondent engaged in flagrant dishonesty. Based upon Respondent’s level of professional achievement and the testimony by character witnesses, I am convinced that Respondent had no intention of defrauding the beneficiaries of the special needs trusts since he believed his percentage fee approach – which was apparently his standard practice with other types of trusts – was fair and reasonable. In my view, his passion about using a percentage-basis for his fee led to a misguided crusade in defiance of several judges. This appeared to be a crusade on his own behalf and (given his professional status and visibility) on behalf of the community of trust attorneys handling special needs trusts in the D.C. Probate Courts. Respondent’s passion clouded his judgement to the point where many of his actions have to be deemed as “dishonest” according to the Rules of Professional Conduct since he purposefully misled the courts, even though they were not dishonest in the mind of Respondent (nor in many cases in the view of the majority). In other words, his dishonesty was not directed at the beneficiaries of the trusts but his dishonesty and lack of disclosure was directed at the courts.

Member Buffy Mims

Although I agree with the conclusions of law in the majority Report of the Ad Hoc Hearing Committee (“H.C. Report”), I disagree with the majority’s conclusion with respect to the Rule 1.15(a) misappropriation charges in the Seay and Brown matters. See H.C. Report at Section IV, C and H. I would find a Rule 1.15(a) violation in the Seay Special Needs Trust based on Respondent’s admitted duplicate fee disbursements (FF 35, 43) and in the Brown Special Needs Trust based on Respondent’s reimbursement of unsubstantiated expenses (FF 80-81, 86). This Hearing Committee member interprets the law to require a finding of misappropriation even in a case where the mistake was the careless mistake of another.

Unfortunately, under the law, an innocent, good-faith mistake of fact or law is not a defense to misappropriation. Law dictates that it is a per se offense requiring no proof of improper intent...

I agree with the Chair’s analysis of the delay issue raised by Respondent. With respect to the Chair’s “Other Mitigating Factors,” I agree in part and disagree in part. I agree that Respondent’s long history of work in the area of trusts, estates, and probate, his service as an expert witness (at the request of the Office Disciplinary Counsel), and his service as a regular lecturer do merit discussion. Respondent has also served as a steering committee member and later as cochair of the Estates, Trusts, and Probate section of the Bar. Respondent has an impressive history of service and community involvement. However, at some point, the number of violations has to serve to reduce the application of the mitigating factors. If Respondent had been found to have violated one or two Rules and had extensive mitigating factors, as Respondent does here, a recommendation of a stay of most or all of his recommended sanction could be warranted. I find Respondent’s violation of five Rules – some with multiple violations of the same Rule – a considerable obstacle to the application of mitigating factors that might have otherwise served to stay part or all of my sanction recommendation. 

It is unusual to see disagreements such as those reflected in the various opinions of the Hearing Committee members. It is also unusual to see all three members so clearly engaged in the task at hand.

In my view, when the non-lawyer has the harshest view of the three adjudicators, that view likely is most consistent with the truth of the matter.

Editor's note: In D.C., the Board owes no deference to the hearing committee's recommended sanction. Deference is given to any facts found by the majority, so long as those facts are supported by substantial record evidence. 

The opinion in In re Krame can be accessed here. (Mike Frisch)

https://lawprofessors.typepad.com/legal_profession/2018/07/a-matter-docketed-for-investigation-in-2007-has-led-to-a-204-page-report-and-recommendation-of-a-district-of-columbia-hearing.html

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