Friday, September 20, 2019
An Illinois Hearing Board has proposed a split sanction for an attorney's misconduct after missing the statute of limitation on a personal injury claim
As to negotiating over prospective liability
Rule 1.8(h)(1) provides that a lawyer shall not "make an agreement prospectively limiting the lawyer's liability to a client for malpractice unless the client is independently represented in making the agreement." Pursuant to Rule 8.4(a), it is professional misconduct for a lawyer to violate or attempt to violate the Rules of Professional Conduct.
The Administrator alleges Respondent violated Rules 1.8(h)(1) and 8.4(a) by "attempting to have Beachel agree to accept payment of $10,000 in exchange for releasing Respondent from liability for Respondent's failure to file a personal injury action on his behalf within the applicable statute of limitations when Beachel was not independently represented in making the agreement." Respondent denied this allegation. She admitted offering Beachel $10,000 but denied asking Beachel to sign a release or discussing release terms with him.
The evidence established that, while no agreement limiting Respondent's liability was executed, Respondent clearly attempted to enter into such an agreement with Beachel. Respondent intended for Beachel to release her from liability for malpractice in exchange for the $10,000 she offered to pay him. It is undisputed that Beachel was not independently represented at the time Respondent made the offer. Consequently, we find the Administrator proved Respondent violated Rule 8.4(a).
We do not find sufficient proof that Respondent violated Rule 1.8(h)(1). Beachel did not accept Respondent's offer to enter into an agreement, so no agreement was executed. Consequently, Respondent and Beachel did not "make an agreement" within the meaning of Rule 1.8(h)(1). Rather, Respondent's conduct is properly treated as an attempt to violate Rule 1.8(h)(1). See In re Banks, 2011PR0008, M.R. 25136 (Mar. 19, 2012). Accordingly, we find the Administrator proved Respondent violated Rule 8.4(a) by attempting to make an agreement prospectively limiting her malpractice liability but the mere attempt did not constitute a violation of Rule 1.8(h)(1).
As to settling claims with an unrepresented client
Rule 1.8(h)(2) provides that a lawyer shall not "settle a claim or potential claim for such liability with an unrepresented client or former client unless that person is advised in writing of the desirability of seeking and is given a reasonable opportunity to seek the advice of independent legal counsel in connection therewith." While the Complaint states Respondent attempted to settle a potential claim for liability without advising Beachel in writing to seek advice from independent counsel, it does not include an allegation that Respondent violated Rule 8.4(a), which prohibits a lawyer from attempting to violate the Rules of Professional Conduct.
Thus, the issue before us is whether the Administrator proved a violation of Rule 1.8(h)(2). We find he did not. The plain language of Rule 1.8(h)(2) instructs that a lawyer may not "settle a claim" without taking certain actions to protect the client. There was no settlement in this case, as Beachel did not accept Respondent's offer. Rule 1.8(h)(2) does not address offers or attempts to settle a claim, and we decline to expand the scope of the Rule beyond its plain language.
Although Respondent clearly attempted to settle with Beachel without giving him the proper written admonitions and opportunity to seek independent legal advice, the Administrator failed to charge Respondent with violating Rule 8.4(a). The Supreme Court has instructed, "As a matter of due process, an attorney who is charged with misconduct and faces potential discipline must be given adequate notice of the charges, including the rule or rules he is accused of violating." In re Karavidas, 2013 IL 115676, par. 103. We presume the Administrator's omission of Rule 8.4(a) with respect to this charge was inadvertent but, nonetheless, we cannot discipline a lawyer for uncharged misconduct. Karavidas, 2013 IL 115676, par. 73. For these reasons, we find the Administrator failed to prove a violation of Rule 1.8(h)(2).
As to sanction
Respondent's misconduct was serious but not egregious. It was limited in time and did not involve dishonesty. Nonetheless, for the reasons set forth in more detail below, we believe a period of suspension is warranted.
There is little mitigating evidence to consider, other than Respondent's cooperation in these proceedings. While Respondent expressed her intention to compensate Beachel for the loss of his cause of action, she has not done so as of the date of the hearing. Respondent did not present any character witness testimony, evidence of pro bono work, or involvement in her community.
Several factors aggravate Respondent's misconduct. She attempted to take advantage of Beachel, who was a vulnerable client. See In re Bates, 05 CH 48, M.R. 22711 (Nov. 18, 2008). She caused harm to Beachel when her conduct forced him to obtain a new attorney. In addition, we are not convinced Respondent recognizes the importance of complying with her ethical obligations. See In re Samuels, 126 Ill. 2d 509, 531, 535 N.E.2d 808 (1989). Based on her statements to the Panel, she appears to view settlement with her clients as the primary means for addressing her ethical lapses rather than taking steps to prevent the misconduct from occurring in the first place.
Respondent's prior discipline is another significant factor in aggravation. In light of her previous suspension for neglecting four client matters and failing to tell clients their matters were dismissed, Respondent should have had a heightened awareness of her obligation to communicate with Beachel. See In re Storment, 203 Ill. 2d 378, 401, 786 N.E.2d 963 (2002). We are concerned that Respondent did not recognize the importance of communicating with Beachel as soon as possible regarding the status of his case and did not have a basic awareness of the rules regarding limiting her liability to a client for malpractice.
...we recommend that Respondent, Paula McKemie Newcomb, be suspended for eighteen months, stayed after nine months by nine months of probation, subject to [enumerated] conditions
Dissent on sanction
I concur in the factual findings and the findings as to the charges of misconduct. I dissent with respect to the sanction recommendation, as I do not agree that Respondent should be placed on probation. Given that Respondent has engaged in misconduct after completing probation for similar misconduct, I do not believe another term of probation would be a productive use of the Commission's resources. Therefore, I recommend that Respondent be suspended from the practice of law for nine months.