Thursday, January 23, 2020

Compassionate Collaboration

A bar discipline case summary from Dan Trevas on the Ohio Supreme Court web page

Two Cuyahoga County attorneys were suspended for one year after they attempted to secure a more than $1 million fee from a wrongful death case settlement, admitting they only provided an estimated 15 hours of legal work and preparation of basic court documents.

In a 5-2 per curiam opinion, a Supreme Court majority ignored a recommendation from the Board of Professional Conduct to impose six-month, fully stayed suspensions on Mark D. Amaddio of Beachwood and John J. Wargo of Berea. The Court found an actual suspension from the practice of law was warranted for the attorneys’ attempt to collect a clearly excessive fee and the circulation of a frivolous draft petition to remove the father of a deceased child as the administrator of an estate.

Chief Justice Maureen O’Connor and Justices Judith L. French, Patrick F. Fischer, Michael P. Donnelly, and Melody J. Stewart joined the majority opinion.

Justice Sharon L. Kennedy dissented, stating that based on the Court’s precedent , the attorneys should receive one-year, fully stayed suspensions, with the condition that they commit no further misconduct. Justice R. Patrick DeWine joined the opinion.

Father Seeks Legal Advice, Not Representation
In April 2016, a 16-year-old girl, identified in court documents as O.B., was in the care of a hospital treating her for mental-health disorders. She died in the hospital of an apparent suicide. Hospital personnel immediately acknowledged responsibility for the death and expressed condolences to her parents.

O.B.’s parents decided to handle negotiations with the hospital and engage in “compassionate collaboration” with the doctors and hospital administrators. Because of the confidential nature in which the matter was resolved, the parents’ names were withheld from court documents.

O.B.’s parents set three goals for the negotiations: ensure the surviving members of the family, including the two younger sisters of O.B., receive treatment to deal with their loss; establish initiatives between the hospital and local city schools to care for students who return to school after receiving mental-health treatment; and reach a financial settlement that respected O.B.’s life.

While O.B.’s parents planned to negotiate directly with the hospital, they sought an attorney to represent their interests if negotiations broke down. The father interviewed multiple attorneys including Amaddio.

Amaddio and Wargo are not in the same firm, but sometimes work together in medical-malpractice and personal-injury cases. O.B.’s parents met with Amaddio, and he proposed a 20 percent contingent fee. Because the family wanted to avoid litigation, no fee agreement was signed, and the father made it clear to Amaddio and other attorneys that he did not want to hire an attorney unless negotiations with the hospital broke down.

After several months of meetings, the parents achieved their goals and reached an agreement that included a seven-figure financial settlement. While Amaddio was not present at the meetings, the father kept him apprised of the progress.

Attorneys Open Estate
As the negotiations entered the final stages, Amaddio advised the father that it would be necessary to open an estate for O.B. and obtain probate-court approval of any financial settlement. In November 2016, Wargo prepared and filed documents to open the estate and appoint the father as administrator.

The father informed the hospital that Amaddio and Wargo would obtain court approval. Up to this point Amaddio estimated he spent about 15 hours on the matter within the seven months between O.B.’s death and the signing of the settlement.

After the settlement signing, Amaddio told the father he could not speak to the hospital’s lawyer until he had a signed contract. The father expected to sign a contract with Amaddio to handle the probate matter going forward and estimated he would pay the attorneys a few thousand dollars in fees. Instead, Amaddio presented the same 20-percent contingent-fee agreement, and the father refused to sign it. Amaddio suggested the father contact Wargo about the probate proceedings.

The father met Wargo in early December 2016. The conversation focused on Amaddio’s fee and Wargo suggested that if Amaddio agreed to significantly reduce the fee, the hospital might pay a portion of it.

Attorneys ‘Play Some Hardball’ with Father
With the consent of the father, Wargo called the hospital’s attorney to discuss the possibility of the partial fee payment, and left a message. Later that day, the father withdrew his consent to those discussions. He terminated Wargo’s representation later that month.

The father hired a new attorney, who informed Wargo that the family did not believe they owed him and Amaddio any fees related to the settlement.

Amaddio and Wargo enlisted Tom Wilson, Wargo’s law partner, to pursue a claim for the fee. Wilson proposed filing an application to remove the father as administrator of the estate to pressure the parents into paying the fee. When asked during disciplinary proceedings about his reaction to Wilson’s plan, Wargo said: “I didn’t argue with him at all. I just thought, OK, play some hardball.”

Wargo hand-delivered a copy of the petition to the father, and emailed it to his lawyer and the hospital’s attorney. The draft petition, which would have been a public document if filed, included O.B.’s medical conditions, her troubled emotional history, and the actual circumstances of her death. It also accused the father of “fraudulently” representing to Amaddio that he would pay the 20-percent fee. The petition disclosed the amount and structured payout of the confidential settlement, and it listed Amaddio and Wargo as creditors to the estate, entitling them to attorney fees.

The father asked the probate court to sanction Amaddio and Wargo, and the two acknowledged they were aware of the draft petition’s contents and that it was intended to pressure the father to pay the fee.

The father’s attorney and the hospital’s attorney urged Amaddio and Wargo to abandon their fee claim and the petition. The petition was not filed, but the two requested from the probate court that they receive attorney fees from the estate. The day before the hearing, the two withdrew the fee request.

As part of the sanctions proceedings, Amaddio and Wargo agreed to donate $30,000 to mental health organizations as an apology to the family, and paid $15,000 of it prior to their Board of Professional Conduct disciplinary hearing. They agreed to pay the balance by the end of 2020.

Attorneys Charged with Rule Violations
Based on their actions, the Office of Disciplinary Counsel charged the two with violating rules governing the conduct of Ohio lawyers. The board found the two violated the rule against charging a clearly excessive fee. By circulating a petition accusing the father of being a fraud and a liar, they engaged in conduct that adversely reflects on their fitness to practice law, the board concluded.

The parties agreed that a public reprimand was an appropriate sanction for the two, who had no prior disciplinary records. The board found Amaddio and Wargo acted with a selfish motive and caused harm to a vulnerable family by publicly threatening to accuse O.B.’s father of fraud.

Based on sanctions imposed on attorneys for similar misconduct, the board rejected the public reprimand and recommended to the Court that the two be suspended for six months, with the suspensions fully stayed with the condition that they commit no further misconduct.

The Court opinion stated that based on its review of the record and precedent, a fully stayed suspension was “entirely inadequate.” The Court found the fee was “grossly disproportionate to the amount and difficulty” of the work they performed. Because the fee agreement was not in writing and signed by both parties, the agreement was unenforceable under R.C. 4705.15(B), and in violation of the professional conduct rules.

“O.B.’s parent successfully negotiated a seven-figure settlement with the hospital just over seven months after their daughter’s tragic death, but they spent the next year of their lives and incurred $42,000 in attorney fees opposing Amaddio and Wargo’s unreasonable claim,” the opinion stated.

The Court concluded the more severe one-year suspension was warranted.

Dissent Challenges Sanction
In her dissenting opinion, Justice Kennedy wrote the purpose of the disciplinary process “is not to punish the attorney who engaged in the misconduct but to protect the public.” She wrote that the majority’s imposition of a one-year suspension “seems more like punishment than an attempt to protect the public.”

Both the majority and dissenting opinions cited the Court’s 2012 Cincinnati Bar Assn. v. Hartke decision as precedent for imposing the sanctions on Amaddio and Wargo. In Hartke, after a client refused to pay a $5,000 fee, the attorney, James R. Hartke, went to the client’s home and threatened criminal action against her if she did not pay. The client agreed to immediately drive to the bank with Hartke, where a bank employee called the police because the client had appeared so upset.  After a police officer arrived and suggested that the client pay what she owed, Hartke accepted a $3,000 payment to satisfy the debt. Harkte had a prior disciplinary record, and the Court imposed a six-month suspension on him.

The dissent stated that like Hartke, Amaddio and Wargo used improper threats to pressure a client to pay a fee. But Amaddio and Wargo did not threaten criminal charges, did not receive any payment for their work, and acknowledged the wrongfulness of their conduct. They also agreed to make a $30,000 donation and have paid half of it.

Because of the “striking differences” between this case and Hartke, the dissent stated that a lesser sanction than what Hartke received is appropriate so that the two should instead receive fully stayed one-year suspensions.

2019-0809. Disciplinary Counsel v. Amaddio and Wargo, Slip Opinion No. 2020-Ohio-141.

(Mike Frisch)

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