Opinion
No. 93-390
Submitted April 6, 1993 —
Decided June 9, 1993.
ON CERTIFIED REPORT by the Board of Commissioners on Grievances and Discipline of the Supreme Court, No. 92-06.
In a complaint filed on February 19, 1992, relator, Cincinnati Bar Association, charged respondent, Billie L. Warren of Cincinnati, Ohio, Attorney Registration No. 0030586, with violations of: (1) DR 9-102(A) (preservation of the identity of funds of a client in attorney's possession), (2) 9-102(B) (preservation of the identity of property of client in attorney's possession, rendering appropriate accounts, and promptly delivering such property to client on demand), (3) 5-101(A) (refusing employment when attorney's personal interest may impair professional judgment), and (4) 5-104(A) (requiring client's consent after full disclosure to any transaction in which attorney and client have differing interests).
The matter was heard before a panel of the Board of Commissioners on Grievances and Discipline of the Supreme Court on October 15, 1992, upon stipulated admissions of law and fact.
On or about April 9, 1990, Hugh and Pamela Jackson, husband and wife, consulted with respondent to incorporate their environmental clean-up business. It appears that, since the Jacksons paid only $500 of the requested retainer, respondent did not then act to incorporate their business.
Nevertheless, the Jacksons, on June 14, 1990, hired respondent to recover funds they believed their partner, Travis Gray, had embezzled from the business. Acting upon respondent's advice, the Jacksons obtained a check for $17,900.14, which, on June 19, 1990, they gave to respondent. Respondent deposited this check into her trust account and agreed to disburse funds from this account to pay the debts of the Jacksons' business and for legal and accounting fees. Subsequently, the Jacksons gave respondent two additional checks for deposit, bringing the total amount deposited in respondent's trust account to $22,859.24.
Neither respondent nor Hugh Jackson could state the exact terms of respondent's employment. Nevertheless, the Jacksons' legal and business affairs occupied much of respondent's time over the next month, and respondent, in a statement prepared on August 15, 1990, billed the Jacksons at $100 per hour.
On June 28, 1990, pursuant to Hugh Jackson's request, Henry Chai, respondent's husband and business associate, and Rob Brown, Jackson's brother-in-law, were asked to rent a truck so that Jackson could finish work on a project. Chai and Brown could not locate any trucks available for rent. Chai, believing he had Jackson's approval, thereupon purchased a new truck for $10,372.56 with the funds held in respondent's trust account, and obtained a certificate of title in the name of "Billie Warren Co. LPA." Jackson denies authorizing respondent or Chai to purchase this truck and, on learning about the purchase, indicated his displeasure to respondent.
On July 14, 1990, respondent, Chai, and the Jacksons agreed to formalize their relationship and for respondent to purchase the truck. In the agreement, Chai was to perform as controller for the Jacksons' business, which had by then been incorporated. Respondent agreed to perform legal services for the Jacksons' corporation and to use her trust account to receive income from and pay expenses for the Jacksons' corporation. As to the truck, respondent agreed to make $5,000 immediately available to the Jacksons' corporation and to apply the remainder of the price, $5,372.56, as a partial payment for respondent's legal fees. Respondent's corporation retained title to and possession of the truck. Respondent stored the truck for four months and then traded it in for $7,500.
To make the $5,000 sum available to the Jacksons' corporation, respondent, on July 16, 1990, opened a commercial NOW account in the name of her legal practice corporation, referencing her federal identification number.
On July 20, 1990, Chai wrote a check for $500 payable to himself on this commercial account and purchased a certificate of deposit to secure a personal checking account for himself and respondent. On July 23, 1990, respondent closed this commercial account. Chai wrote a check for $3,330 payable to "Billie Warren Co. L.P.A." from the commercial account and deposited the check into respondent's trust account, to the Jacksons' credit. This check created a $500 overdraft in the commercial account, and, to clear the overdraft, Chai wrote, without the Jacksons' knowledge or consent, a $500 check on respondent's trust account. Respondent later credited this $500 to the Jacksons as legal fees paid. Respondent also paid Hugh Jackson $1,670 from this commercial account.
On or about July 27, 1990, Jackson met with respondent and demanded an accounting of the funds held on his behalf and the release of the remaining funds. Jackson specifically requested $1,000. Respondent did not provide an accounting then and released only $400 to Jackson.
On August 15, 1990, respondent sent Jackson a letter advising him of a balance of $4,675.86 due her for legal fees. The correspondence also indicated additional "payments" of $2,844.40 in legal fees to respondent from the trust account. However, respondent had applied these funds to the outstanding fee bill without the express or contemporaneous knowledge or consent of the Jacksons. Respondent admits that she violated DR 9-102(A) because her trust account was out of balance.
On September 18, 1990, again without the express or contemporaneous knowledge and consent of the Jacksons, respondent paid herself $1,500 from the Jacksons' money. On this same date, an attorney representing the Jacksons mailed respondent a letter demanding an accounting of funds and legal fees.
Respondent answered this letter on September 25, 1990. In this letter, she offered to forgo the balance due her if the Jacksons would stop wasting her time. She threatened that, if the Jacksons persisted, she would sue them for the legal fees. She also stated that she was putting liens on documents concerning Hugh Jackson and would send them to Jackson's new attorney when Jackson made a complete break from her and her office. She subsequently sued the Jacksons for the fees.
In summary, the Jacksons delivered $22,859.24 for deposit in respondent's trust account. Respondent charged them $8,716.96 in legal fees. The hearing panel concluded that respondent earned these fees and that they were not excessive.
The panel also concluded that respondent violated (1) DR 9-102(A) and 9-102(B) on multiple occasions by failing to preserve the identity of funds and property of her clients, and by failing to render appropriate accounts of the Jacksons' funds, and to promptly deliver the funds to her clients; and (2) DR 5-101(A) and 5-104(A), by not refusing employment when her personal interest impaired her professional judgment and by not requiring the clients' consent after full disclosure to transactions in which she and the clients had differing interests.
The panel found that respondent had no other disciplinary violations in Ohio or Kentucky, where she began solo practice in 1984. The panel also concluded that her inexperience, misplaced reliance on her husband, and a difficult client contributed to the violations. It finally concluded that she would not likely repeat this conduct.
The panel recommended respondent receive a one-year suspension from the practice of law, but stayed the suspension on the following conditions:
(A) Respondent serve a two-year probation and meet regularly with a member of the Cincinnati Bar Association to supervise her office practices;
(B) She take ten hours of continuing legal education courses on law office management in addition to the standard education requirements;
(C) She immediately dismiss her pending litigation against the Jacksons for fees and submit the case to mandatory binding arbitration before the Fee Dispute Committee of the Cincinnati Bar Association if the Jacksons so agree; and
(D) She commit no further disciplinary violations during the probationary period.
The board adopted the findings of fact and conclusions of law of the panel and recommended that respondent be suspended from the practice of law in the state of Ohio for one year with the suspension stayed on the conditions set forth by the panel.
Wood Lamping, Henry E. Menninger, Jr., and Naomi C. Dallob, for relator.
Burlew, Caliman Youngblood Co., L.P.A., and John H. Burlew, for respondent.
We agree with the board's findings and recommendations. Accordingly, we suspend respondent from the practice of law for one year, with the suspension stayed upon the following conditions: (1) respondent be placed on probation for two years and be required to meet regularly with a monitoring attorney who has been assigned by relator and who will supervise respondent's office practices; (2) during the probationary period, respondent take ten hours of continuing legal education courses on law office management in addition to the standard education requirements; (3) during the probationary period, respondent commit no further disciplinary violations; and (4) respondent immediately dismiss her pending litigation against the Jacksons and submit to mandatory binding arbitration before the Fee Dispute Committee of the Cincinnati Bar Association, if the Jacksons so agree.
Costs taxed to respondent.
Judgment accordingly.
MOYER, C.J., A.W. SWEENEY, DOUGLAS, WRIGHT, RESNICK, F.E. SWEENEY and PFEIFER, JJ., concur.