Opinion
No. 89-718
Submitted September 13, 1989 —
Decided January 10, 1990.
Attorneys at law — Misconduct — Indefinite suspension — Misappropriation of trust assets.
ON CERTIFIED REPORT by the Board of Commissioners on Grievances and Discipline of the Supreme Court, No. 88-56.
Relator, Disciplinary Counsel, filed a two-count complaint with the Board of Commissioners on Grievances and Discipline of the Supreme Court, on October 28, 1988, charging respondent, David Charles Hipp, with violations of DR 1-102(A)(3) (illegal conduct involving moral turpitude), 1-102(A)(4) (conduct involving dishonesty, fraud, deceit, or misrepresentation), 1-102(A)(5) (conduct prejudicial to the administration of justice), 6-101(A)(3) (neglecting a legal matter entrusted to him), 7-101(A)(3) (intentionally causing prejudice or damage to a client), and 9-102(A) and (B) (failing to preserve the identity of funds and property of a client).
Count I of the complaint charged that respondent violated DR 1-102(A) (3), (4), and (5) in his capacity as an appointed trustee under a will. Respondent was appointed trustee under the will in 1980. The value of the trust was approximately $92,225.25. Thereafter, respondent allegedly misappropriated $27,906.06 from the trust for his personal use between May 1982 and July 1986.
Count I oof the complaint charged that respondent violated DR 1-102(A) (3), 7-101(A)(3) and 9-102(A) and (B) by failing to deposit receipts promptly into the trust and misappropriating funds, thereby causing a loss of interest and other damages.
Respondent substantially admitted the allegations of the complaint. Relator and respondent filed an agreed stipulation of evidence including court orders for the removal of respondent as trustee, appointment of a new trustee, and a full audit and investigation of the trustee's account and trust. The probate court based these orders on its finding that respondent had failed to file accounts as required by law.
Based on the investigation by the subsequent trustee and an accountant, the probate court found that respondent committed eighteen misappropriations from the trust between May 1982 and July 1986 in the amount of $27,906.06 and caused a loss of $17,943.38 in interest and other damages.
The panel and board found, though respondent disputes it, that respondent did not admit that he had misappropriated funds from the trust until confronted with indisputable evidence of his misconduct obtained through the audit ordered by the probate court. However, respondent did reimburse the trust $31,712.59 from March 1986 through September 1987, and additionally reimbursed the trust for attorney fees, audit fees, outstanding interest on misappropriations at twelve percent, and all additional ascertainable losses resulting from the misappropriations.
The probate court stated that there has been a full and final settlement of all claims which the trustee may have had against the respondent due to his improper activities, with the exception of any tax liability that the trust may incur as the result of fraud, and that the remainderman had consented to the settlement of this matter.
A hearing panel of the board found that respondent violated all the Disciplinary Rules charged except DR 7-101(A)(3), finding that since respondent had made total restitution to the trust, including interest and other damages, there was insufficient evidence to prove that his conduct caused prejudice or damage to the trust estate. Because of this restitution and other mitigating circumstances, the panel recommended an eighteen-month suspension from the practice of law.
the board adopted the panel's findings, but recommended that respondent be indefinitely suspended from the practice of law. The board believed this penalty was more consistent with our prior decisions than was the panel's recommendation. Furthermore, the board considered such factors as the number of misappropriations, the substantial amounts involved, and the fact that respondent was a public officeholder. Additionally, the board recommended that the costs of these proceedings be taxed to the respondent.
J. Warren Bettis, disciplinary counsel, and Mark H. Aultman, for relator.
Connolly, Hillyer Welch and Hudson Hillyer, for respondent.
We agree that respondent violated DR 1-102(A)(3), 1-102(A)(4), 1-102(A)(5), 6-101(A)(3), 9-102(A) and 9-102(B), and we adopt the board's recommendation. Respondent is indefinitely suspended from the practice of law in Ohio. Costs taxed to respondent.
Judgment accordingly.
MOYER, C.J., SWEENEY, HOLMES, DOUGLAS, WRIGHT, H. BROWN and RESNICK, JJ., concur.