Opinion
No. 89-2217
Submitted April 4, 1990 —
Decided July 11, 1990.
Attorneys at law — Misconduct — Indefinite suspension — Ignoring fiduciary duty to oversee client's trust account — Taking money from client's trust account without permission and without an accounting or notice to client — Taking an exorbitant amount for attorney fees in a divorce case.
ON CERTIFIED REPORT by the Board of Commissioners on Grievances and Discipline of the Supreme Court, No. 88-37.
By a complaint filed on July 12, 1988, relator, Office of Disciplinary Counsel, charged that respondent, Thomas R. Reinstatler, had violated DR 1-102(A)(3) (engaging in illegal conduct involving moral turpitude), 1-102(A)(4) (engaging in conduct involving fraud, deceit, dishonesty or misrepresentation), 1-102(A)(5) (engaging in conduct prejudicial to the administration of justice), 6-101(A)(3) (neglecting an entrusted legal matter), 7-101(A)(1) (failing to seek client's lawful objective), 7-101(A)(3) (causing client damage or prejudice), 9-102(B)(3) (failing to render appropriate accounts of client's funds in attorney's possession), and 2-106(A) (collecting an illegal or excessive fee). The matter was heard by a panel of the Board of Commissioners on Grievances and Discipline of the Supreme Court on April 21 and May 24, 1989.
All the allegations in the complaint arose from respondent's representation of Frank Yeager in a divorce action filed by his wife, Marion Yeager, in 1977. According to the submitted stipulations, testimony and exhibits, respondent and Charles W. Creger, Mrs. Yeager's attorney, were ordered by the Clermont County Court of Common Pleas in 1981 to sell all the couple's marital assets and to hold the sale proceeds in a joint trust account that named respondent and Creger as co-trustees. The court also ordered the co-trustees to account "to their clients at any time that money is available for distribution," and that "[n]o money shall be distributed until fifteen (15) days after notice of the availability has been given to each of the clients."
The sale of the Yeagers' property realized more than $300,000. In April 1981, these proceeds were deposited in a trust account pursuant to the court's order. In December 1981, the Yeagers were granted a divorce and the funds in the trust account were declared joint assets, to be divided accordingly after payment of the couple's outstanding obligations.
From April 1981 through 1983, however, respondent, with Creger's assistance and without notifying Mr. Yeager, caused approximately $62,000 to be withdrawn from the Yeager trust account for his own use. Creger assisted respondent in this regard by issuing him checks whenever respondent asked for money. In all, Creger wrote twenty-nine checks to respondent, purportedly for owed attorney fees and expenses.
Both respondent and Creger had authority to write checks on the Yeager trust account, but respondent always asked Creger to make these disbursements. Respondent testified at the hearing that Creger paid him under this arrangement because the attorneys were attempting, for tax purposes, to offset their fees against the interest accrued by the trust principal, and only Creger received statements concerning the account's balance. However, Creger also wrote approximately $72,000 worth of checks to himself during this period, and by May 5, 1982, the trust account balance contained just $2,861.16. The balance remained below $5,000 until August 1983, dipping as low as $209.19 on July 7, 1983.
Eventually, Mr. Yeager began asking respondent about the trust account assets and also about the amount that he owed respondent for his services. Respondent did not satisfactorily respond to these inquiries, and, in the spring of 1985, Mr. Yeager demanded that respondent obtain a court order requiring Creger to provide an accounting of the trust balance. Thereafter, respondent filed a motion asking for the release of all information pertaining to the Yeager trust account. Before doing so, however, respondent forwarded a copy of the motion to Creger. In a cover letter, respondent explained:
"I had no choice in this matter. The [m]otion was his idea. Frank has been on my back about an accounting of the funds in the trust account for several months."
Mr. Yeager subsequently received an accounting of the trust assets from which he learned for the first time that respondent and Creger had paid themselves from that account. This discovery caused Mr. Yeager to engage another attorney to represent him in the divorce action. Mrs. Yeager also retained other counsel in the matter and, by April 1, 1986, an agreed entry approving distribution of the trust account assets was signed by the court.
In January 1986, the Yeagers filed suits against respondent and Creger for their actions as attorneys and co-trustees in the Yeager divorce case. Mediation proceedings in those matters led to the filing of informal disciplinary complaints against respondent and Creger. Creger resigned from the practice of law in Ohio as a result of these filings. See In re Resignation of Creger (1988), 37 Ohio St.3d 603, 525 N.E.2d 761.
Based on the foregoing, the panel found that respondent had ignored his fiduciary duty to oversee the Yeager trust account and that he had thereby violated DR 6-101(A)(3) and 7-101(A)(1) and (3). The panel found violations of DR 9-102(B) and 1-102(A)(3) through (5) because respondent had taken money from the trust without his client's permission, and also without an accounting or notice to his client. Moreover, because no evidence justified the exorbitant amount of attorney fees that respondent took for his services in the Yeager divorce case, the panel further found a violation of DR 2-106(A). The panel recommended that respondent be suspended from the practice of law for a period of two years, and that he be required to complete continuing legal education ethics courses during this period. The board adopted the panel's findings and its recommendation.
J. Warren Bettis, disciplinary counsel, and Mark H. Aultman, for relator.
Thomas R. Reinstatler, pro se.
Having thoroughly reviewed the record in this case, we agree with the board's findings of misconduct. However, we find that an indefinite suspension from the practice of law should be imposed in response to respondent's violations of the Disciplinary Rules. Accordingly, respondent is hereby ordered 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.