Opinion
D.D. No. 70-4
Decided December 2, 1970.
Attorneys at law — Misconduct — Commingling client's funds with his own — Acts warranting permanent disbarment.
ON CERTIFIED REPORT by the Board of Commissioners on Grievances and Discipline.
While respondent was employed by the Legal Aid Society of Toledo he undertook to represent two women in personal injury matters, contrary to his employment contract with the Society.
The matters were settled out of court. Respondent received releases and drafts to effect settlements on August 30, 1967. On September 5, 1967, he told his clients, so they testified in this proceeding, that he had received "settlements" which they were to sign because the judge and the other lawyer needed to know the amount for which they would settle. They testified that they signed what they thought were "demand settlements," not knowing or being informed that they were releases, and that respondent did not inform them that he had received the drafts.
On the same day, respondent endorsed and cashed the drafts, totaling $2,500, on behalf of his clients and himself, and obtained a bank check drawn to his order for that sum. There is no evidence of any authority authorizing respondent to endorse his clients' names to the drafts.
Respondent endorsed the $2,500 bank check to one Robinson, who negotiated it at the drawee bank two days later. Respondent claims that this check was used to pay a debt owed Robinson by a friend. However, respondent was unable to identify the friend, or to recall the reason for the debt.
In November 1967, the clients heard that the case had been settled. As a result, one of the clients asked respondent for some money for Christmas, and on November 7, 1967, he gave her his personal check for $500. She testified that she believed respondent was advancing money from his personal funds, not realizing that her claim had been settled and final payment had been received.
A payment of $200, by bank check, was made by respondent to the other client on December 19, 1967. On March 29, 1968, he gave her his personal check, dated April 1, 1968, for the balance of $500 due her, but told her not to cash it. (At that time respondent's bank funds were insufficient to cover the check.) Then, on April 5, 1968, respondent gave his client a bank check for $500 in place of his personal check. It is admitted by relator, the Toledo Bar Association, that respondent made final payment of all monies due, but not until September 1968, over a year and three months after he received the settlement money.
Respondent testified that he had never had an escrow account, and used his personal account. He claims that he had a safe at his home which was nailed to a closet wall, and that the funds in question were in that safe the first part of September 1967.
The Board of Commissioners on Grievances and Discipline gave no credence to the respondent's testimony. Respondent testified that this was the only complaint involving money matters filed against him. However, the secretary of the Toledo Bar Association testified that five other complaints had been filed against respondent; that four, two of which involved money matters, had been settled, and that one, still pending, also involved money matters.
The board found that respondent had violated Canons 11, 29, and 32, and recommended that he be permanently disbarred from the practice of law.
Mr. Maurice D. O'Connell, Mr. Richard S. Baker and Mr. Walter M. Lehman, for relator.
Mr. William H. Cone, in propria persona.
Respondent waived oral argument. In his brief, he does not deny that he failed promptly to inform his clients of his receipt of the settlement drafts or that he endorsed them, or caused them to be endorsed, on behalf of his clients without their knowledge, and claims no authority for so doing.
His chief defense is that he retained his clients' shares of the settlements at their specific request, and was to hold their funds until they notified him when and how they desired payment, and he so testified in the proceedings. The clients testified that they made no such request.
This being the state of the record, and the proceeding before us being a de novo hearing, it is incumbent upon us to search the entire record. Cleveland Bar Assn. v. Fleck (1961), 172 Ohio St. 467.
We find that there is a preponderance of credible evidence in the record to support our findings that respondent wrongfully negotiated the drafts; that he thereby obtained a bank check, which included funds belonging to his clients, in his own name; that he used the check to pay an obligation of a "friend," whose name he could not remember; that respondent's acts were without the consent or knowledge of his clients; and that such acts were deliberately intended by respondent at the time he obtained his clients' signatures to the releases.
We conclude that, by those acts, respondent commingled and used his clients' funds for his own purposes and took advantage of the confidence resposed in him by the clients in violation of Canon 11 of the Canons of Professional Ethics, as adopted by this court; that such acts violate respondent's duty as a lawyer to strive at all times to uphold the honor and maintain the dignity of the legal profession, as required by Canon 29; and that they constitute improper service to his clients, in violation of Canon 32.
We come now to the recommendation of the board that respondent be permanently disbarred from the practice of law.
Respondent's assertion of the availability of his clients' funds, in cash in a safe in his home, even if true, does not satisfy the requirements of Canon 11, nor does it excuse his clear violation thereof.
In Toledo Bar Assn. v. Illman (1969), 18 Ohio St.2d 122, 124, this court said: ". . . What is mandatory is strict accounting and absolute separation of the funds of the client from those of the lawyer." See Ohio State Bar Assn. v. Gray (1965), 1 Ohio St.2d 97, 98.
Moreover, our findings necessarily encompass the fact that respondent blatantly lied to his clients, used their funds for his own personal advantage without authority therefor, and wrote a bad check in the process. The fact that he was able to, and did, make complete restitution more than a year thereafter does not justify or excuse his clearly unprofessional conduct.
Therefore, the report of the board is confirmed and judgment is rendered permanently disbarring respondent from the practice of law.
Judgment accordingly.
O'NEILL, C.J., SCHNEIDER, HERBERT, DUNCAN, CORRIGAN, STERN and LEACH, JJ., concur.