Ambrose v. State Bar

643 P.2d 486, 31 Cal. 3d 184, 181 Cal. Rptr. 903, 1982 Cal. LEXIS 160
CourtCalifornia Supreme Court
DecidedApril 19, 1982
DocketL.A. 31438. Bar Misc. No. 4198
StatusPublished
Cited by17 cases

This text of 643 P.2d 486 (Ambrose v. State Bar) is published on Counsel Stack Legal Research, covering California Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Ambrose v. State Bar, 643 P.2d 486, 31 Cal. 3d 184, 181 Cal. Rptr. 903, 1982 Cal. LEXIS 160 (Cal. 1982).

Opinion

Opinion

THE COURT.

This is a proceeding to review the recommendations of the State Bar Court in two actions. In the first, the State Bar Court recommended that petitioner be disbarred. In the second, the State Bar Court recommended that he be suspended from the practice of law for five years on conditions of probation, including actual suspension of three years. Although the two matters were argued separately before the State Bar Court, it is appropriate to consider them together. 1 (Fitzpatrick v. State Bar (1977) 20 Cal.3d 73, 78 [141 Cal.Rptr. 169, 569 P.2d 763], and cases there cited.)

I.

Petitioner was admitted to the practice of law in California in June of 1967. He had no prior disciplinary action brought against him.

*187 L.A. 31438

In the first action, the State Bar Court found that petitioner had engaged in misconduct as detailed in the following facts.

In July of 1976, petitioner agreed to represent Joseph Canchóla on behalf of his minor son, Gilbert, in an action for personal injuries. Petitioner settled the action for $15,000 and received a settlement draft for that amount in November of 1976. He deposited the proceeds in his- clients’ trust account and withdrew $5,000 as his fee. However, he failed to pay the remainder to the Canchólas.

In March of 1977, petitioner issued a $10,000 check to the Canchólas. He asked the Canchólas not to cash it, informing them that it would be improper to pay them the funds before Gilbert’s 18th birthday without a court proceeding. Petitioner promised to hold the $10,000 in an interest-bearing account until Gilbert reached majority age. He had no intention of fulfilling this promise. Beginning in March of 1977, petitioner misappropriated the Canchólas’ funds and commingled them with his own.

Gilbert turned 18 years of age in September of 1977. Thereafter, petitioner issued a check for $10,300 to the Canchólas. The check included an endorsement condition stating, “Settlement including damages suffered due to tardy receipt of funds.” In so doing, petitioner attempted to exonerate himself from and limit his liability for malpractice. He knew his account did not contain sufficient funds to pay the check, which was dishonored.

When the Canchólas inquired about their money, petitioner falsely told them that the reason for the delay in payment was that the settlement draft had not cleared. In fact, he had negotiated the draft in November of 1976. The Canchólas stated that they would complain to the State Bar or resort to their legal remedies. In order to prevent or stall the Canchólas’ complaints, petitioner falsely told them in January of 1978 that they would receive their money in three days. He did not make restitution to them until the disciplinary and criminal proceedings were well under way.

In a matter involving a second client, petitioner agreed to represent Virginia Murphy in a civil cause of action. He settled the case, and in December of 1977 he received a settlement check for $7,000. He depos *188 ited the check in his clients’ trust account and received $2,500 in cash. He did not tell Murphy that he had received the check and he misappropriated and commingled a substantial portion of the funds. As in the Canchóla matter, petitioner did not make restitution until the disciplinary and criminal proceedings had begun.

A third course of misconduct involved Joy Smithwick, who retained petitioner to represent her in an action for personal injuries. Petitioner was to receive one-third of any recovery. He filed a complaint in 1975. In April of 1976, the State Compensation Insurance Fund (Fund) intervened in the action. The Fund alleged that Smithwick’s injuries arose from her municipal employment and that the Fund was entitled to recover benefits it was required to pay her. In August of 1976, without Smithwick’s knowledge, petitioner agreed to represent the Fund for one-third of any amounts the Fund recovered. Petitioner’s representation of the Fund was adverse to Smithwick’s interests, since the amount she could recover might be reduced by what the Fund received.

After a trial, judgment for $35,000 was entered in Smithwick’s favor. In October of 1976 and January of 1977, petitioner received drafts totalling about $35,760 in satisfaction of the judgment. Petitioner caused someone to endorse the drafts on Smithwick’s behalf without her knowledge. Petitioner presented these drafts for payment with the knowledge that the endorsements were unauthorized. Smithwick and the Fund were not paid and petitioner misappropriated and commingled all or a substantial portion of the $35,760 he received.

In February of 1977, petitioner paid Smithwick $10,000, but told her that the remainder of the judgment proceeds had to be held in his trust account until resolution of certain claims by the Fund and the state pension system. Petitioner failed to work on resolving those claims despite Smithwick’s request that he do so. In August of 1977, Smithwick asked petitioner for a written accounting of the judgment proceeds he had received. Petitioner failed to provide this accounting.

In May and November of 1977, petitioner misappropriated about $3,600 and $500 in settlement proceeds belonging to two other clients. As in the other instances of misappropriation, petitioner caused his clients’ names to be signéd on the settlement drafts without their knowledge, and he negotiated the drafts knowing that the endorsements were not authorized. In one of these cases, petitioner also misappropriated $800 which he had received on behalf of an insurance company.

*189 In matters involving six other clients, petitioner failed to communicate with his clients, perform services, and return clients’ files upon demand. In one of these matters, petitioner also filed an application for extension of time to file a tax return on behalf of a client without the client’s knowledge. He thereby acted as her attorney without authority. In two cases, sanctions were imposed against petitioner’s clients in their civil actions as a result of his failure to render services to them. Most of this misconduct occurred between November of 1976 and July of 1978. However, in one case, petitioner’s failure to perform services began in May of 1973.

Petitioner also wrote a dishonored check for $500 to a client in December of 1977. He knew his funds were insufficient to cover the check. In January and April of 1978, he knowingly wrote two more dishonored checks for $30 and $54 in payment of clients’ filing fees. He testified that he was able to write checks on insufficient funds because he had an informal arrangement with his bank that his checks would be honored and he would be told to deposit more money in his account. The hearing panel of the State Bar Court found petitioner’s testimony to be contradicted by evidence of a pattern of issuing checks without sufficient funds, the nonpayment of some overdrafts, and the demeanor of petitioner when he testified.

Finally, petitioner became involved in a dispute with Don Lowry, the owner of the building where petitioner had his office.

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Bluebook (online)
643 P.2d 486, 31 Cal. 3d 184, 181 Cal. Rptr. 903, 1982 Cal. LEXIS 160, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ambrose-v-state-bar-cal-1982.