Gene Rosas v. Commission for Lawyer Discipline

CourtCourt of Appeals of Texas
DecidedNovember 10, 2010
Docket04-10-00121-CV
StatusPublished

This text of Gene Rosas v. Commission for Lawyer Discipline (Gene Rosas v. Commission for Lawyer Discipline) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Gene Rosas v. Commission for Lawyer Discipline, (Tex. Ct. App. 2010).

Opinion

OPINION No. 04-10-00121-CV

Gene R. ROSAS, Appellant

v.

COMMISSION FOR LAWYER DISCIPLINE, Appellee

From the 45th Judicial District Court, Bexar County, Texas Trial Court No. 2009-CI-03745 Honorable Brenda Kennedy, Judge Presiding 1

Opinion by: Catherine Stone, Chief Justice

Sitting: Catherine Stone, Chief Justice Sandee Bryan Marion, Justice Steven C. Hilbig, Justice

Delivered and Filed: November 10, 2010

AFFIRMED

Gene Rosas appeals a judgment disbarring him from the practice of law. We affirm the

trial court’s judgment.

BACKGROUND

Rosas was licensed to practice law in Texas. As part of his legal practice, Rosas provided

legal assistance to homeowners facing bank foreclosure. Mark Mallery is a real estate

1 Sitting by assignment. 04-10-00121-CV

salesperson in California. Mallery’s real estate experience includes holding open houses,

showing properties, and drafting letters of intent. Mallery testified, however, that he is

unfamiliar with the legal aspects of real estate transactions.

Mallery purchased an investment property in San Antonio, Texas, but fell behind on his

mortgage payments. Mallery’s lender chose to foreclose on the property and scheduled a

foreclosure sale for August 7, 2007. Rosas learned about Mallery’s situation and sent Mallery a

letter offering to help him avoid foreclosure. Rosas’s letter outlined several options for Mallery,

which persuaded Mallery to contact Rosas’s office on the day of his foreclosure sale.

Mallery asked for Rosas’s assistance in saving his property from foreclosure. During the

course of his conversation with Rosas’s legal assistant, Mallery offered to convey his property to

Rosas. Rosas’s legal assistant relayed the information to Rosas, who immediately filed a petition

for temporary restraining order and application for an injunction on Mallery’s behalf. 2 The trial

court granted Mallery temporary relief and scheduled an injunction hearing for August 21,

2007. 3

Several days later, on or about August 9, 2007, Rosas spoke to Mallery about transferring

his Texas investment property over to him. Mallery indicated to Rosas that Rosas needed to pay

him $5,000 in order for the conveyance to occur. Rosas agreed to Mallery’s monetary request

and, on September 22, 2007, forwarded to Mallery the transfer documents for his approval.

Mallery executed a warranty deed supplied by Rosas on September 26, 2007 and returned all of

2 The petition Rosas filed in district court was styled Mark A. Mallery v. Litton Loan Servicing L.P., Its Assigns, Successors, and Predecessors in Interest. 3 The injunction hearing scheduled for August 21, 2007 did not occur.

-2- 04-10-00121-CV

the documents to him. Rosas neither discussed the details of the property transfer with Mallery

nor verified that Mallery understood the documents he was signing. 4

In the interim, Mallery’s investment property was once again scheduled for a foreclosure

sale to occur on October 2, 2007. On October 1, 2007, Rosas filed a second petition for

temporary restraining order and application for injunction in the district court. Like the prior

temporary restraining order and application for injunction, Rosas identified Mallery as the

plaintiff in the proceedings. The petition states “Defendant has placed Plaintiff’s property for

foreclosure” and notes “Plaintiff has obtained a buyer for the property and requires time to close

the transaction.” The district court granted the relief requested by Rosas and set an injunction

hearing for October 16, 2007. This injunction hearing did not occur, and Rosas recorded the

warranty deed signed by Mallery on November 26, 2007. 5

After Rosas did not pay Mallery in accordance with the terms of their agreement, Mallery

filed a grievance against Rosas with the State Bar of Texas. Mallery complained he had hired

Rosas to save him from foreclosure and that Rosas had “stolen” his house. Rosas responded to

the grievance on August 4, 2008. In his response, Rosas confirmed that he agreed to represent

Mallery in the foreclosure proceedings on August 7, 2007 and that he and Mallery subsequently

entered into a business transaction whereby Rosas’s company acquired title to Mallery’s

property. Rosas confirmed he had failed to pay Mallery and noted that individuals were residing

in the home.

4 Mallery was conveying his property to Rosas’s property holding company, ASGR Property Holdings. The transfer documents provided that ASGR would take ownership of Mallery’s property, while Mallery would remain financially responsible for the property’s mortgage payments. Mallery purportedly did not understand the effect of the documents he signed and did not realize he would remain financially responsible for the property’s mortgage payments. According to Mallery, he executed the documents because he trusted Rosas and believed that Rosas was acting to further his interests. The record shows Mallery made no changes to the documents provided by Rosas except for altering the due date on the promissory note. 5 The Texas investment property was scheduled for foreclosure three additional times, but was never foreclosed upon by the bank.

-3- 04-10-00121-CV

On March 4, 2009, the Commission for Lawyer Discipline (the “Commission”) initiated a

disciplinary action against Rosas for violation of the Texas Disciplinary Rules of Professional

Conduct. The Commission alleged Rosas violated Disciplinary Rule 1.08(a) by entering into a

business transaction with a client wherein: (1) the transaction and terms on which Rosas acquired

the property were not fair and reasonable to the client and were not fully disclosed in a manner

that could be reasonably understood by the client; (2) the client was not given a reasonable

opportunity to seek the advice of independent counsel in the transaction; and (3) the client did

not consent in writing. The Commission also alleged Rosas violated Disciplinary Rule

8.04(a)(3) by engaging in conduct that involved dishonesty, deceit, or misrepresentation. Rosas

elected to have the complaint proceed in district court and denied the allegations raised by the

Commission. While the disciplinary proceeding was pending, Rosas and Mallery entered into a

settlement agreement on June 27, 2009, resolving their dispute over the unpaid $5,000

promissory note.

After a bench trial, the trial court found Rosas committed misconduct in violation of

Disciplinary Rules 1.08(a) and 8.04(a)(3). See TEX. DISCIPLINARY RULES PROF’L CONDUCT R.

1.08(a), 8.04(a)(3) reprinted in TEX. GOV’T CODE ANN., tit. 2, subtit. G, app. A (West 2005).

The trial court did not file findings of fact and conclusions of law in support of the judgment. As

a sanction, the trial court disbarred Rosas and ordered him to pay the State Bar of Texas $9,250

in attorney’s fees. This appeal followed.

DISCIPLINARY RULE OF PROFESSIONAL CONDUCT 1.08

A. Sufficiency of the Evidence

In his first issue, Rosas alleges he is not guilty of violating Texas Disciplinary Rule of

Professional Conduct 1.08(a) because there is no evidence demonstrating an attorney-client

-4- 04-10-00121-CV

relationship existed between he and Mallery at the time of their business transaction. See TEX.

DISCIPLINARY RULES PROF’L CONDUCT R. 1.08(a) (prohibiting a lawyer from entering into a

business transaction with a client). We review challenges to the legal sufficiency of the evidence

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