In re Alex

205 So. 3d 895, 2016 La. LEXIS 2365
CourtSupreme Court of Louisiana
DecidedNovember 15, 2016
DocketNo. 2016-B-1020
StatusPublished
Cited by2 cases

This text of 205 So. 3d 895 (In re Alex) is published on Counsel Stack Legal Research, covering Supreme Court of Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re Alex, 205 So. 3d 895, 2016 La. LEXIS 2365 (La. 2016).

Opinion

ATTORNEY DISCIPLINARY PROCEEDING

PER CURIAM

| iThis disciplinary matter arises from formal charges filed by the Office of Disciplinary Counsel (“ODC”) against respondent, Joslyn Renee Alex, an attorney licensed to practice law in Louisiana.

PRIOR DISCIPLINARY HISTORY

Before we address the current charges, we find it helpful to review respondent’s prior disciplinary history. Respondent was admitted to the practice of law in Louisiana in 1988. In 2003, we suspended respondent from the practice of law for thirteen months, fully deferred, subject to a two-year period of supervised probation with conditions. In re: Alex, 02-1289 (La. 1/14/03), 835 So.2d 455 (“Alex I”). The misconduct at issue involved respondent’s failure to timely pay third-party medical providers, as well as commingling and conversion of client and third-party funds, [896]*896arising out of the gross mismanagement of her law practice.

Against this backdrop, we now turn to a consideration of the misconduct at issue in the present proceeding.

UNDERLYING FACTS

This matter originally consisted of two counts of formal charges. The second count of the formal charges alleged that respondent failed to pay an arbitration award rendered in favor of a former client. In fact, however, respondent |ahad paid the arbitration award to her former client pri- or to the filing of the formal charges, and did so less than two months after the arbitration award was rendered against her. Accordingly, neither the hearing committee nor the disciplinary board found any violation of the Rules of Professional Conduct by respondent in connection with this count. The ODC does not object to these findings. We therefore will make no further reference to the second count of the formal charges, and will simply refer to the disciplinary proceeding as if it had always consisted of a single count of formal charges.

The Trust Account Matter

Pursuant to its investigation of a complaint filed against respondent, the ODC performed an audit of respondent's client trust account for the period of March through December of 2010. Respondent submitted accounting records requested by the ODC, including bank statements, copies of canceled checks, and settlement statements for the period of April through December 2010.1

According to the auditor’s report, respondent misused and commingled client trust funds. The accounting records reflect that inappropriate payments were made from the trust account. Respondent also failed to disburse attorney’s fees from the account as they were earned, and she made numerous accounting and procedural errors regarding settlement documents. In some instances, the statements contained mathematical errors. In others, the statements showed that individuals received settlement funds, although there was no evidence of an existing settlement or of a retainer having been deposited on the payee’s behalf.

The ODC alleged that respondent’s conduct violated the following provisions of the Rules of Professional Conduct: Rules 1.15(a)(b) (safekeeping |sproperty of clients or third persons) and 1.15(d) (failure to timely remit funds to a client or third person).

DISCIPLINARY PROCEEDINGS

In March 2015, the ODC filed formal charges against respondent. Respondent, through counsel, answered the formal charges and admitted to errors with her trust account. This matter then proceeded to a formal hearing on the merits, conducted by a hearing committee on September 1, 2015.

Hearing Committee Report

After considering the evidence and testimony presented at the hearing, the hearing committee summarized the witness testimony as follows, in part:

Traci Fontenot, a forensic accountant formerly employed by the ODC, concluded that respondent’s funds were not held separately in her client trust account. She noted that funds were advanced to clients from the account before settlement funds were received. She noted that some third parties were not paid and that respondent paid personal expenses through the ac[897]*897count.2 She believed the audit showed commingling, conversion, misuse of the trust, and accounting errors, but she could not recall a time when the account was overdrawn. She concluded that in only two instances, one for $.77 and one for $75.02, did the client not receive the full amount due to them.

^Respondent testified that she did not know that other people were issuing checks on her trust account. Due to previous problems, she set up a computer generated check writing system. After a settlement, her staff would prepare the breakdown of disbursements, and she would generate the checks. Once her staff was trained, respondent did not typically verify the breakdown. Sometimes, respondent would negotiate medical bills and reduce her fee, but she would not necessarily note the changes on the settlement disbursement forms.

Respondent testified that she left earned fees in her trust account because (1) her practice keeps her out of the office at least two days a week, and she prioritizes payments to clients and third-party providers, and (2) she has experienced theft by staff members who forged operating account checks when they knew funds were available. During the audit period, respondent reconciled her account once a year. Recognizing the problems with her accounting protocols, she has since revised these procedures and engaged the services of an accountant to make sure her trust and operating accounts are properly managed. Respondent testified that she has opened a separate account for her fees and that no one else has access to her trust account checkbook.

In her testimony, respondent’s accountant, Sandra Hampton, made no comments about the audit, instead focusing on assisting respondent in implementing safeguards to protect against theft and mismanagement of her accounts. Ms. Hampton now reconciles respondent’s trust account quarterly. Each month, respondent sends her bank statements to Ms. Hampton, who verifies all settlement disbursements and investigates all stale checks. Copies of all checks are now made before being mailed and settlement disbursement checks are being tracked. Respondent now has an office separate from her home, limiting access of employees, and locking file cabinets. In Ms. Hampton’s opinion, these safeguards are appropriate and sufficient to protect the integrity of respondent’s trust account.

| fiBased on this testimony and the other evidence in the record, the hearing committee made factual findings, including the following:

No client funds were wrongfully withheld. The ODC’s forensic accountant concluded that in two cases, client funds were not paid in the amounts of $.77 and $75.02. However, in the first case, the amount owed to the client was paid in full, and respondent was underpaid by $1.13. In the [898]*898second case, the plaintiff was paid the amounts owed according to the settlement disbursement form, but was actually owed less. The same form indicates respondent underpaid herself $689.95. Therefore, the committed disagreed with Ms. Fontenot’s conclusion that $75.02 of client funds were not paid. Those funds are due to respondent.

The ODC has failed to prove, by clear and convincing evidence, that third-party providers were not paid.

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Bluebook (online)
205 So. 3d 895, 2016 La. LEXIS 2365, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-alex-la-2016.