In re Anonymous No. 94 D.B. 87

5 Pa. D. & C.4th 259
CourtSupreme Court of Pennsylvania
DecidedApril 25, 1989
DocketDisciplinary Board Docket no. 94 D.B. 87
StatusPublished
Cited by1 cases

This text of 5 Pa. D. & C.4th 259 (In re Anonymous No. 94 D.B. 87) is published on Counsel Stack Legal Research, covering Supreme Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re Anonymous No. 94 D.B. 87, 5 Pa. D. & C.4th 259 (Pa. 1989).

Opinion

TUMOLO, Member,

HISTORY OF PROCEEDINGS

Respondent is a 34-year-old [ ] County attorney admitted to practice law in the Commonwealth of Pennsylvania in 1986.

On December 22, 1987 a petition for discipline [260]*260was filed alleging a violation of the following Disciplinary Rules of the Code of Professional Responsibility:

(A) D.R. 1-102(A)(4), dealing with conduct involving dishonesty, fraud, deceit or misrepresentation;

(B) D.R. 1-102(A)(6), dealing with conduct adversely reflecting on an attorney’s fitness to practice law;

(C) D.R. 6-101(A)(3), dealing with a lawyer neglecting a legal matter entrusted to him;

(D) D.R. 9-102(A), dealing with proper maintenance and use of a lawyer’s trust account for entrusted funds of clients; and,

(E) D.R. 9- 102(B)(4), requiring a lawyer to promptly pay or deliver to his client, as requested by the client, the funds, securities, or the properties in the possession of the lawyer which the client is entitled to receive.

After respondent filed his answer, on April 25, 1988, the hearing committee took evidence on those factual matters which were not stipulated.

On January 26, 1989, the hearing committee filed a majority report finding that respondent had violated all of the Disciplinary Rules charged and recommending that respondent be subject to a private reprimand. The dissenting hearing committee member recommended a dismissal of all charges.

On February 15, 1989, petitioner filed a brief on exceptions to the recommended discipline. The petitioner’s position is that the removal of a client’s money should require a discipline of at least a two-year suspension, if not a disbarment.

On February 17, 1989, respondent filed a brief on exceptions which requested that if discipline was to be imposed at all, it should be in accord with the majority recommendation of the hearing committee.

[261]*261Arguments were heard before a panel of the Disciplinary Board on March 29, 1989, and the matter was adjudicated by the Disciplinary Board on April 7, 1989.

FACTUAL BACKGROUND

Respondent became the holder of escrowed monies pursuant to an escrow agreement entered into on or about April 18, 1987. The facts show that a mortgage had been given by a property owner named [A] to [Mrs. B], who subsequently assigned that instrument to her husband. The [Bs] then executed an assignment of that instrument to [C], and these parties deemed it necessary for [C] to escrow $2,100 of the consideration for the assignment to insure that certain real estate taxes were paid. That is, it might be that the property owner or the [Bs] might pay the taxes, in which case the [Bs] would be entitled to the $2,100; or it might be that [C] would decide in order to protect her interest to pay the taxes, and thereby be entitled to a refund of part or all of the $2,100. Respondent’s function as an escrow holder was to insure that those funds not be released for any reason other than to fulfill the purposes of the escrow agreement.

On June 10, 1987, respondent issued a check from his escrow account in the amount of $2,000 made payable to himself. These funds were used by respondent to pay his office expenses, a deposit on an engagement ring, and for a trip to Disney World in Florida. The only factual controversy in this adjudication arises at this point. Respondent contends he contacted [D], the husband, manager, and attomey-in-fact of [C], and asked for $2,000. At that time, the facts show that respondent was engaged to [D’s] daughter and that there was a very close [262]*262personal and business relationship between the two. Respondent testified that [D] told him to use the money in the “[B] escrow account,” which respondent did. [D] has always denied this, contending he was never asked for any such permission, nor did he ever grant that authority. This might seem to raise the issue of [D’s] bias toward respondent, all of which is graphically illustrated in Judge [E’s] opinion in the United States District Court for the [ ] District of Pennsylvania at Civil Action no. [ ], but the board believes that this adjudication does not depend on the credibility of [D]. The trial testimony shows that respondent testified that [D] never indicated to him that he was going to pay the taxes. That is, even under respondent’s testimony, he at most was told by [D] that he could take the money from the “[B] escrow account.” Therefore, even accepting respondent’s version of the facts, the question would become whether an attorney governed by the Code of Professional Responsibility could under the facts of the escrow agreement accept the advice of one of the participants, without any proof that the reason for the escrow had been discharged (i.e., payment of the taxes) and take the money. The answer is clearly no. The reason for the escrow was to insure that both the [Bs] and [C] were protected against the failure to pay real estate taxes. Accepting the advice of either party to remove escrowed funds without the reasons for the escrow agreement having been met immediately presents the attorney with a very substantial likelihood that exactly what occurred herein would happen.

That is, respondent removed the funds from his trustee account on June 10, 1987. Within three weeks of that date, the [Bs] provided a tax receipt showing that the owner of the property, [A], had [263]*263paid the taxes. This made the [Bs] immediately entitled to the escrowed funds. But the escrowed funds did not exist because they had been improperly disbursed.

When the [Bs] questioned why they had not received the $2,100 the respondent told them in late June 1987 that he needed [D] to approve the disbursement. In fact, there was nothing to disburse in late June 1987.

On August 7, 1987, respondent did issue a check from his regular business account in the amount of $2,149 made payable to [Mr. B]. This amount accounted for the escrowed funds, plus interest. However, respondent was clearly out of trust and in violation of the escrow agreement for a period of at least two months.

It would understate the factual background of this matter to delete any mention of the bias and hostility of the witnesses presented to prosecute this claim. There really could not be a better presentation of that bias than is shown in the opinion of Judge [E], supra. That opinion in part states:

“For approximately one year, the relationship between [D] and [respondent] was unassailable. Where amity and close business relationships existed, problems began and [respondent] threw [D] out of their shared offices. As a result, [D] became so displeased that in August 1987, he started a systematic avalanche upon [respondent’s] activities intended to destroy [respondent], his law business, his clients and all who associated with him; [D] even began to inflict suffering and obstructions to his own daughter and grandchildren. At first, [D] withdrew files of cases by the aid of [F] and others. [D] began a campaign of communicating with the clients concerning the dis-reputability and criminality of [respondent], in creating dissatisfactions by clients, creditors and busi-[264]*264néss associates, in causing sufficient provocations in them to make grievance charges to the Pennsylvania Supreme Court Grievance Commission, as well, on a wholesale scale.”

In addition, Messers.

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Related

Office of Disciplinary Counsel v. Yates
908 A.2d 868 (Supreme Court of Pennsylvania, 2006)

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Bluebook (online)
5 Pa. D. & C.4th 259, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-anonymous-no-94-db-87-pa-1989.