In re Charron

918 S.W.2d 257, 1996 Mo. LEXIS 23, 1996 WL 135637
CourtSupreme Court of Missouri
DecidedMarch 26, 1996
DocketNo. 77352
StatusPublished
Cited by7 cases

This text of 918 S.W.2d 257 (In re Charron) is published on Counsel Stack Legal Research, covering Supreme Court of Missouri primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re Charron, 918 S.W.2d 257, 1996 Mo. LEXIS 23, 1996 WL 135637 (Mo. 1996).

Opinions

ORIGINAL DISCIPLINARY PROCEEDING

LIMBAUGH, Judge.

This is an original disciplinary proceeding filed in two counts. The Chief Disciplinary Counsel charges Respondent, John J. Char-ron, with numerous violations of the rules of professional conduct in relation to 1) his representation of the Industrial Development Authority of the City of Berkeley (IDA) and 2) his performance as personal representative of the estate of Craig Layton and as trustee of a revocable trust established by Craig Layton. The Honorable Carol Kennedy Bader was appointed special master and, after hearing, recommended that Respondent be disbarred.

In a disciplinary proceeding, the master’s findings of fact, conclusions of law, and recommendation are advisory. In re Oberhellmann, 873 S.W.2d 851, 852-53 (Mo. banc 1994). This Court reviews the evidence de novo, determines independently all issues pertaining to credibility of witnesses and the weight of the evidence, and draws its own conclusions of law. Id.

I.

On March 31, 1992, IDA terminated Respondent as its counsel and requested the return of IDA’s official seal and all documents, papers, files, and minutes belonging to IDA in Respondent’s possession. A follow-up letter was sent by IDA on April 2, 1992, repeating the request. For months thereafter, IDA and Respondent engaged in an ongoing dialogue about the return of IDA’s property, but the matter was still not resolved. Finally, on May 27, 1992, IDA filed a formal complaint with the Chief Disciplinary Counsel. On October 13, 1993, a year and seven months after the original request, Respondent returned the property.

Rule 4-1.15(b) requires an attorney to promptly turn over any property the client has a right to receive. Respondent does not dispute the underlying factual basis of the charge against him, and he concedes that IDA had a right to the files. In his defense, Respondent makes two points. First, he contends that IDA was not harmed by the failure to promptly return the property because IDA had duplicates of everything in its own files. However, the fact that the client does not suffer harm does not acquit Respondent of violating the rule. See In Matter of Miller, 568 S.W.2d 246, 252-53 (Mo. banc 1978) (interpreting DR9-102, the predecessor to Rule 4-1.15). For his second point, Respondent argues that he returned the files as soon as possible. Any delay, he explains, was a result of numerous changes in personnel at his law firm during the time period that IDA was attempting to recover their files. Even if we accept Respondent’s contention, the amount of time it took for Respondent to return the files to IDA — a year and seven months — is not prompt and is better explained by Respondent’s own negligence in handling the matter. Therefore, we conclude that Respondent violated Rule 4-1.15(b).

II.

A.

Craig Layton owned and operated Barrett’s Florist, Inc. For a number of years, Respondent had performed legal services for Barrett’s Florist. In exchange for this representation, Respondent accepted a $20,000 promissory note guaranteed by Craig Lay-ton. In May of 1990, Craig Layton died of AIDS.

Thereafter, in accordance with Layton’s will, Respondent became the personal representative of Layton’s estate. Prior to that time, Respondent had never been a personal representative of an estate and had little experience in probate matters. Soon after the estate was opened, Respondent paid himself from the estate the $20,000 owed on the promissory note. In making this payment, however, Respondent failed to file a claim against the estate, nor did he apply for appointment of an administrator ad litem as required under § 473.423, RSMo 1986, when the personal representative is also a creditor of the estate. Furthermore, while acting as personal representative, Respondent made payments to himself totaling $9,500 for legal services rendered to the estate. These pay[260]*260ments were also made without approval of the court.

In October of 1992, the probate division ordered Respondent to appear and to show cause why no annual settlement had been filed. When Respondent failed to appear on the appointed date, he was removed as the personal representative. Over the next few months, the probate division set seventeen different dates for Respondent to provide a “settlement to revocation,” a settlement to the date of his removal. § 473.603, RSMo 1986. Respondent failed to appear on three of those dates, and on several occasions when he did appear, he failed to provide complete information.

Once the settlement was finally completed and filed, Respondent was ordered to show cause why he should not be surcharged for the payments he made to himself. In response, he filed a counter-motion to ratify the payments. The probate division disallowed the $20,000 payment on the promissory note because no claim had been filed against the estate. Of the $9,600 Respondent paid himself in attorney’s fees, the probate division approved only $6,000, the maximum allowed under the probate fee statute, § 473.153, RSMo 1986. Finally, the probate division found that Respondent had distributed $2,965 worth of furniture to family members without vouchers being filed to document the distribution, and that the settlement to revocation reported a shortage of $403.55. Therefore, the probate division ordered Respondent to repay to the estate all of the above amounts plus interest on the excess attorney’s fees and the promissory note. The total amount was $29,408.55.

B.

Craig Layton’s estate plan also included a pour-over trust in which Respondent was named trustee. At the time Respondent began administration of the trust, it contained a condominium, Layton’s florist business, and $200,000. For his services as trastee and as lawyer for the trust, Respondent paid himself $70,000 in fees. After two years as trustee, Respondent voluntarily turned over the trust to a successor trustee. By then, the trust contained only $409, the condominium, and the florist business, which was on the verge of bankruptcy.

It was Mr. Layton’s wish, as explained in the trust, that the florist business be sold to its employees. The employees, however, were unable to purchase the business, and the record is unclear whether other buyers were available. In any event, Respondent continued to operate the business despite the fact that it showed a $21,000 operating loss for 1991 and had liabilities of over $200,000. Of those liabilities, approximately $150,000 were taxes owed to either the United States or the State of Missouri. The recession of the early ‘90s, according to Respondent, was the cause of the operating loss, and prior to that time, he noted, the business had done quite well. Respondent testified that he continued the business because he felt that the recession would not last long, and that the business was potentially successful. Further, he believed that the business could eventually be sold for a substantial price of $250,000 to $400,000. Nevertheless, after Respondent removed himself as trustee, the florist business was placed into bankruptcy by the successor trustee.

Craig Layton’s condominium was also part of the trust. The condominium had two outstanding notes against it totaling $80,000, each secured by a deed of trust on the property. Respondent testified to his belief that the condominium had a value of $100,000 to $125,000.

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Bluebook (online)
918 S.W.2d 257, 1996 Mo. LEXIS 23, 1996 WL 135637, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-charron-mo-1996.