In re Rabine

253 A.D.2d 144, 687 N.Y.S.2d 654, 1999 N.Y. App. Div. LEXIS 2731

This text of 253 A.D.2d 144 (In re Rabine) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re Rabine, 253 A.D.2d 144, 687 N.Y.S.2d 654, 1999 N.Y. App. Div. LEXIS 2731 (N.Y. Ct. App. 1999).

Opinion

OPINION OF THE COURT

Per Curiam.

The respondent was served with a petition containing seven charges of professional misconduct against him. After a hearing, the Special Referee sustained all seven charges. The Grievance Committee now moves to confirm the Special Referee’s report. The respondent has submitted an affirmation in opposition and has asserted evidence in mitigation in which he asks the Court to consider imposing the mildest possible form of discipline.

Charge One alleged that in breach of his fiduciary duty, the respondent failed to maintain a duly constituted escrow account by failing to designate his special account as required, in violation of Code of Professional Responsibility DR 9-102 (B) (2) and DR 1-102 (A) (8) (22 NYCRR 1200.46 [b] [2]; 1200.3 [a] [8]). On or about May 22, 1996, the Lawyers’ Fund for Client Protection informed the Grievance Committee that two checks, in the amounts of $1,357 and $390, respectively, drawn against the respondent’s escrow account at Chemical Bank were presented for payment against insufficient or uncollected funds on April 22, 1996 and April 25, 1996, respectively. The Grievance Committee initiated a sua sponte complaint, pursuant to the Dishonored Check Reporting Rules (22 NYCRR 1300.1). The respondent was asked to provide the Grievance Committee with the bookkeeping records specified in Code of Professional Responsibility DR 9-102 (D) (1), (2) and (8) (22 NYCRR 1200.46 [d] [1], [2], [8]) for the six months prior to the date of the complaint.

The respondent submitted an answer dated August 1, 1996. He failed to provide the original cancelled checks, bank statements, and deposit slips for the account, but arranged for the bank to provide copies. The records were submitted to the Grievance Committee on or about November 19, 1996, and neither the bank statements, cancelled checks, nor deposit slips designate the account as an attorney trust, special, or escrow account, as required by Code of Professional Responsibility DR 9-102 (B) (2) (22 NYCRR 1200.46 [b] [2]). The account is simply labeled a “Client Funds Account”.

Charge Two alleged that in breach of his fiduciary duty, the respondent failed to maintain a duly constituted escrow ac[146]*146count in that he failed to maintain required bookkeeping records relating thereto, in violation of Code of Professional Responsibility DR 9-102 (D) (1), (2) and (8) and (H); and DR 1-102 (A) (8) (22 NYCRR 1200.46 [d] [1], [2], [8]; [h]; 1200.3 [a] [8]). By complaint dated May 23, 1996, and follow-up letters dated June 27, August 7, August 26, November 7, and December 6, 1996, the Grievance Committee directed the respondent to produce for inspection bookkeeping records, which he was required to maintain, relating to his attorney escrow account at Chemical Bank. On or about November 19, 1996, the respondent submitted to the Grievance Committee copies of bank statements and cancelled checks for the period January 1996 through July 1996, but failed to supply duplicate deposit slips.

On or about December 20, 1996, the respondent submitted an affirmation concerning the deposits and withdrawals made from the account for the time period in question. The affirmation, not made at or near the time of the transactions, was prepared by the respondent in response to the Grievance Committee’s request for his required bookkeeping records. The respondent did not produce or maintain a record of the source of all funds deposited in such accounts, the names of all persons for whom the funds were held, the amount of the funds, and the names of all persons to whom the funds were disbursed.

Charge Three alleged that in breach of his fiduciary duty, the respondent failed to maintain a duly constituted escrow account by failing to safeguard funds entrusted to him to be held in escrow. This conduct also reflects adversely on his fitness to practice law, in violation of Code of Professional Responsibility DR 9-102 (A) and DR 1-102 (A) (8) (22 NYCRR 1200.46 [a]; 1200.3 [a] [8]). On at least two separate occasions,the balance in the respondent’s escrow account fell below that which he was required to hold. On or about April 15, 1996, the respondent deposited or caused to be deposited into his escrow account the sum of $4,778 on behalf of his client, Fein Families Trust, including a check for $2,223 which was not collected by the bank, and was returned on or about April 22, 1996. He thereafter made disbursements totalling $4,778 with respect to the Fein Families Trust. On or about April 22, 1996 and April 25, 1996, two checks drawn in payment of expenses for the Fein Families Trust in the amounts of $1,357 and $390 were presented for payment at Chemical Bank against insufficient funds. Accordingly, the respondent only had the sum of $2,555 available for disbursement regarding the Fein Families Trust.

[147]*147Charge Four alleged that in breach of his fiduciary duty, the respondent failed to maintain a duly constituted escrow account because he converted funds entrusted to him to be held in escrow. This conduct adversely reflects on the respondent’s fitness to practice law, in violation of Code of Professional Responsibility DR 9-102 (A) and DR 1-102 (A) (8) (22 NYCRR 1200.46 [a]; 1200.3 [a] [8]). By check number 1053 drawn on that account on April 18, 1996, the respondent disbursed the sum of $4,892.04, payable to the Estate of Grace Sabato. At that time, however, there were no funds on deposit in the respondent’s primary escrow account relating to the Estate of Grace Sabato. Funds corresponding to the estate matter were not transferred into the respondent’s primary escrow account until on or about April 24, 1996. The respondent disbursed check number 1053 from his primary escrow account before transferring corresponding funds from the Sabato Client Funds Account, which he had established as a subaccount of his primary escrow account. As a result, that check was drawn against funds on deposit in the respondent’s primary escrow account pertaining to unrelated clients.

Charge Five alleged that in breach of his fiduciary duty, the respondent failed to maintain a duly constituted escrow account because he converted funds entrusted to him to be held in escrow. This conduct adversely reflects on his fitness to practice law, in violation of Code of Professional Responsibility DR 9-102 (A) and DR 1-102 (A) (8) (22 NYCRR 1200.46 [a]; 1200.3 [a] [8]). By check number 1043 drawn on that account and dated April 1, 1996, the respondent disbursed the sum of $300 payable to the Bronx County Surrogate, relating to the Estate of Grace Sabato. The check cleared the respondent’s primary escrow account on or about April 3, 1996. At that time, however, there were no funds on deposit in the respondent’s primary escrow account pertaining to the Sabato estate. Funds corresponding to the estate matter were not transferred into the respondent’s primary escrow account until on or about April 9, 1996. The respondent disbursed check number 1043 from his primary escrow account before transferring corresponding funds from the Sabato Client Funds Account, which he had established as a subaccount of his primary account. As a result, the subject check was drawn against funds on deposit in the respondent’s primary escrow account pertaining to unrelated clients.

Charge Six alleged that in breach of his fiduciary duty, the respondent failed to maintain a duly constituted escrow ac[148]*148count because he converted funds entrusted to him to be held in escrow.

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253 A.D.2d 144, 687 N.Y.S.2d 654, 1999 N.Y. App. Div. LEXIS 2731, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-rabine-nyappdiv-1999.