In re Stanford

50 So. 3d 151, 2010 La. LEXIS 2830, 2010 WL 5129837
Supreme Court of Louisiana·Decided December 17, 2010·No. No. 2010-B-1547·Published·Cited by 3 cases

Opinions

[152]*152ATTORNEY DISCIPLINARY PROCEEDINGS

PER CURIAM.

tin this matter, the Office of Disciplinary Counsel (“ODC”) appeals a decision of the disciplinary board ordering that respondent, Daniel James Stanford, be publicly reprimanded.

UNDERLYING FACTS

In March 1995, Reginald Milstead retained respondent to handle a personal injury claim. In May 1995, Mr. Milstead hired respondent to represent him in a criminal matter for a $5,000 fee. Mr. Milstead signed a document entitled “Authorization to Sign on Behalf of Client” (“Authorization”), which gave respondent permission to sign Mr. Milstead’s name on any settlement checks and releases in the personal injury matter.

In June 1995, respondent settled Mr. Milstead’s personal injury claim for $4,907 without first discussing the settlement with Mr. Milstead, who was incarcerated at the time. Pursuant to the Authorization, respondent endorsed Mr. Milstead’s name on the settlement check and signed his name on the release.

Instead of depositing the settlement check into a trust account, respondent cashed the check. He kept $1,226 as his attorney’s fee and withheld $770 to pay Dr. Joe Turk, who had treated Mr. Milstead’s injuries. Although the record does not establish the exact date Dr. Turk was paid, in a letter dated September 25, 2008, Dr. LTurk’s office stated, “After reviewing Mr. [153]*153Milstead’s medical records, it appears we have been paid in full.”

By letter dated August 22, 1995, respondent informed Mr. Milstead that his portion of the settlement funds ($2,911) had been applied to the $5,000 fee for the criminal case. He also informed Mr. Mil-stead that his records reflected an additional $575 in payments toward the criminal case fee, leaving a $1,514 balance. By letter dated December 11, 1995, respondent informed Mr. Milstead that his balance was $1,100 after family members made payments towards the criminal case fee. By May 1996, additional payments towards the criminal case fee resulted in a balance of $330. Respondent received no further payments.

In November 2006, Mr. Milstead filed a disciplinary complaint against respondent, alleging he never received any proceeds from the settlement check. He also alleged respondent misled him about the status of his personal injury claim and “forged” his signature on the settlement documents.

DISCIPLINARY PROCEEDINGS

In August 2008, the ODC filed one count of formal charges against respondent, alleging his conduct as set forth above violated the following provisions of the Rules of Professional Conduct: Rules 1.4 (failure to communicate with a client), 1.15 (safekeeping property of clients or third persons), 8.4(b) (commission of a criminal act that reflects adversely on the lawyer’s honesty, trustworthiness, or fitness as a lawyer), and 8.4(c) (engaging in conduct involving dishonesty, fraud, deceit, or misrepresentation). Respondent answered the formal charges, denying any misconduct. The matter then proceeded to a formal hearing on the merits.

laHearing Committee Report

After considering the testimony and evidence presented at the hearing, the hearing committee made the following factual findings:

1. Any evidentiary issues surrounding the authenticity of the Authorization have been resolved in respondent’s favor in light of Mr. Milstead’s testimony at the hearing that the signature on the Authorization is his signature and the expert opinion of a duly qualified forensic document examiner that Mr. Milstead authored the signature on the Authorization.
2. Mr. Milstead and respondent agreed respondent would settle Mr. Mil-stead’s personal injury claim, sign Mr. Milstead’s name to all pertinent documents, and apply the settlement proceeds, less respondent’s 25% fee and Dr. Turk’s fee, toward the $5,000 criminal case fee.
3. Respondent was only able to locate Mr. Milstead’s legal file after formal charges had been filed against him. Respondent’s explanation of the delay in locating Mr. Milstead’s closed legal file is credible.1
4. In endorsing the settlement check and release, respondent sincerely believed he was acting appropriately, pursuant to the agreement with Mr. Milstead and with legal authorization. Respondent’s failure to obtain an appropriate power of attorney can be attributed to inexperience.
5. Respondent did not knowingly deceive Mr. Milstead concerning the [154]*154settlement and handling of the settlement funds or otherwise engage in conduct involving dishonesty, fraud, deceit, or misrepresentation in violation of Rules 8.4(b) and 8.4(c).
6. Respondent negligently handled Mr. Milstead’s property by failing to properly deposit the settlement check in a trust account and failing to render an appropriate accounting of the disbursement of the settlement funds to Mr. Milstead. Nonetheless, respondent has, through documentary and testimonial evidence, overcome any legal presumption that he misappropriated or knowingly converted client funds.
7. There is clear and convincing evidence that respondent violated Rules 1.4 and 1.15, but the violations were negligent, as opposed to knowing or intentional.
[48. Mr. Milstead suffered only de min-imis harm, if any, as a result of respondent’s misconduct.

Based on these facts, the committee determined respondent failed to properly communicate with his client and failed to appropriately manage and safeguard client funds. Respondent’s conduct violated his legal and ethical obligations. However, his conduct lacked any dishonest motive and caused no direct harm to his client. After considering the ABA’s Standards for Imposing Lawyer Sanctions, the committee determined the baseline sanction is a public reprimand.

The only aggravating factor the committee found was vulnerability of the victim. In mitigation, the committee found the following factors: absence of a prior disciplinary record, absence of a dishonest or selfish motive, full and free disclosure to the disciplinary board and a cooperative attitude toward the proceedings, and inexperience in the practice of law (admitted 1993).

Under these circumstances, the committee recommended respondent be publicly reprimanded.

The ODC filed an objection to the hearing committee’s report and recommendation, arguing the committee erred in concluding respondent did not convert funds and did not engage in conduct involving dishonesty, fraud, deceit, or misrepresentation. The ODC suggested a suspension ranging from one year and one day to three years is appropriate for respondent’s misconduct.

In his brief to the disciplinary board, respondent asserted, for the first time, the affirmative defense of liberative prescription pursuant to Supreme Court Rule XIX, § 31, because his conduct was negligent and occurred more than ten years before Mr. Milstead filed his disciplinary complaint. Accordingly, he urged the board to dismiss the formal charges as having prescribed.

1 -Jtuling of the Disciplinary Board

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In re Stanford, 50 So. 3d 151, 2010 La. LEXIS 2830, 2010 WL 5129837 (La. 2010).

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