In re the Proceedings, Looking to the Disbarment of Renehan

19 N.M. 658
Procedural entryThis page is a short order in In re the Proceedings, Looking to the Disbarment of Renehan. Read the opinion of the Court — 19 N.M. 640
New Mexico Supreme Court·Decided December 31, 1914·No. No. 1607·Published

Opinion

OPINION ON REHEARING.

EAYNOLDS, D. J.

The real facts in this case, as we understand them, may be briefly stated as follows:

The respondent, in June, 1908, was employed by one Antonio Eaustin Lovato, in behalf of himself and his four brothers, to collect the amount' of money due them under the $20,000 mortgage. The respondent had not solicited this employment, and had not theretofore had any relation with these five Lovatos, and he did not even know them. It was proposed by these Lovatos and agreed at that time, that he should receive one-third of the amount of the recovery. The fund out of which the recovery was to be had was a mortgage for $20,000, executed in February, 1905. At that time it was assumed that Antonio Faustin Lovato had acquired the interest of Jose Maria Lovato by deed, and that he would be entitled, consequently, to one-fourth of the entire fund, by reason of this conveyance. If this arrangement had been carried out, the respondent would have received $2,916.66, being made up of one-third of the Jose Maria Lovato interest; netting $5,000, after paying Mr. Howard $1,000, which would amount to $1,666.66, and one-third of $750 coming to the said Faustin for an interest he inherited, and one-third of $750 for each of his four brothers, amounting to $1,250. The respondent finally received $3,750 out of the transaction, but there were three other brothers not his clients from whom he received $350, each by purchase of their interests, amounting to $1,-050, making a total of $3,966.66. The respondent never, at any time, bore any relation of attorney to any of the other Lovato heirs.

In June, 1908, Messrs. Tntt & Skinner, of Colorado Springs, took an option to purchase all of the Lovato grant for the sum of $175,000. This option ran until the 15th day of October, 1908, and was afterwards- renewed, and was finally exercised by Messrs. Tutt & Skinner, on the 7th or 8th day of December, 1908.

At that time, George Hill Howard, trustee for the Lovato heirs, and to whom the mortgage had been executed for the $20,000, his son, G. Volney Howard, and after-wards substituted trustee, the respondent, Messrs. Tutt & Skinner, and Judge Ira Harris, met in Colorado Springs and effected a sale of the property to Messrs. Tutt & Skinner. The entire purchase price for the grant was either paid or arranged for at that time, except the money to pay off the $20,000 mortgage.

The testimony is not entirely clear as to what the understanding .was between the parties as to just when this mortgage was to be paid, but all of them agreed that at that time the mortgage was to be assumed and paid. The respondent testified that it was agreed that the purchasers might take one year within which to pay off this mortgage, if they so elected, and that it was understood that they were not to pay any attorneys’ fees or costs, but simply the amount of principal and interest. This mortgage at this time was, of course, long past due, but the Lovato heirs were represented by their trustee, and if he agreed that the purchasers might take a year to pay off the mortgage, it was probably binding upon them. Confirmation of the testimony of the respondent is to be found in paragraph two, of the option, which provided that upon the election to purchase, $105,000 should be paid, and $35,000 in six months thereafter, and $35,000 in twelve months thereafter.

While in Colorado Springs, a discussion was had between the parties as to the best method of collecting this money for the Lovato heirs. The respondent representing his five clients, at first talked a foreclosure for them as a means of enforcing the payment of the mortgage. It was' finally agreed by the parties and the respondent accepted-employment from Messrs Tntt & Skinner to undertake to purchase and acquire assignments of the interests of all of the Lovato heirs -which he could get, at as cheap a price as possible. lie testifies that he wrote Antonio Faustin,. the only one of his clients with whom he had had any correspondence, the full details of this arrangement from Colorado Springs. He was unable to produce a copy of the-letter, but that he did write from Colorado Springs is evidenced by the fact that he received a reply dated December 12th, 1908, written by the daughter of Antonio Faustin, acknowledging the receipt of his letter, and the fact that he left Colorado Springs and went directly to California and did not return until after the 12th of December, 1908. In this letter of acknowledgment reference is made to the fact that the respondent had asked Antonio Faustin to send his deeds for interests of his brothers, and a statement is made that he had not bought the interests-of his brothers, but that he had bought Jose Maria Lovato’s share, and that the deed was in Mr. Howard’s possession.

Upon the return of the respondent to Santa Fe, and on. the 29th day of December, he prepared and sent out a large number of documents to Antonio Faustin Lovato, which are the assignments shown in this case. In the letter of transmittal, he asked Antonio Faustin to have Jose Maria Lovato sign on the back of an assignment an. endorsed in Faustin’s favor. He stated that such endorsement would be sufficient under the circumstances to enable him to collect.the money, even in-the absence of the-deed which Jose Maria had given to Antonio Faustin, and which had been delivered to Mr. Howard, trustee.

In this letter of transmittal, the respondent failed tosíate the true amount, or any amount, to which his clients were entitled, respectively, out of the fund evidenced by the $20,000 mortgage.' In this letter he says: “It is your-interest and the interest of the several owners in money which you will obtain by executing the enclosed papers.”' These papers were sent out with amounts in money inserted therein as the purchase price for the respective interests. The four brothers of Antonio Faustin owned a one-thirty-second interest which would produce and be worth :$750 to each. In those assignments the sum of $400 is inserted. He had a contract for one-third of the amount recovered, which would be $250, leaving the net amount, due the heirs, of $500. This state of affairs existed as to the four brothers of Antonio Faustin.

As to Antonio Faustin, there is much confusion in the testimony, but an assignment was produced in evidence in which the sum of $2,600 was inserted. The respondent was unable to account for this as he says that $2,600 bore no relation to any proposition which was ever discussed or written about between himself and Antonio Faustin.

These circumstances would be, standing alone, sufficient to cast a doubt upon the fair dealing of the respondent with his clients.

In explanation of this situation, the respondent states that he assumed that the trustee had informed the Lovato heirs of their rights under the mortgage. It was certainly his duty to do so, and there is no reason to doubt that he had performed that duty. The respondent further states that these assignments were sent out for the purpose of facilitating the preliminary arrangements for paying off the Lovato heirs, and were not final in character. This explanation seems reasonable, in so far as his own clients were concerned. He had not jret settled with his clients, and still retained the power to settle with them according to his original contract with them, and if his intentions were correct no harm had yet been done.

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In re the Proceedings, Looking to the Disbarment of Renehan, 19 N.M. 658 (N.M. 1914).

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