IN THE SUPREME COURT OF IOWA No. 08–1413
Filed June 5, 2009
IOWA SUPREME COURT ATTORNEY DISCIPLINARY BOARD,
Complainant,
vs.
VAN PLUMB,
Respondent.
On review of the report of the Grievance Commission.
Respondent appeals from a report of the Iowa Supreme Court
Grievance Commission recommending respondent’s license to practice
law be suspended. LICENSE SUSPENDED.
Charles L. Harrington and David Grace, Des Moines, for
complainant.
Alfredo Parrish of Parrish Kruidenier Dunn Boles Gribble Parrish
Gentry & Fisher, L.L.P., Des Moines, for respondent. 2
HECHT, Justice.
The Iowa Supreme Court Attorney Disciplinary Board alleged the
respondent, Van Plumb, violated several ethical rules by divulging a
client’s secrets or confidences, neglecting clients’ cases, attempting to
persuade a client to withdraw an ethical complaint, failing to respond to
a complaint filed by the board, failing to provide responses to the board’s
discovery requests, failing to provide clients with an accounting for
unearned retainers, failing to deposit unearned fees in a trust account,
engaging in dishonesty or misrepresentation in attempting to cover up
his failure to file a civil action within the statute of limitations, and
misappropriation of funds from a trust account. A division of the
Grievance Commission of the Supreme Court of Iowa found Plumb
violated numerous ethical rules and recommended we suspend his
license to practice law for a period of twelve months. Plumb filed a notice
of appeal from the commission’s report. See Iowa Ct. R. 35.11(1).
Having given respectful consideration to the commission’s findings of
fact, conclusions of law, and recommendation, we find the respondent
violated numerous ethical rules. We therefore suspend his license to
practice law indefinitely with no possibility of reinstatement for eighteen
months.
I. Scope and Standards of Review.
We review attorney disciplinary proceedings de novo. Iowa Ct. R.
35.10(1). The board has the burden to prove disciplinary violations by a
convincing preponderance of the evidence. Iowa Supreme Ct. Att’y
Disciplinary Bd. v. D’Angelo, 710 N.W.2d 226, 230 (Iowa 2006). “This
burden is ‘less than proof beyond a reasonable doubt, but more than the
preponderance standard required in the usual civil case.’ ” Id. (quoting
Iowa Supreme Ct. Bd. of Prof’l Ethics & Conduct v. Lett, 674 N.W.2d 139, 3
142 (Iowa 2004)). We give weight to the commission’s findings, especially
when considering the credibility of witnesses, but we are not bound by
those findings. Iowa Supreme Ct. Att’y Disciplinary Bd. v. McGrath, 713
N.W.2d 682, 695 (Iowa 2006). “Once misconduct is proven, we ‘may
impose a lesser or greater sanction than the discipline recommended by
the grievance commission.’ ” Iowa Supreme Ct. Att’y Disciplinary Bd. v.
Conrad, 723 N.W.2d 791, 792 (Iowa 2006) (quoting Lett, 674 N.W.2d at
142).
II. Factual Findings.
The board’s complaint alleged Plumb committed ethical violations
in the representation of four separate clients. We will address them
seriatim in the same order they were addressed in the commission’s
findings, conclusions of law, and recommendation.
A. McRae Matter. Plumb represented McRae on a domestic
abuse charge which was concluded with the entry of a deferred
judgment. While subsequently representing a different party in
contentious commercial litigation, Plumb deposed McRae who was listed
as a witness by a party-opponent. Plumb posed questions during an
August 14, 2002 deposition requesting McRae to disclose the nature of
the criminal charge and the substance of certain statements made by
McRae to Plumb in the course of their attorney-client relationship.
Although McRae asserted the attorney-client privilege, Plumb persisted
in the line of questioning. The board asserted Plumb’s conduct during
the deposition violated DR 4–101(B) (revealing confidences or secrets of
client), DR 7–102(A)(1) (taking action on behalf of a client when it is
obvious such action would serve merely to harass or maliciously injure 4
another), and DR 1–102(A)(1), (5), and (6) (violating a disciplinary rule). 1
The commission found Plumb’s conduct during the deposition was
properly characterized as overzealous, but not so egregious as to require
a sanction. Plumb contends his questions did not reveal any secret or
confidence imparted to him by McRae, and claims the questions posed
during the deposition inquired only as to matters that were already of
public record in McRae’s criminal case.
A client’s “secrets” includes information gained by an attorney in
an attorney-client relationship that “would be embarrassing” or that
would “be likely to be detrimental to the client.” DR 4–101(A). Even if it
was not already apparent to Plumb that McRae considered his domestic
abuse history as a distinct embarrassment, this became clear to him
when McRae declined to answer because he believed the questions
inquired about a matter protected by the attorney-client privilege.
Notwithstanding McRae’s initial refusal on the ground of privilege to
answer the question posed, Plumb persisted and expressly inquired as to
the substance of a conversation he claimed to have had with McRae
about the consequences of any plea bargain in the criminal case. We
find Plumb’s conduct during the deposition crossed the line of
appropriate zealous representation in the commercial litigation, and
constituted a revelation of a former client’s secret in violation of DR 4–
101(B)(1). We also find Plumb’s conduct during the deposition
constituted a violation of DR 1–102(A)(1) (violation of a disciplinary rule),
DR 1–102(A)(5) (conduct prejudicial to the administration of justice), and
DR 1–102(A)(6) (conduct adversely reflecting on fitness to practice law).
1Most of the conduct at issue in this case occurred prior to July 1, 2005. As to such conduct, the board charged Plumb with violation of rules then extant in the Iowa Code of Professional Responsibility for Lawyers. Where Plumb’s conduct after July 1, 2005 forms the basis of claimed ethical violations, the board has alleged breach of rules stated in the Iowa Rules of Professional Conduct. 5
B. Babcock Matter. Plumb agreed to represent Babcock, who
was incarcerated at the correctional facility in Newton, in a civil action
for the sum of $3000. Plumb received the advance fee payment from
Babcock, but did not deposit it in a trust account. Babcock later filed a
complaint with the board after Plumb failed to respond to several written
inquiries between March and October of 2004. Plumb notified Babcock
of his intention to withdraw as counsel. Plumb and Babcock thereafter
discussed the matter by telephone and reconciled their differences.
Plumb drafted a letter for Babcock’s signature withdrawing the
complaint. The reconciliation was short-lived, however, for soon
thereafter Babcock refiled the ethics complaint against Plumb, and
requested an accounting and a refund of the unearned attorney fee.
Plumb ignored for several months the request for an accounting. When
the board requested information from Plumb about the complaint, he did
not respond.
The board charged Plumb with neglecting Babcock’s case in
violation of DR 6–101(A)(3), improperly attempting to influence Babcock
to withdraw the ethical complaint in violation of DR 1–102(A), failing to
respond to the board’s inquiry in violation of DR 1–102(A)(5), (6), failing
to deposit unearned fees in a trust account in violation of DR 9–102(B),
and failing to refund unearned fees in violation of DR 2–110(A)(3) and
DR 9–102(B)(4).
We find the communication problems between Plumb and Babcock
were attributable, at least in significant part, to the circumstances of
Babcock’s incarceration. Plumb communicated with Babcock for a time
through a person holding Babcock’s power of attorney. When the
relationship between Babcock and the person holding that power broke
down, Plumb began communicating with Babcock’s mother. We find the 6
board failed to prove by a convincing preponderance of the evidence that
Plumb breached ethical rules in failing to communicate with Babcock.
Babcock asserted, and the board claimed, that Plumb’s neglect of
Babcock’s case led to the repossession of Babcock’s vehicle and tardiness
in providing responses to discovery requests propounded to Babcock.
Although Plumb did fail to prevent the repossession of Babcock’s vehicle,
we find this was a consequence of Babcock’s failure to make his monthly
loan payments, and not the result of neglect on the part of Plumb. The
delay of Babcock’s responses to discovery was, in significant part,
attributable to the uncertainties resulting from the filing of the ethical
complaint and Plumb’s motion to withdraw as Babcock’s counsel. We
find the board failed to prove Plumb’s conduct in these particulars
constituted neglect of Babcock’s defense.
Although Plumb’s drafting of Babcock’s letter to the board
requesting dismissal of the ethics complaint is a circumstance that
provokes suspicion, we find persuasive Plumb’s explanation that the
letter to the board was drafted at Babcock’s request after the telephonic
reconciliation had occurred. Babcock conceded in his testimony that he
did not feel pressured by Plumb to withdraw the complaint. Upon our de
novo review, we find the board failed to prove Plumb’s conduct
constituted an improper attempt to dissuade Babcock from maintaining
the ethics complaint or an effort to persuade Babcock from cooperating
in the board’s investigation of the matter.
Plumb concedes he failed to respond to the board’s inquiry in this
matter. We therefore find he violated DR 1–102(A)(5) (conduct prejudicial
to the administration of justice) and DR 1–102(A)(6) (conduct adversely
reflecting on fitness to practice law). See Iowa Supreme Ct. Att’y
Disciplinary Bd. v. Marks, 759 N.W.2d 328, 331 (Iowa 2009). 7
We have characterized advance fee payments as “special retainers.”
Iowa Supreme Ct. Att’y Disciplinary Bd. v. Piazza, 756 N.W.2d 690, 697
(Iowa 2008); Iowa Supreme Ct. Bd. of Prof’l Ethics & Conduct v. Apland,
577 N.W.2d 50, 55–57 (Iowa 1998). “ ‘[F]ee advances are not earned
when paid, and therefore must be deposited into the trust account.’ ”
Apland, 577 N.W.2d at 55 (citation omitted) (emphasis added). Such
“[f]unds remain the property of the client until the attorney earns them.”
Id.; accord Iowa Supreme Ct. Att’y Disciplinary Bd. v. Kadenge, 706
N.W.2d 403, 408 (Iowa 2005) (“all advance fee payments other than
general retainer fee payments are refundable and must be placed in a
client trust account”). 2 We find Plumb violated DR 9–102(A) when he
failed to deposit Babcock’s $3000 advance fee payment in a trust
account. When Babcock requested a refund of the unearned portion of
the fee, Plumb failed for several months to do so. This failure to
promptly refund the unearned portion of the advance fee constituted a
violation of several rules including DR 9–102(B)(4) (lawyer’s duty to
promptly pay or deliver client’s funds to client as requested).
C. Nelson Matter. Nelson was a party to a dissolution of
marriage proceeding in Dickinson County. After becoming dissatisfied with his counsel, Nelson discharged him and requested other attorneys
to undertake the representation. Two other attorneys declined Nelson’s
entreaties before Plumb agreed to handle the matter for a fee of $7500.
Nelson paid that amount in two installments, but Plumb did not deposit
either payment in a trust account. Soon after the professional
2These requirements are incorporated in the new Iowa Rules of Professional Conduct and the client trust account rules. See Iowa R. Prof'l Conduct 32:1.15(c) (“A lawyer shall deposit in a client trust account legal fees and expenses that have been paid in advance, to be withdrawn by the lawyer only as fees are earned or expenses incurred.”); Iowa Ct. R. 45.7(1), (3) (defining advance fees and requiring deposit of advance fee into the client trust account). 8
relationship commenced, Nelson requested Plumb to also represent him
in a real estate dispute. Plumb agreed to handle this matter as well, and
received from Nelson an advance fee payment of $750.
The attorney-client relationship between Plumb and Nelson soon
soured. It was characterized by profound mutual dissatisfaction which
ultimately led to its termination. Nelson claims he requested a refund of
the unearned fees, but Plumb denies such a request was received.
Following an investigation of Nelson’s complaint, the board charged
Plumb with violation of DR 9–102(B)(4) (failure to promptly refund the
unearned portion of the fee when requested), DR 2–110(A)(3) (same), and
DR 9–102 (failure to deposit unearned fees in a trust account). Plumb
contended his failure to deposit Nelson’s initial payment in a trust
account was justified because he had already earned this sum, when it
was paid, and claimed that he did account for the fees when the
attorney-client relationship ended. Finding Nelson’s testimony
incredible, the commission resolved the factual disputes in Plumb’s favor
finding no ethical violations of counsel’s duty to deposit unearned fees in
a trust account, and no ethical violation of counsel’s duty to account for
unearned fees when requested to do so. Granting appropriate deference
to the commission’s credibility findings, we adopt the commission’s
findings as our own.
Like the commission, we find Plumb violated DR 1–102(A)(5) and
(6) when he failed to respond to the board’s requests for information
pertaining to Nelson’s complaint. Such conduct is prejudicial to the
administration of justice, and it adversely reflects on Nelson’s fitness to
practice law. Iowa Supreme Ct. Att’y Disciplinary Bd. v. Rauch, 746
N.W.2d 262, 265–66 (Iowa 2008). 9
D. Mambu Matter. Mambu was injured on March 7, 2002 in a
motor vehicle crash. She communicated with the adjuster for the other
driver’s insurer on several occasions before she hired Plumb to represent
her. After the applicable statute of limitations had expired, Plumb
drafted and back-dated in Mambu’s presence a letter to the insurer
ostensibly proposing to extend the limitations period by six months.
Plumb subsequently filed suit on the claim, but the case was dismissed
as untimely. Mambu retained new counsel, filed a professional
negligence action against Plumb, and filed an ethics complaint with the
board.
Following negotiations with Mambu’s new counsel, Plumb agreed
to settle the malpractice claim for the sum of $7000. On August 22,
2005, Plumb drew a check on his trust account in that amount and
forwarded it to Mambu’s counsel in furtherance of the settlement. 3
Sensing an appearance of impropriety upon receipt of the check drawn
on Plumb’s trust account, Mambu’s counsel returned it to Plumb.
Plumb responded to the return of the settlement check with a strange
series of bank transactions. He drew a new settlement check on his
business account and delivered it to Mambu’s counsel on September 2, 2005. To cover that check drawn on the business account, Plumb drew
a check in the amount of $8500 payable to himself on the trust account
and deposited it in the business account on that same day. At or about
the same time, Plumb claims to have planned to cover the check drawn
on the trust account by depositing a check in the same amount allegedly
3Plumb testified he drew the check on his trust account because he believed he was counsel for himself, and that use of the trust account for this purpose was required by the rule, and appropriate for preservation of a record of the settlement transaction. He did not explain why he thought a record of the transaction could not have been properly made using his business account. 10
drawn on his wife’s account on September 1, 2005 and payable to
Plumb. When the board’s auditor subsequently appeared to examine
Plumb’s trust account, it was disclosed that the check drawn on Plumb’s
wife’s account was not deposited in the trust account until sixty days
after Plumb withdrew a corresponding amount from the trust account
and deposited it in his business account. No client suffered a financial
loss as a consequence of this series of trust account transactions.
The board charged Plumb with violations of DR 6–101(A)(3) (lawyer
shall not neglect a client’s legal matter), DR 1–102(A)(4) (conduct
involving dishonesty or misrepresentation in attempting to conceal his
negligence by back-dating a letter proposing an extension of the statute
of limitations), DR 1–102(A)(1), (5), and (6) (violation of disciplinary rule;
conduct prejudicial to the administration of justice; conduct adversely
reflecting on fitness to practice), and rule 32:1.15 (duty to keep client’s
property separate). The commission found Plumb violated each of these
rules. Upon our de novo review of the record, we agree. The evidence
clearly establishes and we therefore find that Plumb neglected Mambu’s
legal matter and attempted through deceit and misrepresentation to
conceal his negligence. We find the board also clearly proved Plumb’s
mishandling of his trust account in connection with the Mambu
settlement transactions in violation of rule 32:1.15.
III. Sanction.
The commission recommended Plumb’s license to practice law be
suspended with no possibility of reinstatement for a period of one year.
As we have noted, however, we may impose a lesser or greater sanction
than the discipline recommended by the grievance commission. Conrad,
723 N.W.2d at 792. In determining the appropriate sanction for attorney
misconduct: 11 we consider the nature and extent of the respondent’s ethical infractions, his fitness to continue practicing law, our obligation to protect the public from further harm by the respondent, the need to deter other attorneys from engaging in similar misconduct, our desire to maintain the reputation of the bar as a whole, and any aggravating or mitigating circumstances.
Iowa Supreme Ct. Bd. of Prof’l Ethics & Conduct v. Kallsen, 670 N.W.2d
161, 164 (Iowa 2003).
Misappropriation of a client’s funds by an attorney has, almost
universally, resulted in license revocation. Iowa Supreme Ct. Bd. of Prof’l
Ethics & Conduct v. Anderson, 687 N.W.2d 587, 590 (Iowa 2004); Iowa Supreme Ct. Bd. of Prof’l Ethics & Conduct v. Bell, 650 N.W.2d 648, 655
(Iowa 2002); Comm. on Prof’l Ethics & Conduct v. Ottesen, 525 N.W.2d
865, 866 (Iowa 1994); Comm. on Prof’l Ethics & Conduct v. Shepherd, 431
N.W.2d 342, 344 (Iowa 1988). Exceptions to this longstanding rule have
been noted in instances when the attorney had a colorable future claim
to the funds or did not take the funds for his own use. See, e.g., Iowa
Supreme Ct. Bd. of Prof’l Ethics & Conduct v. Allen, 586 N.W.2d 383, 391
(Iowa 1998); Iowa Supreme Ct. Bd. of Prof’l Ethics & Conduct v. Hansel,
558 N.W.2d 186, 192 (Iowa 1997). Restitution or restoration of client
funds prior to the discovery of their misappropriation does not preclude
the imposition of revocation as a sanction. Anderson, 687 N.W.2d at
590. The sanction of revocation of the offending attorney’s license has
been imposed when the misappropriation was substantially smaller than
$8500. See Comm. on Prof’l Ethics & Conduct v. Rowe, 225 N.W.2d 103,
104 (Iowa 1975) (license revoked for depositing $1500 of client’s funds in
attorney’s personal checking account).
This case presents a very close question as to whether Plumb’s
license should be revoked for misappropriation of funds from a trust 12
account. He drew a check on the trust account and attempted to use it
to pay the settlement of Mambu’s tort claim. When this failed because
Mambu’s counsel objected, Plumb sought to avoid the appearance of
impropriety by forwarding to counsel a new check drawn on his business
account and “covering” it with a corresponding withdrawal from the trust
account and deposit to the business account. When this apparent
irregularity was to be discovered by the board’s auditor, Plumb sought to
cover his tracks by claiming the withdrawal of $8500 from the trust
account would have been “covered”—but for his oversight—by a deposit
to the trust account of a check in the same amount drawn on his wife’s
account. 4 We find this series of transactions and Plumb’s explanation of
them implausible at best. Nonetheless, we conclude the severe sanction
of revocation should not be imposed in this case because Plumb had a
colorable future claim to funds in the trust account in excess of $8500,
the amount withdrawn in furtherance of the Mambu settlement. Plumb’s
uncontroverted testimony establishes he had earned, but had not yet
withdrawn from the trust account on September 2, 2005, attorney fees in
excess of $10,000. Accordingly, we now consider what sanction less
than revocation should be imposed under the circumstances of this case. When combined with incidents of misrepresentation, neglect of a
client’s legal matters will give rise to a lengthy suspension from the
practice of law. Iowa Supreme Ct. Bd. of Prof’l Ethics & Conduct v. Ruth,
656 N.W.2d 93, 100 (Iowa 2002). The multiple violations proved by the
board in this case are aggravated by Plumb’s substantial history of prior
discipline. He has been publicly reprimanded on four previous
4The board presented credible evidence tending to establish there were insufficient funds in Plumb’s wife’s account on the day the check was allegedly drawn to cover the check which Plumb claims he intended, but neglected, to deposit in his trust account. 13
occasions, and his license was suspended in 1999 for sixty days for
neglect of multiple client matters, failure to deposit an advance fee in a
trust account, and failure to respond to the board’s complaint. Plumb’s
conduct in the several matters that are the subject of this case leads us
to conclude the sanctions imposed for his past ethical lapses have been
inadequate to induce conformity with our ethics rules, and a significant
period of suspension is required in this case.
IV. Conclusion.
Plumb’s license to practice law in Iowa is suspended with no
possibility of reinstatement for eighteen months. The suspension
imposed applies to all facets of the practice of law as provided by Iowa
Court Rule 35.12(3) and requires notification of clients as provided in
Iowa Court Rule 35.21. Given the broad range of his ethical violations
and his history of recidivism, Plumb shall take and pass the Multistate
Professional Responsibility Examination prior to making an application
for reinstatement of his license. Iowa Ct. R. 35.12(1). The costs of this
proceeding are taxed against Plumb pursuant to Iowa Court Rule
35.25(1).
LICENSE SUSPENDED. All justices concur except Appel, J., who takes no part.