Kentucky Bar Ass'n v. Mullins

407 S.W.3d 532, 2013 Ky. LEXIS 391, 2013 WL 4623721
CourtKentucky Supreme Court
DecidedMay 23, 2013
DocketNo. 2013-SC-000169-KB
StatusPublished

This text of 407 S.W.3d 532 (Kentucky Bar Ass'n v. Mullins) is published on Counsel Stack Legal Research, covering Kentucky Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Kentucky Bar Ass'n v. Mullins, 407 S.W.3d 532, 2013 Ky. LEXIS 391, 2013 WL 4623721 (Ky. 2013).

Opinion

OPINION AND ORDER

The Board of Governors (“Board”) of the Kentucky Bar Association (“KBA”) recommends this Court suspend Earl C. Mullins, Jr. from the practice of law for ninety (90) days, with sixty (60) days of the suspension conditionally probated for a period of two years. Finding sufficient cause to do so, we adopt the Board’s recommendation. Mullins, whose KBA number is 50565 and whose bar roster address is 1012 South 4th Street, Louisville, Kentucky 40202, was admitted to the practice [533]*533of law in the Commonwealth of Kentucky on November 1,1983.

This matter arises from Mullins’s representation of William Searcy, who was tried and convicted on felony charges of drug use and drug trafficking in October of 1992. In the hope of obtaining a new trial, Searcy retained Mullins to pursue his appeal. Anticipating that the appeal would require significant legal work, and aware that Searcy had limited financial means, Mullins encouraged Searcy to consider using his interest in a parcel of real estate owned by his ex-wife, Janice Hagan, in order to arrange a fee agreement. In accordance with their discussions, the parties executed three documents: 1) a written fee agreement between Searcy and Mullins; 2) a “Revolving Credit Note” by Searcy in favor of Mullins; and 3) a mortgage on Hagan’s property which served as security for Searcy’s performance on the note. The mortgage specifically recited the fact that it created a mortgage lien against Hagan’s property for the purpose of securing payment of the debt set forth in the note. All three documents were executed on November 24,1992.1

After the property was sold, the parties devised a new arrangement wherein Sear-cy would loan a sum of money to Mullins out of the proceeds of the sale of Hagan’s property. That sum would be considered payment of Mullins’s legal fees and he would be entitled to those fees as an offset against repayment of the loan. In turn, Mullins would make periodic interest payments on the principal amount of the loan, and those payments would be used to pay child support for Searcy’s son and other financial obligations subject to Searcy’s direction. The parties executed a revised agreement on December 3, 1992, and Mullins received $5,000.00 that same day.2 Under the revised terms, Mullins and Se-arcy agreed that the fee for appealing the matter to the Court of Appeals would be $5,500.00 “plus expenses.”3 By the execution of the revised agreement, Mullins had already received the entire fee: $500.00 for the initial retainer, and $5000.00 from the proceeds of the sale of the Hagan property. Mullins did not advise Searcy to seek the advice of independent counsel regarding the December 3rd agreement.

In late 1992 and early 1993, four other checks were issued to Mullins, totaling $9,511.60. In February of 1993, Mullins received an additional $10,000.00 from Se-arcy (by and through Hagan). Mullins received a total of $25,011.60 in connection with his representation of Searcy. These funds were not placed into a trust account, as Mullins understood that the checks were issued to him pursuant to the loan agreement. Mullins at all times treated the money as his own, upon receipt.

Mullins made interest payments to Sear-cy pursuant to the loan agreement from 1993 until 2008. When Searcy’s son reached the age of majority, Mullins con[534]*534tinued to deposit the interest payments into Searcy’s commissary account at the Kentucky State Reformatory. The interest payments totaled $27,500.00.4

Searcy demanded repayment of his loan on several occasions. However, Searcy withdrew his demand on each of those occasions when Mullins would remind him that any repayment of the loan would be offset by legal fees already earned. Mullins maintained time sheets, expense ledgers, and other documentation which he offered to provide to Searcy. However, Searcy told him it was not necessary to provide a complete accounting of his services.

On February 9, 1996, the Court of Appeals issued a final opinion affirming Sear-cy’s conviction. When Mullins approached Searcy with the prospect of proceeding with a motion for discretionary review to the Supreme Court, Searcy authorized him to do so. However, Mullins faded to file the motion in a timely manner and was forced to file a motion for enlargement of time. Mullins sent a letter to Searcy where he enclosed a copy of the Motion for Discretionary Review. He did not, however, include a copy of the separate motion for enlargement of time. In the letter Mullins stated that the motion “had been filed with the Court of Appeals.” The Supreme Court ultimately denied Mullins’s motion for discretionary review.

On April 19, 1996, Mullins wrote Searcy to inform him that the Supreme Court would not hear his appeal. He did not mention the late filing or the supplemental motion requesting more time, nor did he tell Searcy that the Supreme Court denied discretionary review on the basis of the late filing. Several weeks later, Mullins met with Searcy at the penitentiary in order to discuss some other legal matters. During that meeting Mullins revealed that the motion for discretionary review had been denied due to the filing error and admitted to not telling Searcy about the error because he was embarrassed. Despite Mullins’s admission, Searcy insisted that the interest payments continue.

In 2004, Searcy contacted the KBA alleging that Mullins had refused to pay him the money under their loan agreement. Thereafter, with the knowledge of the KBA, Mullins and Searcy met to settle the matter. Mullins advised Searcy to seek new counsel because he did not think he could continue to represent him in light of allegations made to the KBA. Searcy withdrew his demand for an immediate settlement and indicated that the monthly interest payments should continue until further notice. He also attempted to withdraw the bar complaint which led to the underlying inquiry. In various communications with both Mullins and the Office of Bar Counsel, Searcy has asserted that the purpose of filing the bar complaint was to obtain repayment of his loan money. Searcy has further asserted that he did not want Mullins to face any discipline in this matter.

The Inquiry Commission charged Mullins with nine counts of misconduct arising from his representation of Searcy, consisting of violations of: Supreme Court Rule (“SCR”) 3.130-1.5(a) (charging an unreasonable fee); SCR 3.130-1.8(a) (entering into a business transaction with a client); SCR 3.130-1.8(e) (providing financial assistance to a client); SCR 3.130-1.15(a) (failing to keep a-client’s property separate from the lawyer’s own property); SCR 3.130-1.15(b) (failing to promptly notify client of receipt of funds or deliver funds [535]*535to a client); SCR S.180-1.15(c) (commingling funds); SCR 3.130-1.4(a) (failing to keep client reasonably informed); SCR 3.130-1.4(b) (failing to reasonably explain matters to a client); and SCR 3.130-8.4(c) (engaging in dishonesty, fraud, deceit, or misrepresentation).

Mullins admits that he is guilty of all nine violations and further admits that he needs to be disciplined for the totality of his misconduct. The Office of Bar Counsel and Mullins agreed to submit the case to the Board pursuant to SCR 3.210(2).5

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Bluebook (online)
407 S.W.3d 532, 2013 Ky. LEXIS 391, 2013 WL 4623721, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kentucky-bar-assn-v-mullins-ky-2013.