State Ex Rel. Oklahoma Bar Association v. Smith

1973 OK 56, 510 P.2d 936, 1973 Okla. LEXIS 356
CourtSupreme Court of Oklahoma
DecidedMay 22, 1973
DocketSCBD 2342
StatusPublished
Cited by7 cases

This text of 1973 OK 56 (State Ex Rel. Oklahoma Bar Association v. Smith) is published on Counsel Stack Legal Research, covering Supreme Court of Oklahoma primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
State Ex Rel. Oklahoma Bar Association v. Smith, 1973 OK 56, 510 P.2d 936, 1973 Okla. LEXIS 356 (Okla. 1973).

Opinion

BERRY, Justice:

This matter is before us for review and approval of a Report and Recommendation of trial authority appointed by this Court and under the provisions of Rules Creating and Controlling the Oklahoma Bar Association.

A complaint was filed against respondent, H. Lee Smith, by the Oklahoma Bar Association. Allegations of the complaint are that Mrs. Manning paid $350 to respondent for professional services and court costs to institute divorce proceedings against her husband. In the event her husband was ordered to pay any sum up to $350, this amount would be repaid to Mrs. Manning. Proceedings were commenced. Mr. Manning [defendant in divorce proceeding] was ordered to pay respondent $250, which was paid prior to trial. Mrs. Manning was granted a divorce. The division of property resulted in each receiving an undivided one half interest in a 3 acre tract upon which stood a building used as a garage. Mr. Manning appealed.

An agreement between Mrs. Manning and respondent provided an additional $500 fee in the event of an appeal. Mrs. Manning paid respondent $200 to apply on this additional fee. In April of the next year the building on the 3 acre tract was damaged by fire. Respondent represented Mrs. Manning in settlement with the insurance company along with Mr. Manning’s attorney, R. M. Without the knowledge of Mrs. Manning, respondent and R. M. settled with the insurance company in the amount of $708.75. R. M. delivered to respondent a check in this amount made payable to Mr. and Mrs. Manning. Subsequently respondent returned this check with Mrs. Manning’s signature which respondent had previously forged along with his own signature. This was carried out by respondent without knowledge, consent, authority and permission of Mrs. Manning. R. M. secured and delivered a cashier’s check to respondent in the amount of $301.39 made payable to Mrs. Manning as her portion of the settlement less contribution for premium.

Later respondent forged Mrs. Manning’s signature and endorsed his own, presented the check and received payment of $301.39. All this was done without knowledge, con *937 sent, authority or permission of Mrs. Manning. He then appropriated the use and purpose of the money contrary to the trust due Mrs. Manning and in violation of his oath of attorney.

To this complaint respondent filed a response in the form of a five page hand written letter to the General Counsel of the Bar Association. The response itemized all moneys received by respondent in connection with his representation of Mrs. Manning. Included in this list is the following :

“I now hold $301.39 against her indebtedness to me of $300.00 on agreed fee of appeal.”

The response generally denied any wrongdoing on respondent’s part. He set out a resume of the quantity and quality of the work performed and the reasonableness of his fee. He admitted endorsing Mrs. Manning’s signature to checks, but did so with her consent and approval. She had told him to do so as his fee to be applied on an appeal in her divorce proceedings. He deposited the proceeds [$301.39] of Mrs. Manning’s insurance settlement to his “client trust account.”

After respondent learned from attorney R. M. for Mr. Manning that' the divorce appeal was being dismissed, Mrs. Manning called respondent and asked for a return of the $500 she had paid him to handle the appeal. Respondent refused. Later Mrs. Manning demanded $750; then she asked for all she had paid him or $1,100.00. She told him that she would ruin him. Respondent told her that he was holding $301.39 until she paid him.

The matter came on for hearing before the trial authority.

Cannon 11 of the Canons of Professional Ethics as amended 1966, then in force and effect [now included in the Code of Professional Responsibility Canon 9] provides:

“Dealing with trust property. The lawyer should refrain from any action whereby for his personal benefit or gain he abuses or takes advantage of the confidence reposed in him by his client.
“Money of the client or collected for the client or other trust property coming into the possession of the lawyer should be reported and accounted for promptly, and should not under any circumstances be commingled with his own or be used by him. As amended Aug. 31, 1933; Sept. 30,1937.”

After the conclusion of the hearing trial authority entered a detailed statement of facts, findings thereon, and conclusions of law supported with precedents. The trial authority found that respondent accepted settlement from an insurance company due Mrs. Manning and endorsed Mrs. Manning’s name to the draft without her permission or authority. Trial authority also found that Smith endorsed Mrs. Manning’s name to a cashier’s check, which was her one half of a fire loss settlement, and diverted these funds without her knowledge, authority or approval.

Complainant’s evidence clashed sharply with respondent’s on two points. The first being the initial payment of $350 by Mrs. Manning to respondent. Mrs. Manning testified the agreement was that respondent would return all sums paid by Mr. Manning ordered by the court to repay Mrs. Manning’s advanced fee. Respondent denied this and testified this was merely a temporary fee not to be repaid and that he was to receive all moneys ordered by the court to be paid by Mr. Manning for legal fees on her behalf. The trial authority made no finding in regard to this point.

The second contradicted point was the endorsement by respondent of the name of Mrs. Manning on two checks. One check from the insurance company payable to Mr. & Mrs. Manning was for settlement of fire damage to jointly acquired property and one endorsement on a cashier’s check [$301.39] was for Mrs. Manning’s portion of the settlement. Respondent’s evidence was that he signed Mrs. Manning’s name with her knowledge, consent and approval. She owed him an additional $300 for his legal fee to represent her on the appeal, and she orally instructed him to cash the check and apply the proceeds on the bal- *938 anee due him. He testified that he put this money in a “client trust account.”

Without an extended summary of the ev-identiary proceedings certain evidence is unrefuted. An officer of the bank who cashed the cashier’s check made payable to Mrs. Manning in the amount of $301.39, testified to the following: Respondent presented the check with Mrs. Manning’s name already signed and endorsed his signature in the officer’s presence. With proceeds he purchased 4 cashier’s checks in the following amounts: $60, $12, $15 and $13 with the bank charges of 60‡. Each check was made payable to a different person who are otherwise not connected with this case. He took $25.79 in cash. Respondent then deposited $175 in a checking account in that bank called “H. Lee Smith, Client-Trust Account.” [It is to be noted as of the date of deposit this trust account did not exceed $175 and within seven weeks the account was depleted to less than $30.]

An examination of the record discloses Mrs. Manning’s name as it appears as an endorsement on the cashier’s check bears a close resemblance to Mrs. Manning’s genuine signature. As Mrs.

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Bluebook (online)
1973 OK 56, 510 P.2d 936, 1973 Okla. LEXIS 356, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-ex-rel-oklahoma-bar-association-v-smith-okla-1973.