March 19, 1998
IN RE RICHARD L. HUBER, RESPONDENT. A MEMBER OF THE BAR OF THE DISTRICT OF COLUMBIA COURT OF APPEALS.
Before Steadman, Schwelb and Ruiz, Associate Judges.
The opinion of the court was delivered by: Steadman, Associate Judge.
Already temporarily suspended from the practice of law by this court's order of March 8, 1995, respondent Richard L. Huber on March 3, 1997, filed an affidavit consenting to the entry of an order of disbarment. The only issues before us relate to the recommendations of the Board on Professional Responsibility that the order of disbarment 1) provide for the payment of interest on restitution payments made or to be made, and 2) be effective only as of the time that respondent shall have filed an affidavit pursuant to D.C. Bar Rule XI, § 14(g). We adopt the recommendations of the Board and order respondent disbarred accordingly.
In 1994, two hearing committees determined that Huber had engaged in numerous ethical violations, including misappropriation. In a Report and Recommendation of February 13, 1995 ("the February 1995 Report"), the Board recommended that we disbar Huber and require him to make restitution with interest to four clients.
On March 8, 1995, pursuant to a petition by the Board, this court temporarily suspended Huber from the practice of law in the District of Columbia pending our review of the February 1995 Report. See D.C. Bar R. XI, §§ 3(c), 14(e) (1997). On March 22, 1995, Huber filed a sworn affidavit with this court purporting to comply with our suspension order and the terms of Bar Rule XI, § 14(g). However, as it turned out, he did not comply with the suspension order. In February of 1997, Huber pled guilty to two counts of criminal contempt of this court's order placing him on interim suspension, viz., the unlawful practice of law in connection with a Virginia matter and the failure to place client fees in a trust account.
Meanwhile, Huber and Bar Counsel submitted briefs for our review of the February 1995 Report, and we scheduled oral argument for March 4, 1997. One day before oral argument, Huber filed an affidavit consenting [708 A2d Page 260]
to disbarment under the terms of the February 1995 Report. We granted Huber's motion to stay oral argument so that the Board could consider his affidavit consenting to disbarment and prepare a new report pursuant to Bar Rule XI, § 12(b). That Report is now before us, together with Huber's two exceptions thereto. *fn1
The first question before us that Respondent Huber has identified is "[w]hether the Board erred in recommending that respondent pay interest to Isabella Johnson, John Cone and/or Charles Osterhoudt, Leroy Allen, and Miriam Kopanic." Huber argues that interest is an inappropriate component of restitution because his clients have already received their principal amounts. All four clients, he represents, have been compensated by the Clients' Security Trust Fund of the District of Columbia Bar ("CSTF") and therefore have forfeited their rights to interest. *fn2
To begin, we note that Huber agreed to pay interest to these four clients by the terms of his own consent to disbarment. The February 1995 Report specifically provided for restitution on behalf of the named clients "with interest." In his Affidavit Declaring Consent to Disbarment, Huber stated that he "accepted the order of the Board relating to restitution" and represented that he had "begun making restitution to the D.C. Bar Client Security [Trust] Fund in compliance with that recommendation." Thus Huber's own consent to disbarment incorporates by reference the Board's recommendation that he pay restitution "with interest."
The obligation to pay interest is intertwined with the obligation to make restitution. Even if Huber has repaid the principal — a fact not proven below and unverifiable on the record before us — that would not absolve him of the duty to pay interest for the period between the misappropriation and the repayment, if any. Interest in this context is not a consequential damage of the attorney's misconduct, compare In re Robertson, 612 A.2d 1236, 1239-41 (D.C. 1992), but an obligation arising from the client's deprivation of the use of his or her money. See generally Riggs Nat'l Bank v. District of Columbia, 581 A.2d 1229, 1253 (D.C. 1990) (explaining that courts impose interest to compensate creditors for delays in repayment). For this reason, we direct the respondents in disciplinary matters to make restitution not only of the principal but also of interest at the [708 A2d Page 261]
legal rate of six percent. See, e.g., In re Foster, 699 A.2d 1110, 1110 (D.C. 1997) (per curiam); In re Clarke, 684 A.2d 1276, 1281 (D.C. 1996) (per curiam); In re Dietz, 633 A.2d 850, 851 & n. 2 (D.C. 1993) (per curiam); see also D.C.Code § 28-3302(a) (1996) (setting the interest rate "in the absence of expressed contract" at six percent per annum).
We are wholly unpersuaded by Huber's argument that his clients have assigned their claims against him to the CSTF and thus forfeited their right to interest, or that only CSTF may assert a right to interest. The CSTF is not an independent collection agency but a creature of this court, created pursuant to Bar Rule XII. This court may "require an attorney to make restitution either to persons financially injured by the attorney's conduct or to the Clients' Security Trust Fund (see Rule XII), or both, as a condition of probation or of reinstatement." D.C. Bar R. XI, § 3(b) (emphasis added).
Under the contractual terms of each client's assignment of his or her claims to the CSTF, any surplus amount that the CSTF may recover from respondent, beyond what it has already paid to the client and costs of collection, shall be paid over to the client. Thus it is proper and appropriate for this court to order Huber to make all restitution payments, both of principal to which he has not yet made restitution and interest upon all principal amounts up to the date of restitution (whether heretofore or hereafter made), to the CSTF, with the understanding that the CSTF shall forward to each client the portion of the interest attributable to that period of time that the client was deprived of his or her money (i.e., prior to the time that CSTF compensated the clients for the loss of his or her principal pursuant to Rule XII). Restitution to the CSTF must include interest for the period between the date the CSTF compensated each client and the date Huber reimbursed the CSTF in full, because the CSTF was deprived of the use of its money for such period.
The second question before us that Huber has identified is "[w]hether the Board erred in recommending that respondent should not receive credit for [the] time during which he was suspended by the Court, but did not obey the [suspension] order and that respondent's period of disbarment should run from the time he files a supplemental affidavit that complies with the requirements of Rule XI, § 14(g)." *fn3 Huber makes no legal argument on this point, but simply urges "that this Court use its discretion in making any disbarment nunc pro tune to such date as the Court deems appropriate, all things considered."
Huber is in no position to raise at this point any objection to the requirement that he file a supplemental affidavit. He never in any form argued this point to the Board. Bar Counsel, in its response to Huber's Affidavit Declaring Consent, emphasized that Huber should be required to file a new § 14(g) affidavit
in which he demonstrates with particularity and supporting proof that he has complied fully with the provisions of the Court's order of interim suspension and disbarment and with Rule XI, including notifying all clients, attorneys for adverse parties, and others listed in the rule with whom Respondent has dealt as a lawyer since his interim suspension.
Huber filed a reply to this pleading, but he addressed only the question of interest; he never addressed the proposal that he be required to file a new affidavit until filing his brief in this appeal. He has therefore waived his right to raise the argument for the first time here. See In re James, 452 A.2d 163, 168-70 (D.C. 1982).
The only issue, then, is whether the disbarment should take effect from the date of the filing of the supplemental affidavit or from some earlier period, such as when respondent came fully into compliance with the terms of the suspension order and § 14. Under our rules, while an order of suspension or [708 A2d Page 262]
disbarment goes into effect at the time specified in the order, the time for purposes of reinstatement does not begin to run until the attorney files an affidavit under § 14(g) demonstrating full compliance with the order of suspension or disbarment. D.C. Bar R. XI, § 16(c). Compliance with the order and the terms of § 14 is not enough without the filing of the affidavit. See In re Wiley, 697 A.2d 406, 407 (D.C. 1997); Slosberg, supra note 3, 650 A.2d at 1331-33. *fn4 Under our rules, the filing of the affidavit is the requisite final step to be taken by the attorney in winding up his or her affairs after the effective date of the suspension or disbarment: the affidavit must, inter alia, "[d]emonstrat[e] with particularity, and with supporting proof, that the attorney has fully complied with the provisions of the order [of disbarment or suspension] and with this rule." D.C. Bar R. XI, § 14(g)(1) (emphasis added).
Here, Huber wilfully violated the terms of the order *fn5 and was convicted of criminal contempt for such actions. *fn5 By the very structure of our rules, his affidavit of March 1995 was therefore rendered nugatory, and an obligation was placed upon him to again bring himself into compliance with the "provisions of the order and with this rule" and to demonstrate the same with a supplemental affidavit in order to start the period of disbarment running under § 16(c). Furthermore, Huber has been on notice at least since the response of Bar Counsel filed on March 17, 1997, and the issuance of the Board Report on April 23, 1997, that, in their view, such a renewed affidavit must be filed. Yet he took no such action until January 22, 1998, the day before oral argument on his exceptions to the Board Report. *fn5
Under all these circumstances, we think the Board quite properly concluded that the disbarment imposed by consent should not begin to run for purposes of reinstatement under § 16(c) until an affidavit meeting all the requirements of § 14, including a demonstration of full compliance with the order and with the rules, is or has been filed. *fn6 Accordingly, it is
ORDERED that respondent Richard L. Huber is disbarred from the practice of law in the District of Columbia, effective upon such date as he shall have fully complied with the temporary order of suspension and with D.C. Bar Rule XI, § 14, including the filing of the requisite affidavit, and it is further
ORDERED that respondent shall complete restitution, including interest at the rate of six per cent per annum, in accordance with this opinion.