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In re Shaw

July 12, 2001


Before Steadman, Schwelb and Reid, Associate Judges.

The opinion of the court was delivered by: Per Curiam

On Report and Recommendation of the Board on Professional Responsibility

Argued April 12, 2001

Before us is a unanimous recommendation by the Board on Professional Responsibility that respondent be publicly censured for violation of two rules of professional conduct: Rule 1.5(a) (charging an unreasonable fee), and Rule 1.15(b) (failure to notify interested party of receipt of funds). Respondent has filed exceptions, asserting that the finding that he violated Rule 1.15(b) lacks support and that a public censure is inconsistent with the sanction imposed in similar cases.

1. Rules Violations

Briefly put, *fn1 the record supports the following facts. Respondent was retained to represent a client who was injured in a Maryland motor vehicle accident. The retainer agreement provided for a one-third contingency fee. The other motorist was insured by Travelers Indemnity Co. Travelers informed respondent that it was transmitting to him $2,500 in personal injury protection (PIP) benefits under Maryland law. Of that sum, $800 was retained as attorneys' fees *fn2 and the bulk of the balance paid over to the client.

The client carried a health insurance policy with Kaiser Permanente, which covered her medical expenses arising out of the accident. The client signed Kaiser's "Acknowledgment of Lien and Assignment of Proceeds" form (A & A), in which she acknowledged that "pursuant to the contract governing enrollment in Kaiser Permanente," it had a lien "against any and all sums recovered from any third party source, whatsoever, without set off, limitation or reduction," and directed her attorney "to disburse to Kaiser Permanente said sums upon receipt thereof." Respondent in an "Acknowledgment of Attorney" section also signed the form, whereby he acknowledged that he had read and agreed "to be bound by the terms of the Acknowledgment of Lien and Assignment of Proceeds set forth above." Nonetheless, Kaiser was never timely notified of the PIP payment to respondent by Travelers nor of its disbursement.

We "accept the Board's findings as long as they are supported by substantial evidence in the record." In re Boykins, 748 A.2d 413, 414 (D.C. 2000); D.C. Bar R. XI, § 9(g)(1). Respondent does not here dispute that he took an unreasonable fee when he charged $800 in an uncontested $2,500 PIP claim. See Attorney Grievance Comm'n v. Kemp, 496 A.2d 672, 677-79 (Md. 1985) (attorney may not charge more than a minimal fee for processing an uncontested PIP claim). *fn3 However, respondent does claim that he was not in violation of Rule 1.15(b). He argues that under Maryland law Kaiser in fact had no valid claim to the settlement funds, citing Riemer v. Columbia Med., 747 A.2d 677 (Md. 2000). However that holding might apply to a situation like that of the client here, the fact is that at the time three years previously when respondent received the check from Travelers (February 19, 1997), Maryland law was unsettled on the issue. *fn4 Indeed, as already indicated, in signing the "A & A" form on February 7, 1997, respondent specifically recognized and acknowledged Kaiser's rights in the monies paid by Travelers. It was not for respondent three weeks later to unilaterally ignore Kaiser's possible claim in the funds and belatedly attempt to justify it by long-after-the-fact legal developments. In these circumstances, the Board permissibly concluded that respondent's failure to notify Kaiser of the receipt of funds constituted a violation of Rule 1.15(b).

2. Sanction

The Board noted that sanctions ranging from informal admonition to suspension have been imposed in cases with an excessive or unreasonable fee violation. *fn5 See, e.g., In re Roxborough, 675 A.2d 950, 952 (D.C. 1996) (per curiam) (noting prior informal admonition for excessive fee); In re Waller, 524 A.2d 748, 749 (D.C. 1987) (thirty-day suspension for clearly excessive fee and two other violations); In re Landesberg, 518 A.2d 96, 97 (D.C. 1986) (per curiam) (sixty-day suspension for failure to return unearned fee and three other violations). The Board also observed that in a reciprocal case involving only an excessive fee, we had stated that "a public censure is within the range of sanctions that would be imposed in this jurisdiction for respondent's misconduct." In re Oaks, 724 A.2d 1205, 1206 (D.C. 1999) (per curiam) (citation omitted). *fn6 The Board further noted that sanctions have been likewise imposed in cases with a violation of Rule 1.15(b) or its predecessor *fn7 ranging from informal admonition to suspension. See, e.g., In re Ross, 658 A.2d 209 (D.C. 1995) (thirty-day suspension for failure to notify and pay over funds to third party and another violation,); Matter of Goldstein, 471 A.2d 267 (D.C. 1984) (public censure for failure to deliver funds to client, and one other violation). *fn8

The Board here carefully considered the relevant factors in determining censure to be an appropriate sanction in this dual violation case. See In re Waller, 573 A.2d 780, 784-85 (D.C. 1990). We "impose the sanction recommended by the Board unless to do so would foster a tendency toward inconsistent dispositions for comparable conduct or would otherwise be unwarranted." In re Boykins, 748 A.2d 413, 414 (D.C. 2000) (citing D.C. Bar R. XI, § 9(g)(1)). "The Board's recommended discipline comes to the court with a strong presumption in favor of its imposition. Generally speaking, if the Board's recommended sanction falls within a wide range of acceptable outcomes, it will be adopted and imposed." In re Lopes, 770 A.2d 561, 567 (D.C. 2001) (citations omitted). Such is the case here.

It is therefore ORDERED that respondent be, and he hereby is, ...

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