The opinion of the court was delivered by: Blackburne-rigsby, Associate Judge
On Report and Recommendation of the Board on Professional Responsibility
(Bar Docket Nos. 397-96 & 488-02)
(Amended March 18, 2010)*fn1
Before FISHER and BLACKBURNE-RIGSBY, Associate Judges, and BELSON, Senior Judge.
In the principal one of these two consolidated matters (No. 07-BG-608), the Board on Professional Responsibility (the "Board") recommends that respondent be disbarred for intentional or reckless misappropriation of $2,000 that her client, Mark Green, had entrusted to her in 1995 to satisfy his creditors and prevent foreclosure of his condominium. We accept the Board's recommendation of disbarrment based upon its thorough, painstakingly considered report - adopting for the most part the likewise meticulous findings of fact by Hearing Committee No. One - which we append to this opinion. Our brief ensuing discussion assumes familiarity with the Board's report. In the second, unrelated matter before us (No. 06-BG-1480), the Board recommends that respondent be suspended for thirty days for misconduct involving her failure, for years after the death of her client William Dickerson, to locate and file with the court the original Will she had drafted on his behalf and which named her as the personal representative. Here, too, we accept the Board's recommendation; we discuss this matter briefly in footnote 2, infra.
We deem it necessary to answer only a single point made by respondent in opposition to the Board's recommendation of disbarrment. She argues that the Board, and implicitly the Hearing Committee, applied the preponderance of evidence standard to resolve the key factual issue of whether her client (Green) gave her the $2,000 to pay attorney's fees owed her (as respondent contends) or instead entrusted her with that money for use on his behalf (as the Board and Hearing Committee found). Thus, in respondent's view, the Board ignored Bar Counsel's obligation to prove misconduct, including the core factual allegations underlying the charged misconduct, by clear and convincing evidence.
It is, of course, "Bar Counsel's burden to establish by clear and convincing evidence that respondent violated the Rules of Professional Conduct." In re Mitchell, 727 A.2d 308, 313 (D.C. 1999). Moreover, we have said that "factual findings [underpinning disciplinary charges] must be supported by clear and convincing evidence." In re Anderson, 778 A.2d 330, 335 (D.C. 2001) (quoting In re Williams, 464 A.2d 115, 119 (D.C. 1983)). Whether that rule applies to all such facts, including historical and subsidiary facts contributing to a mosaic of alleged misconduct, is not something we need consider here. We agree with respondent that at least the pivotal "threshold issue" here (the Board's term) of whether respondent received and held the $2,000 in trust for Green required proof by clear and convincing evidence before it could be answered affirmatively. However, none of this helps respondent for the following reasons.
First, appellant did not raise the issue of application of the wrong standard of proof in her brief to the Board (which accordingly did not address it), and, indeed, failed to raise it with the court until her reply brief - both reasons why we would be within our authority to ignore it. See In re Artis, 883 A.2d 85, 97 (D.C. 2005) ("We have held consistently that an attorney who fails to present an issue to the Board waives it and cannot present it for the first time to this court."); Stockard v. Moss, 706 A.2d 561, 566 (D.C. 1997) ("It is the longstanding policy of this court not to consider arguments raised for the first time in a reply brief."). Furthermore, it is not at all apparent from the Hearing Committee's report that it applied only a preponderance of the evidence standard in finding that respondent received - indeed, knew she had received - the $2,000 in trust for her client. Rather, the Committee stated explicitly at the onset its understanding that "clear and convincing evidence" was the applicable standard of proof. It then arrayed in detail (as did the Board in its report) the evidence of respondent's own contemporaneous conduct demonstrating, in the Committee's view, both that the entire $2,000 had been entrusted to respondent as client property and that she knew this to be the case. Respondent points to nothing in the Committee's analysis suggesting that it applied a lesser (i.e., preponderance) standard of proof in finding incredible her defense that she had received the money in payment of attorney's fees.
Finally, this court bears ultimate responsibility for the imposition of discipline, and we may make our own determination of whether clear and convincing evidence supports the Hearing Committee's finding - at least where our conclusion on the point contradicts nothing in the Committee's (or the Board's) analysis.*fn2 The evidence arrayed in the Board's report leaves us with no doubt that Bar Counsel proved respondent's receipt of client funds by clear and convincing evidence. Moreover, the evidence supports - equally convincingly - the Board's conclusion that respondent was at least reckless in her misuse of the entrusted funds. Cf. In re Berkowitz, 801 A.2d 51 (D.C. 2002).
Accordingly, in No. 07-BG-608, we order respondent's disbarrment from the practice of the law in the District of Columbia, effective thirty days from the date of this opinion. See D.C. Bar R. XI, § 14 (f). For the purpose of seeking reinstatement to the Bar, the period of disbarrment shall not be deemed to begin until respondent files a sufficient affidavit pursuant to D.C. Bar R. XI, § 14 (g). In No. 06-BG-1480, we order her suspension from the practice of law for thirty days, to run concurrently with her disbarrment.*fn3 Lastly, in No. 07-BG-608, we order as a condition of reinstatement that respondent pay restitution to her client of $1,000 with interest at the legal rate of 6% from June 7, 1995.
DISTRICT OF COLUMBIA COURT OF APPEALS BOARD ON PROFESSIONAL RESPONSIBILITY In the Matter of:
LUCY R. EDWARDS, Bar Docket No. 397-96 Respondent.
REPORT AND RECOMMENDATION OF THE BOARD ON PROFESSIONAL RESPONSIBILITY
The Office of Bar Counsel charged Lucy R. Edwards ("Respondent") with eight separate violations of the disciplinary rules, growing out of her representation of Mr. Mark Green in an effort over two years to stave off foreclosure on his condominium. Hearing Committee One (the "Committee") concluded that Respondent violated a number of Rules, including misappropriation, and recommends disbarrment. The Board on Professional Responsibility (the "Board") agrees.
Bar Counsel initially filed a petition instituting formal disciplinary proceedings and a specification of charges on March 12, 1997. On May 19, 1997, Bar Counsel filed a Motion to Dismiss Without Prejudice, which the Board granted on May 27, 1997. Bar Counsel submitted the petition and specification of charges now before the Board on October 21, 2005. Respondent filed an Answer on May 11, 2006, admitting many of the facts asserted by Bar Counsel but denying all of the charges.
The evidentiary hearing was held on May 23, 2006. Respondent was present and represented by counsel. Assistant Bar Counsel called two witnesses: Respondent and her client, Mark R. Green. Bar Counsel moved to introduce Bar Exhibits ("BX") 1 through 18, 25, 26, and 30, which were admitted without objection. Tr. at 304, 312.*fn4 During Respondent's case, Respondent's Exhibits ("RX") A, B, C, and D, were introduced and admitted without objection. Tr. 295-97, 307-08. No additional witnesses were presented by Respondent. At the end of the hearing, the Committee made a preliminary, non-binding determination that Bar Counsel had sustained its burden, under the clear and convincing evidence standard, that Respondent had committed some of the charged violations and the Committee requested briefing from the parties on all of the charges. Tr. at 306. Bar Counsel then submitted exhibits in aggravation and Respondent testified on her behalf during the mitigation phase of the hearing. Tr. at 315-33.
Bar Counsel submitted to the Committee proposed findings of fact, conclusions of law, and recommendations as to sanction ("BC Brief") on June 26, 2006, and Respondent submitted proposed findings of fact and conclusions of law ("R Brief") on July 17, 2006. Bar Counsel submitted a reply brief on August 2, 2006. The Committee issued its Report December 26, 2006.
II. PROPOSED FINDINGS OF FACT
With minor alterations that do not change the significance of the findings of fact, the Board adopts the well-written findings of the Committee.
1. Respondent is a member of the Bar of the District of Columbia Court of Appeals, having been admitted by examination on February 18, 1965, and assigned Bar number 197020. BX A; Tr. at 69-70. In 1994, she moved her practice to 1424 K Street, N.W., in the District of Columbia. Tr. at 74.
Retention of Respondent by Mark Green
2. On March 7, 1994, Mark R. Green, then a resident of the District of Columbia, met Respondent and retained her to assist him in filing for bankruptcy to protect his condominium, located at 1736 Willard Street, N.W., from foreclosure after he fell behind in making mortgage and condominium fee payments. BX 2 at 5; Tr. at 75, 186-90, 233. A foreclosure sale had been scheduled for two days later, on March 9, 1994. BX 9 at 28; Tr. at 233. Mr. Green agreed to pay a flat $1,000 fee for Respondent to prepare the bankruptcy filing, attend a meeting with his creditors, and secure an order from the Bankruptcy Court confirming Mr. Green's payment plan. BX 2 at 5. He also agreed to pay a $160 filing fee. Tr. at 96; BX 2 at 5. Mr. Green paid $700 of his fee that day. BX 9 at 33; Tr. at 96, 102. The retainer agreement also indicated that Mr. Green would pay Respondent $150 per hour for any further work required in his case. BX 2 at 5.*fn5
3. On March 9, 1994, Respondent filed a voluntary bankruptcy petition on behalf of Mr. Green, with an attached list of creditors and statement of attorney compensation, in the United States Bankruptcy Court for the District of Columbia (the "Bankruptcy Court"). BX 17 at 133; BX 18 at 136-38.
4. Mr. Green had three creditors: G.E. Capital Mortgage Services, Inc. ("G.E. Capital"), which held the first trust on Mr. Green's condominium amounting to about $45,000, a second trust holder to which Mr. Green owed about $8,000, and his condominium association, which held a secured debt of about $7,500. BX 9 at 28.
5. On March 21, 1994, Respondent sent Mr. Green an invoice indicating that he was required to pay the remaining $460 of his initial retainer and filing fee. BX 2 at 4.
6. On April 6, 1994, Respondent filed Mr. Green's various schedules, a statement of financial affairs, and Chapter 13 plan. BX 17 at 133.
7. On April 9, 1994, Mr. Green paid Respondent the remaining $460 of his initial retainer and filing fee. BX 9 at 33; Tr. at 96, 102.
8. On June 3, 1994, the Bankruptcy Court entered an order confirming Mr. Green's Chapter 13 plan. BX 18 at 139. Respondent thus achieved Mr. Green's objective of preventing foreclosure on his condominium.
Respondent's Post-Bankruptcy Confirmation Representation of Mr. Green
9. On August 18, 1994, G.E. Capital filed a motion for relief from the automatic bankruptcy stay because it had not received payments from Mr. Green pursuant to the bankruptcy plan. BX 17 at 134; BX 18 at 162. Subsequently, Respondent consulted with Mr. Green, reviewed records, and successfully negotiated a consent decree that gave Mr. Green an opportunity to catch up on his post-petition arrears (delinquent payments that had accumulated since the bankruptcy filing). BX 9 at 29.
10. On September 14, 1994, the Bankruptcy Court entered a consent order denying G.E. Capital's motion for relief from the stay after the parties had reached their agreement. BX 17 at 134; BX 18 at 162-63. The order provided that Mr. Green would cure the arrears by paying $1,180 to G.E.
Capital that day and by making extra payments until December 1, 1994. Id. Mr. Green provided Respondent with a $1,180 cashier's check, which Respondent forwarded to G.E. Capital's attorney on September 14, 1994. BX 18 at 160-61. That same day, Respondent sent a letter to Mr. Green informing him that she had forwarded his check and reminding him about his new payment responsibilities. Id. at 160.
11. On January 19, 1995, G.E. Capital filed an affidavit of breach notifying the Bankruptcy Court that Mr. Green had failed to make payments required by the consent order's new payment schedule and that Mr. Green needed to pay $4,860.68 to cure the breach. BX 17 at 134; BX 18 at 165-68. G.E. Capital sent copies of the affidavit to both Mr. Green and Respondent. BX 18 at 167, 168.
12. On March 17, 1995, the Bankruptcy Court entered an order granting G.E. Capital relief from the bankruptcy stay because Mr. Green had failed to cure the breach. G.E. Capital was thus allowed to foreclose on Mr. Green's condominium. BX 18 at 170-72, 175-77.
13. On March 21, 1995, Respondent spoke with Mr. Green about a proposed forbearance agreement she might be able to negotiate with G.E. Capital to keep it from taking action against Mr. Green's property. Tr. 114-17. Mr. Green testified that he told her he thought he could come up with at least $5,000 as part of that effort. Tr. 114-17. Respondent provided similar testimony, though she recalled that the amount was between $3,000 and $5,000 and that this amount would include some payment of attorney's fees. Tr. at 140-41.
14. On April 10, 1995, Respondent faxed the attorney representing G.E. Capital a proposed forbearance agreement dated March 29, 1995, under which Mr. Green would pay $3,000 immediately and then make additional payments until he cured his outstanding arrears by, at the latest, the end of February 1996. BX 18 at 181-82; BX 9 at 29. G.E. Capital's attorney did not act on the proposal. BX 9 at 29.
15. During the spring and summer of 1995, Respondent and Mr. Green discussed the possibility of reducing his bankruptcy payments from $330 per month, as the bankruptcy plan required, to $100. BX 9 at 30. The bankruptcy plan, however, was never modified. Id.
May 17, 1995 Check from Mr. Green to Respondent
A critical fact in this case involves the characterization of a $2,000 check drafted by Mr. Green payable to Respondent, dated May 17, 1995. BX 12 at 40.
16. On May 16, 1995, Respondent spoke with Mr. Green by telephone about his need to produce some money to satisfy Mr. Green's outstanding debts. Mr. Green indicated that he would bring in $2,000 the next day and $5,000 altogether. BX 9 at 34.
17. On May 17, 1995, Mr. Green brought a cashier's check in the amount of $2,000 to Respondent's office. BX 12 at 39; Tr. at 193-95. Respondent was at her office when Mr. Green arrived with the check. Tr. at 192-95. It is not clear whether Mr. Green gave the check directly to Respondent or to one of Respondent's staff members, but Respondent was at least in the office when Mr. Green brought the check in and, in any event, became aware that Mr. Green had brought the money into the office. BX 9 at 31-32; Tr. at 195.
18. According to Mr. Green, he brought the $2,000 in for Respondent to hold on his behalf and use to try to forestall the foreclosure procedures on his condominium or to settle the arrears on his mortgage payments. Tr. at 195, 274-76; BX 9 at 31. Mr. Green testified that he, Respondent, and Respondent's then office manager, Walter Johnson, agreed that the money would go into an escrow account. Tr. at 195. Mr. Green does not recall receiving any receipt showing that Respondent had received the check and what she was going to do with it. Id.
19. Respondent's testimony on this event differs in one critical respect. Respondent testified that this money was to be used in part to address Mr. Green's outstanding debts with his three creditors, but also would be used to pay some of his outstanding attorney's fees. Tr. at 140-41. Although Respondent had a legitimate basis to seek additional attorney's fees from her client, her actions were inconsistent with the notion that any part of the $2,000 was for payment of an attorney's fee.
20. On May 19, 1995, Respondent deposited Mr. Green's $2,000 check into her attorney trust account. On that day, Respondent also deposited two checks, one for $4,000 and the other for $400, provided by her client Capitol Bus Rental, Inc. ("Capitol Bus") into the trust account. BX 14 at 57-59. Respondent indicated on the $4,000 Capitol Bus check's memo line that the money would be used to make an Internal Revenue Service ("IRS") payment on the company's behalf. BX 14 at 59. Simultaneously, Respondent withdrew $1,400 in cash from the $6,400 deposit, leaving a net deposit of $5,000, which brought her trust account balance to $5,336.77. BX 14 at 55, 57. Respondent did not note on the deposit ticket the reason for the $1,400 withdrawal or whose money it represented, but she testified that she took it out of Mr. Green's check as attorney's fees. BX 14 at 57; Tr. at 125.
21. On May 20, 1995, Respondent wrote a check drawn on her attorney trust account for $5,016.77 payable to the IRS on which she wrote "Tax payment for Capitol Bus Rental." BX 14 at 69. Respondent does not have any records to explain how she was able to send a check for this amount to the IRS on behalf of Capitol Bus when she had received only $4,000 for this purpose the day before. Tr. at 128-32. Respondent testified that a company representative provided sufficient additional money at some point, but none of the deposits immediately before she wrote the $5,016.77 check or any up to a month after the IRS cashed it show that any additional money on behalf of Capitol Bus entered her escrow account. Tr. at 128-38.
22. On May 24, 1995, Respondent deposited a $2,100 insurance settlement check made payable to another client into her escrow account, as well as a $4,000 check payable to herself and drawn against her operating account at Industrial Bank of Washington. BX 14 at 61. On the $4,000 check, Respondent wrote "Bal. Atty's Fee," but she did not indicate whose fees that sum represented. Id.; Tr. at 148. Simultaneously, Respondent withdrew $1,000 from the $6,100 total deposit, leaving a net deposit of $5,100, which brought her escrow account balance to $10,436.77. BX 14 at 55, 61. Respondent did not note on the deposit ticket the reason for the $1,000 withdrawal or whose money it represented. Id. at 61.
23. Respondent wrote several checks against her escrow account that, by June 7, 1995, left a balance of $1,489.30. Id. at 55. Additional disbursements left the escrow account with overdraft balances of -$11.30 on June 19, 1995, and -$36.30 on June 20, 1995. BX 15 at 81. On June 21, 1995, Respondent deposited $50 into her account, bringing the balance to $13.70. Id. at 81, 87. On June 26, 1995, the balance rose to $913.70, then dropped to $712.68 by July 10, 1995. Id. at 81, BX 16 at 109. Thus, from June 7, 1995, until July 10, 1995, Respondent's escrow account balance remained under $2,000 - less than the amount Mr. Green had brought to her office on May 17, 1995.
24. Mr. Green subsequently requested $1,000 back from the $2,000 he had brought to Respondent's office, to cover some pressing expenses including the cost of recovering his car from an impound lot and of moving to New York City for graduate school. Tr. at ...