Case Title: Cincinnati Bar Assn. v. Schwartz

Citation: 2003-Ohio-1635

Docket Number: 20022178

State: ohio

Court: Ohio Supreme Court

Date: 2003-04-16T00:00:00Z

Document:
[Cite as Cincinnati Bar Assn. v. Schwartz, 98 Ohio St.3d 438, 2003-Ohio-1635.] 
 
 
CINCINNATI BAR ASSOCIATION v. SCHWARTZ. 
[Cite as Cincinnati Bar Assn. v. Schwartz, 98 Ohio St.3d 438, 2003-Ohio-
1635.] 
Attorneys at law — Misconduct — Permanent disbarment — Engaging in a 
pattern of illegal conduct systematically misappropriating clients’ money 
and neglecting to safeguard clients’ interests — Failing to cooperate in 
disciplinary investigation. 
(No. 2002-2178 — Submitted February 12, 2003 — Decided April 16, 2003.) 
ON CERTIFIED REPORT by the Board of Commissioners on Grievances and 
Discipline of the Supreme Court, No. 02-13. 
__________________ 
 
Per Curiam. 
{¶1} 
Respondent, Allen Schwartz of Cincinnati, Ohio, Attorney 
Registration No. 0001157, was admitted to the practice of law in Ohio on October 
9, 1958.  On January 8, 2002, the Hamilton County Grand Jury indicted 
respondent on six counts of theft involving over $200,000 in funds from two 
estates and a trust. 
{¶2} 
On April 8, 2002, relator, Cincinnati Bar Association, filed a 
complaint charging respondent with eight counts of misconduct in violation of the 
Code of Professional Responsibility and one count of violating Gov.Bar R. 
V(4)(G) by failing to cooperate in the disciplinary investigation.  Respondent 
failed to answer relator’s complaint, and the Board of Commissioners on 
Grievances and Discipline referred the cause to a master commissioner pursuant 
to Gov.Bar R. V(6)(F)(2) to review relator’s motion for default judgment.  The 
master commissioner made the following findings. 
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{¶3} 
On March 27, 2000, respondent was appointed executor of an 
estate.  Respondent also acted as attorney for the estate and was appointed the 
trustee of a trust established by his client.  In July 2001, respondent abandoned his 
law practice and disappeared.  An attorney who had shared office space with 
respondent prior to his disappearance received a letter from respondent on July 
25, 2001, in which respondent admitted to misappropriating money from this 
client. 
{¶4} 
As a result of respondent’s abandonment of his law practice and 
disappearance, the Hamilton County Probate Court removed respondent as 
executor of the estate and appointed a new administrator.  The final accounting of 
the estate revealed that respondent had converted money from the estate for his 
own personal use and that his failure to invest any of the estate funds resulted in 
lost interest income to the estate.  On December 5, 2001, the probate court found 
that respondent had violated his fiduciary and professional duties as executor and 
attorney for the estate by misappropriating $111,427.  The probate court also 
found that respondent had violated his duties as trustee and attorney by 
misappropriating $26,296.10 from the trust. 
{¶5} 
Relator initiated a second investigation into respondent’s conduct 
as executor and attorney for the estate of another client.  In August 2001, the 
probate court removed respondent as fiduciary for this estate.  The probate court 
found that respondent had misappropriated $233,600 from the estate. 
{¶6} 
In 1971, respondent represented another client in a divorce action.  
As part of the divorce, the client’s home was sold and respondent undertook to 
invest the proceeds from the sale for his client’s benefit.  Respondent did not 
provide an accounting of the proceeds. 
{¶7} 
On September 24, 1994, respondent entered into a trust agreement 
with this client.  The agreement indicated that funds totaling $49,406.22 were 
being held by respondent as trustee and that he would invest the funds on his 
January Term, 2003 
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client’s behalf.  On June 5, 1999, the client confronted respondent about the status 
of her money.  Respondent failed to deliver any funds to his client at this time 
and, instead, presented her with a handwritten accounting of her funds and a 
promissory note for $29,876.  Respondent failed to remit any additional money to 
this client prior to his disappearance and failed to prepare an accounting of his 
client’s money. 
{¶8} 
A fourth grievance stems from 1967, when two of respondent’s 
clients, a married couple, were involved in a commercial airline accident.  The 
husband was killed in the accident and the wife was severely injured.  The 
husband’s estate was valued in excess of $1,100,000.  An additional $600,000 
was added to the estate from the wrongful death settlement, and the wife received 
$300,000 for injuries she suffered in the accident.  Respondent handled the 
husband’s estate and, beginning in 1967, maintained custodial control of the 
wife’s assets. 
{¶9} 
Because he was a close friend of the family, respondent’s handling 
of the estate and the wife’s personal injury settlement was not initially questioned.  
For many years, respondent sent regular monthly checks to the wife.  However, in 
December 1996, the wife requested an accounting of her assets.  Respondent 
presented her with a handwritten document purporting to be an accounting and 
informed her that she had $355,000 remaining, mainly in bond investments.  
Following the accounting, the wife did not spend any of the principal but 
continued to receive monthly payments from respondent until May 2001, when 
payments ceased.  In April 2001, the wife’s son confronted respondent, and 
respondent claimed that the assets were lost due to bad investments. 
{¶10} As a result of respondent’s conduct, the master commissioner 
concluded that respondent had violated DR 1-102(A)(3) (engaging in illegal 
conduct involving moral turpitude), 1-102(A)(4) (engaging in conduct involving 
dishonesty, fraud, deceit, or misrepresentation), 6-101(A)(3) (neglecting an 
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entrusted legal matter), 7-101(A)(1) (failing to seek the lawful objectives of the 
client), 7-101(A)(2) (failing to carry out a contract of employment), 7-101(A)(3) 
(prejudicing or damaging clients in the course of the professional relationship), 9-
102(B)(3) (failing to maintain records of client’s funds), and 9-102(B)(4) (failing 
to promptly pay or deliver client’s funds).  The master commissioner also 
determined that respondent had violated Gov.Bar R. V(4)(G) by not cooperating 
in relator’s investigation into the allegations of misconduct against him. 
{¶11} The master commissioner recommended that respondent be 
disbarred.  In making the recommendation, the master commissioner considered 
as aggravating factors that respondent had a dishonest or selfish motive, 
respondent’s actions involved a pattern of misconduct, there were multiple 
offenses, and respondent did not cooperate in the disciplinary process.  The 
master commissioner further considered as aggravating the vulnerability of and 
resulting harm to the victims of respondent’s misconduct and his failure to make 
restitution. 
{¶12} In mitigation, the master commissioner considered statements 
made by respondent in his July 2001 letter.  In the letter, respondent 
acknowledged the wrongful nature of his misconduct and authorized the 
collection of certain outstanding fees, which respondent conceded may be 
inadequate to repay his debts.  Respondent claimed that his gambling accounted 
for his financial problems, and that he is physically and mentally ill.  Finally, 
respondent asserted in the letter that the assets from his friend’s estate were 
depleted approximately 15 years ago and respondent had been paying the wife 
from his own funds. 
{¶13} The board adopted the master commissioner’s findings of fact and 
conclusions of law, and recommended the sanction of disbarment. 
{¶14} On review, we find that the evidence of record supports the board’s 
findings of misconduct and recommended sanction.  Respondent has on several 
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occasions breached his duties as attorney, fiduciary, and trustee.  Respondent has 
engaged in a pattern of illegal conduct whereby he has systematically 
misappropriated clients’ money and neglected to safeguard clients’ interests.  
While respondent candidly admitted to his misconduct, he has shown no remorse 
for his actions, has failed to make restitution, has abandoned his law practice and 
disappeared, and stated in his July 2001 letter that he “won’t return of [his] own 
volition.”  Moreover, respondent has preyed on the vulnerability and trust of his 
clients in order to achieve his own selfish motives. 
{¶15} When a lawyer knowingly converts client funds, the appropriate 
discipline is disbarment.  Cleveland Bar Assn. v. Belock (1998), 82 Ohio St.3d 98, 
100, 694 N.E.2d 897.  Respondent’s conduct of neglecting entrusted legal matters, 
engaging in a continuous course of deceit involving the misappropriation of 
clients’ funds, failing to make restitution, and failing to cooperate in the 
investigation of grievances warrants disbarment. 
{¶16} Accordingly, respondent is permanently disbarred from the 
practice of law in Ohio.  Costs are taxed to respondent. 
Judgment accordingly. 
 
MOYER, C.J., RESNICK, F.E. SWEENEY, PFEIFER, COOK, LUNDBERG 
STRATTON and O’CONNOR, JJ., concur. 
__________________ 
 
Edwin W. Patterson III and Jack S. Healy, for relator. 
__________________