Case Title: Toledo Bar Assn. v. Rust

Citation: 1996-Ohio-242

Docket Number: 19952128

State: ohio

Court: Ohio Supreme Court

Date: 1996-02-28T00:00:00Z

Document:
Toledo Bar Association v. Rust. 
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[Cite as Toledo Bar Assn. v. Rust (1996), ___ Ohio St.3d ____.] 
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Attorneys at law -- Misconduct -- Public reprimand -- Accepting 
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employment where attorney’s independent judgment on 
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client’s behalf is likely to be adversely affected, without client’s 
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consent after full disclosure -- Continuing multiple employment 
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where attorney’s independent judgment on any client’s behalf 
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is likely to be adversely affected, without clients’ consent after 
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full disclosure -- Failing to deposit client’s funds in identifiable 
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bank account. 
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(No. 95-2128 -- Submitted December 6, 1995 -- Decided February 28, 
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1996.) 
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ON CERTIFIED REPORT by the Board of Commissioners on Grievances 
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and Discipline of the Supreme Court, No. 94-04. 
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Relator, Toledo Bar Association, charged respondent, John G. Rust of 
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Toledo, Ohio, Attorney Registration No. 0000098, with professional 
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misconduct involving, inter alia, violations of DR 5-105(A) (accepting 
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employment where attorney’s independent judgment on client’s behalf is 
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likely to be adversely affected, without client’s consent after full 
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disclosure), 5-105(B) (continuing multiple employment where attorney’s 
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independent judgment on any client’s behalf is likely to be adversely 
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affected, without clients’ consent after full disclosure), and 9-102(A) 
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(failing to deposit client’s funds in identifiable bank account).  A panel of 
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the Board of Commissioners on Grievances and Discipline of the Supreme 
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Court (“board”) heard the matter on December 15, 1994. 
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The parties, in effect, stipulated that respondent violated DR 5-
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105(A) and (B) and 9-102(A) in the course of arranging two loans between 
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his clients, Molly A. Harris-Gordon and Courtland Harwood.  Harris-
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Gordon hired respondent in May 1992 to represent her in an uninsured 
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motorist claim.  In June 1992, Harris-Gordon approached respondent about 
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a loan to help her avoid being evicted from her home.  Apparently, Harris-
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Gordon was unable to obtain a loan from anywhere else, and respondent 
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learned from one of relator’s representatives that he could not ethically loan 
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her money himself.  As a result, respondent inquired of Harwood, the owner 
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of a company named “National Loan Co.,” and Harwood agreed to offer 
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Harris-Gordon a $937.50 loan.  As security for this loan, respondent 
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arranged for Harris-Gordon to assign to Harwood a $1,500 interest in her 
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uninsured motorist claim and for Harris-Gordon to buy back her assigned 
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interest for $1,112.50.  Under the terms of the loan agreement, Harris-
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Gordon would buy back the assigned interest a week or so after the loan 
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agreement was signed with funds being held by the Toledo Municipal Court 
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in connection with a default judgment Harris-Gordon had obtained in an 
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unrelated case.  The loan agreement also authorized respondent, as Harris-
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Gordon’s attorney, to receive the $1,112.50 from the Toledo Municipal 
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Court and then to deliver the funds to Harwood.  Finally, the loan agreement 
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provided for the payment of $25 per month in interest if Harwood did not 
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receive payment by August 3, 1992. 
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Harris-Gordon received her loan in the amount of $937.50 on July 24, 
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1992, respondent timely paid Harwood $1,112.50 on about July 31, 1992, 
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and Harwood made $175 on the deal.  Respondent paid Harwood with a 
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personal check for $1,112.50 written after he had deposited the Toledo 
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Municipal Court funds  into his personal bank account. 
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Harris-Gordon also agreed to pay Harwood $2,500 for a second loan, 
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this time in the amount of $2,000.  As security for this loan, respondent 
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arranged for Harris-Gordon to assign to Harwood a $2,500 interest in 
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anticipated proceeds from her uninsured motorist claim and a $2,500 
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interest in an inheritance she expected to receive from her father’s estate.  
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Harris-Gordon understood that her loan obligation would be satisfied from 
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her inheritance only if she did not receive sufficient proceeds from her 
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uninsured motorist claim.  She asked respondent not to file anything in 
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probate court; however, respondent filed the assignment as a part of the loan 
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transaction.  Since this filing, Harwood has not taken advantage of either 
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assignment, and Harris-Gordon is in the process of repaying the $2,000 
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loan. 
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Harris-Gordon knew respondent had previously represented 
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Harwood, but she objected to Harwood’s profit from these loan transactions 
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when she realized respondent might have explored other less costly 
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alternatives to the loans.  The panel agreed that respondent represented 
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clients with competing interests without their consent after full disclosure 
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and, therefore, found respondent in violation of DR 5-102(A) and (B).  The 
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panel also found respondent in violation of DR 9-102(A). 
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In recommending a sanction for this misconduct, the panel considered 
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that respondent had been in practice since 1948 and had committed no prior 
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disciplinary infractions.  Relator suggested that respondent be suspended 
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from the practice of law for six months, with the sanction period being 
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suspended on the condition that respondent complete twelve hours of 
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continuing legal education courses on ethics.  Respondent suggested a 
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public reprimand.  The panel recommended that respondent be publicly 
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reprimanded and that he be required to complete three credit hours in ethics 
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in addition to the amount mandated by continuing legal education 
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requirements. 
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The board adopted the panel’s report, including its findings of fact, 
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conclusions of law, and recommended sanction. 
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Joseph L. Wittenberg; Paul D. Giha; Frank W. Cubbon, Jr. & 
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Associates and Guy T. Barone, for relator. 
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Marshall & Melhorn and Richard M. Kerger, for respondent. 
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Per Curiam.  Upon review of the record, we concur in the board’s 
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findings of misconduct, but we consider public reprimand a sufficient 
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sanction.  Respondent is therefore publicly reprimanded for his violations of 
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DR 5-105(A) and (B) and 9-102(A)  Costs taxed to respondent. 
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Judgment accordingly. 
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MOYER, C.J., WRIGHT, F.E. SWEENEY, PFEIFER and COOK, JJ., concur. 
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DOUGLAS and RESNICK, JJ., not participating. 
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