Case Title: Fink v. Neal

Citation: 

Docket Number: 

State: arkansas

Court: Arkansas Supreme Court

Date: 1997-05-27T00:00:00Z

Document:
John W. FINK v. James A. NEAL, as Executive
Director of the Supreme Court Committee on
Professional Conduct

96-450                                             ___ S.W.2d ___

                    Supreme Court of Arkansas
                 Opinion delivered May 27, 1997


1.   Appeal & error -- decision of Supreme Court Committee on Professional
     Conduct -- standard of review. -- On review of a decision of the
     Supreme Court Committee on Professional Conduct, the supreme
     court reviews the matter de novo on the record and pronounces
     judgment as if its opinion had been rendered by the Committee;
     further, the court affirms the Committee's action unless it is
     clearly against the preponderance of the evidence and will not
     reverse the Committee's findings unless they are clearly
     erroneous.

2.   Attorney & client -- intentional misconduct not prerequisite for finding
     Model Rule 8.4(d) violation. -- Intentional misconduct is not a
     prerequisite for a finding of a violation of Model Rule 8.4(d)
     of the Model Rules of Professional Conduct.

3.   Attorney & client -- misconduct -- level of improper conduct relevant to
     sanction levied. -- The level of improper conduct, whether
     negligent, reckless, or intentional, is relevant to the
     sanction levied as opposed to the classification of whether
     the conduct is unethical.

4.   Attorney & client -- instructive standard for violation of Model Rule
     8.4(d) -- whether conduct equates to violation of ARCP Rule 11. -- An
     instructive standard for determining whether an asserted
     violation of Model Rule 8.4(d) occurred is whether the
     attorney's conduct equates to a violation of ARCP Rule 11.

5.   Pleadings -- meaning of attorney's signature on pleadings. -- By the
     terms employed in Rule 11 of the Federal and Arkansas Rules of
     Civil Procedure, an attorney signing a pleading, motion, or
     other paper on behalf of a party constitutes a certificate
     that (1) the attorney made a reasonable inquiry into the facts
     supporting the document or pleading, (2) he or she made a
     reasonable inquiry into the law supporting that document to
     ensure that it is warranted by existing law or a good faith
     argument for the extension, modification, or reversal of
     existing law, and (3) the attorney did not interpose the
     document for any improper purpose, such as to harass or to
     cause unnecessary delay or needless increase in the cost of
     litigation.

6.   Attorney & client -- appellant attorney's actions were sufficient to
     support finding that they were prejudicial to administration of justice and
     to support sanction. -- Where appellant attorney failed to make
     reasonable inquiry into the facts at critical stages of
     litigation, and those failures ultimately led to a writ of
     garnishment being issued to the pro se defendant's employer
     for her wages; where, had appellant read the file, he would
     have known that the pro se defendant was not responsible for
     the full amount claimed in the complaint and would have known
     when she was served; where, had appellant checked with the
     circuit clerk, he would have known that the pro se defendant
     had answered the complaint; and where, had appellant carefully
     reviewed the default judgment prior to having the writ of
     garnishment issued, he would have known that judgment was not
     taken against the pro se defendant and that the writ was
     clearly in error, the supreme court concluded that appellant
     attorney's actions were sufficient to warrant a finding that
     they were prejudicial to the administration of justice and
     sufficient to support the sanction of a letter of caution.


     Arkansas Supreme Court Committee on Professional Conduct;
affirmed.
     Jack, Lyon & Jones, P.A., by: Philip K. Lyon; and Kaplan,
Brewer & Maxey, P.A., by: Philip E. Kaplan, for appellant.
     Boyett, Morgan & Killough, P.A., by: Comer Boyett, Jr., for
appellee.

     Robert L. Brown, Justice.
     Appellant John W. Fink appeals the decision of the Arkansas
Supreme Court Committee on Professional Conduct (Committee), which
found that he had violated Rule 8.4(d) of the Model Rules of
Professional Conduct and issued a letter of caution as the
sanction.  This matter is appealed to this court under Section 5 of
the Procedures of the Court Regulating Professional Conduct of
Attorneys at Law.  On de novo review, we affirm the decision of the
Committee.
     On September 8, 1991, Ruth James accompanied her brother, John
Shelman, to St. Vincent Infirmary (St. Vincent) because he was
thought to be having a heart attack.  Due to Shelman's physical
condition, he was unable to complete the required admission forms
at the time of his arrival.  His sister, James, filled out certain
forms on his behalf, one of which purported to personally guarantee
Shelman's payment for services rendered by the hospital.  Shelman
was released, and he returned on two later occasions for additional
observation and tests.  It is uncontroverted that James incurred no
liability as a result of Shelman's latter two hospital stays.
     Shelman subsequently became delinquent in his payments to St.
Vincent, and his account was assigned for collection to Independent
Service Finance, Inc. (ISF), a corporation which was owned at the
time by the hospital.  As counsel for ISF, appellant Fink caused a
complaint to be filed against James and Shelman on October 7, 1992,
for the collection of $13,831.44, which represented the sum due for
all three of Shelman's hospital visits.  Service was had on Shelman
on October 14, 1992.  James, however, was not served until November
18, 1992.  James filed an answer pro se with the Prairie County
Circuit Court on November 19, 1992, but did not serve the answer
upon either ISF or Fink.
     On November 20, 1992, Fink filed a motion for default judgment
with the Prairie County Circuit Court.  The default judgment, which
was signed by the court on November 23, 1992, but filed for record
on January 11, 1993, provided in part:
          The Defendants have been duly served with Summons
     for more than twenty days before this date, as required
     by law, the Defendants have failed to appear and defend;
     the Defendant John Shelman, Sr. is indebted to the
     Plaintiff, by virtue of an account with the Plaintiff, in
     the total sum of thirteen thousand eight hundred thirty
     one and 44/100 dollars ($13,831.44).
The judgment was then taken against Shelman in the amount of
$13,831.44, but not against James.  
     Shelman remained delinquent on the account.  As a result, on
August 26, 1994, Fink caused a writ of garnishment to be issued
against James's employer, Capitol Movers.  James later contended
that she was not sent a copy of the motion for default judgment or
served with the writ of garnishment.  The Committee found that
James was not served with a copy of the motion for default
judgment.
     On September 8, 1994, Fink sent a letter to the Prairie County
Circuit Court in which he moved to amend the default judgment
because of a "mistake" in order to clarify that James was jointly
liable with Shelman for the sum of $4,729.91, resulting from the
first hospital stay.  On September 21, 1994, the trial court denied
the motion and ruled that it could not amend a judgment against a
party due to a clerical mistake without notice to that affected
party.  In the interim, James filed a pro se motion to quash the
writ of garnishment or, in the alternative, to set aside the
default judgment.  On October 4, 1994, Fink again sent a letter to
the court moving to amend the default judgment and completed a
certificate of service stating that copies of the motion were
served on both Shelman and James by U.S. Mail.  
     On October 26, 1994, Fink sent a letter to James advising her
that she had filed a timely answer to ISF's complaint and admitting
that a default judgment should not have been entered against her. 
Fink wrote that he would send an order to the Prairie County
Circuit Court that would set aside both the default judgment and
the writ of garnishment.  That same day, Fink forwarded an order to
the circuit court which also provided that the matter would be set
for trial at the request of ISF.  Fink assured James that any funds
that had been garnished would be returned to her.
     As a result of these events, James filed a complaint against
Fink with the Supreme Court Committee on Professional Conduct and
alleged violations of Rules 1.1, 3.3(a)(1), 3.3(d), and 8.4(d) of
the Model Rules of Professional Conduct.  After this complaint was
filed, Fink dismissed the ISF complaint in circuit court without
prejudice.  In defense of the complaint made by James, Fink
testified that he did not receive notice of the fact she had filed
an answer to the October 7, 1992 complaint until October 6, 1994. 
He stated that he employed a "tickler" system in his law office
under which a paralegal would count 20 days from service of
process, at which time the paralegal was to contact the circuit
clerk's office to determine whether an answer had been filed.  Fink
stated that he required the paralegal to contact the circuit
clerk's office in recognition of the fact that many people indebted
to ISF would proceed pro se and file an answer without complying
with the service requirements of the Arkansas Rules of Civil
Procedure.  Depending upon whether an answer had been filed, Fink
would either move for a default judgment or initiate discovery.  In
this case, Fink stated that he did not know whether his paralegal
either failed to contact the circuit clerk's office or received
false information from that clerk.
     Fink further stated that his file on the case against Shelman
and James reflected only that service had been perfected on October
14, 1992.  According to the usual practice, separate file notations
should have been made that detailed when service was made on each
of the named defendants.  In this case, only one notation of
service completion was made without reference to either defendant. 
Fink explained that this error, in conjunction with James's failure
to serve him with her answer, set in motion the course of events
that led to the entry of the default judgment which incorrectly
provided both defendants had been summoned 20 days prior and no
answer had been forthcoming.  
     Fink averred that after the default judgment was entered,
Shelman made intermittent payments to ISF for a period of time but
eventually ceased making payments altogether.  As a result, a writ
of garnishment was issued to James's employer on August 26, 1994. 
Fink explained that the writ would not have issued had Shelman
continued making payments, and he took issue with James's assertion
that she did not receive notice of the writ.  Fink acknowledged
that had he looked beyond the notations on his ISF file pertaining
to Shelman and James, he might have discovered that he did not
perfect service on James on October 14, 1992.  He recognized that
mistakes were made but asserted a lack of intentional misconduct. 
He further emphasized that he took corrective measures once the
facts came to his attention.
     Based on the evidence presented at the hearing, the Committee
issued a letter of caution to Fink after finding that he had
violated Rule 8.4(d) of the Model Rules, which provides that it is
professional misconduct for a lawyer to "engage in conduct that is
prejudicial to the administration of justice[.]"
     Fink's salient point on appeal to this court is that the
Committee erred in finding a violation of Rule 8.4(d) and further
erred in sanctioning him with a letter of caution.  He further
contends that his actions did not constitute a violation of Model
Rules 1.1, 3.3(a)(1), or 3.3(d).  On review of a decision of the
Supreme Court Committee on Professional Conduct, this court reviews
the matter de novo on the record and pronounces judgment as if its
opinion had been rendered by the Committee.  Mays v. Neal, 327 Ark.
302, 938 S.W.2d 830 (1997); Finch v. Neal, 316 Ark. 530,