Case Title: Disciplinary Counsel v. O'Brien

Citation: 2008-Ohio-6198

Docket Number: 20080812

State: ohio

Court: Ohio Supreme Court

Date: 2008-12-04T00:00:00Z

Document:
[Cite as Disciplinary Counsel v. O’Brien, 120 Ohio St.3d 334, 2008-Ohio-6198.] 
 
 
DISCIPLINARY COUNSEL v. O’BRIEN. 
[Cite as Disciplinary Counsel v. O’Brien, 
 120 Ohio St.3d 334, 2008-Ohio-6198.] 
Attorneys — Misconduct — Assisting client in conduct that attorney knows to be 
fraudulent — Six-month stayed suspension. 
(No. 2008-0812—Submitted July 22, 2008—Decided December 4, 2008.) 
ON CERTIFIED REPORT by the Board of Commissioners on Grievances and 
Discipline of the Supreme Court, No. 07-068. 
__________________ 
 
Per Curiam. 
{¶ 1} Respondent, Kevin John O’Brien of Columbus, Ohio, Attorney 
Registration No. 0028108, was admitted to the bar in 1983.  On August 13, 2007, 
relator, Disciplinary Counsel, filed a complaint charging respondent with two 
counts of violating the Code of Professional Responsibility, and respondent 
answered.  A hearing was held before a panel of the Board of Commissioners on 
Grievances and Discipline of the Supreme Court.  The panel dismissed count two 
of the complaint, and relator narrowed the charge with respect to count one. 
{¶ 2} In April 2008, the panel issued its findings of fact, conclusions of 
law, and recommendation, which the board adopted in part.  The board 
recommends that respondent be suspended from the practice of law for six 
months, but that the suspension be stayed on the condition that respondent 
commit no further misconduct.  We adopt the board’s findings and the 
recommended sanction. 
Facts 
{¶ 3} At issue is respondent’s conduct with respect to a client’s sale of 
real property and his virtually simultaneous filing of a Chapter 7 bankruptcy. 
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{¶ 4} Respondent represented Stefan A. Unger in connection with the 
latter’s sale of his home in Fredericktown, Ohio.  After the closing, respondent 
took possession of the sale proceeds of $81,000 at his client’s request, and on 
November 1, 2004, he placed the $81,000 in his client trust account.  On 
November 8, 2004, Unger filed for bankruptcy in the United States Bankruptcy 
Court for the Southern District of Ohio.  Unger’s attorney for the bankruptcy was 
Robert Bardwell, who rented office space from respondent and to whom 
respondent had referred Unger. 
{¶ 5} Unger did not disclose the proceeds from the sale of the 
Fredericktown house to his bankruptcy attorney and did not include the asset in 
his bankruptcy petition.  Respondent became aware of the bankruptcy one week 
after it was filed and asked Unger whether the asset had been disclosed.  
According to respondent, Unger told him, “Don’t worry about it.”  Respondent 
discussed the proper course of action with two attorneys in his office (Bardwell 
was not one of them) and testified that he received advice from the late Charles 
W. Kettlewell Sr.  Respondent testified that Kettlewell advised him that he could 
not, consistent with legal ethics, disclose the existence of the funds to the 
bankruptcy court, the trustee, or attorney Bardwell. 
{¶ 6} Subsequently, respondent disbursed monies out of the account at 
Unger’s direction a total of eight times.  The largest of these disbursements was 
$36,493.72, which respondent sent by check to a title company on Unger’s behalf 
on December 13, 2004.  Respondent also attempted to convey the remainder of 
the funds in the account to Unger in December 2004, but the check was marked 
“void” and returned to respondent. 
{¶ 7} Because Unger did not disclose to the bankruptcy court the 
proceeds from selling his house, the trustee filed a “no asset report” with the 
court, and the court discharged Unger’s debts on March 1, 2005.  Approximately 
one week later, the trustee received information – apparently from a former 
January Term, 2008 
3 
associate of respondent – that respondent was holding the house-sale proceeds in 
his client trust account.  In a fax sent to respondent, the trustee in Unger’s 
bankruptcy claimed that the funds constituted property of the trustee and 
demanded immediate remittance of the funds along with an accounting and 
documentation of the real estate sale.  The trustee also withdrew the no-asset 
report. 
{¶ 8} Upon receiving the trustee’s fax, respondent took the following 
steps.  First, he contacted two experienced attorneys, Mark Aultman and Alvin 
Mathews, seeking advice and representation.  According to respondent, both 
attorneys confirmed the earlier advice given by Kettlewell.  Second, respondent 
alerted Unger to the trustee’s action and demanded that Unger turn over the funds 
to the trustee and admit his apparent misrepresentation.  When Unger refused, 
respondent disclosed the presence of the house-sale funds in the trust account to 
Unger’s bankruptcy attorney.  Respondent also refused to turn over the funds 
remaining in the account to Unger. 
{¶ 9} Following the advice he had received, respondent sent a fax to the 
trustee that stated, “We are unable to respond to your questions on the basis of 
attorney/client privilege.”  On May 3, 2005, the trustee transmitted another 
demand for the funds, this time noting that she stood “in the shoes of the debtor” 
with respect to the attorney/client privilege.  The fax stated that if respondent did 
not remit the funds and tender the requested documents within ten days, the 
trustee would file a motion with the bankruptcy court and seek sanctions.  In 
response, respondent sent a letter proposing, on behalf of Unger, to “resolve this 
matter” by having Unger agree to pay the amounts owed to creditors plus an 
amount as fee to the trustee by September 1.  In a June 1 letter, the trustee rejected 
the offer and renewed her demands. 
{¶ 10} 
On August 24, 2005, the trustee filed a motion to compel the 
turnover of documents and funds with the bankruptcy court.  On September 19, 
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2005, the court granted the motion.  Respondent did not comply until the trustee 
filed an additional motion on October 26, 2005; respondent testified that although 
his office had received the court order, it was misfiled by his staff.  On November 
29, 2005, respondent conveyed the remaining funds and documents to the trustee.  
He also requested, by motion, relief from paying attorney fees and costs.  By then, 
$13,513.97 of the original $81,000 remained in respondent’s client trust account.  
At the board hearing, the trustee testified that creditors who had filed proofs of 
claim had received only 97 percent of the amounts owed. 
{¶ 11} 
Subsequently, respondent did pay fees and costs, and the matter 
was resolved between respondent and the trustee. 
The Violation of DR 7-102(A)(7) 
{¶ 12} 
In connection with the foregoing conduct, relator originally 
charged respondent with violations of DR 1-102(A)(4) (prohibiting conduct 
involving dishonesty, fraud, deceit, or misrepresentation), 1-102(A)(5) 
(prohibiting conduct prejudicial to the administration of justice), 1-102(A)(6) 
(prohibiting conduct adversely reflecting on the lawyer’s fitness to practice law), 
and 7-102(A)(7) (prohibiting the counseling or assisting of a client in conduct that 
the lawyer knows to be illegal or fraudulent).1  At the hearing, relator dismissed 
the dishonesty charge under DR 1-102(A)(4). 
{¶ 13} 
In finding a violation of the Disciplinary Rules, the board 
focused on the prohibition in DR 7-102(A)(7) against assisting a client in conduct 
that the lawyer knows to be illegal or fraudulent.  The board viewed respondent’s 
disbursement of house-sale proceeds at the direction of Unger as a violation of 
that prohibition. 
                                                 
1. In certain instances, DR 7-102(B)(1) contravenes client confidentiality and requires a lawyer to 
reveal a fraud perpetrated by a client if the client will not do so himself.  Because relator did not 
charge this violation, the propriety of respondent’s conduct under this provision is not before us.  
See Columbus Bar Assn. v. Farmer, 111 Ohio St.3d 137, 2006-Ohio-5342, 855 N.E.2d 462, ¶ 25 
(misconduct not charged cannot be adjudicated in a disciplinary proceeding). 
January Term, 2008 
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{¶ 14} 
We agree with the board.  The evidence showed that when 
respondent ordered the disbursements to be made, he was fully aware of the 
bankruptcy, harbored the reasonable suspicion that Unger had not disclosed the 
house-sale proceeds to the bankruptcy court, and had the means to inform himself.  
Nonetheless, the ledger for the client trust account reveals that respondent ordered 
eight disbursements totaling $65,189.72 after the bankruptcy filing, of which 
three equaling $44,927.72 went to payees other than Unger himself.2  When asked 
why he made the disbursements at Unger’s request under these circumstances, 
respondent stated, “I had no other option but to distribute the money to him.”  But 
respondent also stated that, from his initial knowledge of the existence of the 
bankruptcy case, he had fully “assumed” that the money in the trust account 
constituted an asset properly subject to ownership and control by the bankruptcy 
court and its trustee.  As discussed, the board concluded that the house-sale 
proceeds constituted bankruptcy assets at the filing of the bankruptcy, and we 
agree with that conclusion. 
{¶ 15} 
In spite of all these circumstances, respondent initially disbursed 
all but $13,500 of the funds to Unger and to third parties at Unger’s direction.  
Only after the bankruptcy trustee discovered the funds and demanded turnover of 
the money did respondent adopt the different approach of refusing to disburse 
monies at Unger’s direction. 
{¶ 16} 
We agree with the board that respondent, by disbursing money 
from the client trust account at Unger’s direction, provided active assistance to 
Unger’s evasion of the bankruptcy laws in violation of DR 7-102(A)(7).  We also 
agree that respondent’s conduct was not excused by his belief that the attorney-
client privilege prohibited him from disclosing the existence of the house-sale 
                                                                                                                                     
 
2.  We note that in December 2004, respondent attempted to convey the remainder of the proceeds 
to Unger, but the check was voided and returned.   
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proceeds.  Quite simply, respondent could have acted with consistency by not 
disclosing but also not disbursing the funds at Unger’s direction.  Although 
respondent rejected this course of action initially, he embraced it after the 
bankruptcy trustee learned of the house-sale proceeds. 
{¶ 17} 
Finally, we note that respondent’s improper assistance to Unger 
with respect to the bankruptcy proceeding led to a depletion of the proceeds from 
the sale of the house that caused actual harm to Unger’s creditors:  the bankruptcy 
trustee testified that the creditors lost three percent of their claims because of 
insufficient assets in the bankruptcy estate.  All these circumstances justified the 
finding of a violation of DR 7-102(A)(7) as well as DR 1-102(A)(5) and (A)(6). 
The Propriety of the Sanction 
{¶ 18} 
Having found a violation of DR 7-102(A)(7) and concomitant 
violations of DR 1-102(A)(5) and (6), the board proceeded to determine the 
proper severity of the sanction.  In this regard, the board determined that 
respondent’s refusal to admit wrongdoing was offset by the fact that respondent 
had sought and relied on legal advice with respect to the assertion of the attorney-
client privilege.  The board found that reliance on legal advice did not have any 
further mitigating effect as to the improper disbursement of house-sale proceeds, 
because respondent apparently did not seek advice regarding the disbursement 
issue.  The board additionally found mitigation in the absence of any selfish 
motive on respondent’s part and in the character testimony offered by the 
Honorable James Green of the Franklin County Municipal Court. 
{¶ 19} 
We agree with the board’s analysis of the factors presented.  In 
particular, we look to two cases to evaluate the proper sanction in this case.  In 
Cincinnati Bar Assn. v. Wallace (1998), 83 Ohio St.3d 496, 700 N.E.2d 1238, the 
attorney had assisted her client in filling out interrogatories in connection with 
contempt proceedings for failure to pay child support.  Assisted by the attorney, 
the client quit-claimed his interest in a house to his current wife; the deed was 
January Term, 2008 
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executed the day after the attorney received the interrogatories, which demanded 
that the client identify, among other things, any interest he owned in real property.  
The quitclaim deed was recorded a week later.  Ultimately, the attorney helped 
the client fill in “none” where identification of real property interests was 
requested.  Originally charged with violating DR 7-102(A)(7) (among other 
provisions) for assisting in a fraudulent conveyance, the fraudulent character of 
the conveyance was not proved, and the attorney was found to have violated only 
DR 1-102(A)(6) (prohibiting conduct that adversely reflects on a lawyer’s fitness 
to practice law).  That violation stemmed from assisting the client in concealing 
the real property interest on the responses to interrogatories. 
{¶ 20} 
The court adopted the recommended sanction of a public 
reprimand.  The court observed that “[a]lthough respondent could not disclose 
client confidences, she could have disclosed the publicly recorded deed to 
opposing counsel, after advising her client of her intention to do so.”  Wallace, 83 
Ohio St.3d at 500, 700 N.E.2d 1238.  Also significant was the fact that the 
attorney had received “no personal gain” and that “no party suffered any 
permanent financial harm” from the violation.  Id. at 498. 
{¶ 21} 
While in the present case Unger’s concealment of the house-sale 
proceeds, assisted by respondent’s disbursement of funds to third-party creditors, 
conferred no financial benefit on respondent, respondent’s disbursements did 
inflict harm on the creditors of the bankruptcy estate who could not fully collect 
on their claims.  The six-month stayed suspension reflects the greater severity of 
the violation and the harm in this case. 
{¶ 22} 
In Disciplinary Counsel v. Frenden (1996), 74 Ohio St.3d 601, 
660 N.E.2d 1152, we imposed a six-month suspension (without stay) when an 
attorney had obtained the client’s release from probation by actively representing 
to a judge that the client had never been in trouble apart from the underlying 
violation – even though the attorney knew that another arrest warrant had been 
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issued against the client for a separate offense.  For this failure to disclose, the 
attorney stipulated to a violation of DR 1-102(A)(5) (prohibiting conduct that is 
prejudicial to the administration of justice).  The attorney had previously received 
a public reprimand in 1985. 
{¶ 23} 
By contrast with the present case, the attorney in Frenden was 
directly involved in perpetrating the misrepresentation to the court and had 
received discipline previously in the form of a public reprimand several years 
before.  These points of contrast justify the stay of the six-month suspension in 
this case. 
{¶ 24} 
Finally, we note the material differences between the present 
case and Columbus Bar Assn. v. Wright (1991), 58 Ohio St.3d 126, 568 N.E.2d 
1218.  In Wright, the attorney involved himself in a bankruptcy proceeding in 
which a client had failed to disclose assets, and the attorney received a two-year 
suspension with 18 months stayed.  The attorney’s involvement in Wright was 
much more direct than the respondent’s in this case – the attorney attended a 
creditor’s meeting and remained silent despite knowing that the client was 
concealing assets.  The violations in Wright included DR 1-102(A)(4).  By 
contrast, respondent in this case did not involve himself in the bankruptcy, and 
relator dismissed the DR 1-102(A)(4) charge at the hearing. 
{¶ 25} 
For all the foregoing reasons, we adopt the board’s analysis and 
its recommended sanction of a six-month suspension, with all six months stayed 
on the condition that respondent commit no further misconduct during the stayed 
suspension.  If respondent violates this condition, the stay will be lifted, and 
respondent will serve the entire six-month suspension. 
{¶ 26} 
Costs are taxed to respondent. 
Judgment accordingly. 
 
MOYER, 
C.J., 
and 
PFEIFER, 
LUNDBERG 
STRATTON, 
O’CONNOR, 
O'DONNELL, LANZINGER, and CUPP, JJ., concur. 
January Term, 2008 
9 
__________________ 
 
Jonathan E. Coughlan, Disciplinary Counsel, and Stacy Solochek 
Beckman, Assistant Disciplinary Counsel, for relator.   
 
 
Kegler, Brown, Hill & Ritter Co., L.P.A., Christopher J. Weber, Geoffrey 
Stern, and Rasheeda Z. Khan, for respondent. 
______________________