Case Title: The Florida Bar v. Michael Howard Wolf

Citation: 

Docket Number: SC04-1374

State: florida

Court: Florida Supreme Court

Date: 2006-02-23T00:00:00Z

Document:
Supreme Court of Florida 
 
 
____________ 
 
No. SC04-1374 
____________ 
 
THE FLORIDA BAR, 
Complainant, 
 
vs. 
 
MICHAEL HOWARD WOLF, 
Respondent. 
 
[February 23, 2006] 
 
PER CURIAM. 
We have for review a referee's report regarding alleged ethical breaches by 
Michael Howard Wolf.  We have jurisdiction.  See art. V, § 15, Fla. Const.  After 
considering the facts of this case, we disapprove the referee’s recommendation of a 
three-year suspension and impose a two-year suspension followed by one year of 
probation.  
FACTS 
After conducting a hearing, the referee issued a report making the following 
detailed findings.  The Florida Bar filed a complaint alleging that Wolf engaged in 
trust accounting violations.  A Bar audit revealed that Wolf had deposited funds 
 
 
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into his operating account, which should have been held in trust.  By placing such 
funds into his operating account, Wolf used his operating account as a trust 
account.  That account was not an interest-bearing trust account in compliance with 
The Florida Bar’s Interest on Trust Accounts (IOTA) program.  During the 
investigation, Wolf cooperated with the Bar.  He waived a probable cause hearing, 
admitted he placed the funds into his operating account, and admitted he failed to 
comply with the trust account requirements of the Rules Regulating the Florida 
Bar.   
 
Wolf had several bank accounts, including two business accounts for general 
operating expenses, and a client trust account.  Although Wolf had employees who 
managed the accounts, Wolf acknowledged that he had sole signatory authority for 
checks and the ultimate responsibility for the financial activities of his office.  
Further, he testified that he had a long-standing relationship with the bank, which 
would pay the overdrafts on the accounts and bill him with financial penalties.  
In count 1, Wolf represented a client in a personal injury case that settled for 
$10,000.  In October 2001, he deposited the $10,000 settlement check into his 
operating account, rather than in his IOTA trust account.  These trust funds 
covered a previous shortage.  Wolf paid one medical bill related to the case and 
applied other funds for his own use and benefit or for purposes other than the 
specific purpose for which said funds were entrusted, thereby leaving a balance of 
 
 
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approximately $3355 in his operating account.  Thereafter, Wolf remitted a check 
from his operating account to the client for her portion of the settlement, 
$4,624.20, which exceeded the balance in the operating account.  The shortage in 
Wolf’s operating account was caused by his misuse of client monies.  When the 
client notified Wolf=s office of the bounced check, he immediately and personally 
delivered cash to her. 
 
Count 2 involves a general finding that Wolf placed funds to be held in trust 
into his operating account.  He did this to cover shortages and remit funds to 
clients and others with trust monies deposited from other unrelated matters.  The 
Bar audit demonstrated that throughout the audit period, Wolf’s operating account 
was overdrawn.  The use of client funds for purposes other than the specific 
purpose for which these funds were entrusted constitutes misappropriation of client 
funds.  
As to count 3, Wolf used his operating account as a trust account and failed 
to follow the Rules Regulating the Florida Bar pertaining to the regulation of trust 
accounts.  Wolf=s operating account records were deficient and in violation of the 
minimum requirements for trust accounts. 
Before the referee, Wolf asserted that he did not willfully deposit the trust 
checks into his operating account.  His employee had incorrectly made the 
deposits.  Wolf had warned her about this impropriety on earlier occasions.  Also, 
 
 
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Wolf had hired an individual to keep his account records.  Thus, Wolf argued that 
he did not have the intent to misappropriate funds.  Further, he had been audited 
shortly before these incidents occurred and no accounting violations were found.  
In addition, since the Bar’s audit, Wolf participated in the Bar=s trust account 
workshop and explored technological methods to improve his compliance with the 
accounting requirements.   
After considering Wolf’s arguments, the referee made recommendations as 
to guilt.  With regard to count 1, the referee found that by his conduct and his 
misappropriation of client funds, Wolf violated the following provisions of the 
Rules Regulating the Florida Bar as they existed in 2001:  4-1.15(a) (“A lawyer 
shall hold in trust, separate from the lawyer=s own property, funds and property of 
clients or third persons that are in a lawyer=s possession in connection with a 
representation. . . . In no event may the lawyer commingle the client=s funds with 
those of the lawyer or those of the lawyer=s law firm.”); 4-1.15(b) (a lawyer shall 
promptly deliver to the client or third person funds which they are entitled to 
receive); 4-1.15(d) (a lawyer shall comply with the Rules Regulating Trust 
Accounts); 5-1.1(a) (money or other property entrusted to an attorney for a specific 
purpose, including advances for costs and expenses, is held in trust and must be 
applied only to that purpose); 5-1.1(d) (minimum trust accounting records shall be 
maintained and minimum trust accounting procedures must be followed); and 5-
 
 
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1.1(e)(2) (all nominal or short term funds belonging to clients or third persons that 
are placed in trust with any member of the Bar practicing law from an office or 
other business location within the State of Florida shall be deposited into one or 
more interest bearing trust account checking accounts).   
As to count 2, the referee found that Wolf commingled his funds with those 
of his clients and thus violated former rules 4-1.15(a) and (d); and current rules  
5-1.1(a) (commingling prohibited) and (b) (application of trust funds to specific 
purpose); and 5-1.1(g)(2) (formerly 5-1.1(e)(2), cited above).1   
As to count 3, the referee found that Wolf=s failure to follow the proper 
record keeping procedures violated rules 5-1.1 (nature and application of trust 
account funds); 5-1.2(b) (minimum trust accounting records); 5-1.2(b)(2) 
(minimum records include original or duplicate deposit slips clearly identifying 
certain information); and 5-1.2(c) (minimum trust accounting procedures). 
Based on the Florida Standards for Imposing Lawyer Sanctions, the referee 
found four aggravating factors: (1) prior disciplinary offenses; (2) dishonest or 
selfish motive; (3) a pattern of misconduct (repeated overdraft coverages); and (4) 
substantial experience in the practice of law.  In mitigation, the referee found: (1) 
personal or emotional problems; (2) timely good faith effort to make restitution or 
                                          
 
1.  During the one-year period of Wolf’s accounting errors, the numbers of 
and language in certain rules were changed.  Thus, the referee found that Wolf’s 
early acts of negligent misappropriation violated different rule numbers.   
 
 
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to rectify consequences of misconduct; (3) full and free disclosure to disciplinary 
board or cooperative attitude toward proceedings; (4) unreasonable delay not 
caused by the respondent and demonstrated prejudice in the delay; and (5) interim 
rehabilitation.   
As a sanction, the referee recommended that a three-year suspension was 
appropriate and that Wolf retake and pass the ethics portion of The Florida Bar 
examination.  The referee based these recommendations on the finding that Wolf 
engaged in “sloppy bookkeeping” and, thus, he did not commit the 
misappropriations with the requisite intent.  Also, during the time period of the 
instant misconduct, Wolf was undergoing psychotherapy.  Further, the referee 
noted that there was not a monetary loss to any clients in the instant case, and that 
Wolf has not committed any improprieties for the last four years.   
Wolf petitioned for review of the referee’s report, challenging the referee’s 
recommendation of a three-year suspension. 
ANALYSIS 
In reviewing a referee's recommended discipline, this Court's scope of 
review is broader than that afforded to the referee's findings of fact because, 
ultimately, it is the Court’s responsibility to order the appropriate sanction.  See 
Fla. Bar v. Anderson, 538 So. 2d 852, 854 (Fla. 1989); see also art. V, § 15, Fla. 
Const.  However, generally speaking, this Court will not second-guess the referee's 
recommended discipline as long as it has a reasonable basis in existing case law 
 
 
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and the Florida Standards for Imposing Lawyer Sanctions.  See Fla. Bar v. 
Temmer, 753 So. 2d 555, 558 (Fla. 1999). 
It is well settled that the misuse of funds held in trust is one of the most 
serious offenses a lawyer can commit and that disbarment is presumed to be the 
appropriate sanction.  Fla. Bar v. Travis, 765 So. 2d 689, 691 (Fla. 2000); see also 
Fla. Bar v. Tillman, 682 So. 2d 542 (Fla. 1996).  There are cases, however, 
involving attorney misconduct relating to client funds in which the attorneys were 
disciplined by suspension instead of disbarment.  In those cases, the attorney's 
misconduct was due to negligence rather than an intentional act to misappropriate 
funds.   
In the instant case, the referee found that Wolf violated the Rules Regulating 
the Florida Bar, but that he did so without the requisite intent.  When Wolf 
discovered that the check to the client exceeded the balance in the operating 
account, he promptly covered the shortage.  During the investigation, Wolf 
cooperated with the Bar.  Further, he admitted that he violated the trust account 
requirements of the Rules Regulating the Florida Bar.   
The instant misconduct occurred over the course of one year, beginning in 
October 2001.  During that time, Wolf was undergoing psychotherapy.  He has 
conducted himself appropriately for the last four years.  We conclude the record 
supports the referee’s finding that Wolf did not have the requisite intent.  Because 
 
 
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Wolf’s misconduct was due to negligence, and he did not intentionally use the 
funds for personal purposes, suspension is the appropriate sanction.   
Accounting for client funds is a serious responsibility.  Thus, the Court has 
imposed lengthy rehabilitative suspensions when attorneys were grossly negligent 
in the management of trust accounts.  See Fla. Bar v. Mason, 826 So. 2d 985 (Fla. 
2002) (two-year suspension); Fla. Bar v. Whigham, 525 So. 2d 873 (Fla. 1988) 
(three-year suspension).  In Mason, the referee found that the attorney engaged in 
intentional misconduct by making eighty-two unidentified transfers from her trust 
account to cover operating account shortages.  The Court noted that the attorney 
made mistakes in accounting practices, was not attempting to intentionally steal 
from her clients, did not intentionally misappropriate funds, would likely become 
rehabilitated, had no prior disciplinary history, was experiencing personal and 
emotional problems during a bitter divorce, made a timely good-faith effort to 
correct the problems, was inexperienced in handling the administrative 
responsibilities of a solo law practice, had a good reputation, and was remorseful.  
The Court held that a two-year suspension was appropriate.   
Similar to Mason, the referee in this case found five significant mitigating 
factors.2  He also noted that Wolf participated in the Bar’s trust accounting 
                                          
 
2.  “A referee's finding as to the existence of a particular mitigator is 
considered a factual determination and is ‘presumed correct and will be upheld 
unless clearly erroneous or lacking in evidentiary support.’”  Fla. Bar v. Tauler, 
 
 
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workshop after the events in question.  Wolf has acknowledged that he is 
ultimately responsible for the management of trust monies in his law firm and has 
taken affirmative steps to avoid further bookkeeping errors, including improving 
employee oversight.   
A further comparison of Mason and this case reveals crucial distinctions.  
Mason’s misconduct was intentional, while Wolf’s misconduct was not intentional.  
Further, Mason made eighty-two transfers from her trust account to her operating 
account to cover expenses.  In contrast, Wolf mistakenly made six deposits into his 
operating account instead of his trust account.  Thus, the extent of Wolf’s “sloppy 
bookkeeping” is not nearly as egregious as Mason’s.  In addition, Wolf 
immediately covered the shortages in the account by remitting funds to the client.  
Another critical factor is the referee’s finding that Wolf’s case was subject to 
unreasonable delay, which was not caused by Wolf and which caused Wolf 
prejudice.3  We consider this factor in determining the appropriate sanction.  See 
Fla. Stds. Imposing Law. Sancs. 9.32(i) (providing that an “unreasonable delay in 
[the] disciplinary proceeding” may be considered in mitigation “provided that the 
respondent did not substantially contribute to the delay and provided further that 
                                                                                                                                        
775 So. 2d 944, 946 (Fla. 2000) (quoting Fla. Bar v. Hecker, 475 So. 2d 1240, 
1242 (Fla. 1985)).   
3.  Rule Regulating the Florida Bar 3-7.6(g) provides: “Bar counsel shall 
make such investigation as is necessary and shall prepare and prosecute with 
utmost diligence any case assigned.” 
 
 
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the respondent has demonstrated specific prejudice resulting from that delay”); see 
also Fla. Bar v. Micks, 628 So. 2d 1104 (Fla. 1993) (examining delay as a 
mitigating factor); Fla. Bar v. Marcus, 616 So. 2d 975 (Fla. 1993) (same).  The 
check to Wolf’s client bounced in October 2001.  In May 2003, the Bar sent Wolf 
a letter seeking the production of certain documents.  In August 2003, the Bar 
auditor completed a written report regarding the audits of Wolf’s operating and 
trust accounts for various periods from January 2001 through December 2002.  
Nevertheless, the Bar did not file a complaint with the Court until July 2004.  At 
that point, the Bar’s complaint stated that Wolf had already been cooperating with 
the Bar.  Thus, even though Wolf cooperated, his case was delayed for an 
extensive and detrimental period before the Bar filed the complaint.  In light of 
Wolf’s cooperation and his efforts to timely resolve the instant matters, the Bar’s 
unexplained delay in pursuing this case is a significant factor that affects the 
disciplinary sanction.  We hold that a three-year suspension is not appropriate.   
This Court emphasizes the importance of integrity in accounting and views 
the misuse of client funds as extremely serious misconduct.  We find, however, 
that the unique facts of this case and Mason indicate that Wolf’s misconduct merits 
a two-year suspension followed by one year of probation.  
 
  
 
 
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CONCLUSION 
Accordingly, we disapprove the referee’s recommendation of a three-year 
suspension.  Michael Howard Wolf is hereby suspended for two years.  Upon 
reinstatement, he will serve one year of probation.  Also, Wolf shall retake and 
pass the ethics portion of the Florida bar examination.   
The suspension will be effective thirty days from the filing of this opinion so 
that Wolf can close out his practice and protect the interests of existing clients.  If 
he notifies this Court in writing that he is no longer practicing and does not need 
the thirty days to protect existing clients, this Court will enter an order making the 
suspension effective immediately.  
Michael Howard Wolf shall accept no new business from the date this 
opinion is filed until he is reinstated to the practice of law in Florida.  Judgment is 
entered for The Florida Bar, 651 East Jefferson Street, Tallahassee, Florida 32399-
2300, for recovery of costs from Michael Howard Wolf in the amount of 
$4,564.11, for which sum let execution issue. 
 
It is so ordered. 
PARIENTE, C.J., and WELLS, ANSTEAD, LEWIS, QUINCE, CANTERO, and 
BELL, JJ., concur. 
 
THE FILING OF A MOTION FOR REHEARING SHALL NOT ALTER THE 
EFFECTIVE DATE OF THIS SUSPENSION. 
 
 
 
 
 
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Original Proceeding - The Florida Bar 
 
John F. Harkness, Jr., Executive Director and John Anthony Boggs, Staff Counsel, 
The Florida Bar, Tallahassee, Florida, and Michael David Soifer, Bar Counsel, The 
Florida Bar, Fort Lauderdale, Florida, 
 
 
for Complainant 
 
Kevin P. Tynan of Richardson and Tynan, P.L.C., Tamarac, Florida, 
 
 
for Respondent