Title: STATE ex rel. OKLAHOMA BAR ASSOCIATION v. MAYES

State: oklahoma

Issuer: Oklahoma Supreme Court

Document:

STATE ex rel. OKLAHOMA BAR ASSOCIATION v. MAYES  STATE ex rel. OKLAHOMA BAR ASSOCIATION v. MAYES 2003 OK 23 66 P.3d 398 Case Number: SCBD-4720 Decided: 03/11/2003 THE SUPREME COURT OF THE STATE OF OKLAHOMA STATE OF OKLAHOMA ex rel. Oklahoma Bar Association, Complainant, v. ROBERT I. MAYES, JR., Respondent. BAR DISCIPLINE PROCEEDING ¶0 The complainant, Oklahoma Bar Association (Bar Association), charged the respondent, Robert I. Mayes, Jr., with two counts of professional misconduct: mishandling of client funds and an unwillingness to cooperate in the grievance process. Finding clear and convincing evidence to support both counts, the trial panel recommended that the respondent be disbarred and costs be imposed. We hold that: 1) there is clear and convincing evidence of the respondent's misappropriation of settlement funds belonging to two minors and his failure to cooperate in the grievance process; and 2) the respondent's misconduct, his prior disciplinary history and discipline administered in similar cases warrants disbarment and the payment of $653.57 in costs. RESPONDENT DISBARRED; COSTS IMPOSED. Nathan A. Lockhart, Assistant General Counsel, Oklahoma Bar Association, Oklahoma City, Oklahoma, for Complainant. Robert I. Mayes, Jr., Tulsa, Oklahoma, Pro se. KAUGER, J.: ¶1 The complainant, Oklahoma Bar Association (Bar Association), charged the respondent, Robert I. Mayes, Jr., with two counts of professional misconduct involving the mishandling of settlement funds AGREED FACTS ¶2 Both counts arise from the respondent's handling of an estate and his settling of a wrongful death claim on the estate's behalf. Yolanda King (mother/decedent) was killed in a car accident on November 27, 1997, leaving two minor children, Y.K. and D.J.B. On January 15, 1998, the respondent filed a Petition for Letters of Administration on behalf of the mother's estate listing her two children as heirs. Eunice King (King) was appointed administrator on March 6, 1998. ¶3 Thomas G. Scott (Scott) undertook representation of one of the children, D.J.B., filing an application to set bond for an inventory on April 28, 1998. The next month, the probate court ordered King to submit any settlement offers for approval. On August 19 and August 31, 1998, respectively, the respondent filed a petition to settle the personal injury claim and an application for an order approving a settlement of $30,000.00 composed of offers of $10,000.00 from three different insurance companies, Progressive, GEICO and Metropolitan Property and Casualty. The probate court entered an order approving the settlement on August 31, 1998. Between September 1 and September 18, 1998, three checks from the three different insurance companies were deposited in the respondent's trust account for a total of $29,975.00. ¶4 On September 2, 1998, the respondent filed an application for payment of his attorney fee. The respondent indicated that he had a contingency fee contract with King for one-third of the settlement proceeds and that $30,000 had been deposited in the respon-[66 P.3d 401] dent's trust account held at State Bank, N.A. ¶5 The respondent deposited almost $30,000.00 to his trust account for the settlement of the wrongful death action. However, no payments were made to either of the decedent's minor children. Further, although the probate court approved his request for fees, no check in the amount of the approved fees was drawn on the trust account. As early as September 30, 1998, there were insufficient funds in the trust account to issue checks of $10,000.00 to each of the minor children. Over the next eight months, the trust account was depleted until it became overdrawn in April of 1999. ¶6 On February 23, 1999, we issued our opinion in State ex rel. Oklahoma Bar Ass'n v. Mayes (Mayes I), ¶7 Scott filed a second request for an accounting on October 26, 1999, and a hearing was set for November 23 ¶8 King filed a final accounting in the deceased's estate on October 20, 2000, which she signed personally and which was notarized by the respondent's secretary. The accounting indicated that: the decedent's estate received $30,000.00 in an insurance check for negligence on August 31, 1998; an expenditure of $9,999.99 as attorney fees to the respondent on September 25, 1998; a cash balance of $19,700.60 existed in the estate as of November 22, 1999, with the balance being on deposit in State Bank, Tulsa, Oklahoma. ¶9 The respondent's trust account records do not support the representation in the accounting. Three days before the accounting was filed, the respondent's trust account had a balance of $250.00. By October 31, 2000 -- eleven days after the accounting was filed, the balance had shrunk to $60.61. At no time during this time period did the balance of the account approach $20,000.00 as was represented by the accounting. Further, there was no single withdrawal for attorney fees in the amount of $9,999.99. ¶10 On November 28, 2000, the respondent filed a second motion for continuance in the probate action indicating he had diabetes, was participating in dialysis and had undergone surgery. Six months later, Scott filed an exception to the final accounting on behalf of D.J.B. requesting that the accounting be updated and that the respondent should be required to attest to the accounting filed with the court. ¶11 The respondent deposited a check from American Airlines, Inc. to Blanche and Robert Mayes for $33,000.00 in his trust account on June 25, 2001. It is unclear whether the check represented the respon-[66 P.3d 402]-dent's personal funds or related to his legal practice. Before the deposit, the trust account had a balance of only $60.61. Two days after the deposit, the respondent issued a check payable from his trust account to Scott and D.J.B.'s father in the amount of $9,850.00. The memorandum portion of the check indicated that it was a part of the settlement of the mother's estate. At that time, no funds had been paid on behalf of Y.K., the decedent's second minor child. ¶12 Scott filed a grievance with the Bar Association on June 8, 2000. The grievance and a request for a response were forwarded to the respondent on August 1, 2000. On September 29, 2000, when no answer was forthcoming, the Bar Association sent the respondent a second letter requesting information regarding the grievance and a response within 5 days. The Bar Association granted the respondent an extension to October 24th for his response on October 4th. On October 25, 2000, the respondent sent the Bar Association a letter indicating: 1) that he had not answered previously because he was sick and didn't know a complaint had been filed; and 2) Scott had acted unethically by contacting his clients. There was no substantive response to any questions related to the handling of the personal injury funds or an explanation of why the decedent's minor children had not received their proportionate shares of the wrongful death settlement. ¶13 Almost a year following the respondent's original notification of the grievance and a request to provide information, the Bar Association's investigator again wrote the respondent asking for information regarding his trust account and the disbursal of funds. The respondent did not answer. Subsequently, on October 29, 2001, and again on January 23, 2002, the Bar Association was forced to issue subpeonaes to the respondent's banking institution to get a financial picture of the facts in the cause. ¶14 On May 10, 2002, the Bar Association filed this cause as a Rule 6 proceeding. I. ¶15 CLEAR AND CONVINCING EVIDENCE SUPPORTS DETERMINATIONS OF MISMANAGEMENT OF A TRUST ACCOUNT AND FAILURE TO COOPERATE IN THE GRIEVANCE PROCESS. ¶16 The trial panel and the Bar Association agree that clear and convincing evidence supports the charges of mismanagement of a trust account and uncooperativeness in the investigative process by being untimely in responding and neglecting to make a full and fair disclosure. The respondent has not filed a brief in this cause despite our order of October 7, 2002. Nevertheless, the facts stipulated to by the respondent support the alleged charges. Further, a de novo review leaves us convinced that the Bar Association has met the burden of proof necessary to support the imposition of discipline. ¶17 In disciplinary matters, this Court possesses exclusive original jurisdiction. ¶18 When money is entrusted to an attorney, the latter's fiduciary duty is to apply the funds strictly to the purpose intended. ¶19 Although it may be difficult to discern between the three levels of misconduct, here it is clear that more is at issue than a mere commingling of client funds. Bank records for the time frame during which the respondent indicated he had deposited the insurance proceeds to his account show that the balance of the account did not approach $30,000.00. Even before the probate court approved the respondent's fee of one-third of the recovery, the balance of the account was well below $20,000.00 -- the amount it would presumably have required for distribution to the decedent's two minor children. The subpoenaed records disclose that, at the same time the respondent should have been holding funds for the minors, the balance was overdrawn [66 P.3d 404]on at least fifteen occasions and the account was assessed insufficient fund fees. ¶20 Finally, although the Bar Association initially may have stipulated that the acts involved were mere conversion, ¶21 Although neither King, the children nor one of their representatives appeared at the hearing and there was no evidence that any client suffered economic harm because of the respondent's acts, documents either prepared by the respondent or with his assistance were filed with the probate court representing that the minors' funds were being held in the bank where the respondent had his trust account. ¶22 The respondent's own actions have propelled him beyond the level of simple conversion and into the realm of misappropriation. II. ¶23 THE RESPONDENT'S MISCONDUCT, HIS PRIOR DISCIPLINARY HISTORY AND DISCIPLINE IN SIMILAR CASES WARRANTS DISBARMENT AND THE IMPOSITION OF COSTS. ¶24 The respondent argued at the hearing that disbarment is too severe a punishment for his actions, indicating that a two to three year suspension would be more appropriate. ¶25 Discipline is administered to preserve public confidence in the bar. Our responsibility is not to punish but to inquire into and gauge a lawyer's continued fitness to practice law, with a view to safeguarding the interest of the public, of the courts and of the legal profession. Discipline is imposed to maintain these goals rather than as punishment for the lawyer's misconduct. ¶26 There can be little doubt that the respondent has brought discredit upon the legal profession subjecting himself to discipline. ¶27 Other than the respondent's recognition that he acted badly and his expression of regret, there is little that can be said for the respondent in mitigation. One of the minor children, D.J.B., did not receive payment of the settlement proceeds until almost three years after the respondent deposited them in his trust account and this payment was made only after Scott demanded repeatedly an accounting. To date, the second minor child, Y.K., has received only $4,000.00 of the $10,000.00 he is entitled to receive -- payment of this amount was not made until the day of the hearing before the trial panel -- almost four years after the respondent deposited the settlement proceeds in his trust account. Restitution, in and of itself, will not mitigate the need for discipline. ¶28 On the other hand, at precisely the same time that the respondent was mismanaging trust fund monies here, he was involved in the disciplinary process in a case not wholly unlike this cause. On February 23, 1999, we issued our opinion in State ex rel. Oklahoma Bar Ass'n v. Mayes (Mayes I), ¶29 Perhaps the most damning single piece of information mitigating against leniency is the special place of trust the respondent held with the decedent's family. Any lawyer, entrusted with a client's funds, must exercise the highest of fiduciary duties. ¶30 This Court is the ultimate arbiter of appropriate sanctions in bar discipline cases. CONCLUSION ¶31 The nondelegable, constitutional responsibility to regulate both the practice and the ethics, licensure, and discipline of the practitioners of the law is solely vested in this Court. ¶32 Although we may sympathize with the respondent's health conditions and the economic situation in which it has placed him, any empathy is offset by the fact that he may well have inflicted the same misery on two minor children who had already lost their mother. Upon a de novo review of the record, we determine that the respondent mismanaged his trust account and failed to cooperate in the grievance process. The respondent's misconduct warrants disbarment and the payment of $653.57 in costs. RESPONDENT DISBARRED; COSTS IMPOSED. ALL JUSTICES CONCUR. [ 66 P.3d 409 ] FOOT