Title: Disciplinary Counsel v. Maley

State: ohio

Issuer: Ohio Supreme Court

Document:

[Cite as Disciplinary Counsel v. Maley, 119 Ohio St.3d 217, 2008-Ohio-3923.] 
 
 
DISCIPLINARY COUNSEL v. MALEY. 
[Cite as Disciplinary Counsel v. Maley, 119 Ohio St.3d 217, 2008-Ohio-3923.] 
Attorneys at law—Misconduct—Multiple disciplinary violations—Eighteen-month 
suspension, partially stayed on conditions. 
(No. 2008-0038 — Submitted February 27, 2008 — Decided August 13, 2008.) 
ON CERTIFIED REPORT by the Board of Commissioners on Grievances and 
Discipline of the Supreme Court, No. 06-092. 
_______________________ 
Per Curiam. 
{¶ 1} Respondent, Lawrence M. Maley of Lancaster, Ohio, Attorney 
Registration No. 0055448, was admitted to the practice of law in Ohio in 1991.  
Relator, Disciplinary Counsel, charged respondent with violations of the 
Disciplinary Rules in a two-count complaint.  Respondent participated in a 
hearing on the complaint before a panel of the Board of Commissioners on 
Grievances and Discipline.  The board now recommends that we suspend 
respondent’s license to practice for 18 months with six months stayed on 
condition that he take classes in office management and ethics.  Respondent has 
not objected to the board’s report and recommendation.  On review, we find that 
respondent violated the Code of Professional Responsibility and impose the 
recommended sanction. 
Misconduct 
Count I 
{¶ 2} Respondent gave his employee Diane Bilinovich (“the secretary”) 
authority to use the office and credit cards, collect client fee payments, manage 
the office checking account, and meet with clients.  Between July 2004 and 
August 2005, the secretary, in respondent’s name, collected filing fees and agreed 
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to file, or filed, at least 39 bankruptcy petitions. In five of these matters, clients 
made payment, but cases were never filed.  In 34 of these matters, petitions were 
filed without respondent’s knowledge. 
{¶ 3} The secretary developed a practice of preparing bankruptcy 
petitions without informing respondent. She would file the bankruptcy case 
online, taking advantage of the use of the electronic signature and would pay the 
fees online with respondent’s credit card. She would interact with the clients and 
hire other attorneys, whom respondent used from time to time, to appear at the 
various bankruptcy hearings. 
{¶ 4} The secretary performed various legal functions using the 
respondent’s name and office.  She prepared and filed various pleadings such as 
an amended Chapter 13 plan, motions for redemption of property, and 
reaffirmation agreements.  She also responded to notices and letters from 
bankruptcy trustees.  Respondent claimed that the secretary was processing cases 
and using his credit cards without his knowledge or consent.  Respondent claims 
that she pocketed fees amounting to $25,000 to $30,000. Over $11,000 in 
expenses associated with these bankruptcy filings was paid with respondent’s 
credit cards or from respondent’s checking account.  Bank statements and credit 
card bills detailing these expenditures were sent to respondent monthly. 
{¶ 5} In January 2005, respondent discovered that the secretary had used 
his charge card to make over $8,300 in personal charges in 2004, for auto repairs, 
cell phone bills, and the purchase of a computer. When respondent confronted 
her, she agreed to make monthly payments to repay the debt but made only three 
$100 payments. In February 2005, she charged an additional $350 of her own 
expenses on respondent’s credit card. 
{¶ 6} Respondent terminated the secretary at the end of March 2005, 
claiming that he was closing his bankruptcy practice.  Of the 36 petitions filed 
under respondent’s name, she filed 19 after being fired. She continued to enter 
January Term, 2008 
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respondent’s office after business hours.  She also continued to use respondent’s 
credit cards, charging over $5,000 to pay bankruptcy court filings under his name. 
{¶ 7} In April through June 2005, respondent became aware of the new 
filings and credit card charges.  The secretary told respondent that they were for 
an unaffiliated lawyer in respondent’s suite.  That lawyer told respondent in June 
that the secretary was not handling his bankruptcy cases. 
{¶ 8} Respondent’s wife, who had begun working in the office in late 
June, notified him, in a memo dated July 6, 2005, of problems with the 
bankruptcy cases.  She warned respondent that he might get in “deep trouble” if 
he did not get a handle on the cases. The bankruptcy charges and filings continued 
into August 2005. 
{¶ 9} It was not until September 2005 that respondent reported the 
secretary’s activities to the Lancaster police department. He also contacted the 
bankruptcy court to terminate his account and to alert the trustees to what had 
occurred. In October, respondent contacted the Fairfield County Bar Association 
regarding the secretary. 
{¶ 10} As to Count I, the board found violations of DR 1-102(A)(5) 
(prohibiting conduct prejudicial to the administration of justice), 1-102(A)(6) 
(prohibiting conduct adversely reflecting on a lawyer’s fitness to practice law), 3-
101(A) (prohibiting the aiding of a nonlawyer in the unauthorized practice of 
law), 3-102(A) (prohibiting the sharing of fees with a nonlawyer), 6-101(A)(3) 
(prohibiting neglect of an entrusted legal matter), and 7-101(A)(3) (prohibiting 
intentionally prejudicing or damaging a client during the professional 
relationship). 
Count II 
{¶ 11} Respondent did not have a trust account during 2005 and part of 
2004.  He regularly deposited unearned retainers and lawsuit settlement checks 
into his business checking account, commingling them with funds of the law firm. 
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{¶ 12} As to Count II, the board found violations of DR 1-102(A)(5), 1-
102(A)(6), 9-102(A) (prohibiting commingling of client funds with law firm 
funds), and 9-102(B)(3) (requiring lawyers to maintain complete records of client 
funds and render appropriate accounts to clients). 
Review 
{¶ 13} Respondent did nothing to stop the secretary after he became 
aware that she was using his credit card to pay filing fees without his permission 
and that she had accepted retainers in respondent’s name. Respondent became 
aware of unauthorized credit card charges in April 2005 after he had fired the 
secretary. He accepted her explanation that these were another attorney’s charges 
on his account. He never changed the locks on his office, demanded the keys, or 
canceled his credit cards.  He claims that he did not know about her acceptance of 
fees until July 2005. Respondent did not notify the authorities or the bankruptcy 
court until September. 
{¶ 14} Respondent granted broad authority to the secretary to deal with 
and work directly for clients. He either knew or should have known that she was 
taking money from clients and performing legal work for them. Further, once he 
had actual knowledge of her actions, he failed to promptly act to protect the 
clients’ interests. 
{¶ 15} The secretary’s use of respondent’s credit cards for unauthorized 
personal expenses, even after respondent confronted her about it, did not cause 
him to investigate further. Respondent knew she had financial difficulties and 
even loaned her money after she had stolen from him by making unauthorized 
personal charges on his account. 
{¶ 16} Respondent neglected his duty to maintain a trust account.  He 
explained his lack of a trust account by blaming his “sheer stupidity and laziness.”  
Significantly, if respondent had properly separated his funds from those of his 
clients through a trust account and had reconciled the account and his client’s 
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records properly, he could have discovered the secretary’s activities and stopped 
them. 
{¶ 17} We find that there is clear and convincing evidence that respondent 
committed the violations found by the board in both Counts I and II. 
Sanction 
{¶ 18} The board recommends that we suspend respondent’s license to 
practice for 18 months with six months stayed on the condition that he take office-
management and ethics training. 
{¶ 19} In recommending a sanction, the board considered the aggravating 
and mitigating factors listed in Section 10 of the Rules and Regulations 
Governing Procedure on Complaints and Hearings Before the Board of 
Commissioners on Grievances and Discipline (“BCGD Proc.Reg.”).  As 
aggravating factors, the board found a selfish motive, a pattern of misconduct, 
multiple offenses, refusal to acknowledge the wrongful nature of the conduct, and 
vulnerability of and resulting harm to victims of the misconduct.  BCGD 
Proc.Reg. 10(B)(1).  As mitigating factors, the board noted the absence of a prior 
disciplinary record, a cooperative attitude toward the proceedings, and 
respondent’s character and reputation.  BCGD Proc.Reg. 10(B)(2).  We adopt the 
board’s findings as to the aggravating and mitigating factors.  In addition, 
respondent submitted numerous letters attesting to his honesty, integrity, and good 
character from a judge, elected officials, attorneys, and others. The first assistant 
prosecuting attorney in Fairfield County testified that he believes that respondent 
is a person of unquestionable integrity and extremely high moral character.  
Respondent also testified that he was a founding father of Habitat for Humanity of 
Fairfield County and had been awarded the 2003 Fairfield County and Ohio 
“Person of the Year” from the Sertoma club. 
{¶ 20} Respondent’s lax supervision of his employee allowed her to use 
respondent’s credit card, his bankruptcy court credentials, and his reputation to 
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the detriment of his clients and the court. Appropriate oversight of his practice 
could have prevented her misconduct. If respondent had read his e-mail 
notifications from the bankruptcy court, reviewed his bank statements and credit 
card charges, and reviewed his files on a regular basis, he would have known that 
something was wrong. 
{¶ 21} Although we recognize an attorney’s need to delegate, we have 
insisted on supervision to ensure that delegated legal duties are completed 
properly.  Disciplinary Counsel v. Ball (1993), 67 Ohio St.3d 401, 404, 618 
N.E.2d 159. More recent decisions from this and other courts have similarly 
admonished lawyers for failing to supervise nonlawyer assistants with care. See, 
e.g., Lorain Cty. Bar Assn. v. Noll, 105 Ohio St.3d 6, 2004-Ohio-7013, 821 
N.E.2d 988 (imposing a two-year suspension, with 18 months stayed, on a lawyer 
who failed to adequately supervise a legal assistant and committed other 
violations); Richland Cty. Bar Assn. v. Akers, 106 Ohio St.3d 337, 2005-Ohio-
5144, 835 N.E.2d 29 (imposing an 18-month sentence with 12 months stayed for 
failure to supervise an employee.); and Mahoning Cty. Bar Assn. v. Lavelle, 107 
Ohio St.3d 92, 2005-Ohio-5976, 836 N.E.2d 1214, ¶29 (imposing an 18-month 
suspension with 12 months stayed on a lawyer who “chose to remain oblivious to 
the improper actions of the persons he hired”). 
{¶ 22} Whether or not respondent knowingly allowed his employee to 
engage in the unauthorized practice of law, he was negligent in the supervision of 
his staff. And his lack of responsibility facilitated her unauthorized practice of 
law.  Respondent’s admitted failure to maintain a trust account also demonstrates 
irresponsibility. 
{¶ 23} We therefore suspend respondent from the practice of law for 18 
months, with the last six months stayed, on condition that respondent comply 
fully with Prof.Cond.R. 1.15, Safekeeping Funds and Property, complete a CLE 
course on law-office management, and, in addition to the required hours, 
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complete an additional three-hour CLE course in ethics and professionalism.  If 
respondent fails to comply with the conditions, the stay will be lifted, and 
respondent will serve the entire term of the suspension.  Costs are taxed to 
respondent. 
Judgment accordingly. 
 
MOYER, 
C.J., 
and 
PFEIFER, 
LUNDBERG 
STRATTON, 
O’CONNOR, 
O’DONNELL, LANZINGER, and CUPP, JJ., concur. 
_________________________ 
Jonathan E. Coughlan, Disciplinary Counsel, and Robert R. Berger, 
Assistant Disciplinary Counsel, for relator. 
Mitchell, Allen, Catalano & Boda and William Mann, for respondent. 
_________________________