Columbus Bar Association v. Sterner. 1 [Cite as Columbus Bar Assn. v. Sterner (1996), ____Ohio St. 3d _____.] 2 Attorneys at law -- Misconduc t -- Permanent disbarment -- 3 Misappropriating funds and neglecting to safeguard the 4 interests of clients over a five-year period. 5 (No. 96-436 - - Submitted Septembe r 24, 1996 -- Decided December 18, 6 1996.) 7 On CertifiedReportby the Board of Commissioners on Grievances 8 and Discipline of the S upreme Court, No. 95-46. 9 On September 6, 1995 the Columbus Bar Association (“relator”) filed 10 an amended complaint charging in eight counts that James M. Sterner of 11 Columbus, Ohio, Attorney Registration No. 0034047 (“respondent”), 12 violated various Disciplinary Rule s of the Code of Professional 13 Responsibility. Count One of the complaint concerned respondent’s 14 representation of Gregory M. Sabbato during 1991 in the purchase of a 15 business. Respondent did not inform Sabbato that he not only had previous 16 business dealings with the seller of th e business but also had shared office 17 space with and was otherwise affiliated with the seller’s attorney. 18 Following respondent’s advice, Sabbato paid $70,000 to the seller, who was 192 to pay off the liens on the business. The money, however, was used for 1 other purposes, the liens were not paid off, and the creditors foreclosed on 2 the business and took it from Sabbato. When Sabbato sued respondent for 3 malpractice, respondent refused to no tify or cooperate with his insurance 4 carrier, and as a result Sabbato obtained a judgment against respondent for 5 $208,000. Respondent then transferred assets out of his name to avoid 6 attachment by Sabbato and other creditors. 7 Count Two of the complain t was based on respondent’s 8 representation in 1993 of John Malhalic , who had agreed to sell a liquor 9 license to John Scimone. As part of the transaction, respondent told 10 Scimone that the license was free a nd clear of liens and received $7,500 11 from Scimone to be held in escrow until the completion of the sale. 12 Scimone later learned that there were tax liens against the license, that the 13 license had been revoked, and that in a contemporaneous negotiation 14 respondent had received funds from a th ird party who wished to purchase 15 the same license. The license was never transferred to Scimone, and 16 respondent both failed to return the escr ow funds to Scimone and refused to 17 account for them. 183 Count Three involved respondent’s receipt of $24,000 from Mary 1 Lavelle in 1991 to be held by him as escrow agent and used for the payment 2 of Ohio sales tax and for payments to the Ohio Bureau of Employment 3 Services in connection with Lavelle’s purchase of Norton Road Beverage, 4 Inc., a company represented by respondent. The transfer of the Norton 5 assets to Lavelle was delayed by re spondent’s failure to expeditiously 6 perform his duties as escrow agent. Respondent settled Lavelle’s suit 7 against him for breach of his fiduciary duty for $3,000, but he has never 8 accounted for the funds in the escrow account. 9 As to Count Four, respondent repres ented the seller of a bar business, 10 and received $10,000 from James Flax, a pot ential purchaser, to be held in 11 escrow pending the transfer of the liquor permit. The permit was not 12 transferred and Flax was entitled to th e return of the escrow money on and 13 after July 1, 1994. Despite requests from Flax, respondent did not return the 14 escrow money until February 28, 1995, with no interest and no explanation 15 for the delay. 16 As to Count Five, Robert a nd Delores Ruzendall in 1991 and 1992 17 retained respondent to reinstate their liquor license and entrusted respondent 184 with over $20,000 to pay delinquent taxes related to the license. 1 Respondent told the Ruzendalls that he paid the funds for the intended 2 purpose. However, the state of Oh io placed two tax liens totaling over 3 $25,000 on the Ruzendalls’ property. Respondent has refused to account 4 for and document the disposition of the f unds entrusted to him, and partly as 5 a result the Ruzendalls filed under Ch apter 13 in the bankruptcy court. 6 As to Count Six, respondent in 1991undertook to act as a fiduciary at 7 the closing of a real estate sale by Deborah Shirey to Network, Inc. and 8 received $10,000, which was to be paid by him to release federal and state 9 tax liens on the property. As a result of respondent’s failure to pay over the 10 money, the federal government foreclos ed on the property. Respondent has 11 refused to account for the funds. 12 Underlying Count Seven was res pondent’s representation in 1995 to 13 Tony Canale that respondent could s ecure a liquor license for Canale’s bar 14 business upon payment of $6,000 in back taxes. Canale gave respondent a 15 certified check in that amount payable to the state of Ohio. Respondent 16 endorsed the check, “not used for purpose intended,” signed Canale’s name, 175 cashed the check, and received the funds . Respondent did not pay the taxes 1 and refused to account to Canale for the funds. 2 Count Eight was added to the complaint because respondent failed to 3 provide adequate responses and to cooperate with relator in its investigation 4 when he was notified of the charges. 5 Respondent failed to file an answ er to the amended complaint and on 6 December 13, 1995, relator moved for an entry of default. Respondent filed 7 no response to the motion for default. Based upon the complaint, the default 8 motion, and supporting affidavits and documentation, a panel of the Board 9 of Commissioners on Grievances and Discipline of the Supreme Court 10 (“board”) found that respondent had vi olated DR 1-102(A)(3) (engaging in 11 conduct involving moral turpitude) with respect to Count Three; 1- 12 102(A)(4)(engaging in conduct involving dishonesty, fraud, deceit, or 13 misrepresentation) with respect to Count s One, Three, Five, Six, and Seven; 14 1-102(A)(6) (engaging in conduct adversel y reflecting on fitness to practice 15 law) with respect to Counts One through Eight; 5-101(A) (not refusing 16 employment when the interest of the lawyer may impair independent 17 professional judgment) with respect to Count One; 6-101(A)(3) (neglecting 186 a legal matter entrusted) with respect to Counts Two, Four, Five, Six, and 1 Seven; 7-101(A)(1) (failing to seek the lawful objectives of a client) with 2 respect to Counts One, Five, Six, a nd Seven; 7-101(A)(2) (failing to carry 3 out a contract of employment) with re spect to Counts Five, Six, and Seven; 4 7-101(A)(3) (prejudicing or damaging a client during the course of 5 representation) with respect to C ounts One, Five, Six, and Seven; 9- 6 102(B)(3) (failure to maintain records of client funds) with respect to 7 Counts Five and Seven; and 9-102(B)(4) (failure to pr omptly pay over client 8 funds) with respect to Counts Five, Six, and Seven. 9 The panel recommended that the respondent be permanently 10 disbarred because of the length, br eadth and egregious nature of his 11 conduct, his failure to participate in th e disciplinary process, and the lack of 12 any mitigating circumstances. The board adopted the panel’s findings, and 13 recommended permanent disbarment and that costs be taxed to respondent. 14 Respondent filed objections to th e board’s findings, conclusions of 15 law and recommendations, and requested or al argument before this court. 16 In respondent’s objections and in or al argument, counsel for respondent 177 sought to introduce evidence that respondent’s activities are explained by 1 his psychological condition and that he had made restitution. 2

_______________________________ 3 Bruce A. Campbell, James E. Davidson and Janice M. Bernard, for 4 relator. 5 Charles W. Kettlewell, for respondent. 6

___________________________ 7 Per Curiam. The respondent misappropriate d funds and neglected to 8 safeguard the interests of his clients over a five-year period. The rules of 9 our Code of Professiona l Responsibility are mandatory; they state the 10 minimum level of conduct below whic h no lawyer can fall without being 11 subject to disciplinary action. As the board found, respondent’s conduct 12 clearly violated a number of these rules. We have said many times that the 13 appropriate sanction for misappropriation of client funds and continued 14 neglect of duty is disbarment . See, e.g., Mahoning Cty. Bar Assn. v. 15 Michaels (1996), 75 Ohio St.3d 645, 647, 665 N.E.2d 676, 677; 16 Disciplinary Counsel v. Connaughton (1996), 75 Ohio St.3d 644, 645, 665 17 N.E.2d 675, 676; Lake Cty. Bar Assn. v. Ostrander (1975), 41 Ohio St.2d 188 93, 70 O.O.2d 173, 322 N.E.2d 653. These previous disbarment cases 1 involved one or two incidents over a limited time. Respondent’s course of 2 action involved a series of similar infractions extending over a five-year 3 period. 4 Respondent has attempted in his brief and in oral argument to 5 introduce in mitigation evidence of his a lleged attention deficit disorder, a 6 psychological condition which respondent did not connect to his five-year 7 pattern of neglect of duty. We declin e to accept such evid ence at this late 8 date. 9 Disciplinary matters are original ac tions. Rule V of the Rules for the 10 Government of the Bar of Ohio, setti ng forth detailed procedures for such 11 matters, is promulgated pursuant to our constitutional power to oversee all 12 phases of the conduct of the bar. S. High Dev., Ltd. v. Weiner, Lippe & 13 Cromley, L.P.A. (1983), 4 Ohio St.3d 1, 4, 4 OBR 1, 3-4, 445 N.E.2d 1106, 14 1109. Under Rule V, the time for the production of evidence is at the 15 formal hearing before a panel appointedby the Secretary of the Board of 16 Commissioners on Grievances and Discipline. After the board issues its 17 findings and recommendations based on the certified report of the panel, 189 this court issues an order to show cau se to the respondent who then has the 1 opportunity to object and to support that objection with a brief. Rule V has 2 no provision for the introduction of eviden ce in the brief filed in this court 3 or in the oral argument to this court. Only in the most exceptional 4 circumstances would we accept additional evidence at that la te stage of the 5 proceedings. 6 If respondent has any objection here, it must be to the findings and 7 recommendations of the board. The entir e record sent to us from the board 8 consists of the pleadings, the default motion, the affidavits, and other 9 material filed in support of the mo tion, and the findings of fact and 10 recommendations of the board after re spondent failed to answer, otherwise 11 plead, or appear before the panel. Matters in excuse and mitigation do not 12 appear in that record, nor do excepti onal circumstances exist that would 13 allow such evidence to be introduced for the first time by way of brief or 14 oral argument in response to the order to show cause. 15 Respondent is hereby disbarred fro m the practice of law in Ohio. 16 Costs taxed to respondent. 17 Judgment accordingly. 1810 M OYER , C.J., R ESNICK , F.E. S WEENEY , P FEIFER , C OOK and KLINE , JJ., 1

concur. 2 D OUGLAS , J., not participating. 3 R OGER L. KLINE , J., of the Fourth Appellate District, sitting for 4 S TRATTON , J. 5 6