Case Name: In the Matter of William A. Hayes, an Attorney
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1915-11-05
Citations: 169 A.D. 516
Docket Number: 
Parties: In the Matter of William A. Hayes, an Attorney.
Judges: 
Reporter: Appellate Division Reports
Volume: 169
Pages: 516–518

Head Matter:
In the Matter of William A. Hayes, an Attorney.
First Department,
November 5, 1915.
Attorney at law disbarred — conversion.
Attorney at law disbarred for converting to his own use moneys intrusted to him by his client for the purpose of investment.
Application on the report of official referee upon charges against the respondent, an attorney and counselor at law, for professional misconduct.
Edward R. Finch of counsel [Einar Chrystie, attorney], for the petitioner.
William A. Hayes, respondent, in person.

Opinion:
Per Curiam:
The main charge against the respondent is that he received from one Adelaide C. Davidson a check for $38,541.05, the property of the said Davidson and her sister, Mrs. Emma L. Charlick, with instructions to invest the same in a first mortgage on real property; that he agreed to so invest it and represented that he had so invested it; that he did not do so, but on the contrary converted the same to his own use. The official referee to whom the matter was referred has reported that the respondent is guilty as charged. The evidence submitted with the report of the referee abundantly supports his finding.
It is conceded that respondent as attorney for Mrs. Davidson and Mrs. Charlick, collected for their account and turned over to Mrs: Davidson a check for $38,541.05 on March 24,1910, the same being the proceeds received from certain mortgages less the costs of collection; that said check was drawn to the joint order of Mrs. Davidson and Mrs. Charlick; that Mrs. Davidson indorsed her own name thereon, and, also, by direction of the respondent, indorsed the name of Mrs. Charlick and returned the check to respondent who deposited it to his own account in a trust company and used the money, save about $3,000, in a projected building operation in which respondent was jointly interested with one Russel.
The building operation failed and all the money invested in it by respondent was lost, and no part thereof was ever returned to Mrs. Davidson and Mrs. Charlick, or to either of them or to any one for their account. In plain terms the respondent, unless his explanation be accepted, stole the money of his clients intrusted to him for investment.
The explanation which he offers is that he invested the money in the building operation at the request and with the knowledge and consent of Mrs. Davidson, the one of the two owners of the fund with whom he dealt. This attempted explanation is demonstrably false, as is clearly shown by the careful analysis of the evidence by the official referee.
But even if everything the respondent says in his own behalf were to be accepted as true he would still be guilty of grave professional misconduct. By his own story he knew that the money belonged to both Mrs. Davidson and Mrs. Charlick, and there is no pretense that Mrs. Charlick had ever authorized her sister to use the money in a speculative venture. Yet he would have us believe that he conspired with Mrs. Davidson to invest the money in a highly speculative and hazardous enterprise, without the knowledge of Mrs. Charlick, and further conspired with Mrs. Davidson to delude Mrs. Charlick into the belief that the money had been safely invested upon a bond and mortgage. On August 10, 1910, respondent wrote a letter to Mrs. Davidson respecting the disposition of the property, stating that it had been invested on a bond and mortgage executed by the Park Avenue Holding Company, and giving a detailed statement of the value of the property; the equity of the holding company in it; the capital and assets of the company, and the like. Nearly every statement contained in that letter was false. If it be taken at its face value it clearly proves the respondent's guilt as to both of the owners of the fund. If it was written, as respondent alleges, to mislead Mrs. Charlick and to conceal from her the disposition which her sister and the respondent had made of the fund it conclusively convicts the respondent of an attempt to cheat at least one of his clients. Whichever way the letter be taken the respondent is shown to be an unfit person to remain a member of an honorable and responsible profession.
His offense is aggravated, as is unhappily too often the case in matters of this kind, by the wholesale perjury which he has committed in seeking to escape the consequences of his wrongdoing.
The respondent is disbarred.
Present — Ingraham, P. J., McLaughlin, Laughlin, Scott and Dowling, JJ.
Eespondent disbarred. Order to he settled on notice.