Opinion ID: 1872312
Heading Depth: 1
Heading Rank: 5

Heading: Samedi Rosenzweig Matter

Text: Dr. Samedi Rosenzweig testified that, in June 2003, she owned three veterinary clinics in the Knoxville area with her husband, Dr. Mitchell Rosenzweig. Samedi and Mitchell both testified that, in the latter part of that month, Mitchell told Samedi that he wanted a divorce. Samedi testified that, at the request of a former client who knew Samedi through church, Threadgill spoke with Samedi on Saturday, June 22, 2003 about representing her in the divorce proceedings. Threadgill and Samedi spoke again on Sunday, June 23 and met in Threadgill's office on Monday, June 24. According to Samedi's testimony, Threadgill explained that he would charge $250 an hour. Samedi testified that, on Threadgill's advice, she withdrew $250,000 from the clinics, representing her entire interest in those businesses. She advanced $50,000 to Threadgill, who agreed to place the money in a trust account, draw his fees from that account, and provide Samedi with a monthly accounting. Samedi testified that Threadgill did not make any reference to a non-refundable fee and that she would not have advanced non-refundable money to Threadgill. [20] In addition to these meetings, Threadgill testified he spent time reviewing various financial documents relating to the condition of the clinics. According to Samedi's testimony, Samedi called Threadgill on Tuesday, June 25, 2003 to advise that she and Mitchell had reconciled. Samedi testified that she visited Threadgill's office the next day to confirm this decision. [21] Samedi then raised the issue of reimbursement. Samedi testified that Threadgill promised to give her money back, less his fees actually incurred, and to have the bookkeeper issue a check in a week. Although the precise subsequent timeline is subject to conflicting testimony, Threadgill wrote Samedi a check for $25,000 within two months of the Rosenzweigs' decision to reconcile. Samedi testified that she was sure [the check] was from his personal account. In a July 8, 2003 cover letter accompanying the return of the financial documents, Threadgill wrote concerning the fee arrangement: This firm undertook your representation on a flat fee basis with an initial earned fee due to the unique circumstances. Nevertheless, we have returned to you 50% of that fee. In spite of our fee arrangement, you should be entitled to an additional refund which I will calculate within the next 30 days. After receiving the initial $25,000, Samedi testified that she continued to call and meet with Threadgill about obtaining the remaining refund. Because Threadgill repeatedly dishonored oral promises to pay back the remainder, Samedi requested that Threadgill memorialize the promise in writing. Threadgill handwrote the following note on personal stationery: Sam, This will confirm that even though I had an agreement with you for a lump sum earned fee for your legal matter I have agreed to return the full amount of your fee. One half has already been paid. The balance will be forthcoming. John Threadgill 8/11/03 After receiving the letter, Samedi testified that she continued to call and/or visit Threadgill's office at least once a week. Threadgill never honored his written promise to refund the remaining $25,000. Threadgill testified that he changed his mind after subsequent unpleasant encounters with the Rosenzweigs. These encounters included Mitchell's unannounced visit to Threadgill's office on September 12, 2003, which resulted in Threadgill filing a report with the Knoxville Police Department. [22] Also, Samedi visited the Threadgill home and spoke with Threadgill's wife about the remaining payment. [23] Samedi testified that, besides withholding her balance, Threadgill also never provided an accounting of time billed to her matter. While testifying about the Rosenzweig matter, Threadgill also testified concerning his general financial situation. [24] Threadgill's property has been the subject of a federal tax lien since 1986, and Threadgill has incurred judgments from two commercial landlords [25] and from medical bills [26] following heart surgery. Finding Samedi to be a credible witness and accepting her testimony as true, the Panel concluded that Samedi's $50,000 transfer to Threadgill was an unearned advanced fee, rather than a non-refundable earned fee. Noting the absence of a written fee agreement, the Panel found that the evidence did not establish a clear understanding with the client that the fees are earned fees and unrefundable. Tenn. Bd. of Prof'l Responsibility, Formal Ethics Op. 92-F-128(a) (1992); see RPC 1.5(b) (lawyer to communicate fee preferably in writing). Accordingly, the Panel concluded that Threadgill's failure to place the $50,000 payment in a trust account violated RPC 1.15(a). The Panel further determined that, by retaining the remaining $25,000 after the refund, Threadgill effectively charged an unreasonable fee and retained advance payment for fees that he did not earn. Thus, the Panel concluded that he violated RPC 1.5(a) [27] and 1.16(d)(5). By not keeping the disputed $25,000 in a trust account until the accounting and severance of Threadgill's and Samedi's respective interests, the Panel also determined that Threadgill violated RPC 1.15(c). [28] Based on the legal services that Threadgill actually provided Samedi, and giving [Threadgill] the benefit of the doubt, the Panel concluded that Threadgill earned a fee of $2,500. [29] Therefore, the Panel ordered Threadgill to refund $22,500 of unearned fees to Samedi Rosenzweig.