Opinion ID: 1304457
Heading Depth: 2
Heading Rank: 1

Heading: Hannah Bohlmann

Text: Bohlmann and Martinez became social acquaintances in the summer of 1980. Bohlmann immigrated from Germany in 1954 and is now approximately 63 years old. In February of 1984, Bohlmann was involved in an automobile collision for which she received a traffic citation. Claims were made against her by the owners and operator of the other vehicle. Upon notifying her insurance carrier of the accident, she was informed that her insurance had been canceled as of December 31, 1983, because she had failed to sign and return certain forms. In early March of 1984, Bohlmann contacted Martinez to elicit his aid in dealing with the problems arising from the automobile accident. He met with Bohlmann at her house to discuss the matters and agreed to represent her in attempting to secure coverage from her insurance company and in pursuing any claims she might have for the wrongful cancellation of her automobile policy. The respondent told Bohlmann that in representing her in the dispute with the insurance company his fee would be $1,000, half of which was to be paid in advance, together with $80 for court costs. Martinez also apparently agreed to represent Bohlmann concerning the traffic ticket, but a fee for those services was not discussed. Bohlmann paid Martinez a retainer fee of $580, and gave him the traffic citation and the various insurance papers that were in her possession. Thereafter, all the mail that Bohlmann received in relation to the accident was forwarded by her to the respondent's office in Colorado Springs at his request. Martinez was successful in obtaining dismissal of the traffic case. He advised Bohlmann early in June that he had gone to court on her behalf and when the police officer who had issued the ticket failed to appear, the case was dismissed. In August of 1984, after Martinez had made no significant progress concerning the insurance coverage matter, and after other problems had arisen between Bohlmann and Martinez, Bohlmann retained another lawyer. That lawyer attempted on several occasions to retrieve Bohlmann's auto insurance file from Martinez, without success. Although Martinez had lost the file, he never advised Bohlmann or her new attorney of that fact. There is no evidence in the record that any of the claims against Bohlmann related to the accident were ever pursued. No progress was ever made on her claim against the insurance company. No part of the retainer fee paid by Bohlmann to Martinez was returned to her, and Martinez never furnished Bohlmann with an accounting for his services in this matter. The hearing board concluded that Martinez's conduct in the Bohlmann insurance matter was neglectful and that he acted improperly in retaining the fee without accounting to Bohlmann for his services.
In September of 1983, Martinez established Money Finders, Inc., a loan brokerage business. The business ceased operations in October of 1984, and made only one loan during its entire existencea loan utilizing funds obtained from Bohlmann. In mid-June of 1984, three and one-half months after Bohlmann retained Martinez on the insurance matter, she received copies of documents reflecting the dissolution of her marriage. Concerned about the dissolution, and apparently not having been represented by counsel in the proceedings, Bohlmann called Martinez, and he went to her home to review the papers. He also reviewed her will. Approximately one week later, Martinez contacted Bohlmann and asked if he could borrow some money from her so that Money Finders, Inc. could make a loan to a prospective customer. At the time, Bohlmann's total assets consisted of approximately $20,000 in certificates of deposit in addition to her residence, which she owned free and clear of encumbrances. She refused the request for a loan. Later in June, Martinez called Bohlmann to invite her to ride along with him on a brief business trip to Greeley. She accepted the invitation. During the course of the day, the subject of a loan was discussed again. Martinez said that a friend of his, Mark Patterson, needed $20,000 to pay his employees. Patterson was a plumbing contractor and although he currently was without adequate cash, he supposedly was to receive over $31,000 for work on a plumbing contract sometime around July 6th. The payment was to be in the form of a joint payee check payable to Patterson and his supplier and was to be in an amount more than $31,000 in excess of the amount owed by Patterson to the supplier. Martinez told Bohlmann that if she loaned the money to Patterson through Money Finders, Inc., she would be repaid in full in two weeks and would receive an additional $2,000. Based on Martinez's promise of returning her money, and her trust in him as an attorney, she agreed to make the loan. Martinez never discussed the possibility of a conflict of interest arising between them, nor did he encourage her to obtain the advice of independent counsel with respect to the loan. He did not provide her any information about the financial condition of Money Finders, Inc. or his own financial condition, which rendered his personal guarantee worthless, nor did he tell her that three banks had declined to make such a loan to Patterson. The next morning, June 29th, Martinez and Patterson went to Bohlmann's home and waited there while she traveled to the bank to obtain a loan. Using her certificates of deposit as collateral, she signed a promissory note for $21,825 and received a cashier's check in the amount of $20,000 [2] made payable to the order of Martinez. Patterson executed a note in the amount of $22,000 payable on July 6, 1984, to Money Finders, Inc. Martinez, as president of Money Finders, Inc., assigned the note to Bohlmann and also guaranteed payment of the note individually. In addition, Patterson signed a statement on June 29th agreeing to pay the interest that Bohlmann would incur on the $20,000 she had borrowed. In order to show Bohlmann how the loan would be repaid, Martinez provided her with a summary of the prospective payments to be received by Patterson on the plumbing contract, the amounts to be used to pay the supplier, and the balance remaining for use in paying the loan made with Bohlmann's funds. Martinez and Patterson signed a letter to the supplier directing the supplier, upon receipt of the check in payment for Patterson's work on the plumbing contract, to issue its check for the balance of the monies due Patterson after deducting the amount of Patterson's account with the supplier. Martinez and Patterson returned to Colorado Springs with the $20,000, deposited $2,000 into Martinez's bank account, obtained four cashier's checks totaling $9,800 made payable to companies controlled by Patterson, paid a $12 fee for the cashier's checks, and took the remainder of the money in cash, $7,688 for Pattersonostensibly to be used to meet Patterson's payroll and $500 for Martinez. Patterson eventually did receive payment from his supplier, but the payment was in the amount of $12,555 rather than the $31,000 he had said was owed to him. It can be inferred that after receiving Bohlmann's money, Patterson continued to order supplies from his supplier, thereby increasing the balance of his account and decreasing the amount of the proceeds to be received by Patterson from the plumbing contract payment. The check he received was made payable to both Money Finders, Inc. and Patterson's business. Patterson forged an endorsement for Money Finders, Inc. and absconded with the $12,555. Subsequent to July 6, 1984, Bohlmann made several calls to Martinez in an effort to recover her money. On one of the rare occasions that she was able to reach Martinez, he advised her that if she could wait, she would be paid an extra $1,000. Bohlmann eventually retained another attorney to help her recover her money from Martinez, as well as to pursue her claim against the insurance company. Bohlmann terminated the services of the other lawyer on August 29, 1984, because she could no longer afford to pay him. In September of 1984, Martinez took Bohlmann to a meeting with an attorney who represented the bank that had paid the $12,555 check bearing the forged endorsement. Nothing came of the meeting, and no claim against the bank was ever made on Bohlmann's behalf. In October, Martinez issued two $1,000 checks to Bohlmann from the Money Finders, Inc. account, both of which were ultimately dishonored. Thereafter, Martinez provided a cashier's check in the amount of $1,350 to Bohlmann, which was the full extent of his reimbursement to her. Bohlmann retained an attorney on a contingent fee basis in January of 1985 and filed a complaint against Martinez seeking recovery of the moneys she had loaned. No answer was filed, and as a result, Bohlmann obtained entry of a clerk's default against Martinez on or about October 25, 1985. The record does not reflect that any further action has been taken concerning this litigation. The hearing board concluded that Martinez encouraged Bohlmann to enter into a business transaction with him in which the two had differing interests, that Martinez failed to disclose relevant facts and that Bohlmann clearly and reasonably expected Martinez to exercise his professional judgment for her protection, and that he failed her. The hearing board concluded that Martinez grossly neglected Bohlmann's interests in this matter.