Opinion ID: 2106464
Heading Depth: 1
Heading Rank: 11

Heading: report and recommendation of the hearing committee number two to the board of professional responsibility regarding petition for reinstatement

Text: For the past fifteen (15) years, Petitioner has sought reinstatement to the Bar. But for the 1980 decision of the District of Columbia Court of Appeals that disbarments based on convictions involving moral turpitude were permanent, which decision was overruled in 1992, she would probably have been reinstated long ago. Since the time a prior hearing committee first recommended her reinstatement in 1979, the evidence of her fitness to resume the practice of law has only improved. As set forth below, the Committee recommends that Petitioner be reinstated.
The Petitioner, Elaine Kerr, received her law degree from the University of Maryland Law School (Exhibit 2) and was admitted to the Maryland bar in 1957. She was admitted to the District of Columbia Bar on April 4, 1960, by motion (Exhibit 1). While no evidence has been presented as to the date of admission, Petitioner was also admitted to practice law in the Commonwealth of Virginia. No evidence was presented that Petitioner was ever disciplined by any Bar prior to the conviction which led to her disbarment. In 1970, Petitioner was charged in the United States District Court for the District of Columbia with mail fraud, interstate transportation of stolen property, forging and uttering, and larceny after trust. (Bar Exhibit 8). The allegations involved a scheme to defraud two victims; Claudia Borthwick and Frances Meager, by Mrs. Kerr and her co-defendant, a Mr. Benn. (Bar Exhibit 8). On September 10, 1971, Mrs. Kerr entered an Alford plea to one count of mail fraud (Bar Exhibit 12), (Petitioner Exhibit 7). She was sentenced to a period of incarceration and served approximately nine months (Bar Exhibit 17, Tr. 119). While she later filed motions to set aside her plea, arguing it was coerced, she admitted in the earlier reinstatement proceeding and now admits that her conduct was wrong. She maintains, however, that she did not act with the specific intent to defraud the victims. (Tr. 30). On the basis of her conviction, she was suspended and later disbarred. (Bar Exhibit 26). The facts underlying her conviction were set forth at the hearing on her plea, few of which Mrs. Kerr now disputes. (Kerr Exhibit 7). Mr. Benn persuaded Mrs. Claudia Borthwick, by various false representations, to invest approximately $50,000, her entire life savings, in a Rosslyn, Virginia real estate venture, known as Capitol Investors. (Petitioner Exhibit 7). Claudia Borthwick sought Ms. Kerr's services as an attorney to help her rescind her agreement with James T. Benn. (Tr. 21, 23). After the rescission agreement was executed, Ms. Borthwick further consulted with the Petitioner as to the advisability of reinvesting with Mr. Benn. (Tr. 23). Petitioner, without disclosing her close business relationship with Mr. Benn, reassured Ms. Borthwick that her money was secure with Mr. Benn. (Petitioner Exhibit 7; Tr. 25). Ms. Borthwick thereafter reinvested her funds, all of which were lost. The Petitioner has acknowledged that she failed to provide adequate representation for Ms. Borthwick by not arranging to meet with the client (Tr. 25), by not making clear to the client the possible conflict of interest resulting from her representation of another corporation in which Mr. Benn was a principal, and by not conducting an independent investigation of the Capital Investors project (Tr. 27, 28), in order to advise her client on the wisdom of reinvesting. She has further admitted that her failure to adequately represent Ms. Borthwick assisted her co-defendant's scheme and resulted in serious financial loss to her client (Tr. 30-31). She admits that her misconduct was serious (Tr. 31) and violated the Disciplinary Rules and the D.C.Rules of Professional Conduct (Tr. 31, 32, 33). Consistent with her Alford plea, she does not admit she acted with the specific intent to defraud Ms. Borthwick. (Tr. 30, 138). Mr. Benn also defrauded Mrs. Meager, who invested money in his company, Capital Investors. In this instance, Petitioner helped procure the loan and served as trustee on two deeds of trust which secured the loan that Ms. Meager made to Capital Investors. (Tr. 35). Immediately after the loans were made, Petitioner, acting as trustee, released the deeds of trust, knowing that the release would destroy Mrs. Meager's security for the repayment of her loan. (Petitioner Exhibit 7; Tr. 36-40). As in the case of Claudia Borthwick, the Petitioner admits to failing in her fiduciary responsibility, this time as trustee. (Tr. 38, 39). She acknowledges that when presented with the notes and deed of trust for partial release by a third party, she should have contacted Mrs. Meager and should have asked to see evidence of the third party's authority to serve as her agent, since one of the notes had Mrs. Meager as payee. (Tr. 39, 40). The Petitioner further acknowledges that her involvement in this transaction contributed to the loss by Mrs. Meager and that this was serious misconduct on her part, although she did not benefit from the transaction. (Tr. 40, 41). The Petitioner first applied for reinstatement on March 28, 1978 (Bar Exhibit 27). At that time, she had obtained a masters degree in clinical psychology from George Mason University (Bar Exhibit 3) (Tr. 90), and a doctorate in Philosophy from Virginia Polytechnic Institute. (Bar Exhibit 3) (Tr. 90-91). She was then serving as a director of a mental health clinic. As she testified at that time, her interest in psychology stemmed from her recognition of her own personal failings as related to her relationships with Mrs. Meager, Mrs. Borthwick and Mr. Benn. She recently testified that she started the course of psychological study to gain insight and understanding of her prior behavior and to avoid her repeating past mistakes. (Tr. 98). The hearing committee that heard her case in 1979 recommended her reinstatement. (Bar Exhibits 28 & 31). The Committee was concerned about her recognition and appreciation of the misconduct resulting in her conviction and in her then current knowledge of ethics governing the practice of law. Thus, the Hearing Committee's recommendation of reinstatement was conditioned on her undertaking a course in ethics as a prerequisite. (Bar Exhibits 30 & 32). The Board agreed with the Hearing Committee's recommendation and Bar Counsel did not oppose. (Bar Exhibits 30 & 32). However, on November 17, 1980, the District of Columbia Court of Appeals, sitting en banc, denied petitioner reinstatement. The court ruled that D.C.Code § 11-2503(a) prohibited reinstatement of a person disbarred for conviction of an offense involving moral turpitude. In re Kerr, 424 A.2d 94 (D.C. 1980) ( en banc ). After the Court of Appeals ruling in her case, the Petitioner continued to practice psychology. Her career included acting as a director of various clinics and most recently, operating a solo practice as a clinical psychologist in the District of Columbia. (Tr. 11). She also continued to have contact with the courts, appearing as an expert witness in various types of cases in Maryland, Virginia and the District of Columbia. (Tr. 11, 12, 13, 14). Oddly enough, she was never cross-examined as an expert regarding her prior conviction and/or disbarment. (Tr. 11). In 1992, the Court of Appeals, sitting en banc, overruled its prior decision in In re Kerr. See In re McBride, 626 [602] A.2d 629 [626] (D.C.1992) ( en banc ). This decision allowed Mrs. Kerr to seek reinstatement. Subsequent to the McBride decision, Mrs. Kerr has over taken thirty continuing legal education courses, including the professional responsibility course offered at the University of Virginia. (Tr. 98-101) (Bar Exhibit 2). Not only have several of her peers in psychology recommended her reinstatement (Petitioner Exhibits 1-4), but several attorneys who have discussed CLE course matter with her and referred clients to her as a psychologist, testified on her behalf, as character witnesses. (Tr. 41-49; 54-86). A hearing on the instant petition for reinstatement was held on December 5, 1994, before Hearing Committee Number Five. Petitioner testified. Both parties submitted exhibits, all of which were received. Post hearing briefs were filed. Bar Counsel has recommended reinstatement, without conditions. As will be discussed in the following section, the Committee believes the facts to establish by clear and convincing evidence that the Petition for Reinstatement should be granted.

Petitioner was disbarred because of her conviction for aiding and abetting a scheme to defraud two victims. Her Petition for Reinstatement is governed by D.C.Bar Rule XI, Section 16(b), which requires that she show by clear and convincing evidence that she is fit to resume the practice of law. In particular, Petitioner must show that (1) she has the moral qualifications, competency and learning in law required for readmission, and (2) her readmission, will not be detrimental to the integrity and standing of the Bar, or to the administration of justice, or subversive to the public interest. Section 16(d)(1)-(2). In assessing whether these criteria have been met, the District of Columbia Court of Appeals has identified five factors to be considered:

We briefly discuss each factor below.
The underlying offense occurred 27 years ago. It is clear from the grand jury testimony and the available records that her co-defendant was a con man and the principal perpetrator of the fraud. (Bar Exhibits 9, 10, 11, Tr. 141). Mr. Benn used Petitioner's legal services to legitimize his operation. Her comforting of the two victims, as their attorney and/or trustee, permitted the scheme to work. There is no evidence that Petitioner profited financially from the scheme or received fees from anyone. (Tr. 129). She has consistently denied having acted with the specific intent to defraud and entered an Alford plea to count one of the indictment.
Initially Petitioner pleaded guilty, but then sought (unsuccessfully) to withdraw her plea. Her current petition for reinstatement and her testimony demonstrate an enhanced understanding of her involvement and culpability. Years of reflection have provided insight. She admits her professional relationship with the two complaining witnesses and acknowledges that her failure to fully perform her responsibilities under those relationships resulted in financial harm to the two women. She further admits that she perhaps unwittingly, aided the scheme to defraud engineered by her co-defendant. She recognizes the seriousness of her misconduct in failing to meet her professional responsibility. Petitioner testified: I have come to, over time, seen my culpability and what I should have done. I have gained insights by going back and thinking of conversations I had with the various people involved into what they must have been thinking, certainly with regard to the trust issues, the trust that these two women placed in me. (Tr. 106). She testified further: I allowed myself to be involved in the perpetration of a fraud. (Tr. 134). She admitted to malpractice and a breach of ethical responsibility. (Tr. 134-135). While Petitioner does not admit that she intended to defraud the victims, this is consistent with the nature of her plea.
This factor supposes that the disbarred attorney has taken steps to remedy past wrongs and to prevent future ones. Petitioner has been a successful psychologist for over twenty years and has treated hundreds of patients without incident. She had held positions of trust at various mental health clinics. She has testified in hundreds of cases as a forensic psychologist. (Tr. 110-111). She has engaged in pro bono treatment of patients on a regular basis. (Bar Exhibit 3). She has served as a professional with integrity. She has also sought to develop insight into her own psychology, so as to assure that the past transgressions are not repeated. She has participated in psychoanalysis, as well as discussed her criminal conduct with her peers. [1] The only area of concern is the remedy of past wrongs. Petitioner initially undertook restitution, only to be rebuffed by the victims over the amount of money she then had available  $45,650. (Tr. 21, 117). She subsequently declared bankruptcy, after her attorneys were unable to reach a settlement for the civil judgments obtained by the victims. (Tr. 53). She turned over $26,000 to the bankruptcy court, but never found out how the funds were divided. (Tr. 118-119). She has been told that neither victim subsequently sought restitution from her, but this matter is unclear. (Bar Exhibit 3, Tr. 119). Because both victims had judgments against Petitioner, which were discharged in bankruptcy without protest by the victims, the matter appears to be at rest. There is no evidence as to whether either Ms. Meager or Ms. Borthwick are alive.
Petitioner has demonstrated fitness of present character, as set forth above and based upon the testimony of her character witnesses. (Bar Exhibit 3, Tr. 41-86).
Bar Counsel does not take issue with Petitioner's proof of this factor. While the length of time since she was disbarred is extraordinary, Petitioner has undertaken a massive effort to re-educate herself. Her occupation brings her in constant contact with the law, courts and lawyers. Her testimony revealed her to be intelligent and careful.
The Committee finds by clear and convincing evidence that Petitioner has shown her fitness to resume the practice of law and, therefore, should be reinstated. Respectfully submitted, By: /s/ Steven M. Salky STEVEN M. SALKY By: /s/ Karen Spar KAREN SPAR By: /s/ Robert J. Harlan, Jr. ROBERT J. HARLAN, JR. Dated: January 8, 1995