Opinion ID: 1646326
Heading Depth: 1
Heading Rank: 4

Heading: Count III The Lloyd Matter

Text: By way of background, Gwendolyn Lloyd agreed to sell her house to Ronald Lewis under the following conditions: 1) Mr. Lewis was to pay Ms. Lloyd $10,000 at closing; 2) Ms. Lloyd would lease the house back from Mr. Lewis for one year at $1,800 per month; 3) During that year, Mr. Lewis would make repairs and additions to the house; and 4) Ms. Lloyd would repurchase the house from Mr. Lewis at the end of the year. Ms. Lloyd and Mr. Lewis executed a lease purchase agreement setting forth the above conditions. Respondent was retained to handle the closing, which occurred on December 30, 2004. Deborah King accompanied Mr. Lewis to the closing. Although Ms. Lloyd did not have an agreement with Ms. King, respondent structured the closing with Ms. Lloyd selling the property to Ms. King, not Mr. Lewis. According to the HUD-1 settlement statement, Ms. Lloyd was to receive $91,374 in net sales proceeds. However, despite what respondent reported on the settlement statement, Ms. Lloyd did not receive these proceeds. Pursuant to Ms. Lloyd's agreement with Mr. Lewis, Mr. Lewis paid Ms. Lloyd $10,000. Respondent failed to properly disburse the loan proceeds and/or failed to pay off Ms. Lloyd's outstanding mortgage. Consequently, foreclosure proceedings were instituted against Ms. Lloyd with respect to the house she purportedly sold to Ms. King. The property was sold at a sheriff's sale on June 9, 2005 with Mr. Lewis as the winning bidder. However, Mr. Lewis' check in the amount of $155,161 in payment of the balance of the sheriff's sale purchase price was dishonored for insufficient funds. On December 9, 2005, the sheriff's sale was set aside and all outstanding liens on the property were reinstated. Apparently, Mr. Lewis and/or Ms. King committed fraud against Ms. Lloyd. Respondent was either directly involved in the fraud or facilitated the fraud as evidenced by the erroneous information listed on the settlement statement. Respondent is believed to have absconded with the loan proceeds and/or converted a portion of the funds to his own use.