Opinion ID: 1297560
Heading Depth: 1
Heading Rank: 8

Heading: The Waters/Scarboro Matter

Text: Respondent represented Waters (later named Scarboro) in a personal injury action. While this action was pending, Respondent induced her to borrow $7,000 for him from Fairfax Company, stating he needed the loan to support his litigation costs. Waters did this, executing an irrevocable assignment of all rights in $10,622.64 (loan amount plus 85% annual interest rate) due her by way of her personal injury action. She authorized respondent to disburse that amount to the Fairfax Company from her legal proceeds. The actual litigation costs were only $267.75 because the case was settled. The settlement amount was $28,950.18. After receiving the money, Respondent deducted $8,333.33 as his fee and informed Scarboro the rest of the money would remain in his escrow account until a related worker's compensation subrogation lien could be resolved. A year later Waters consulted another attorney on an unrelated matter. She assured this attorney she could pay his fee because her settlement proceeds were still in respondent's escrow account. Her attorney attempted unsuccessfully to contact respondent. He later discovered respondent's trust account had a negative balance.