Opinion ID: 2611838
Heading Depth: 1
Heading Rank: 3

Heading: The Mesick Matter

Text: The respondent was retained in 1989 to represent Richard E. Mesick in his claim for a share of his father's estate, and later to assist Mesick in the management of funds received from the estate. Mesick was an elderly man, and according to an expert psychiatric opinion, was impaired by reason of mental illness, mental deficiency, physical illness or disability, meeting the definition of an incapacitated person [2] in 1992; and Mesick remained unable to testify as to the facts of the present case in April 1994. The respondent had previously befriended Mesick when they were neighbors, and had provided him free legal services. In July 1989, the administrator of the father's estate sent the respondent a check in the amount of $65,416.32, consisting of estate income payable to March 31, 1989. The respondent opened a bank account under the name of the Richard E. Mesick Trust Account, Israel Galindo, Trustee on July 10, 1989. He deposited all but $5,000 of the estate income into this account. The respondent deposited the remaining $5,000 into Mesick's personal account. In October 1989, the respondent cashed a trust account check in the amount of $20,000 and received a cashier's check in that amount in his name. A portion was to be used to pay Mesick's taxes, and the rest was to be lent to two of the respondent's clients. The respondent testified that Mesick authorized him to use the $20,000 this way. The respondent was one of the directors of a corporation which was to primarily broker automobile loans, and he agreed to invest in the corporation. The respondent intended to use his personal savings as an investment in the beginning of 1990. When a representative of the corporation approached the respondent in October 1989 for the funds to be invested, however, the respondent gave him the $20,000 cashier's check. Mesick did not authorize the respondent to use the funds from his trust account for the respondent's personal benefit. Using his personal funds, the respondent loaned $9,750 to one client, and $4,750 to another client. Of these loans, a total of $7,600 was made payable to Mesick, although only $1,000 had actually been provided by Mesick by way of a trust account check. The loans were made for the clients' personal living expenses and medical care, in anticipation of settling their respective cases. The ability of the clients to repay the loans was contingent upon successful resolutions of their personal injury and workers' compensation cases. The loans provided with Mesick's money were zero interest loans. The respondent routinely reduced his fees to clients, but he told Mesick that the two clients would be required to pay the fees originally agreed on. The respondent would then reduce the fee he retained, and he would pay the difference to Mesick as interest. The respondent used his own money on February 5, 1992, to pay $12,177.31 that Mesick owed the Internal Revenue Service. On February 14, 1992, the respondent paid $1,956 from his personal funds to the Colorado Department of Revenue for back taxes and penalties owed by Mesick. In March and July 1992, the respondent made a total of $10,250 in repayments to Mesick for the two loans to the other clients. These repayments allowed approximately $2,650 in interest for the loans, and occurred after the clients settled their respective cases. The respondent stipulated that his loans to clients in the Mesick matter violated DR 5-103(B) (while representing a client in connection with contemplated or pending litigation, a lawyer shall not, subject to certain exceptions not applicable here, advance or guarantee financial assistance to the client). The respondent also agreed that he violated DR 9-102(A) (all funds of clients paid to the lawyer shall be deposited in one or more identifiable interest-bearing depository accounts maintained in the state in which the law office is located), and DR 9-102(B)(2) (a lawyer shall identify and label securities and properties of a client promptly upon receipt and place them in a safe deposit box or other place of safekeeping as soon as practicable). The respondent further stipulated that he neglected the Mesick matter, contrary to DR 6-101(A)(3). The hearing board however rejected the assistant disciplinary counsel's most serious charge, that the respondent knowingly and intentionally converted Mesick's funds. Based on the evidence presented at the hearing, the board found that the respondent's account of his handling of the Mesick trust funds was credible and persuasive, and the board concluded that the respondent's mishandling of the funds was the result of neglect rather than dishonesty. The board found the following factors especially compelling: (1) the respondent's demonstrated social commitment over the previous twenty years made it incredible to believe that the respondent would suddenly prey upon a vulnerable client; (2) the respondent's reputation for integrity and honesty was inconsistent with the willful conversion of client funds; (3) the respondent's testimony at the hearing was forthright and he voluntarily stipulated to several charges against him that would have been difficult if not impossible to prove given that Mesick could not testify at the hearing; (4) the respondent was experiencing considerable personal stress at the time he handed the check over to the representative of the corporation, making it believable that he acted hastily and without consideration of how his actions would be viewed later; and (5) the respondent had represented Mesick over a number of years on a pro bono basis, making it unlikely that he would abruptly begin to treat Mesick as a dupe. We conclude that the board's finding is supported by substantial evidence in the record. People v. Wechsler, 854 P.2d 217, 220-21 (Colo.1993) (supreme court will not overturn hearing board's conclusion that intentional conversion was not established by clear and convincing evidence unless there is no substantial evidence in the record to support conclusion).