Court Opinion

ID: 4200051
Source: CourtListenerOpinion
Date Created: 2017-08-30 16:08:58.205191+00
Date Added: 2024-06-11T09:27:47.292011
License: Public Domain

TO BE PUBLISHED

               ,uprttttt ~nurf nf ~tnfurku
                               20 l 6-SC-000662-KB

MARC ALAN WELLS                                                         MOVANT

V.                            IN SUPREME COURT

KENTUCKY BAR ASSOCIATION                                           RESPONDENT

                             OPINION AND ORDER

      Marc Alan Wells was admitted to the practice of law on October 1, 1975.

Wells's bar roster address is 209 W. Main Street, Princeton, Kentucky 42445,

and his Kentucky Bar Association (KBA) member number is 75747.

      Pursuant to Supreme Court Rule (SCR) 3.480(2), Wells moves this Court

to impose a suspension of sixty-one days, probated for one year with

conditions, for violation of SCR 3.130(1.15)(a), SCR 3.130(1. lS)(d), SCR

3.130(8.l)(b), and SCR 3.130(8.4)(c). The KBA has no objection to Wells's

motion.

                               I. BACKGROUND.

      on· September 7, 2012, Wells conducted a closing involving the sale of

real estate from the Hintons to theVan Hoosers. In connection with that
 closing, Wells received a check from the Van Hoosers in the amount of

$4,927.00 and a wire transfer from their mortgage company in the amount of

$128,932.00. The check and wire transfer were deposited into Wells's escrow

account. At the time of the closing, the Hintons had a $65,771.47 mortgage,

which was held by Wells Fargo. Wells states that he: placed a check drawn on

his escrow account in that amount in a FedEx envelope; properly addressed

the envelope to Wells Fargo; and deposited the envelope in a FedEx drop box.

However, according to Wells, FedEx did not pick up or deliver the envelope to

Wells Fargo, and he did not learn that the Hintons' mortgage had not been paid

until sometime in November 2012. When Wells learned that the mortgage had

not been paid, he paid the delinquency of $2,936.28 and the revised payoff

amount.

      Wells admits that there were insufficient funds in his escrow account in

September 2012 to cover the check he wrote to pay the Hintons' mortgage.

Wells also admits that, in order to cover the check he wrote in November 2012,

he deposited personal funds into his escrow account. Finally, Wells admits

that he borrowed $75,000.00 from a friend and deposited that amount into his

escrow account in order to reimburse another client in an unrelated matter.

Wells has repaid that loan.

      Based on the preceding, the Inquiry Commission issued a Complaint,

charging Wells with violating SCR 3.130(1. lS)(b), which states that:

                                        2
      Upon receiving funds or other property in which a client has an
      interest, a lawyer shall promptly notify the client. Except as stated
      in this Rule or otherwise permitted by law or by agreement with
      the client a lawyer shall promptly deliver to the client any funds or
      other property that the client is entitled to receive and, upon
      request by the client, shall promptly render a full accounting
      regarding such property.

The Inquiry Commission also charged Wells with violating SCR 3.130(1. lS)(d),

which states: "A lawyer may deposit the lawyer's own funds in a client trust

account for the sole purpose of paying bank service charges on that account,

but only in an amount necessary for that purpose." Finally, the Inquiry

Commission charged Wells with violating SCR 3.130(8.4)(c) which states that it

is professional misconduct for a lawyer to "engage in conduct involving

dishonesty, fraud, deceit or misrepresentation."

      Following receipt of Wells's response to the Complaint, Bar Counsel

made several. requests for additional information. Notably, Bar Counsel

requested information on July 24, 2014, stating that a response was due by

August 5, 2014. When Wells failed to respond, Bar Counsel sent a second

request on October 2, 2014, stating that a response was due by October 16,

2014. On October 14, 2014, Wells sent an email to Bar Counsel confirming a

phone conversation they had regarding Wells's trial preparation and stating

that the requested information would be forthcoming by October 29, 2014. On

October 29, 2014, Wells sent Bar Counsel another email indicating that he was

again in trial preparation, and he would supply requested information by the

end of the week of November 10, 2014. Because of Wells's dilatory response to

                                       3
 Bar Counsel's request for information, he was charged with violating SCR

 3.130(8.1 ){b), which states that a lawyer shall not "fail to disclose a fact

 necessary to correct a misapprehension !mown by the person to have arisen in

 the matter, or knowingly fail to respond to a lawful demand for information

from an admissions or disciplinary authority."

       As noted above, Wells has admitted to violating the applicable ethical

rules. He and Bar Counsel have entered into a negotiated settlement that

provides for a sixty-one day suspension, probated for one year. Wells's

probation is contingent on: (1) receipt of no further disciplinary charges; (2)

completion of the Ethics and Professionalism Enhancement Program (EPEP);

(3) timely payment of KBA dues; (4) timely satisfaction of all continuing legal

education requirements; and (5) payment of all costs associated with the

investigation and prosecution of this matter. The recommended sanction has

been reviewed and approved by the Chair of the Inquiry Commission and a

Past President of the KBA.

                                   II. ANALYSIS.

      In support of its position that the agreed to discipline is appropriate, the

KBA notes that Wells has not been a party to any prior disciplinary

proceedings. The KBA also cites to King v. Kentucky Bar Ass'n, 440 S.W.3d

378 (Ky. 2014); Kentucky Bar Ass'n v. Francis, 439 S.W.3d 750 (Ky. 2014); Son

v. Kentucky Bar Ass'n., 398 S.W.3d 432 (Ky. 2013); and Section 9.32 of the

American Bar Association Standards for Imposing Lawyer Sanctions (the ABA

                                         4
 Standards). Having reviewed the cited cases and section of the ABA Standards
                                                                                  '
 we agree that the proposed sanction is appropriate.

       In King; King deposited client funds in two separate cases into his escrow

account pending resolution of Medicaid liens. When the lien issues were

resolved, King distributed the funds to his clients. However, in the interim,

King failed to maintain sufficient funds in his escrow account to cover

payments to his clients and/or Medicaid. He also used money from his escrow

account to pay personal expenses. 440 S.W.3d at 379-380. King, who had

previously received a public reprimand with conditions, was suspended for 181

days, with sixty-one days to serve, the remainder being probated for two years

subj.ect to several conditions. Id. at 380-81.

      In Francis, Francis wrote several checks from his escrow account that

were returned for insufficient funds. 439 S.W.3d at 751. He also took a fee

from a client, failed to perform any work, and failed to refund the fee when

asked to do so. Id. at 752. Finally, Francis failed to respond to either of the

complaints and to requests for information from Bar Counsel. Id. at 752-53.

Pursuant to the KBA's recommendation, and noting that Francis had been

privately reprimanded on two prior occasions, this Court suspended Francis for

181 days. Id. at 753.

      In Son, Son negotiated a $100,000 settlement for a client in a personal

injwy claim. 398 S.W.3d at 433. He deposited the settlement proceeds in his

escrow account, paid himself his one-third fee, and paid his client $30,000. Id . .

                                        5
 Son kept the remainder in his escrow account to pay his client's unpaid

 medical bills. Id. However, Son failed to negotiate with the medical services

 providers and, when he failed to respond to his client's requests for

information, she retained new counsel. Id. Son forwarded the remainder of the

client's money to the new attorney, but he had to deposit personal funds into

the escrow account to cover the check. Id. 'Furthermore, during the time

between the settlement and the time he· forwarded that check, Son failed to

maintain sufficient funds in his escrow account to pay either the client or her

medical bills. Id. This Court approved of and imposed the thirty-day sanction,

probated for two years with conditions, which Son and the KBA had negotiated.

Id. at 434-35.

       Finally, we note that, although not binding, the ABA Standards "can at

times serve as persuasive authority." Anderson v. Kentucky Bar Ass'n, 262

S.W.3d 636, 639 {Ky. 2008). Here, we find that Section 9.32, which notes that

a lack of a history of discipline and the effort to make amends may be

considered as mitigating factors, is persuasive. Wells has no history of prior

discipline in more than forty years of practice. Furthermore, when he

recognized the issue with regard to the Hintons' mortgage, Wells took the

necessary steps to rectify the situation. These are laudable attributes.

However, they do not completely excuse Wells's failure to maintain an adequate

balance in his escrow account, his failure to refrain from co-mingling client and

personal funds, and his failure to timely respond to requests for information

                                        6
 from Bar Counsel. Therefore, we agree with the KBA that a sixty-one day

 suspension, probated for one year with conditions, is appropriate .

. ACCORDINGLY, IT IS ORDERED THAT:

 1.     Marc Alan Wells, KBA Member No. 75747, is suspended from the

        practice of law for sixty-one days, probated for a period of one year from

        the date of the Court's Order on the condition that he comply with the

       remainder of this Order;

2.     Wells shall not receive any charges of professional misconduct during the

       probationary period;

3.     Wells shall attend at his own cost and successfully complete the KBA 's

       EPEP within one year of this Court's Order, and Wells shall not apply for

       CLE credit for his attendance at that program. Furthermore, Wells shall

       provide an appropriate release form so that his CLE records can be

       reviewed for one year following his completion of that program;

4.     Wells shall timely pay his KBA membership dues and satisfy all

       continuing legal education requirements;

5.     Pursuant to SCR 3.450, Wells is directed to pay all costs associated with

       this disciplinary proceeding, certified to be in the sum of $446.30, for

       which execution may issue from this Court upon finality of this Opinion

       and Order;

6.     In the event Wells violates any of the terms of probation stated herein,

      . the KBA may file a motion with the Court requesting the issuance of an

                                         7
      order directing Wells to show cause why the sixty-one day suspension

      should not be imposed; and

7.    If Wells fully complies with the terms of this Opinion and Order, the

      suspension and all terms of probation shall be terminated at the end of

      the probationary period.

      Minton, C.J., Hughes, Keller, VanMeter, Venters and Wright, JJ., concur.

Cunningham, J., not sitting.

      ENTERED: February 16, 2017.

                                     C

                                         8