Opinion
No. 92SA126
Decided June 22, 1992.
Original Proceeding in Discipline.
Linda Donnelly, Disciplinary Counsel, James C. Coyle, Assistant Disciplinary Counsel, for Complainant.
Attorney-Respondent, Pro Se.
In this attorney disciplinary proceeding, a complaint was filed on May 21, 1990, with the Colorado Supreme Court Grievance Committee charging the attorney-respondent, William A. McGrath, with professional misconduct while representing Loraine Westbrook in her efforts to sell a corporate entity. After conducting a hearing on the complaint, a hearing board found that the respondent removed $5,000 from a client trust account without the client's authorization, gave false information to another attorney about the status of the funds, failed to return the money until the client filed a lawsuit demanding return of the funds, and failed to withdraw from representation of the client after an actual conflict of interest arose. A hearing panel approved the board's findings and unanimously approved the board's recommendation that the respondent be disbarred and assessed costs. Neither the assistant disciplinary counsel nor the respondent has filed exceptions to the recommendation. We agree that disbarment constitutes an appropriate sanction.
I
The respondent was admitted to the bar of this court on September 27, 1972, and is registered as an attorney upon this court's official records. He is therefore subject to the jurisdiction of this court and its grievance committee in these proceedings. C.R.C.P. 241.1(b).
The respondent was previously suspended for one year and one day by order of this court dated September 18, 1989, for misconduct unrelated to the present proceeding. People v. McGrath, 780 P.2d 492 (Colo. 1989). He has not been reinstated and remains suspended under that order.
II
The hearing board conducted an evidentiary hearing on September 12, 1991. Subsequently, the hearing board found the following facts to have been established by clear and convincing evidence.
Westbrook retained the respondent in November 1986 to represent her in a dispute arising out of the sale of Westbrook's interest in a corporation, Seven West Productions (Seven West). The purchasers and Westbrook disagreed about the status of a sum of $5,000 Westbrook had withdrawn from the corporation, and a criminal complaint had been filed against Westbrook. The respondent agreed to file a civil action against the purchasers on behalf of Westbrook.
Upon the respondent's advice, Westbrook delivered $5,000 in cash to the respondent on January 9, 1987. The respondent deposited that sum into his trust account on that day. By January 23, 1987, the trust account balance had declined below $5,000. It continued to decline, and on July 15, 1987, the trust fund balance was $8.34. The respondent testified that he withdrew the funds in the trust account in small amounts over a period of time because he was concerned that his former wife or the Internal Revenue Service would attach the funds and that he wrapped the $5,000 in a brown paper wrapper and kept the cash at his residence or on his person. The hearing board found that the respondent's testimony was inconsistent with the fact that some of the checks drawn on the trust account were made out to third parties to pay the respondent's debts.
Between November 1986, and May 1987, the respondent performed no work for Westbrook. In May 1987, Seven West filed a civil action against the respondent to obtain the $5,000. However, the respondent failed to withdraw as Westbrook's counsel. After Seven West filed its complaint against the respondent, Westbrook asked the respondent to return the $5,000. The respondent did not comply with the request. In December 1987, the respondent drafted a complaint against the purchasers and submitted a copy thereof to Westbrook. He took no further action in the matter subsequent to that date. The respondent proposed in May 1988 that he interplead the $5,000, but Westbrook rejected the suggestion. When she again asked for the return of the $5,000, the respondent refused to comply with the request.
It was disputed as to when the respondent notified Westbrook of the conflict of interest and whether he advised her to seek other counsel.
In July 1988, the respondent closed all his bank accounts and moved to California. He did not notify Westbrook of his move. Westbrook later called the respondent's former offices and made an appointment with another attorney who had shared office space with the respondent. When the other attorney telephoned the respondent in California and inquired about the $5,000, the respondent misrepresented to her that most of the $5,000 had been used for attorney fees. After Westbrook filed a civil action against the respondent to recover the money, the respondent settled that case by paying Westbrook the $5,000 plus interest from May 1989.
III
The hearing board concluded, and we agree, that the respondent's conduct in removing the $5,000 from his trust account without Westbrook's authorization; in refusing to return the sum when requested, thus forcing Westbrook to file a lawsuit against him; and in lying about the transaction to the attorney who had shared office space with him, violated disciplinary rules DR 1-102(A)(4) (engaging in conduct involving dishonesty, fraud, deceit, or misrepresentation); DR 1-102(A)(6) (engaging in conduct adversely reflecting on the attorney's fitness to practice law); and DR 9-102(B)(4) (failing to deliver promptly to a client, upon request, funds in the possession of the attorney which the client is entitled to receive). Moreover, the respondent's failure to withdraw from representing Westbrook after he was confronted with an actual conflict of interest violated DR 2-110(B)(2) (failing to withdraw from employment if the attorney knows or it is obvious that continued employment will violate the disciplinary rule) and DR 5-101(A) (except with the consent of the client after full disclosure, accepting employment if the exercise of the attorney's professional judgment on behalf of the client will be or reasonably may be affected by the attorney's own financial business, property, or personal interests). Finally, the respondent's conduct in performing almost no professional services for Westbrook after being retained violated DR 6-101(A)(3) (neglecting a legal matter entrusted to the attorney).
We find that at least two of the American Bar Association's Standards for Imposing Lawyer Sanctions (1986 1992 Supp.) (ABA Standards), apply in this case. In the absence of aggravating or mitigating circumstances, "[d]isbarment is generally appropriate when a lawyer knowingly converts client property and causes injury or potential injury to a client." ABA Standards 4.11. Further, "[s]uspension is generally appropriate when a lawyer knows of a conflict of interest and does not fully disclose to a client the possible effect of that conflict, and causes injury or potential injury to a client." Id. at 4.32.
In aggravation, the respondent has a history of prior discipline. Id. at 9.22(a). He received two letters of admonition in 1978, one letter of admonition in 1982, and was suspended for one year and one day in 1989 for conduct involving, inter alia, the conversion of client funds. People v. McGrath, 780 P.2d 492 (Colo. 1989). The hearing board discussed the following additional aggravating factors: (1) the respondent's dishonest motive in not returning the $5,000 and using it for his own benefit, ABA Standards 9.22(b); (2) the respondent's refusal to acknowledge the wrongful nature of his conduct, id. at 9.22(g); (3) the vulnerability of the victim, id. at 9.22(h); and (4) the respondent's substantial experience in the practice of law, id. at 9.22(i). In mitigation, the respondent testified that he has experienced a new interest in religion, that he is involved in helping others as a drug and alcohol counselor and that he has made full restitution to Westbrook.
The hearing board determined that the factors in mitigation were insufficient to call for a disciplinary sanction short of disbarment. We agree with that conclusion. In so doing, we note that restitution that is forced or compelled should not be considered a mitigating factor at all. ABA Standards 9.4(a). People v. Finesilver, 826 P.2d 1256, 1258-59 (Colo. 1992); People v. Margolin, 820 P.2d 347, 349 (Colo. 1991).
IV
It is hereby ordered that William A. McGrath be disbarred and that his name be stricken from the list of attorneys authorized to practice before this court, effective immediately upon the issuance of this opinion. It is further ordered that the respondent pay the costs of these proceedings in the amount of $471.10 within thirty days after the announcement of this opinion to the Supreme Court Grievance Committee, 500-S Dominion Plaza, 600 —17th Street, Denver, Colorado 80202-5126.