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TCL > October 2002 Issue > Opinions

The Colorado Lawyer
October 2002
Vol. 31, No. 10 [Page  163]

© 2002 The Colorado Lawyer and Colorado Bar Association. All Rights Reserved.

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From the Courts
Colorado Disciplinary Cases

Opinions

Case Number: 02PDJ005

Petitioner:

NICK AVILA, JR.,

Respondent:

THE PEOPLE OF THE STATE OF COLORADO.

ORIGINAL PROCEEDING IN DISCIPLINE BEFORE
THE OFFICE OF THE PRESIDING DISCIPLINARY JUDGE

July 22, 2002

OPINION AND ORDER READMITTING NICK AVILA, JR., TO THE PRACTICE OF LAW

Opinion by Presiding Disciplinary Judge Roger L. Keithley and two hearing board members, Thomas J. Overton and Douglas D. Piersel, both members of the bar.

ATTORNEY READMITTED TO THE PRACTICE OF LAW

A readmission hearing was held in the within matter on May 20 and 21, 2002, pursuant to C.R.C.P. 251.29(a) before a Hearing Board consisting of the Presiding Disciplinary Judge ("PDJ") Roger L. Keithley and two hearing board members, Thomas J. Overton and Douglas D. Piersel, both members of the bar. John Astuno, Jr. appeared on behalf of petitioner Nick Avila, Jr. ("Avila"), who was also present. James S. Sudler, Assistant Attorney Regulation Counsel, appeared on behalf of the People of the State of Colorado (the "People"). The following witnesses testified on behalf of Avila: Lesile Jordan, Ph.D., Brooke Wunnicke, Manual J. Solano, Cipriano Griego, David W. Givens, Debra Williams, Laurie A. Crook, Renee Schwalger, Marcella Paiz, Judge Aleene Ortiz-White, and Sandy Baca-Sandoval. Nick Avila, Jr. testified on his own behalf. Avila offered and the PDJ admitted into evidence stipulated exhibits A though N.

The Hearing Board considered the testimony and credibility of the witnesses, the stipulation entered into by the parties, the exhibits admitted into evidence, and made the following findings of fact, which were established by clear and convincing evidence.

I. FINDINGS OF FACT

Nick Avila, Jr. ("Avila") took the oath of admission and was admitted to the bar on May 17, 1977, registration number 08049. Avila was immediately suspended from the practice of law by Order of the Supreme Court dated July 1, 1986 due to his conviction in Denver District Court on two counts each of second degree forgery and conspiracy to commit second degree forgery. Avila arranged for the unauthorized alteration of two of his clients’ driving records in the State Motor Vehicle Division. The two clients’ driver’s licenses were under revocation for alcohol-related offenses. Avila charged his clients between $1,500 and $3,000 for his services. See People v. Avila, 770 P.2d 1330 (Colo. App. 1988). Avila was sentenced to a period of probation on these convictions.

Following the suspension of his law license, Avila encountered significant financial problems. Avila financed a drug operation importing cocaine from Florida to Colorado. In three transactions occurring from April through August 1987, Avila received more than three kilograms of cocaine. Avila was convicted in United States District Court for the District of Colorado of one count of conspiracy to possess with intent to distribute cocaine in violation of 21 U.S.C. § 846 (1982), and three counts of possession with intent to distribute in violation of 21 U.S.C. §841(a)(1)(1982). Avila was sentenced to ten years in prison on each count and fined $10,000.00. As a result of the federal convictions, Avila’s state probation was revoked and he was sentenced to a term of eight years in state prison to run consecutively with the federal term of incarceration. On July 17, 1989, by Order of the Supreme Court, Avila was disbarred from the practice of law in the State of Colorado. People v. Avila, 778 P.2d 657, 657 (1989). Over eight years have passed since the effective date of Avila’s disbarment. See 251.29(a).

Avila served eight years of imprisonment. While serving his sentence in prison, Avila maintained relations with his family and was employed by the prison to work in the educational department where he helped inmates study for and take the high school equivalency exam. In 1995, Avila was released to a halfway house, and in 1996, he was released on parole. He was formally discharged from both sentences in July 1997.

Avila has worked to reestablish relationships with his two sons. His older son, a recent law school graduate, believes his father was and is his inspiration for choosing the legal profession, and remembers that even while he was in prison, Avila provided him with guidance and helped him when he encountered obstacles in school or in his personal life. Avila commits as much time as possible to his younger son. He provides transportation to and from school each day. He participates in his son’s school activities and extra-curricular sports activities. He volunteers his time at his son’s school, chaperoning dances, working at the church, collecting donations for mission trips and collecting food for the homeless. He extends financial support to his son beyond the child support payments he is required to pay. According to the mother of Avila’s younger son, Avila has made a complete transformation since he was released from prison.

In his community, Avila has volunteered his time for several years to a program which helps at-risk teenagers obtain their high school equivalency diplomas. He assists with church functions, and gives presentations through a state agency on learning new skills and changing behavior. He offers himself as an example of the severity of the consequences for improper behavior.

Avila has established his proficiency in the law. He sat for and passed the February 27, 2001 Colorado Bar Exam, and the Multistate Professional Responsibility Examination. Prior to the submission of his Petition for Readmission, Brooke Wunnicke tutored Avila on the ethical obligations of a lawyer in Colorado. Specifically, Ms. Wunnicke instructed Avila on the importance of writing a representation letter at the outset of the attorney/client relationship, the need to render competent representation to the client, the need to clarify the client’s and attorney’s goals, the importance of discussing fees with clients at the outset, the importance of confirming to the client in writing all major aspects of his representation, the need to confirm in writing all discussions or agreements with opposing counsel, the importance of identifying and addressing conflicts of interest, and the importance of remaining current on Colorado Bar Association Formal Ethics Opinions and the American Bar Association ethics opinions.

In addition to demonstrating his proficiency in the law by taking the bar exam, Avila has worked as a paralegal for the last five years. The attorneys with whom Avila worked as a paralegal — Cipriano Greigo, David Givens and Manuel Solano – uniformly agree that Avila possesses good lawyering skills, good judgment, an ability to quickly comprehend complex legal issues, a solid work ethic, and is technically competent. Accompanied by a supervising attorney, he has met with clients, communicated with clients on behalf of his employers, assisted in the drafting of pleadings and trial preparation, and conducted legal research. As a paralegal, Avila is hard-working, well organized, dedicated to the legal profession, and has earned a reputation for being honest and forthright. Avila has developed a mentoring relationship with these attorneys and will look to them in the event he needs advice on a legal matter. All three attorneys knew Avila personally and professionally prior to his incarceration, have worked with him since his release, and confirmed that Avila is a changed person who takes responsibility for his actions and can competently practice law. One of the attorneys has invited Avila to join his firm as an associate attorney.

Avila consulted with a psychologist, Dr. Leslie Jordan, from March through June 2000. Avila worked to rehabilitate those flaws in his character which resulted in his prior misconduct. Avila recognizes that his background, which included a childhood filled with a considerable amount of punishment but not a lot of guidance, resulted in his not developing core values, and he lacked these core values when entering the practice of law. He was the first member of his family to attend college. He started off as a young lawyer with no one to advise him how to handle his caseload. He worked under conditions of financial insecurity and continual fear of failure. He believed he could not fail in resolving his clients’ legal problems, even when his solution did not comport with the law.

On January 15, 2002, Avila filed a Verified Petition for Readmission and Reinstatement. Avila has complied with past disciplinary orders. He fully complied with both his state and federal sentences and completed his period of parole without incident. The parties stipulated that Avila substantially complied with the Supreme Court’s Order dated July 17, 1989, requiring him to pay the costs arising from the prior disciplinary proceeding in the amount of $212.61.

Avila acknowledges the seriousness of his misconduct and has expressed genuine remorse. He has demonstrated that he has been willing to put forth the self-discipline and emotional effort to change old patterns.

The People conducted an investigation of Avila’s background, resulting in the conclusion that Avila has successfully changed his behavior. Based on this investigation of Avila’s post-incarceration conduct, his testimony and the testimony of others in this proceeding, the People stipulated that Avila should be readmitted to the practice of law in Colorado.

II. CONCLUSIONS OF LAW

C.R.C.P. 251.29 provides in relevant part:

(a) Readmission After Disbarment.

To be eligible for readmission the attorney must demonstrate the attorney’s fitness to practice law and professional competence, and must successfully complete the written examination for admission to the Bar. The attorney must file a petition for readmission
. . . [which] shall be heard in procedures identical to those outlined by these rules governing hearings of complaints, except it is the attorney who must demonstrate by clear and convincing evidence the attorney’s rehabilitation and full compliance with all applicable disciplinary orders and with all provisions of this Chapter.

People v. Klein, 756 P.2d 1013, 1016 (Colo. 1988) interprets the language of the prior rule governing readmission to the bar, C.R.C.P. 241.22, and sets forth criteria which must be considered in reinstatement proceedings in order to evaluate an attorney’s rehabilitation. Klein requires:

[A]ny determination of that issue [rehabilitation] must include consideration of numerous factors bearing on the respondent’s state of mind and ability, such as character, conduct since the imposition of the original discipline, professional competence, candor and sincerity, recommendations of other witnesses, present business pursuits of the respondent, the personal and community service aspects of the respondent’s life, and the respondent’s recognition of the seriousness of his previous misconduct.

Rehabilitation for purposes of attorney reinstatement and readmission to the bar has been defined as "the reestablishment of the reputation of a person by his or her restoration to a useful and constructive place in society." Goff v. People, 35 P.3d 487, 494 - 495 (Colo. PDJ August 4, 2000), citing Avrom Robin, Character and Fitness Requirements for Bar Admission in New York, 13 Touro L. Rev. 569, 583 (1997)(quoting In re Carson, 294 S. E. 2d 520, 522-23 (Ga. 1982)). Other factors which are considered are the applicant’s age at the time of the offense and the likelihood that the applicant will repeat the behavior in the future. Id. Courts, including those in Colorado, focus upon the applicant’s current mental state. Id., See Klein, 756 P.2d at 1016.

Imposition of discipline against an attorney includes a determination that some professional or personal shortcoming existed upon which the discipline is premised. Goff, 35 P.3d at 495, 496. The shortcoming may have resulted either from personal deficits or from a combination of personal deficits and professional and/or environmental inadequacies. Id. It necessarily follows that the analysis of rehabilitation should be directed at the professional or moral shortcoming which resulted in the discipline imposed. Id., citing C.R.C.P. 251.29(c)(5); Tardiff v. State Bar, 612 P.2d 919, 923 (Cal. 1980)(citing Roth v. State Bar, 253 P.2d 969, 972 (Cal. 1953)(holding that in an application for reinstatement . . . the proof presented must be sufficient to overcome the court’s former adverse judgment of [the] applicant’s character).

Avila established that he has complied with all applicable disciplinary orders and with all provisions of the relevant rules regarding actions required of disbarred attorneys. He established his efforts to maintain professional competence by passing the Colorado Bar Exam, by successfully working as a paralegal for the last five years, by taking and passing the Multistate Professional Responsibility Exam, and by continuing to update his understanding of the law through Continuing Legal Education.

It is rare that an attorney who engages in criminal conduct and is subsequently disbarred seeks readmission to the bar. It should be rarer still that readmission should be granted. See In the Matter of the Petition For Reinstatement of David J. Trygstad, 435 N.W.2d 723; 724 (S.D. 1989)(stating that "[a] court should be slow to disbar, but it should be even slower to reinstate; it should endeavor to make certain that it does not again put into the hands of an unworthy petitioner that almost unlimited opportunity to inflict wrongs upon society possessed by a practicing lawyer."). "If a Court disciplines an attorney, it does so not to mete out punishment to an offender, but [so] that the administration of justice may be safeguarded and the courts and the public protected from the misconduct or unfitness of those who are licensed to perform the important functions of the legal profession." Statewide Grievance Committee v. Alan Spirer, 725 A.2d 948 (Conn. 1999). "Although [it has been] suggested that certain offenses are so serious that an ‘attorney committing them can never again satisfy the court that he has become trustworthy,’ Matter of Keenan, 314 Mass. 544, 548-549 [1943] [it is] recognized that no offense "is so grave that a disbarred attorney is automatically precluded from attempting to demonstrate through ample and adequate proofs, drawn from conduct and social interactions, that he has achieved a ‘present fitness,’ In re Kone, 90 Conn. 440, 442 [1916] to serve as an attorney and has led a sufficiently exemplary life to inspire public confident once again, in spite of his previous actions." In the Matter of Allen, 509 N.E. 2d 1158, 1160-1161 (Ma. 1987), citing Matter of Hiss, 368 Mass. 447, 452, 333 N.E. 2d 429, 433 (1975). A fundamental precept of our system . . . is that men can be rehabilitated." Hiss, 333 N.E. 2d at 434. Rehabilitation . . . is a ‘state of mind’ and the law looks with favor upon rewarding with the opportunity to serve, one who has achieved ‘reformation and regeneration.’" Id., citing March v. Committee of Bar Examrs, 67 Cal. 2d 718, 732 (1967). Time and experience may mend flaws of character which allowed the immature man to err. Id. The chastening effect of a severe sanction such as disbarment may redirect the energies and reform the values of even the mature miscreant. Id. There is always the potentiality for reform, and fundamental fairness demands that the disbarred attorney have opportunity to adduce proofs. Id. See e.g., Hubbard v. Kentucky Bar Association, 66 S.W. 3d 684 (Ky. 2001)(attorney readmitted after having been convicted of three felonies, including conspiracy to impede and impair the Federal Election Commission, one count of theft of government property, and one count of obstruction of justice, the attorney having proven that his conduct since disbarment had been of a positive proactive nature and he was worthy of the trust and confidence of the public); Allen, 509 N.E. 2d 1160-1161 (attorney reinstated after having been indefinitely suspended following his conviction for conspiracy to commit arson and conspiracy to cause a building to be burned with intent to defraud the insurer).

A prior disbarment based upon felonious conduct requires a close examination of the actual misconduct. See Goff, 35 P.3d at 495, 496; In the Matter of Wegner, 417 N.W. 2d 97, 100 (Minn. 1987)(holding that the present fitness to practice law of an attorney seeking [readmission] must be considered in light of the offenses for which he or she was disbarred, citing Matter of Peterson, 274 N.W. 2d 922, 926 (Minn. 1979)). In this case, Avila was disbarred because of the commission of two separate criminal acts. First, Avila knowingly caused the falsification of public records in an ill-conceived effort to avoid the imposition of harsh penalties against Avila’s clients. In the second instance of criminal misconduct, Avila knowingly financed the importation of cocaine with the intent that it be subsequently distributed.

Avila’s participation in the falsification of public records arose out of his then belief that an attorney’s function was to prevail on behalf of his client at any cost. At the time of those events, Avila was thirty-six years old, was practicing by himself, had no mentoring relationship with other attorneys and was driven by a compulsion to secure favorable rulings for his clients. His willingness to violate the law was the direct result of his lack of experience, lack of guidance in the practice of law, misunderstanding of a lawyer’s role in the adversarial process and a willingness to break the rules to obtain the desired result.

Avila’s involvement in the drug importation and distribution scheme reveals different character deficits. After Avila’s immediate suspension from the practice of law, he encountered significant financial difficulties. He was not able to meet his expenses, satisfy the basic needs of his children, pay overdue taxes or maintain the lifestyle which he thought was required of him in his community. In a misdirected effort to raise sufficient monies to meet those needs, Avila knowingly elected to violate the law.

Both of these criminal episodes reveal character deficits present at the time the events transpired which — Avila now acknowledges — rightfully should have prevented him from holding a license to practice law. Both episodes arose out of Avila’s willingness to look for easy answers and bend or break fundamental rules of conduct to achieve ends that he personally perceived as desirable. The question before this Hearing Board is whether those character deficits have now been removed so as to insure that similar misconduct does not recur.

Much testimony was offered from Avila and others that he has spent many hours and days reflecting upon his misconduct, both during his incarceration and after. Through such self-examination, Avila is convinced the misconduct will not recur. However, self-examination in the absence of illustrative and independent evidence of fundamental character change is insufficient to establish by clear and convincing evidence that change is real. Goff, 35 P.3d at 496 n. 14. In this case, there is, however, other independent and illustrative evidence of fundamental character changes.

Almost immediately after Avila’s convictions, he acknowledged the wrongfulness of his misconduct and began the lengthy process of restructuring his life. While incarcerated, Avila continuously maintained a job, assisted other inmates in obtaining an equivalent high school education and maintained a close guiding relationship with both his older son and his minor son. Avila’s conduct while incarcerated was sufficiently exemplary that he was allowed to work outside the facility during the last year of his sentence. Upon his discharge to a halfway house, Avila obtained employment and expanded his relationship with his sons. In 1996, Avila was released on parole and immediately secured a job as a paralegal for three lawyers who had maintained contact with him during the years he was incarcerated. As a paralegal, Avila re-immersed himself in the legal profession. He has, under the supervision of other lawyers, met and communicated with clients, conducted legal research, drafted pleadings, evaluated facts and circumstances for his supervisors, and attended numerous continuing legal education programs. Each of the three lawyers for whom Avila has worked as a paralegal have strongly endorsed his effort to be readmitted and have attested to his renewed character and ethical understanding. One of those lawyers has offered Avila a position as an associate attorney should he be readmitted.

More important than the opinion of those for whom he has worked, however, is Avila’s own conduct. In an effort to understand the underlying reasons for his criminal behavior, Avila has sought professional evaluation and counseling. He has taken the results of that counseling and applied it to his normal routine. Avila is actively involved in community affairs, continues to assist young adults in obtaining high school equivalency education, participates in youth activities and continues to maintain a close, guiding relationship with his sons.

Possibly the most definitive independent evidence of the change in his character is Avila’s presentation to youth groups of his life’s misdirection. Now, as a fifty-two year old man, Avila openly describes his descent into criminal conduct, the consequences he endured as a result of that conduct, and the difficulty he has encountered in trying to rebuild his life. Avila’s willingness to represent his choices as examples of conduct to avoid to formative youth and to encourage them to make different choices is strong evidence of Avila’s genuine understanding of his prior misconduct and real character change.

These facts convince the Hearing Board by clear and convincing evidence that Avila no longer looks for easy answers and recognizes that he is bound by rules of conduct which may not be bent or broken to accomplish a desired outcome. Because he has demonstrated that change in character, the Hearing Board finds that he is rehabilitated.

Avila’s passage of the Colorado Bar Examination, the Multi State Professional Responsibility Examination and his special tutoring with Brooke Wunnicke establishes his competence to practice law. By stipulation, the Office of Attorney Regulation Counsel has agreed that Avila has substantially complied with all disciplinary orders.

Although not controlling in this readmission proceeding, it is important to note and significant to the Hearing Board that at the conclusion of all testimony in this proceeding that Mr. Sudler, the Assistant Regulation Counsel, stipulated that Avila should be readmitted to the practice of law.

The evidence having established by a clear and convincing standard that Avila has been rehabilitated, the Hearing Board herein Orders that Avila shall be readmitted to the practice of law. Avila shall appear before the Presiding Disciplinary Judge within fifteen days of the date of this Order to take the oath of admission and receive an attorney registration number.

III. ORDER

It is therefore ORDERED:

1. That the Verified Petition for Reinstatement of Nick Avila, Jr. is GRANTED and Avila is readmitted to the practice of law;

2. Avila is ORDERED to appear before the Presiding Disciplinary Judge within fifteen days of the date of this Order to take the oath of admission and to obtain a new attorney registration number;

3. That prior to taking the oath of admission, Avila shall tender $195.00 to the Office of Attorney Registration, fill out an attorney registration form and a COLTAF form;

4. Avila is ORDERED to pay the costs of these proceedings;

5. The People shall submit a Statement of Costs within fifteen (15) days of the date of this Order. Petitioner shall have ten (10) days thereafter to submit a response thereto.

 

 

Case Number: 01PDJ017
(consolidated with 01PDJ054 and 01PDJ060)

Petitioner:

THE PEOPLE OF THE STATE OF COLORADO

Respondent:

THOMAS D. LENAHAN

ORIGINAL PROCEEDING IN DISCIPLINE BEFORE

THE OFFICE OF THE PRESIDING DISCIPLINARY JUDGE

August 9, 2002

REPORT, DECISION AND IMPOSITION OF SANCTION

Opinion by Presiding Disciplinary Judge Roger L. Keithley and Hearing Board members, Henry C. Frey and William J. Martinez, both members of the bar.

SANCTION IMPOSED: ATTORNEY DISBARRED

A sanctions hearing pursuant to C.R.C.P. 251.15 was held on March 5, 2002, before the Hearing Board consisting of the Presiding Disciplinary Judge Roger L. Keithley ("PDJ") and two hearing board members, Henry C. Frey and William J. Martinez , both members of the bar. Terry Bernuth, Assistant Attorney Regulation Counsel, represented the People of the State of Colorado (the "People"). Thomas D. Lenahan ("Lenahan"), the respondent, appeared pro se.

This matter arises from three separate proceedings, Case No. 01PDJ017,1 Case No. 01PDJ054, and Case No. 01PDJ060, which were consolidated upon the People’s motion on June 29, 2001.

In Case No. 01PDJ054, the People filed a Complaint, amended it on May 15, 2001, and filed a Proof of Service of the Amended Complaint on June 19, 2001. Service was proper pursuant to C.R.C.P. 251.32(b). Lenahan failed to file an Answer or otherwise respond. Upon the People’s motion, the PDJ granted default as to the facts set forth in the Amended Complaint, and granted in part and denied in part default as to the violations set forth therein.2

The People filed a Complaint in Case No. 01PDJ060 on May 29, 2001. Service was proper pursuant to C.R.C.P. 251.32(b). Lenahan failed to file an Answer or otherwise respond to the Complaint. Upon the People’s motion, the PDJ granted default as to the facts set forth in the Complaint, which were deemed admitted, and granted in part and denied in part default on the violations set forth therein. The People amended the Complaint, filed proof of proper service of the Amended Complaint pursuant to C.R.C.P. 251.32(b), and moved for default, which the PDJ granted on December 19, 2001, thereby establishing the rule violations alleged.

At the sanctions hearing, exhibits 1 through 14 were offered by the People and admitted into evidence. The People presented testimony from Dawn Petras, Brian Goodhead, Diane Kandt, James Topliss, Randy Perry, Richard Pfeifer, Michael Blanchette, and Thomas D. Lenahan, who also testified on his own behalf. The Hearing Board considered the testimony of the witnesses, the facts established by the entry of default, the exhibits admitted, and made the following findings of fact which were established by clear and convincing evidence.

I. FINDINGS OF FACT

Thomas D. Lenahan has taken and subscribed to the oath of admission, was admitted to the bar of the Supreme Court on May 10, 1995, and is registered upon the official records of this court, attorney registration number 25498. Lenahan is subject to the jurisdiction of this court pursuant to C.R.C.P. 251.1(b).

All factual allegations in the Complaints and Amended Complaints set forth below were deemed admitted by the entry of default, and are therefore established by clear and convincing evidence.

Case No. 01PDJ054
Claim One: the Perry Matter

On August 12, 1998, Jay and Randi Perry (the "Perrys") retained Lenahan to file an offer in compromise with the IRS to resolve a tax problem. The Perrys paid Lenahan $1,500 for his representation. When the Perrys continued to receive demand letters from the IRS after they retained Lenahan, he told them to disregard them and said he had spoken to someone at the IRS to resolve their tax problem. On February 24, 1999, the Perrys paid an additional $1,500 to Lenahan. A year after they had first contacted Lenahan, the Perrys were informed by the IRS that their assets could be seized due to their failure to resolve the pending taxes owed to the IRS. When the Perrys informed Lenahan what the IRS had said, he reprimanded them for talking directly to the IRS. In February 2000, the IRS told the Perrys that they intended to start collection proceedings against them unless an offer in compromise was received within forty-five days, and informed the Perrys that Lenahan had not contacted the IRS. After the Perrys demanded an explanation from Lenahan, he contacted the IRS, but did not file an offer in compromise. Thereafter, the Perrys heard nothing from Lenahan and, in April 2000, the IRS garnished the Perrys’ bank account and seized $1,300. Since April 2000, the Perrys have had no communication from Lenahan despite their efforts to contact him. On October 25, 2000, the Perrys wrote to Lenahan demanding that he return their $3,000. They have not received a refund.

Claim II: the Petras Matter

Wayne Petras and his wife (the "Petrases") hired Lenahan in the summer of 1996 to resolve their state and federal tax problems and paid him $1,400, the amount he requested. Since 1996 the Petrases have left numerous messages for Lenahan, and he would occasionally over the years return their calls and state that he was working on their case. Lenahan did not negotiate an offer in compromise for the Petrases with the IRS or with the State of Colorado; in fact, he performed no legal work for them. In April 2000, the State of Colorado garnished the Petrases’ bank account for non-payment of the taxes. Thereafter, the Petrases hired other counsel.

The last communication the Petrases had with Lenahan was in April 2000 following the garnishment of their bank account. They demanded a refund of the $1,400 they had paid him in 1996, and Lenahan stated he would refund the money. Thereafter, they never heard from him again and did not receive a refund. When the Petrases attempted to contact him, his telephone numbers had been disconnected. The Petrases terminated Lenahan’s representation by letter dated October 26, 2000.

Claim III: The Goodhead Matter

Brian Goodhead ("Goodhead"), who was suffering from chronic life-threatening conditions, wanted to resolve a tax problem before his demise. In June 1997, Goodhead met with Lenahan regarding the personal and business withholding taxes and penalties he owed the IRS. Goodhead and Lenahan entered into a contract for legal services. Lenahan stated to Goodhead that he would resolve the tax problem by negotiating an offer in compromise with the IRS in exchange for a fee of $2,400. Goodhead borrowed $2,400 from his life insurance policy and paid the full amount to Lenahan on June 24, 1997. Goodhead provided Lenahan with his original tax returns from 1985 through 1988.

Thereafter, Goodhead called Lenahan every few months to inquire about the status of his offer in compromise. Lenahan initially told Goodhead that the negotiation was progressing with the IRS, and later said that the offer in compromise was in "limbo" at the IRS due to a lawsuit. Goodhead repeatedly asked for copies of documents that Lenahan had provided to the IRS but never received them.

In late 1998, Lenahan told Goodhead that he had offered the IRS $4,000 to settle the tax matter but that the offer was still in limbo. Goodhead again asked for copies of documents but never received them. On March 10, 1999, Lenahan wrote to Goodhead stating that due to a recent tax reform, the IRS was increasing the percentage of offers in compromise it accepted. On March 28, 1999, Goodhead met with Lenahan’s business partner who informed him that Lenahan had left his law practice and taken numerous client files with him. Goodhead made many attempts to find Lenahan without success; his telephone numbers had been disconnected and Lenahan had no current address.

On June 9, 2000, three years after Goodhead had paid the advance fee and after he had contacted the Office of Attorney Regulation Counsel, Lenahan called Goodhead and stated that he had filed an offer in compromise with the IRS but that another offer needed to be filed because of the change in tax law. Lenahan told Goodhead that if he filled out an offer in compromise he would earn the fee Goodhead had paid him. A few days later, Goodhead received an envelope in the mail from Lenahan which contained a blank offer in compromise form with no correspondence and no explanation.

On October 31, 2000, Goodhead demanded in writing that Lenahan provide him with an accounting and refund the money he was paid. Lenahan has never responded to Goodhead, has not provided an accounting, and has not provided a refund. Goodhead never received his original documents and file.

Claim IV: The Kandt Matter

On August 6, 1998, Diane Kandt and her husband (the "Kandts") retained Lenahan to resolve a serious tax problem. They signed a fee agreement and paid an initial $1,500 requested by Lenahan with the agreement to pay an additional $1,500 when Lenahan submitted the offer in compromise to the IRS. Thereafter, the Kandts attempted to contact Lenahan many times. On one occasion, Lenahan told the Kandts that he was talking to the IRS about their offer in compromise and that he had forwarded all the necessary documents to the IRS. The Kandts never received any copies of documents that indicated Lenahan had filed an offer in compromise with the IRS or had performed any other work. In September 1999, Lenahan told the Kandts that the IRS was temporarily not considering offers in compromise. Beginning in January 2000, the Kandts called Lenahan nearly every day for a period of several months, but Lenahan did not return their calls. The Kandts gave up trying to reach Lenahan and retained other counsel. They were informed by the IRS that Lenahan did not submit any documents on their behalf. Lenahan has not refunded the funds paid to him by the Kandts nor has he provided their file to them.

Claim V: the Topliss Matter

James Topliss ("Topliss") hired Lenahan to resolve a tax dispute for him, and entered into a fee agreement on May 22, 1998. Lenahan requested and Topliss paid $1,500 for Lenahan’s services the same day. Subsequent to their initial meeting, Topliss never received any telephone calls or correspondence from Lenahan. Both Topliss and his attorney wrote letters to Lenahan on three separate occasions requesting information regarding the status of the matter and demanding Lenahan refund his money. Lenahan did not respond, and has not refunded the client’s funds.

Claim VI: The Bullen Matter

Mr. Bullen ("Bullen") sought tax advice from Lenahan and his business associate. He signed a fee agreement and paid Lenahan $1,500 to resolve his tax problem. After meeting with Lenahan in June, 1998, Bullen has had no contact with Lenahan for over two years. Lenahan has not responded to Bullen’s phone messages. Bullen entrusted Lenahan with original documents which have not been returned to him. On November 1, 2000, Bullen wrote to Lenahan and demanded an accounting, a refund of his $1,500 payment, and his documents. Lenahan has not returned the funds, has not provided an accounting and has not returned any of Bullen’s original documents.

Claim VII (sic VIII): the Blanchette Matter

Michael Blanchette ("Blanchette") hired Lenahan to resolve an income tax problem and executed a fee agreement with Lenahan. Lenahan requested and Blanchette paid $3,000 on September 28, 1998. After several months, when Blanchette called Lenahan to inquire about the status of his case, Lenahan told him that his case was on hold because the IRS was undergoing internal changes. In the spring of 1999, Lenahan told Blanchette that his offer in compromise had been submitted to the IRS and that Lenahan was waiting for a revenue officer to be assigned. At the time Lenahan uttered this statement it was false: he had not submitted the offer in compromise to the IRS.

In August 1999, Lenahan told Blanchette that he had a verbal acceptance of an offer in compromise from the IRS and that Blanchette would be contacted by the IRS in writing to confirm the offer. Lenahan’s statement was false; at the time he uttered it he had not prepared or filed the offer in compromise nor did he have a verbal acceptance of the offer in compromise. When several months passed and Blanchette did not hear from the IRS, he questioned Lenahan, who told him that he had not heard from the IRS because the agent assigned to his case was on medical leave but that written confirmation and acceptance of his offer in compromise would be forthcoming. This was a false statement; at the time Lenahan uttered it he had not filed an offer in compromise with the IRS.

In December 1999, Blanchette contacted the IRS directly and was told that they had no file or pending offer in compromise. Blanchette confronted Lenahan with the information and Lenahan stated that he had submitted the documents but that the IRS had lost the file. Blanchette asked for proof and Lenahan was unable to provide it. Blanchette threatened to sue Lenahan for his failure to perform the requested legal work. In December 1999, Lenahan requested Blanchette sign a form offer in compromise, and stated that he would submit the offer immediately. Lenahan submitted the offer in compromise to the IRS in December 1999. Blanchette spoke with Lenahan in February 2000 and thereafter Lenahan refused to take Blanchette’s calls or communicate with him in any other manner.

Case No. 01PDJ060
The Pfeifer Matter

On July 20, 1998 Rick Pfeifer ("Pfeifer") retained Lenahan to resolve a tax problem arising from Pfeifer’s failing to pay or being delinquent in paying income tax over a twenty year period. Lenahan advised Pfeifer that he could resolve the problem by preparing and negotiating offers in compromise with the Internal Revenue Service ("IRS") and with the state. Pfeifer signed a fee agreement which required a fee of $3,000 to perform the legal work, and paid $1,500 to Lenahan at the same time. The additional $1,500 was due when the offer in compromise was submitted to the tax authorities. Lenahan’s hourly rate on the fee agreement was $145 per hour. Pfeifer gave Lenahan all of his tax records.

Thereafter, Pfeifer spoke to Lenahan twice. Both times, Lenahan told him that the IRS was in a lawsuit and was not processing offers in compromise. In early March 1999, Pfeifer received a letter from Lenahan which stated that all offers in compromise were in limbo with the IRS, that the IRS was only beginning to process them, and that Lenahan still had not prepared the offer in compromise for Pfeifer. After Pfeifer discussed the matter again with Lenahan at his office in March 1999, Pfeifer never heard from Lenahan again. Lenahan did not prepare the documents he had agreed to prepare in July 1998. Neither the IRS nor the state ever received any documentation from Lenahan, and the state pursued Pfeifer. When the state attempted to contact Lenahan, he was no longer at his business number.

Pfeifer attempted to contact Lenahan but has not been able to reach him. Lenahan continues to retain possession of Pfeifer’s tax records and funds. Lenahan met with Pfeifer for a one hour initial consultation, prepared and sent him a letter to him and had two very short conversations with him. The total amount of work did not exceed three hours. Lenahan earned only $435 of the $1,500 paid to him. Pfeifer wrote to Lenahan and demanded a refund.

II. CONCLUSIONS OF LAW

The facts deemed admitted and the violations deemed established by the entry of default sustain a finding that in seven separate cases (Perry, Petras, Goodhead, Kandt, Topliss, Bullen and Pfeifer) Lenahan accepted clients’ funds, failed to perform the services for which he was hired, and failed to refund the funds to the clients when they requested he do so. Lenahan’s accepting the clients’ funds, failing to perform the services he was hired to perform, failing to refund the unearned portion of the funds to his clients, while knowing that he had not performed the services for which the funds were paid is sufficient evidence to conclude that Lenahan knowingly converted his clients’ funds in violation of Colo. RPC 8.4(c)(engaging in conduct involving dishonesty, fraud, deceit, or misrepresentation). See People v. Varallo, 913 P.2d 1, 11 (Colo. 1996)(holding that knowing misappropriation . . . consists simply of a lawyer taking a client’s money entrusted to him, knowing that it is the client’s money and knowing that the client has not authorized the taking, citing In re Noonan, 102 N.J. 157, 160, 506 A.2d 722 (1986)). See also People v. Silvola, 915 P.2d 1281, 1284 (Colo. 1996)(finding that misconduct that occurred over an extended period of time must be deemed to be willful).

In the Petras matter, Lenahan represented to the client that he would return the funds paid to him, which was a false statement when uttered in violation of Colo. RPC 8.4(c)(engaging in conduct involving dishonesty, deceit, fraud or misrepresentation). In the Blanchette matter, Lenahan informed the client that he had submitted an offer in compromise to the IRS when he had not, that the IRS had made a verbal acceptance of the offer when it did not, and that the delay in resolving the matter was due to the IRS having lost the client’s file when in fact the IRS never acquired the file from Lenahan. Each of the statements were false when uttered and Lenahan knew them to be false, constituting three separate violations of Colo. RPC 8.4(c).

In each of the eight cases giving rise to this proceeding, Lenahan failed to communicate adequately with the clients despite the clients’ repeated attempts to learn the status of their cases in violation of Colo. RPC 1.4(a)(an attorney shall keep a client reasonably informed about the status of a matter and promptly comply with reasonable requests for information). In each of the eight cases, Lenahan severely neglected the clients’ matters over an extended period of time in violation of Colo. RPC 1.3(an attorney shall act with reasonable diligence and promptness in representing a client). In seven of the eight cases (Perry, Petras, Goodhead, Kandt, Topliss, Bullen and Pfeifer) the extent of Lenahan’s neglect rose to the level of abandonment. To find abandonment rather than merely neglect, there must be proof that the attorney — during a given time period — was required to accomplish specific professional tasks for the client, failed to accomplish those tasks, and failed to communicate with the client. People v. Carvell, No. 99PDJ096, slip op. at p. 9 (Colo. PDJ September 11, 2000), 2000 Colo. Discipl. LEXIS 26. The proof must objectively indicate that the attorney has deserted, rejected and/or relinquished the professional responsibilities owed to the client. Id. The totality of facts establish that Lenahan deserted, rejected and/or relinquished the professional responsibilities owed to theses seven clients and thereby abandoned them.

In six separate matters (Perry, Petras, Goodhead, Kandt, Bullen and Pfeifer) Lenahan failed to take steps reasonably necessary to protect the clients’ interests by returning the files to the clients following their termination of his representation in violation of Colo. RPC 1.16(d)(an attorney shall, upon termination of representation, take steps to the extent reasonably practicable to protect a client’s interests, including . . . refunding any advance payment of any fee not earned). In several cases, the documents Lenahan failed to return included original tax documents.

III. IMPOSITION OF SANCTION

The seven incidents of knowing conversion are sufficient to warrant disbarment. See Varallo, 913 P.2d at 11. The sanction of disbarment is also warranted for knowing conversion coupled with the seven incidents of abandonment of clients. See People v. Wallace, 936 P.2d 1282, 1284 (Colo.1997) (disbarring lawyer who abandoned clients, causing them serious harm, and knowingly misappropriated client funds); People v. Townshend, 933 P.2d 1327, 1329 (Colo.1997)(lawyer disbarred who effectively abandoned two clients after accepting retainers and failing to account for or return the unearned retainers). See also ABA Standards for Imposing Lawyer Sanctions (1991 & Supp. 1992) ("ABA Standards") 4.11 ("[d]isbarment is generally appropriate when a lawyer knowingly converts client property and causes injury or potential injury to a client"); ABA Standard 4.41(b)(disbarment is warranted when a lawyer knowingly fails to perform services for a client and causes serious or potentially serious injury to a client). The additional six incidents of Lenahan’s violation of Colo. RPC 1.16(d) adds additional grounds for disbarment where, in the present case, Lenahan took possession of the original tax documents belonging to the clients and refused to return them after abandoning their legal matters. The withholding of the clients’ original tax documentation evidences Lenahan’s lack of professionalism. Lenahan exhibited no concern for the perilous position in which he placed his clients by failing to return critical documentation to them. Pursuant to ABA Standards 9.22 and 9.32 respectively, the Hearing Board considered aggravating and mitigating factors in arriving at the appropriate sanction. In mitigation, Lenahan has had no prior discipline. See id. at 9.32(a). Lenahan also presented testimony of developing chronic clinical depression and significant alcohol dependency, both of which may be considered as mitigating factors pursuant to ABA Standards 9.32(i) (Supp.1992). However, the consideration of these conditions as mitigating factors has been confined to those situations where it is shown by medical evidence that the lawyer is affected by the disability, that the disability caused the misconduct, that the lawyer’s recovery from the disorder is demonstrated by a meaningful period of successful rehabilitation, and that the recovery arrested the misconduct and its recurrence is unlikely. In re Egbune 971 P.2d 1065, 1073 (Colo. 1999). Lenahan did not meet these requirements. Accordingly, neither Lenahan’s claimed depression nor alcohol dependency cannot be considered by the Hearing Board as mitigating factors in arriving at the appropriate sanction. The facts deemed admitted in the Amended Complaints and Complaint in this consolidated matter establish several aggravating factors pursuant to ABA Standard 9.22. Lenahan had a dishonest or selfish motive, see id. at 9.22(b), he demonstrated a pattern of misconduct, see id. at 9.22(c); he engaged in multiple offenses, see id, at 9.22(d); he engaged in bad faith obstruction of the disciplinary proceeding, see id. at 9.22(e), and he demonstrated indifference to making restitution, see id. at 9.22(j). The Hearing Board noted that Lenahan’s clients were vulnerable, most notably Mr. Goodhead, see id. at 9.22(h). At the conclusion of the hearing, Lenahan expressed remorse for his conduct and stated his belief that an order requiring him pay restitution to his clients was warranted.

IV. ORDER

It is therefore ORDERED:

1. THOMAS D. LENAHAN attorney registration number 25498 is DISBARRED from the practice of law effective thirty-one days from the date of this Order.

2. Lenahan is ordered to pay restitution within one year of the date of this Order with interest at the statutory rate from the date of this Order to:

A. Michael Blanchette in the amount of $3,000;

B. Wayne Petras in the amount of $1,400;

C. Diane Kandt in the amount of $1,500;

D. Mr. Bullen in the amount of $1,500;

E. The Client Protection Fund with regard to Brian Goodhead in the amount of $2,400;

F. The Client Protection Fund with regard to James Topliss in the amount of $1,500;

G. The Client Protection Fund with regard to Jay and Randi Perry in the amount of $3,000; and

H. The Client Protection Fund with regard to Rick Pfeifer in the amount of $1,500.

3. Lenahan is Ordered to pay the costs of these proceedings; the People shall submit a Statement of Costs within ten (10) days of the date of this Order. Respondent shall have five (5) days thereafter to submit a response thereto.

_______

1. The People filed a Petition for Immediate Suspension in Case No. 01PDJ017 on February 27, 2001. On April 5, 2001, the Supreme Court immediately suspended Lenahan’s license to practice law.

2. The PDJ denied default on the alleged violation of Colo. RPC 8.4(c) in claim two, the Petras Matter, arising from respondent’s alleged utterance of a false statement, which was thereafter dismissed.

 

 

Case Number: 01PDJ052

Petitioner:

THE PEOPLE OF THE STATE OF COLORADO

Respondent:

JOHN A. SCRUGGS

ORIGINAL PROCEEDING IN DISCIPLINE BEFORE

THE OFFICE OF THE PRESIDING DISCIPLINARY JUDGE

July 30, 2002

REPORT, DECISION AND IMPOSITION OF SANCTION

Opinion by Presiding Disciplinary Judge Roger L. Keithley and Hearing Board members, Sherry A. Caloia and E. Steven Ezell, both members of the bar.

SANCTION IMPOSED: ATTORNEY DISBARRED

A sanctions hearing pursuant to C.R.C.P. 251.15 was held on June 27, 2002, before the Hearing Board consisting of the Presiding Disciplinary Judge ("PDJ") and two hearing board members, Sherry A. Caloia and E. Steven Ezell, both members of the bar. Nancy L. Cohen, Deputy Attorney Regulation Counsel, represented the People of the State of Colorado (the "People"). John A. Scruggs ("Scruggs"), the respondent, did not appear either in person or by counsel.

The People filed a Complaint in this matter on October 3, 2001. The Citation and Complaint were sent via regular and certified mail to the respondent on the same date. The People filed a proof of service on October 30, 2001 and an amended proof of service on November 23, 2001. The Amended Proof of Service shows that the Citation and Complaint were received at Scruggs’s registered business address. Respondent failed to file an Answer or otherwise respond to the Complaint.

On January 8, 2002, the People moved for default on the claims set forth in the Complaint, and on March 5, 2002, the PDJ granted the motion as to the facts set forth in the Complaint, which were deemed admitted, and as to the claims set forth in the Complaint with the exception of the alleged violations of Colo. RPC 1.16(d) in claims four and eight. On April 12, 2002, the PDJ issued an order dismissing those claims.

At the sanctions hearing, exhibits 1 through 3 were offered by the People and admitted into evidence. The Hearing Board considered the People’s argument, the facts established by the entry of default, the exhibits admitted, and made the following findings of fact which were established by clear and convincing evidence.

I. FINDINGS OF FACT

John A. Scruggs has taken and subscribed to the oath of admission, was admitted to the bar of the Supreme Court on October 25, 1989 and is registered upon the official records of this court, attorney registration number 18977. Scruggs is subject to the jurisdiction of this court pursuant to C.R.C.P. 251.1(b).

All factual allegations set forth in the Complaint were deemed admitted by the entry of default, and are therefore established by clear and convincing evidence. See Complaint attached hereto as exhibit 1. The entry of default also deemed established the alleged violations of The Rules of Professional Conduct set forth therein, with the exception of the two allegations of Colo. RPC 1.16(d) which were dismissed.

II. CONCLUSIONS OF LAW AND
IMPOSITION OF SANCTION

In two separate matters (Pierce and Schmitz) Scruggs accepted clients’ funds, failed to perform the services for which he was hired, and failed to refund Pierce’s funds in the amount of $350.00 and Schmitz’s funds in the amount of $500.00 despite their demands that he do so. By accepting the clients’ funds, failing to perform the services he was hired to perform, failing to refund the unearned portion of the $850.00 to his clients, knowing that he had not performed the services for which the funds were paid is sufficient evidence to conclude that Scruggs knowingly converted his clients’ funds in violation of Colo. RPC 8.4(c)(engaging in conduct involving dishonesty, fraud, deceit, or misrepresentation). See People v. Elliott, 99PDJ059, slip op. at 8 (consolidated with 99PDJ086)(Colo. PDJ March 1, 2000), 2000 Colo. Discipl. LEXIS 40 (disbarring attorney for his accepting advance fees from two clients, performing some but not all of the services for which he was paid, retaining the fees for one year in one matter and two years in another matter, and abandoning the clients, citing People v. Singer, 897 P.2d 798, 801 (Colo. 1995)(holding that extensive and prolonged neglect is considered willful misconduct)); People v. Silvola, 915 P.2d 1281, 1284 (Colo. 1996)(finding that misconduct that occurred over an extended period of time must be deemed to be willful); People v. Varallo, 913 P.2d 1, 11 (Colo. 1996)(holding that knowing misappropriation [for which the lawyer is almost invariably disbarred] consists simply of a lawyer taking a client’s money entrusted to him, knowing that it is the client’s money and knowing that the client has not authorized the taking, citing In re Noonan, 102 N.J. 157, 160, 506 A.2d 722 (1986).

These two incidents of knowing conversion, standing alone, are sufficient to warrant disbarment. See Varallo, 913 P.2d at 11. Additionally, in the Pierce and Schmitz matters, Scruggs failed to communicate with the clients in violation of Colo. RPC 1.4(a)(an attorney shall keep a client reasonably informed about the status of a matter and promptly comply with reasonable requests for information). In the Pierce matter, Scruggs failed to take steps to resolve the client’s dispute with her health insurer, and in the Schmitz matter, Scruggs failed to commence a non-contested divorce proceeding. Such conduct constitutes neglect in violation of Colo. RPC 1.3(an attorney shall act with reasonable diligence and promptness in representing a client). In both matters, the Complaint alleges that the extent of Scruggs’ neglect rose to the level of abandonment.

To find abandonment rather than merely neglect, there must be proof that the attorney — during a given time period — was required to accomplish specific professional tasks for the client, failed to accomplish those tasks, and failed to communicate with the client. People v. Carvell, No. 99PDJ096, slip op. at p. 9 (Colo. PDJ September 11, 2000), 2000 Colo. Discipl. LEXIS 26. The proof must objectively indicate that the attorney has deserted, rejected and/or relinquished the professional responsibilities owed to the client. Id. The totality of facts establish that Scruggs deserted, rejected and/or relinquished the professional responsibilities owed to his clients and thereby abandoned them. The presumed sanction for knowing conversion coupled with abandonment of an attorney’s clients also results in disbarment. See People v. Ain, 35 P.3d 734, 739 (Colo. PDJ 2001)(attorney disbarred for abandonment of a client matter, knowingly converting funds, for making misrepresentations and for violation of court order); People v. Wallace, 936 P.2d 1282, 1284 (Colo.1997) (disbarring lawyer who abandoned clients, causing them serious harm, and knowingly misappropriated client funds); People v. Townshend, 933 P.2d 1327, 1329 (Colo.1997) (lawyer disbarred who effectively abandoned two clients after accepting retainers and failing to account for or return the unearned retainers); People v. Gilbert, 921 P.2d 48, 50 (Colo.1996) (attorney disbarred for converting client funds in conjunction with abandonment of practice); People v. Steinman, 930 P.2d 596, 599-600 (Colo.1997) (lawyer disbarred who accepted fees from clients and then abandoned them while keeping their money and causing serious harm).

With regard to the Schmitz matter, Scruggs failed, upon termination, to take steps reasonably necessary to protect the clients’ interests in violation of Colo. RPC 1.16(d)(an attorney shall, upon termination of representation, take steps to the extent reasonably practicable to protect a client’s interests, including . . . refunding any advance payment of any fee not earned).

In three separate matters (Guhl, Thilman, and Fontinelli) Scruggs was ordered by the court to reduce an order to writing and submit it for the court’s signature. Scruggs failed to do so in a timely fashion in each of the three cases in violation of Colo. RPC 3.4(c)(an attorney shall not knowingly disobey an obligation under the rules of a tribunal). Scruggs also neglected these three clients’ legal matters in violation of Colo. RPC 1.3(neglect). In the Fontinelli matter, Scruggs failed to communicate with the client in violation of Colo. RPC 1.4(a)(failure to communicate with client), and caused prejudice to the administration of justice as a result of the delay in filing the written permanent orders for over a five-month period in violation of Colo. RPC 8.4(d)(engaging in conduct prejudicial to the administration of justice).

In one matter (Bohlman), Scruggs neglected the client’s matter in violation of Colo. RPC 1.3(neglect) by failing to timely forward discovery to the client and thereafter provide it to opposing counsel, resulting in the entry of judgment for opposing counsel’s attorney’s fees against the client. Scruggs’ delay in providing discovery required the court to hold a hearing on attorneys’ fees causing prejudice to the administration of justice in violation of Colo. RPC 8.4(d). Similarly, in the Weaver matter, Scruggs failed to file disclosures and was ordered by the court to pay opposing counsel’s attorneys’ fees and failed to do so in violation of Colo. RPC 3.4(c)(an attorney shall not knowingly disobey an obligation under the rules of a tribunal).

In another matter (Runia), Scruggs agreed to prepare a qualified domestic relations order and failed to prepare it for approximately five months in violation of Colo. RPC 1.3(neglect). In the Bergman matter, the client requested an accounting and written documentation confirming the terms of the resolution of a child support matter and Scruggs failed to communicate with the client in violation of Colo. RPC 1.4(a). Also, Scruggs failed to provide the requested information to his client in violation of Colo. RPC 1.15(b)(an attorney shall, upon request, provide to a client a full accounting and promptly deliver to the client or third person any funds or other property that the client or third person is entitled to receive). In the Livingston matter, Scruggs violated Colo. RPC 8.4(h) (it is professional misconduct for an attorney to engage in any other conduct that reflects adversely on the attorney’s fitness to practice law) by failing to pay court reporter services.

In four matters, (Pierce, Schmitz, Weaver, Guhl), Scruggs failed to provide a written response to requests for information from the Office of Attorney Regulation Counsel constituting grounds for discipline pursuant to C.R.C.P. 251.5(d)(it shall constitute grounds for discipline where an attorney fails "to respond without good cause shown to a request by the . . . Regulation Counsel . . . or obstruction of the . . . Regulation Counsel . . . in the performance of their duties . . . .) and separate violations of Colo. RPC 3.4(c) (an attorney shall not knowingly disobey an obligation under the rules of a tribunal) and Colo. RPC 8.1(b)(knowingly failing to respond reasonably to a lawful demand for information from a disciplinary authority).

These numerous other rule violations, taken together with Scruggs’s failure to participate in this disciplinary proceeding lend additional support to the conclusion that disbarment is warranted. See People v. Jaramillo, 35 P.3d 723 (Colo. PDJ 2001)(attorney disbarred where he knowingly converted client funds in violation of Colo. RPC 8.4(c), he neglected three client matters in violation of Colo. RPC 1.3, he failed to communicate with clients in four different matters in violation of Colo. RPC 1.4(a), he engaged in conduct resulting in prejudice to the administration of justice in violation of Colo. RPC 8.4(d), he knowingly disobeyed the rules of a tribunal in one case in violation of Colo. RPC 3.4(c) and he failed to respond to requests for investigation in eight different matters in violation of C.R.C.P. 251.5(d); Ain, 35 P.3d at 739 (attorney disbarred for abandonment of a client matter, knowingly converting funds, for making misrepresentations and for violation of court order). See also ABA Standards for Imposing Lawyer Sanctions (1991 & Supp. 1992) ("ABA Standards") 4.11 ("[d]isbarment is generally appropriate when a lawyer knowingly converts client property and causes injury or potential injury to a client"); ABA Standard 4.41(b) (disbarment is warranted when a lawyer knowingly fails to perform services for a client and causes serious or potentially serious injury to a client); ABA Standard 4.41(c)(disbarment is warranted when a lawyer engages in a pattern of neglect with respect to client matters and causes serious or potentially serious injury to the client); ABA Standard 6.22 (suspension is appropriate when a lawyer knowingly violates a court order or rule, and there is injury or potential injury to a client or a party).

Pursuant to ABA Standards 9.22 and 9.32 respectively, the Hearing Board considered aggravating and mitigating factors in arriving at the appropriate sanction. Since Scruggs did not participate in these proceedings, no mitigating factors were established. The facts deemed admitted in the Complaint established several aggravating factors pursuant to ABA Standard 9.22. Scruggs had a dishonest or selfish motive, see id. at 9.22(b), he demonstrated a pattern of misconduct, see id. at 9.22(c); he engaged in multiple offenses, see id, at 9.22(d); he engaged in bad faith obstruction of the disciplinary proceeding, see id. at 9.22(e), the respondent had substantial experience in the practice of law having been licensed in Colorado since 1989, see id. at 9.22(i), and Scruggs demonstrated indifference to making restitution, see id. at 9.22(j).

Moreover, Scruggs has had prior discipline, an aggravating factor under ABA Standard 9.22(a). In 1998, Scruggs received a private censure for conduct similar to the conduct giving rise to this proceeding. Scruggs represented a client, commingled the client’s funds with his own in violation of Colo. RPC 1.15(a)(an attorney shall hold property of clients or third persons that is in the attorney’s possession separate from the attorney’s own property), was ordered to prepare a qualified domestic relations order and failed to do so, and failed over a period of six months to return his client’s phone calls in violation of Colo. RPC 1.3 and Colo. RPC 1.4(a).

The two incidents of knowing misappropriation and abandonment are sufficient to warrant disbarment. The numerous other incidents of neglect, failing to communicate, disregard of court orders and the legal needs of his clients, and Scruggs failure to participate in these proceedings confirms that disbarment is warranted.

III. ORDER

It is therefore ORDERED:

1. JOHN A. SCRUGGS, attorney registration number 18977 is DISBARRED from the practice of law effective thirty-one days from the date of this Order.

2. Scruggs is ordered to pay restitution within one year of the date of this Order to:

(A) Ms. Pierce in the amount of $350.00 with interest at the statutory rate from December 1, 2000, and

(B) Mr. Schmitz in the amount of $500.00 with interest at the statutory rate from June 29, 2000.

3. Scruggs is Ordered to pay the costs of these proceedings; the People shall submit a Statement of Costs within ten (10) days of the date of this Order. Respondent shall have five (5) days thereafter to submit a response thereto.

EXHIBIT 1

COMPLAINT

THIS COMPLAINT is filed pursuant to the authority of C.R.C.P. 251.9 through 251.14, and it is alleged as follows:

1. The respondent has taken and subscribed the oath of admission, was admitted to the bar of this court on October 25, 1989, and is registered upon the official records of this court, registration No. 18977. He is subject to the jurisdiction of this court in these disciplinary proceedings. The respondent’s registered business address is 136 South Sherman Street, Denver, Colorado 80209.

The Pierce Matter, 01-01230

2. On or about September 12, 2000, Bonnie Pierce retained respondent to assist her with two legal matters. The first was a dispute she had with an insurance company concerning the cost of worker’s compensation insurance for her company. The second matter concerned her health insurer’s refusal to pay for medical tests and equipment that had previously been authorized for her personal use.

3. Ms. Pierce had an initial meeting with respondent at his home. At that time she paid him a $200.00 flat fee to address the matters referenced above.

4. After more than four months elapsed and Ms. Pierce had placed several phone calls to respondent concerning the status of the matters, the worker’s compensation insurance issue was resolved and fully settled.

5. In December of 2000, respondent told Ms. Pierce that he would need additional funds to pursue her dispute with her health insurer. On December 22, 2000, Ms. Pierce delivered a check to respondent at his home in the amount of $350.00 to cover the additional fees requested. About one week later, Ms. Pierce delivered to the respondent some additional documents he had requested. At the time the additional information was provided to the respondent, respondent requested that Ms. Pierce call him in about a week to discuss the matter. That is the last time that Ms. Pierce spoke with respondent.

6. In early January, Ms. Pierce attempted to contact respondent by telephone. At that time, Ms. Pierce was receiving bills from the doctor’s office and the company who leased the medical equipment (heart monitor) that she was using. After two weeks elapsed, Ms. Pierce called the respondent again and left a message requesting that he contact her concerning the health insurance matter. Respondent did not reply.

7. Ms. Pierce continued to call respondent every week to two weeks concerning the status of her legal matter. She left messages begging respondent to call her, as medical bills were continuously coming to her and she did not know what to do. She also asked, in her messages, if respondent needed any additional information from her.

8. In an effort to contact respondent, Ms. Pierce spoke with the person who had referred respondent to her. That person told Ms. Pierce that she would contact a friend of the respondent concerning the matter. However, this did not succeed in causing respondent to contact Ms. Pierce.

9. After three months of not receiving any return telephone calls, Ms. Pierce’s husband called respondent and left voice mail messages three times, but received no reply. Ms. Pierce and her husband then went to respondent’s home, where they were confronted by a lady who told them that respondent was not available, but that she would give him a message to call. After another week elapsed without a telephone call from respondent, Ms. Pierce filed a complaint with the Office of Attorney Regulation Counsel.

10. Respondent failed to respond to the request for investigation filed by Ms. Pierce, although it was mailed to respondent’s registered business and home address.

11. Respondent has abandoned Ms. Pierce, thereby terminating the attorney/client relationship. Respondent continues to retain the $350.00 paid by Ms. Pierce to him to pursue the claim against her health insurer, although respondent has no right to the money.

CLAIM I

12. The averments of paragraphs 1 through 11 are incorporated herein.

13. Respondent knowingly converted Pierce’s fees in the amount of $350.00 to his own use and benefit, which is conduct involving dishonesty, in violation of Colo. RPC 8.4(c).

Wherefore, complainant seeks relief as set forth more fully below.

CLAIM II

14. The averments of paragraphs 1 through 11 are incorporated herein by reference.

15. Respondent failed to keep Pierce reasonably informed about the status of her legal matter and failed to promptly comply with her reasonable requests for information, in violation of Colo. RPC 1.4(a).

Wherefore, complainant seeks relief as set forth more fully below.

CLAIM III

16. The averments of paragraphs 1 through 11 are incorporated herein.

17. Respondent neglected Pierce’s legal matter and failed to represent Pierce diligently, in violation of Colo. RPC 1.3.

Wherefore, complainant seeks relief as set forth more fully below.

CLAIM IV

18. The averments of paragraphs 1 through 11 are incorporated herein.

19. Respondent failed to protect Pierce’s interest at the time he terminated his services on her behalf in violation of Colo. RPC 1.16(d).

Wherefore, complainant seeks relief as set forth more fully below.

The Schmitz Matter, 01-00785

20. On June 29, 2000, Arron Schmitz hired respondent as his attorney to represent him in a non-contested divorce proceeding. Schmitz paid respondent a $500.00 flat fee at the time he retained him.

21. After about a month and a half, respondent showed Schmitz papers that had been drafted to begin the process. Schmitz signed the paperwork, and it was filed on or about October 26, 2000, roughly four months after Schmitz had retained the respondent, and only after Schmitz made several telephone calls to the respondent concerning the status of the legal matter.

22. In December of 2000, Schmitz contacted his wife to find out if she had received the divorce paperwork. Schmitz’s wife informed Schmitz that she had not received any paperwork and that she had not been served with the documents to begin the divorce process.

23. Beginning in the middle of January, 2001, Schmitz began to attempt to contact respondent concerning the legal matter. Schmitz left a voice mail message for respondent, but respondent did not respond.

24. Thereafter, Schmitz called respondent’s office on January 31, February 1, February 12, and February 13, 2001. Each time Schmitz left a voice mail message for the respondent. The respondent has never responded to Schmitz’ messages. Respondent terminated his relationship with Schmitz by abandoning his representation of him.

25. Respondent did not respond to the request for investigation filed by Schmitz with the Office of Attorney Regulation Counsel, although a copy of it was mailed to respondent’s registered business and home addresses.

26. Respondent has abandoned Schmitz, thereby terminating the attorney/client relationship. Respondent has retained all of the funds paid by Schmitz to the respondent, without completing the work agreed to and without authorization.

CLAIM V

27. The averments of paragraphs 20 through 26 are incorporated herein.

28. Respondent knowingly converted funds belonging to Schmitz to his own use and benefit, which is conduct involving dishonesty, in violation of Colo. RPC 8.4(c).

Wherefore, complainant seeks relief as set forth more fully below.

CLAIM VI

29. The averments of paragraphs 20 through 26 are incorporated herein.

30. Respondent failed to keep Schmitz reasonably informed about the status of his legal matter and failed to promptly comply with Schmitz’s reasonable requests for information, in violation of Colo. RPC 1.4(a).

Wherefore, complainant seeks relief as set forth more fully below.

CLAIM VII

31. The averments of paragraphs 20 through 26 are incorporated herein.

32. Respondent neglected Schmitz’s legal matter and failed to represent Schmitz diligently, in violation of Colo. RPC 1.3.

Wherefore, complainant seeks relief as set forth more fully below.

CLAIM VIII

33. The averments of paragraphs 20 through 26 are incorporated herein.

34. Respondent failed to protect Schmitz’s interest at the time of his termination in violation of Colo. RPC 1.16(d).

Wherefore, complainant seeks relief as set forth more fully below.

The Weaver Matter, 00-03544

35. On December 21, 1999, a domestic relations court ordered respondent to pay $350.00 to opposing counsel in attorney’s fees as result of respondent’s failure to file disclosures. As of this date, although respondent is aware of the order, respondent has not paid the court-ordered sum.

36. Respondent never submitted a written response to the request for investigation in this matter which was sent to respondent’s registered address pursuant to the applicable rule of procedure.

CLAIM IX

37. The averments of paragraphs 35 through 36 are incorporated herein.

38. Respondent violated Colo. RPC 3.4(c) by knowingly disobeying the court’s order requiring him to pay attorney’s fees.

Wherefore, complainant seeks relief as set forth more fully below.

The Guhl Matter, 00-03946

39. On April 19, 2000, respondent appeared before Magistrate Rice in Arapahoe County District Court and read an oral stipulation into the record on behalf of his client, Mr. Guhl. Respondent was ordered to prepare a written order within 15 days.

40. As of February 1, 2001, no written order had been submitted to the court.

41. Respondent received a copy of the request for investigation in the Guhl matter, but never submitted a written response to it.

CLAIM X

42. The averments of paragraphs 39 through 41 are incorporated herein.

43. Respondent violated Colo. RPC 3.4(c) by knowingly disobeying the court’s order requiring him to prepare and file the Guhl order within 15 days.

Wherefore, complainant seeks relief as set forth more fully below.

CLAIM XI

44. The averments of paragraphs 39 through 41 are incorporated herein.

45. Respondent neglected Guhl’s matter and failed to represent Guhl diligently, in violation of Colo. RPC 1.3.

Wherefore, complainant seeks relief as set forth more fully below.

The Thilman Matter, 00-04158

46. Respondent represented Thomas Thilman in a dissolution of marriage matter.

47. On May 19, 1999, the matter came before Magistrate Rice in Arapahoe County District Court for a status hearing. Respondent was ordered to prepare a proposed order within 15 days. Respondent failed to do so.

48. On June 24, 1999, the court contacted respondent by telephone concerning the order, which had not yet been filed.

49. On July 20, 1999, the court entered an order requiring respondent to submit the formal order within 10 days.

50. An order, signed by both counsel, was not filed until October 18, 1999.

CLAIM XII

51. The averments of paragraphs 46 through 50 are incorporated herein.

52. Respondent violated Colo. RPC 3.4(c) by knowingly disobeying the court’s orders requiring him to prepare and file the Thilman order within the time specified.

Wherefore, complainant seeks relief as set forth more fully below.

CLAIM XIII

53. The averments of paragraphs 46 through 50 are incorporated herein.

54. Respondent neglected Mr. Tillman’s representation and failed to represent Tillman diligently, in violation of Colo. RPC 1.3.

Wherefore, complainant seeks relief as set forth more fully below.

The Bohlmann Matter, 00-04160

55. The respondent was retained to represent Ms. Bohlmann in a dissolution of marriage action.

56. Respondent received discovery from opposing counsel in February 1999. Respondent did not forward the discovery to Bohlmann for response until April 1999.

57. In late April 1999, Bohlmann returned her discovery responses to the respondent. Respondent did not provide those responses to opposing counsel until August 1999.

58. On July 18, 1999, the presiding magistrate entered an order compelling Bohlmann’s responses to the discovery opposing counsel had propounded, and ordering Bohlmann to pay $300.00 as and for reasonable attorney’s fees to opposing counsel within 10 days.

59. In addition, judgment in the amount of $2,909.90 was entered against respondent for opposing counsel’s attorney’s fees resulting from respondent’s delay during the course of proceedings. That sum included the $300.00 the magistrate ordered Bohlmann to pay.

CLAIM XIV

60. The averments of paragraphs 55 through 59 are incorporated herein.

61. Respondent violated Colo. RPC 1.3 by neglecting Bohlmann’s legal matter and failing to represent Ms. Bohlmann diligently.

Wherefore, complainant seeks relief as set forth more fully below.

CLAIM XV

62. The averments of paragraphs 55 through 59 are incorporated herein.

63. Respondent engaged in conduct prejudicial to the administration of justice by his failure to handle the discovery matter described above properly, thereby causing a hearing on the matter and the entry of an order for attorney’s fees against his client. Respondent’s conduct violates Colo. RPC 8.4(d).

Wherefore, complainant seeks relief as set forth more fully below.

The Runia Matter, 00-04161

64. Respondent was hired to represent Mr. Runia in a dissolution of marriage action.

65. The decree of dissolution of marriage was entered in complainant’s case in November 1998. A qualified domestic relations order was needed to provide retirement benefits among the parties. Respondent agreed to prepare the document as part of his representation of complainant.

66. A proposed qualified domestics relations order was not prepared by respondent until March or April, 2000.

CLAIM XVI

67. The averments of paragraphs 64 through 66 are incorporated herein.

68. Respondent neglected Runia’s legal matter and failed to represent Runia diligently, in violation of Colo. RPC 1.3.

Wherefore, complainant seeks relief as set forth more fully below.

The Bergmann Matter, 00-04162

69. Bergmann hired respondent in July 1999 to represent him in connection with child support disputes that he had with his ex-wife.

70. In September 1999, respondent notified complainant that he was initiating discussions with opposing counsel concerning the child support matters.

71. On December 20, 1999, respondent advised complainant that the matters had been resolved.

72. Thereafter, complainant requested that respondent provide him with an itemized accounting of his time, and written documentation confirming the terms of the resolution of the child support matter.

73. As of April 4, 2000, respondent had not provided any of the requested information to the complainant.

CLAIM XVII

74. The averments of paragraphs 69 through 73 are incorporated herein.

75. Respondent violated Colo. RPC 1.15(b) by failing to provide an accounting of his fees and costs when expressly requested by his client.

Wherefore, complainant seeks relief as set forth more fully below.

CLAIM XVIII

76. The averments of paragraphs 69 through 73 are incorporated herein.

77. Respondent failed to keep his client reasonably informed about the status of his legal matter and failed to promptly comply with the client’s reasonable requests for information, in violation of Colo. RPC 1.4(a).

Wherefore, complainant seeks relief as set forth more fully below.

The Fontinelli Matter, 00-04275

78. Respondent represented Ms. Fontinelli in a dissolution of marriage action. On May 31, 2000, the respondent, Ms. Fontinelli and Ms. Fontinelli’s ex-husband appeared before a magistrate of the Adam’s County District Court and read a permanent orders stipulation into the record. Respondent was ordered by the Magistrate to prepare written permanent orders and a decree within 30 days.

79. On July 10, 2000, the court entered another order giving respondent an additional 10 days to submit the orders.

80. On July 31, 2000, the court issued a show cause order requiring respondent to appear on September 7, at 8:30 a.m. to show cause why sanctions should not be imposed for his failure to submit the written orders.

81. On September 7, 2000, respondent appeared and still had not prepared the orders. The court set the matter for administrative review on October 10, 2000, by which time respondent was to submit written permanent orders.

82. On October 10, 2000, the court performed a review of the matter and noted that the orders still had not been submitted. Accordingly, a show cause order was entered requiring respondent to appear on November 13, 2000 at 8:30 a.m. to show cause why sanctions should not be imposed for his failure to comply with the court’s previous orders.

83. Respondent failed to appear at the November show cause hearing. Accordingly, a bench warrant was issued for respondent’s arrest, but stayed until December 12, 2000, when a review hearing was scheduled.

84. The review took place on December 12, 2000 and the permanent orders had still not been submitted. On that date, the court ordered that respondent was to return and show cause on February 7, 2001 why sanctions should not be entered against him. The sheriff was directed to serve the show cause order on the respondent personally, and if respondent failed to appear the bench warrant would issue.

85. Respondent submitted the permanent orders on December 22, 2000.

86. Respondent never advised his client that he had submitted the orders, and never sent her a copy of the orders.

CLAIM XIX

87. The averments of paragraphs 78 through 86 are incorporated herein.

88. Respondent violated Colo. RPC 1.3 by neglecting Ms. Fontinelli’s matter and failing to represent her diligently.

Wherefore, complainant seeks relief as set forth more fully below.

CLAIM XX

89. The averments of paragraphs 78 through 86 are incorporated herein.

90. Respondent violated Colo. RPC 3.4(c) by knowingly disobeying the court’s many orders directing him to prepare the permanent orders in the Fontinelli matter.

Wherefore, complainant seeks relief as set forth more fully below.

CLAIM XXI

91. The Averments of paragraphs 78 through 86 are incorporated herein.

92. Respondent’s disobedience, which necessitated further court action, constituted conduct prejudicial to the administration of justice in violation of Colo. RPC 8.4(d).

Wherefore, complainant seeks relief as set forth more fully below.

CLAIM XXII

93. The averments of paragraphs 78 through 86 are incorporated herein.

94. Respondent failed to keep Ms. Fontinelli reasonably informed about the status of her legal matter and failed to promptly comply with her reasonable requests for information, in violation of Colo. RPC 1.4(a).

Wherefore, complainant seeks relief as set forth more fully below.

The Livingston Matter, 01-00262

95. Respondent hired Irwin Seidman to report a deposition. Respondent purchased a transcript of the deposition, but never paid for it.

96. On October 6, 2000, a judgment was entered against respondent for the unpaid deposition fee, plus costs and interest, in the total amount of $324.90.

97. The judgment has not been paid.

CLAIM XXIII

98. The averments of paragraphs 95 through 97 are incorporated herein.

99. Respondent violated Colo. RPC 8.4(h) as a result of his failure to pay the court reporter and/or the judgment entered against him for the costs of the court reporter’s services, which respondent expressly requested.

Wherefore, complainant seeks relief as set forth more fully below.

FAILURE TO COOPERATE

CLAIM XXIV

100. The averments of paragraphs 10, 25, 36, and 41 are incorporated herein.

101. Respondent was served with written notice of the requests for investigation filed by Pierce, Schmitz, Weaver, and Guhl, described above, but respondent failed to provide a written response to any of those requests for investigation as required by C.R.C.P. 251.10(a). Respondent’s knowing failure to provide responses to the requests for investigation identified above, as required by C.R.C.P. 251.10(a), constitutes violations of C.R.C.P. 251.5(d), Colo. RPC 3.4(c) and Colo. RPC 8.1(b).

WHEREFORE, it is prayed that the respondent be found guilty of violations of various rules of conduct which establish grounds for discipline as provided in C.R.C.P. 251.5, and the Colorado Rules of Professional Conduct and that he be appropriately disciplined and assessed the costs of these proceedings, and that the court enter such further relief as may be allowable and appropriate based upon the evidence at trial.

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