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TCL > October 2009 Issue > Disciplinary Case Summaries for Matters Resulting in Diversion and Private Admonition

The Colorado Lawyer
October 2009
Vol. 38, No. 10 [Page  131]

© 2009 The Colorado Lawyer and Colorado Bar Association. All Rights Reserved.

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From the Courts
Matters Resulting in Diversion

Disciplinary Case Summaries for Matters Resulting in Diversion and Private Admonition

Articles describing Diversion Agreements and private admonitions as part of the Attorney Regulation System are published on a quarterly basis. These summaries are contributed by the Colorado Supreme Court Office of Attorney Regulation.


Diversion and Private Admonition Summaries

Diversion is an alternative to discipline.1 Pursuant to the rule and depending on the stage of the proceeding, Attorney Regulation Counsel (Regulation Counsel), the Attorney Regulation Committee (ARC), the Presiding Disciplinary Judge (PDJ), the hearing board, or the Supreme Court may offer diversion as an alternative to discipline. For example, Regulation Counsel can offer a Diversion Agreement when the complaint is at the central intake level in the Office of Attorney Regulation Counsel (OARC). Thereafter, ARC or some other entity must approve the agreement.

From May 13, 2009 through August 11, 2009, at the intake stage:

  • Regulation Counsel entered into eleven Diversion Agreements involving eleven requests for investigation
  • the ARC entered into six Diversion Agreements involving seven requests for investigation
  • the PDJ did not approve any Diversion Agreements
  • the ARC issued four private admonitions involving seven requests for investigation
  • the PDJ did not approve any private admonitions.

Determining Whether Diversion is Appropriate

Regulation Counsel reviews the following factors to determine whether diversion is appropriate:

1) there is little likelihood that the attorney will harm the public during the period of participation;
2) Regulation Counsel can adequately supervise the conditions of diversion; and
3) the attorney is likely to benefit by participation in the program.

Regulation Counsel will consider diversion only if the presumptive range of discipline in the particular matter is likely to result in a public censure or less. However, if the attorney has been publicly disciplined in the last three years, the matter generally will not be diverted.2 Other factors may preclude Regulation Counsel from agreeing to diversion.3

Purpose of the Diversion Agreement

The purpose of a Diversion Agreement is to educate and rehabilitate the attorney so that the attorney does not engage in such misconduct in the future. Furthermore, the Diversion Agreement may address some of the systemic problems an attorney may be having. For example, if an attorney engaged in minor misconduct (neglect), and the reason for such conduct was poor office management, then one of the conditions of diversion may be a law office management audit and/or practice monitor. The time period for a Diversion Agreement generally is no less than one year and no greater than three years.

Conditions of the Diversion Agreement

The type of misconduct dictates the conditions of the Diversion Agreement. Although each Diversion Agreement is factually unique and different from other agreements, many times the requirements are similar. Generally, the attorney is required to attend Ethics School and/or Trust Account School. Classes are conducted by attorneys from the OARC. The attorney also may be required to fulfill any of the following conditions:

  • law office audit
  • practice monitor
  • financial audit
  • restitution
  • payment of costs
  • mental health evaluation and treatment
  • continuing legal education (CLE) courses
  • any other conditions that would be determined appropriate for the particular type of misconduct.

Note: The terms of a Diversion Agreement may not be detailed in this summary if the terms are generally included within Diversion Agreements.

After the attorney successfully completes the requirements of the Diversion Agreement, Regulation Counsel will close its file and the matter will be expunged pursuant to C.R.C.P. 251.33(d). If Regulation Counsel has reason to believe the attorney has breached the Diversion Agreement, Regulation Counsel must follow the steps provided in C.R.C.P. 251.13 before an agreement can be revoked.

Types of Misconduct

The types of misconduct resulting in diversion during May 13, 2009 through August 11, 2009 generally involved the following:

  • competent representation to a client, implicating Colo. RPC 1.1
  • trust account issues, implicating Colo. RPC 1.15
  • an attorney’s neglect of a matter and/or failure to communicate, implicating Colo. RPC 1.3 and 1.4, where the client is not harmed or restitution is paid to redress the harm or malpractice insurance exits
  • fee issues, implicating Colo. RPC 1.5
  • confidentiality of information, implicating Colo. RPC 1.6
  • conflict of interest—current clients, implicating Colo. RPC 1.7
  • failing to comply with a court order, implicating Colo. RPC 3.4(c)
  • communications with person represented by counsel, implicating Colo. RPC 4.2
  • respect for rights of third person, implicating Colo. RPC 4.4
  • committing a criminal act, implicating Colo. RPC 8.4(b)
  • engaging in conduct that is prejudicial to the administration of justice, implicating Colo. RPC 8.4(d).

Some cases resulted from personal problems the attorney was experiencing at the time of the misconduct. In those situations, the Diversion Agreements may have included a requirement for a mental health evaluation and, if necessary, counseling to address the underlying problems of depression, alcoholism, or other mental health issues that may be affecting the attorney’s ability to practice law.

Notes

1. See C.R.C.P. 251.13.

2. See C.R.C.P. 251.13(b).

3. See id.


Random Samples of Diversion Agreements

Below are random samples of Diversion Agreements that Regulation Counsel determined appropriate for specific types of misconduct during May 13, 2009 through August 11, 2009. The samples provide a general description of the misconduct, the Colorado Rule(s) of Professional Conduct implicated, and the corresponding conditions of the Diversion Agreement.

Competence/Scope of Representation

> Respondent represented the father in a district court domestic matter. At a hearing in October 2008, the court instructed respondent to submit a proposed decree and support order. Respondent failed to do so in a timely manner. Respondent eventually submitted the proposed decree, but it did not refer to or include the support order. The court called and left messages for respondent regarding the proposed orders problem. After several unsuccessful attempts to have respondent submit correct proposed orders, the court prepared its own orders in December 2008. The corrected orders reflected a monthly reduction in the father’s child support obligation, which had been ordered at the October hearing.

Rules Implicated: Colo. RPC 1.1, 1.3, 3.4(c), and 8.4(d).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent shall attend Ethics School, have no disciplinable conduct for eighteen months, and pay all costs associated with the eighteen-month Diversion Agreement.

Trust Account Matters

>  After respondent presented a check for payment from his COLTAF account, the account had a negative balance. Respondent believed two other checks, which included earned funds, had already been deposited at the time he made the withdrawal. During this time period, respondent was not in compliance with Colo. RPC 1.15; specifically, respondent failed to maintain the required financial records.

Rule Implicated: Colo. RPC 1.15(j).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent shall attend Ethics School and Trust Account School, submit to financial monitoring and review of his fee agreements, have no disciplinable conduct for two years, and pay all costs associated with the two-year Diversion Agreement.

__________________

Respondent overdrew his COLTAF account. Respondent should have had more than $5,000 in his COLTAF account at the time of the overdraft. Respondent quickly paid the money back to his COLTAF account once he was made aware of the error. Respondent maintained his records both manually and electronically in QuickBooks. However, a mathematical error or error in inputting figures from the handwritten ledger to QuickBooks may have caused respondent to withdraw more funds than he was entitled to withdraw.

Rules Implicated: Colo. RPC 1.15(a) and 1.15(i)(6).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent shall attend Ethics School; retain a certified public accountant or bookkeeper to perform an audit; submit a report to the OARC as to the status of respondent’s bank accounts, as well as any suggestions or recommendations on maintaining his account; and comply with all conditions of the one-year Diversion Agreement.

__________________

> Client’s parents hired respondent to represent client, a juvenile, in a criminal law matter. Client’s parents paid respondent a $2,500 retainer using a credit card. Respondent failed to appear for a pretrial conference due to a calendaring error.

Client’s parents terminated respondent’s representation and requested a refund. Respondent had earned approximately one-half of the retainer at the time the refund was requested. Respondent wrote a check to client’s parents from his trust account for $1,250.

Prior to cashing the check, client’s parents contacted the credit card company and disputed the entire charge to their credit card. The credit card company charged back the entire amount of the retainer. Respondent spoke to the credit card company and explained that he believed one-half of the funds had been earned. Based on his conversation with the credit card company, respondent believed the credit card company would reinstate one-half of the amount of the retainer. The credit card company reinstated the entire charge to the credit card. As a result, client’s parents cashed the check respondent wrote to them from his trust account, causing the account to go into a negative status. Respondent failed to maintain the required financial records.

Rules Implicated: Colo. RPC 1.3, 1.4, and 1.15.

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent shall attend Ethics School and Trust Account School, submit to a financial monitor and audit, have no disciplinable conduct for two years, and pay all costs associated with the two-year Diversion Agreement.

Fees

>  The complaining witness signed a fee agreement and paid respondent $400 in November 2008 to represent the complaining witness in a bankruptcy proceeding. The fee agreement is deficient and confusing. Among the problems with respondent’s fee agreement are the following:

1.  The initial consultation is free unless the firm is retained.

2. It is unclear whether the consultation fee is an hourly fee or a flat fee.

3. The type of bankruptcy to be filed is not specified.

4. The flat fee mentioned in the supplement to the fee agreement is not an amount certain; it is a range of $1,500 to $2,500 for a Chapter 7 bankruptcy.

5. The fees to be charged may be changed without notice, and any revisions will be made available only on request by the client.

The complaining witness fired respondent in February 2009 and requested a full refund less $30 for the credit report obtained by respondent’s firm. Despite respondent’s newspaper advertisement that specifies "free in-office consultation," respondent included 1.3 hours of billable time at $275 per hour ($357.50) for the initial intake meeting in November 2008.

Rules Implicated: Colo. RPC 1.4 and 1.5(a).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent shall attend Ethics School, refund $370 to the complaining witness, have no disciplinable conduct for one year, and pay all costs associated with the one-year Diversion Agreement.

__________________

> Respondent was hired to represent clients in a real estate boundary dispute. Respondent neglected the matter. At one point, respondent was required to file a motion to reinstate the action on the court’s docket due to his neglect.

Ultimately, a settlement was reached. Respondent failed to follow through diligently, causing additional delay in the resolution of the matter. In addition, as part of the settlement, the client paid respondent a sum of money to be disbursed to a surveyor, but only after the survey was complete and pins were set. Respondent prematurely disbursed the money, contrary to the client’s instructions. The client then had to retain a second surveyor to complete his performance under the settlement.

Rules Implicated: Colo. RPC 1.3, 1.4(a), 1.4(b), and 1.15(b).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent shall attend Ethics School, pay restitution, and have no disciplinable conduct during the one-year Diversion Agreement.

__________________

> In 1988, respondent agreed to serve on a pro bono basis as guardian for a protected person. In 2006, an attorney representing the protected person’s mother sent respondent checks representing the protected person’s share of a wrongful death settlement. Respondent did not accept the checks or take any action on behalf of the protected person. More than two years later, after a complaint was filed with the OARC, respondent did cause a trust to be created for the funds for the benefit of the protected person.

Rules Implicated: Colo. RPC 1.3 and 1.15(b).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent shall attend Ethics School and have no disciplinable conduct during the one-year Diversion Agreement.

Conflicts of Interest

>  In January 2009, respondent met with the complaining witness and his sister to review their mother’s will, which respondent had drafted in 1995. During that meeting, respondent told them he hoped the total fees would not exceed $4,000 to $5,000, which was based on respondent’s hourly rate. On that day, the complaining witness signed a waiver of his right to be a co-personal representative with his sister. The following day, the complaining witness’s sister allegedly refused to give her brother access to their mother’s home and was allegedly removing items from the home. A few days later, the complaining witness contacted respondent and rescinded the waiver he had signed.

At a meeting in mid-January 2009 with his sister and respondent, the complaining witness alleged that he learned for the first time that his mother and sister had met with respondent in July 2008 and discussed changes to his mother’s estate plan, which would have made his sister the sole personal representative and reduced the complaining witness’s share of his mother’s estate.

By letter in February 2009, the complaining witness and his sister received a bill from respondent for $9,908.93. Respondent explained that an exceptional amount of time had been required because of the difficulty with the complaining witness and his sister working together and having to act as a buffer between them. He also stated that the fee essentially had been doubled because the documents had to be revised to reflect co-personal representatives. The complaining witness fired respondent in February 2009.

Rules Implicated: Colo. RPC 1.4, 1.5(a), and 1.7.

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent shall attend Ethics School, withdraw from continuing representation of the complaining witness’s sister, submit his fee to binding fee arbitration if the complaining witness chooses to do so, and have no disciplinable conduct during the one-year Diversion Agreement.

Confidentiality of Information

Respondent represented client in a divorce matter from April 2004 to August 2005. Client retained another attorney (lawyer #2) as successor counsel in the domestic case. Client subsequently filed a grievance against lawyer #2. Lawyer #2 contacted respondent about representation of client. Respondent disclosed information to lawyer #2 about respondent’s representation of client and communications with client. Respondent also wrote a letter to the OARC in support of lawyer #2. At no time did respondent obtain consent from client before respondent wrote to the OARC or communicated with lawyer #2.

Rule Implicated: Colo. RPC 1.6.

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent shall attend Ethics School, have no disciplinable conduct for one year, and pay all costs associated with the one-year Diversion Agreement.

Fairness to Opposing Party and Counsel

In 2003, respondent moved to Colorado to accept a position as employment counsel. C.R.C.P. 222 became effective January 1, 2003. This rule permits lawyers who work for a single client to obtain a limited law license allowing a non-Colorado lawyer to practice law in Colorado. However, respondent was unaware of this rule at that time and therefore failed to apply and get certified to practice law in Colorado. From March 2003 through April 2009, respondent continued to be in-house counsel and practice law for her employer, without having complied with C.R.C.P. 222.

Respondent’s failure to comply with C.R.C.P. 222 was negligent. Respondent never received any information about C.R.C.P. 22 and the employer’s general counsel never inquired about respondent’s Bar membership. Had respondent originally applied for single-client certification, she would have satisfied all of the requirements pursuant to C.R.C.P. 222. Respondent recently applied for certification and has now been certified under C.R.C.P. 222. Respondent also has paid all the necessary fees and penalties.

Rule Implicated: Colo. RPC 3.4(c).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent shall attend Ethics School and pay all costs associated with the one-year Diversion Agreement.

__________________

> Respondent represented a client in post-decree matters pertaining to child support and parenting time issues. The opposing party filed a pro se motion to modify child support and parenting time orders in the underlying case. Respondent believed that the pro se opposing party made false statements in the motion to modify child support and was hiding income and assets in his girlfriend’s bank accounts.

The opposing party’s girlfriend wrote a check to pay certain fees charged by the Child and Family Investigator, who provided services in the divorce case. The check was drawn on an account in the name of the girlfriend alone; the account was not a joint account and respondent had no indication that the opposing party had any ownership interest in that checking account.

Respondent used the account number on the girlfriend’s check and issued a subpoena duces tecum to the bank to obtain records of that account based on his belief that the opposing party may be hiding income or assets in that account. At the time the subpoena was issued to the bank, the opposing party and his girlfriend were out of the country.

Respondent provided a copy of the subpoena to the opposing party by e-mail. Respondent did not provide any notice of the subpoena to the opposing party’s girlfriend.

Respondent called the bank and made arrangements to obtain the bank records in advance of the return date listed on the subpoena. Respondent obtained copies of the bank records for that account pursuant to the subpoena. Respondent did not raise with the court in the underlying divorce case his concerns about the opposing party hiding income or assets in his girlfriend’s account, and did not seek any order or other authorization from the court to obtain the bank records of a person who was not a party to the underlying case.

Rules Implicated: Colo. RPC 3.4(c) and 4.4.

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent shall attend Ethics School and pay all costs associated with the one-year Diversion Agreement.

Communication With Person Represented by Counsel

>  Respondent represented a client in a personal injury suit against a third party. Respondent twice contacted the client’s insurance adjuster after being notified that the client’s insurance company had retained counsel.

Rule Implicated: Colo. RPC 4.2.

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent shall attend Ethics School, agree to a practice monitor, and pay all costs associated with the two-year Diversion Agreement.

Criminal Conduct

>  In September 2008, respondent was involved in a one-car accident. The police department responded to the scene of the accident and determined that respondent had been drinking. Respondent refused to submit to a chemical test for blood or breath, pursuant to the Colorado Express Consent law. Respondent was arrested and charged with violation of CRS § 42-4-1301(1)(a) (driving under the influence); CRS § 42-4-1301(1)(b) (driving while ability impaired) (DWAI); CRS § 18-8-104 (1)(a) (obstructing a firefighter or police officer); CRS § 42-4-1402 (careless driving); and CRS § 42-4-1409(3) (failure to display proof of insurance). Later in September 2008, respondent voluntarily entered the Harmony House and completed the Harmony House twenty-eight-day inpatient treatment program. In February 2009, respondent was convicted of DWAI. Respondent has one prior alcohol-related conviction in 1995.

Rule Implicated: Colo. RPC 8.4(b).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent shall attend Ethics School, comply with the court sentence, continue treatment with Harmony House, submit to daily breathalyzers for two years, abstain from the use of alcohol, have no disciplinable conduct for three years, and pay all costs associated with the three-year Diversion Agreement.

__________________

> In September 2008, respondent and respondent’s spouse had an argument that escalated into a physical altercation. Respondent’s spouse contacted the police the next day to report the incident. Respondent was then arrested and charged with a Class 3 Misdemeanor, Harassment/Stalking, CRS § 18-9-111(1)(a). Respondent self-reported a plea to deferred judgment for a charge against this statute.

Rule Implicated: Colo. RPC 8.4(b).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent shall comply with all the conditions of the court sentence, attend Ethics School, and pay all costs associated with the two-year Diversion Agreement.

__________________

> Respondent was stopped by the police and arrested in March 2009 after her husband notified them that respondent was driving while under the influence of alcohol. Respondent’s blood alcohol content (BAC) was .146. Respondent pled guilty to DWAI in April 2009. This is respondent’s first alcohol-related offense.

Rule Implicated: Colo. RPC 8.4(b).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent shall attend Ethics School, comply with all the conditions of the court sentence, have no disciplinable conduct for one year, and pay all costs associated with the one-year Diversion Agreement.

__________________

> Respondent was convicted of DWAI, first offense. Respondent’s BAC was .155. Respondent was stopped for speeding and weaving in and out of traffic.

Rule Implicated: Colo. RPC 8.4.

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent shall comply with all conditions of the court sentence, have no disciplinable conduct for one year, and pay all costs associated with the one-year Diversion Agreement.

Conduct Prejudicial to the Administration of Justice

Respondent failed to pay a court reporter who had to hire a collections attorney to obtain judgment and garnish respondent’s account.

Rule Implicated: Colo. RPC 8.4.

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent shall attend Ethics School, have no disciplinable conduct for one year, and pay all costs associated with the one-year Diversion Agreement.

© 2009 The Colorado Lawyer and Colorado Bar Association. All Rights Reserved. Material from The Colorado Lawyer provided via this World Wide Web server is protected by the copyright laws of the United States and may not be reproduced in any way or medium without permission. This material also is subject to the disclaimers at http://www.cobar.org/tcl/disclaimer.cfm?year=2009.


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