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TCL > October 2010 Issue > Disciplinary Case Summaries for Matters Resulting in Diversion and Private Admonition

October 2010       Vol. 39, No. 10       Page  89
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 quarterly 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 4, 2010 through July 29, 2010, at the intake stage:

  • Regulation Counsel entered into nine Diversion Agreements involving nine requests for investigation
  • the ARC entered into eleven Diversion Agreements involving twelve requests for investigation
  • no Diversion Agreements were submitted to the PDJ for approval
  • the ARC did not issue any private admonitions
  • 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 he or she 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, 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 OARC attorneys. 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 from May 4, 2010 to July 29, 2010 generally involve the following:

  • the scope of representation and allocation of authority between client and lawyer, implicating Colo. RPC 1.2
  • an attorney’s neglect of a matter and/or failure to communicate, implicating Colo. RPC 1.3 and 1.4
  • fee issues, implicating Colo. RPC 1.5
  • confidentiality issues, implicating Colo. RPC 1.6
  • conflict of interest, implicating Colo. RPC 1.7
  • trust account issues, implicating Colo. RPC 1.15
  • truthfulness in statements to others and respect for rights of third persons, implicating Colo. RPC 4.1 and 4.4
  • failure to supervise non-lawyer staff, implicating Colo. RPC 5.3
  • assisting another in the unauthorized practice of law/multijurisdictional practice of law, implicating Colo. RPC 5.5
  • committing a criminal act, implicating Colo. RPC 8.4(b)
  • conduct 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 include 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 from May 4, 2010 to July 29, 2010. The sample gives a general description of the misconduct, the Colorado Rule (or Rules) of Professional Conduct implicated, and the corresponding conditions of the Diversion Agreement.

Competence

> Respondent was retained to represent two people in a probate litigation matter. The matter was concluded without respondent having met a deadline. Later, respondent received correspondence directly from the personal representative, who was represented by counsel. Respondent did not open the correspondence. Weeks later, the former clients, through a third party, asked respondent whether he had received any estate distributions. At that point, respondent opened the correspondence and learned that the envelopes contained more than $40,000 due to his former clients. He then remitted the funds.

Rules Implicated: Colo. RPC 1.1 and 1.3.

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent is required to attend Ethics School, attend Trust Account School, submit to a practice audit, and pay all costs associated with the two-year Diversion Agreement.

__________________

> Respondent ineffectively represented a client in an immigration proceeding, including incorrectly completing certain immigration forms for the client. He also inappropriately handled the fees paid by this client by placing them into his operating account when they were only partially earned; however, he did earn the remainder within a short period of time.

Rules Implicated: Colo. RPC 1.1, 1.4(a) and (b), 1.15(a), and 8.4(d).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent is required to attend Ethics School, attend Trust Account School, and pay all costs associated with the two-year Diversion Agreement.

Diligence and/or Failure to Communicate

> In February 2008, respondent was hired by the clients to prepare and execute a Chapter 13 bankruptcy filing. Respondent completed this work, and the Chapter 13 plan was confirmed by the court in July 2008.

In April 2009, the clients made several attempts to contact respondent concerning a modification of the Chapter 13 plan due to changed financial and employment circumstances. In June 2009, respondent sent e-mail correspondence to the clients indicating that on receipt of certain information, he would prepare and file a motion seeking modification of the Chapter 13 plan. A few days later, the clients e-mailed and faxed respondent current financial information concerning disability payments, required medical payments, income, and insurance premiums. The clients also sent additional e-mails in July, August, September, and October 2009. Respondent did not respond to these communications until late October. At this time, respondent asked for additional information, which the clients provided to respondent a few days later. Respondent failed to take any further action on behalf of the clients.

Rules Implicated: Colo. RPC 1.3, 1.4, and 3.2.

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent is required to attend Ethics School; return the client’s file and issue a refund to the clients; and pay all costs associated with the one-year Diversion Agreement.

__________________

> While representing a client in a personal injury matter, respondent failed to abide by the court's case management order, failed to conduct discovery, and failed to disclose expert witnesses. Shortly before the scheduled trial, respondent filed a motion to continue the trial. Respondent advised the court that he was not prepared for trial and was suffering from financial and physical health issues. The court continued the trial and the client obtained new counsel. Through the investigation of this matter, respondent was evaluated and diagnosed with mild depression.

Rules Implicated: Colo. RPC 1.3, 1.4, and 3.4(c).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent is required to attend Ethics School; comply with recommendations of an evaluator, including weekly counseling; and pay all costs associated with the two-year Diversion Agreement.

__________________

> A subcontractor engaged respondent to bring suit against a homeowner and a general contractor for unpaid work. The subcontractor provided respondent with documentary evidence of the materials supplied and identified for respondent the principal witnesses. Respondent brought suit, electing to proceed under Rule 16.1 (simplified procedures), but failed to timely file disclosures. The homeowner movedin limine to bar respondent from presenting evidence. The court granted the motion.

Rule Implicated: Colo. RPC 1.3.

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent is required to attend Ethics School, refund fees to the client, and pay all costs associated with the two-year Diversion Agreement.

Fee/Trust Account Matters

> Respondent paid several personal and office bills out of his COLTAF account by check and electronic bill pay. Respondent wrote checks payable to cash and commingled monies by leaving earned funds in his account and depositing funds that were not client-related into his COLTAF account to pay his personal bills. He repaid the money to his COLTAF account once he was made aware of the errors.

Rules Implicated: Colo. RPC 1.15(a), (d)(1) and (2), (i)(6), and (j)(1) and (2).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent is required to attend Trust Account School, submit quarterly reports with supporting documentation that he is in compliance with Rule 1.15, and pay all costs associated with the one-year Diversion Agreement.

__________________

> Respondent withdrew payments for her earned fees in a matter prior to making two related deposits. Both deposits were returned, causing her COLTAF account to have a negative balance. Respondent failed to hold deposits until they cleared prior to withdrawing earned fees, failed to maintain the general ledger and individual client ledgers, and failed to reconcile her accounts. She repaid the money to her COLTAF account once she was made aware of the errors.

Rules Implicated: Colo. RPC 1.15(a), (i)(6), and (j)(1) and (2).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent is required to attend Trust Account School and pay all costs associated with the one-year Diversion Agreement.

__________________

> Respondent failed to adequately supervise staff to ensure that clients received refunds of unearned retainers in a timely manner. Consequently, a number of respondent's clients had outstanding trust account balances. After respondent learned of the problem, he hired a forensic accountant and refunded monies to clients as necessary. No client was harmed, other than by experiencing delay in the return of funds.

Rules Implicated: Colo. RPC 1.15(i), 1.16(d), and 5.3(b).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent is required to attend Trust Account School, submit to financial monitoring, and pay all costs associated with the two-year Diversion Agreement.

__________________

> Respondent represented the complainant and his nephew in various real estate deals. During the representation, he had a fee agreement with the complainant for one matter but not for the others. Having completed the first matter without billing against the total retainer paid, he applied the remainder of the retainer to a second matter without the complainant’s permission.

Additionally, OARC received six notices of overdrafts from respondent’s bank, all generated from two transactions. The overdrafts resulted from respondent’s expectation of payment from a client on the same day respondent paid filing fees for an emergency bankruptcy court filing, and from respondent writing a trust fund check for a client in the wrong amount. There was no evidence of conversion of client funds.

Rules Implicated: Colo. RPC 1.5 and 1.15(b).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent is required to repay funds to his former client, submit to a practice monitor, attend Ethics School, attend Trust Account School, and pay all costs associated with the two-year Diversion Agreement.

Respect for Rights of Third Persons

> In the first matter, respondent used abusive and foul language toward the mother in a custody proceeding in which respondent was acting as the child's legal representative. In the second matter, respondent overbilled for legal services and personal representative services against an estate in which respondent served as the personal representative.

Rules Implicated: Colo. RPC 1.5, 4.4(a), and 8.4(d) and (g).

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

Criminal Conduct

> Respondent was stopped by police for speeding. The officer determined that respondent had been drinking, and respondent submitted to a breath test. His breath alcohol content (BrAC) was .141. Respondent pled guilty to driving while ability impaired (DWAI) and was sentenced to serve one year of probation and other conditions.

Rule Implicated: Colo. RPC 8.4(b).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent is required to attend Ethics School, comply with all terms of the court sentence, and pay all costs associated with the one-year Diversion Agreement.

__________________

> In October 2009, a McDonald's restaurant employee contacted the police after respondent ordered food at the drive-through, appearing intoxicated. The responding officer believed that respondent had been drinking before or while he was driving, and noticed an empty small plastic alcohol bottle on the driver’s seat of the vehicle. Respondent elected to undergo a blood test to determine his blood alcohol concentration (BAC).

In early November 2009, respondent pled guilty to driving under the influence of alcohol (DUI/alcohol). In mid-November 2009, respondent was convicted of that offense and sentenced to serve two years’ probation with other conditions. In January 2010, respondent reported his conviction to the OARC pursuant to C.R.C.P. 251.20(b). At the request of the OARC, respondent submitted to an independent medical evaluation to determine whether he met the criteria for a diagnosis of alcohol abuse or dependence; the evaluation determined that respondent did not meet these criteria.

Rule Implicated: Colo. RPC 8.4(b).

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

__________________

> In May 2009, respondent was arrested for DUI/alcohol and for failing to drive in a single lane. Respondent's BrAC was .150. No person was injured and no property was damaged as a result of the misconduct.

In September 2009, respondent pled guilty to DWAI, in violation of CRS § 42-4-1301(1)(b). On that same date, respondent was sentenced to two days in jail, with credit for one day served, and one year of unsupervised probation. Respondent was required to undergo an alcohol evaluation and comply with any recommendations of the evaluator; serve twenty-four hours of community service; attend a Victim Impact Panel; and engage in no further criminal violations, including traffic offenses eliciting more than four points. This was respondent’s first alcohol-related offense. Respondent successfully completed all terms and conditions of the probation in the county court case.

Rule Implicated: Colo. RPC 8.4(b).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent is required to attend Ethics School; comply with all terms of the county court sentence; abstain from alcohol and other mood-altering substances unless prescribed by a duly-licensed Colorado physician; participate in random urinalysis testing; attend Alcoholics Anonymous or an equivalent recovery program at least three times per week for the duration of the Diversion Agreement; and pay all costs associated with the three-year Diversion Agreement.

__________________

> Respondent was arrested in October 2009 following a traffic stop. Respondent submitted to alcohol testing and his BrAC was registered as .136. Respondent pled guilty to DWAI in June 2010.

Rule Implicated: Colo. RPC 8.4(b).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent is required to attend Ethics School, comply with all terms of the court case, and pay all costs associated with the one-year Diversion Agreement.

__________________

> Respondent pled guilty and received a deferred judgment on a municipal ordinance violation of assault. The underlying matter involved a road rage incident that escalated into physical violence after the victim referred to respondent using a racial slur.

Rule Implicated: Colo. RPC 8.4(b).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent is required to comply with all the terms and conditions of the court case, attend Ethics School, and pay all costs associated with the two-year Diversion Agreement.

__________________

> Respondent pled guilty to DWAI and Defective Vehicle. Respondent's BAC was .207.

Rules Implicated: Colo. RPC 8.4(b) and C.R.C.P. 251.5(b).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent is required to attend Ethics School, comply with all terms and conditions of the criminal sentence, and pay all costs associated with the one-year Diversion Agreement.

__________________

> In December 2008, respondent attended a holiday party at a hotel, where he consumed an unknown amount of alcohol. Later that month, a woman that respondent had danced with at the party reported to the police that respondent had inappropriate and nonconsensual sexual contact with her. In May 2010, respondent pled guilty to harassment, in violation of CRS § 18-9-111(1)(a). The court sentenced respondent to one year of supervised probation, and ordered him to attend a ten-week life skills class, prepare letters of apology to the victim, and pay various fines and costs.

Rule Implicated: Colo. RPC 8.4(b).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent shall comply with all the terms and conditions of the court case, attend Ethics School, confirm successful completion of the terms of probation with the OARC, and pay all costs associated with the one-year Diversion Agreement.

Conduct Prejudicial to the Administration of Justice

> Respondent represented a husband and wife in an estate planning matter. Later, after husband died, their adult daughter contacted respondent for assistance regarding a temporary protective order her brothers had obtained against her on behalf of mother. Respondent advised she was unable to assist daughter with the temporary protective order. Daughter explained that she had concerns about mother and discussed with respondent that a conservator be appointed for her. Daughter and mother eventually entered into a stipulation regarding the temporary protective order. The order provided that (1) daughter would return property to mother; (2) daughter would destroy all powers of attorney; and (3) if daughter violated the order, with notice and a hearing, mother could seek a protective order against daughter. Respondent reviewed the order, and it was submitted and approved by a county court judge.

Shortly thereafter, respondent represented daughter in petitioning the district court to appoint a conservator for mother. Daughter had provided respondent a letter from a physician stating mother was suffering from dementia. This conclusion was consistent with some of mother’s behavior that respondent had observed. Respondent attached the letter to the petition. The judge granted the petition and appointed daughter as the conservator, but rescinded the order after mother, through counsel, responded. Respondent learned through mother’s counsel additional facts she had not previously been aware of when she assisted daughter in petitioning for a conservator. Respondent withdrew, and new counsel handled the matter.

Rule Implicated: Colo. RPC 8.4(d).

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

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