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TCL > January 2011 Issue > Disciplinary Case Summaries for Matters Resulting in Diversion and Private Admonition

January 2011       Vol. 40, No. 1       Page  133
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 July 30, 2010 through October 29, 2010, at the intake stage:
  • Regulation Counsel entered into fifteen Diversion Agreements involving fifteen requests for investigation
  • the ARC entered into fifteen Diversion Agreements involving eighteen 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) the likelihood that the attorney will harm the public during the period of participation;
2) whether Regulation Counsel can adequately supervise the conditions of diversion; and
3 ) whether 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, generally the matter 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 July 30, 2010 to October 29, 2010 generally involve the following:

  • a lawyer shall provide competent representation to a client, implicating Colo. RPC 1.1
  • 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
  • former judge, arbitrator, mediator, or other third-party representation, implicating Colo. RPC 1.12
  • trust account issues, implicating Colo. RPC 1.15
  • compliance with court orders, implicating Colo. RPC 3.4
  • communication with person represented by counsel, implicating Colo. RPC 4.2
  • respect for rights of third persons, implicating Colo. RPC 4.4
  • a lawyer shall be responsible for another lawyer’s violation of the Colorado Rules of Professional Conduct if the lawyer orders or, with knowledge of the specific conduct, ratifies the conduct involved, implicating Colo. RPC 5.1
  • a lawyer shall not practice law in a jurisdiction without a license to practice law, implicating Colo. RPC 5.5
  • committing a criminal act, implicating Colo. RPC 8.4
  • conduct prejudicial to the administration of justice, implicating Colo. RPC 8.4

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 occurring from July 30, 2010 to October 29, 2010. The sample gives a general description of the misconduct, the Colorado Rule(s) of Professional Conduct implicated, and the corresponding conditions of the Diversion Agreement.

Competence

> Respondent's firm was hired to represent grandmother in a dependency and neglect (D&N) proceeding involving her grandchild. Daughter was represented by counsel in the D&N proceeding. Per respondent’s instruction, respondent’s associate initiated a new domestic matter and filed a petition for allocation of parental responsibility and a draft parenting agreement. The allocation of parental responsibility petition listed the D&N proceeding as another proceeding regarding the grandchild. The parenting agreement provided that daughter agreed to relinquish her parenting rights for her child to her mother, respondent’s client. Although respondent and his associate knew grandmother was represented in the D&N proceeding, the associate advised grandmother to review the agreement and, if it was acceptable, to have her daughter review and sign the agreement. At no time did respondent or his associate attempt to communicate with daughter’s lawyer in the D&N matter. Grandmother obtained daughter’s signature on the agreement and provided it to respondent. Respondent’s associate filed the agreement with the court.

Pursuant to Colorado Rule of Juvenile Procedure 4.4, any matters pertaining to the custody of the child should have been filed in the D&N proceeding. Daughter’s lawyer learned of the agreement and the domestic proceeding at a subsequent hearing in the D&N case, and objected. Respondent entered his firm’s appearance in the D&N matter. He filed a motion asking the court to adopt the parenting agreement as a court order. He attached the signed parenting agreement to the motion. The court determined that the petition would be decided in the D&N proceeding. Respondent’s firm agreed to dismiss the separate domestic proceeding. A permanency plan hearing was scheduled in the D&N proceeding. Grandmother terminated respondent’s firm and requested a full refund of her money. Respondent sent grandmother an adjusted billing statement, and enclosed a check for $290.50 with the notation "full & final settlement" on the front of the check. Grandmother declined to cash it because she wanted a refund of the entire $4,000 she had paid.

Rules Implicated: Colo. RPC 1.1 and 5.1(c).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent must attend Ethics School, participate in eight hours of CLE related to juvenile law, participate in fee arbitration should the client request it, and pay all costs associated with the one-year Diversion Agreement.

Diligence and/or Failure to Communicate

> Respondent was retained by a client for representation in post-decree dissolution of marriage matters. Respondent was not diligent in addressing her client's requests for legal services. Ultimately, respondent refunded her client's advanced fee and terminated the representation.

Rules Implicated: Colo. RPC 1.3 and 1.4.

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

__________________

> Respondent failed to meet deadlines and failed to timely file § 506 motions in several bankruptcy cases, which resulted in delay or dismissal in some cases. In those cases, respondent assisted debtors without additional cost to the debtor in re-filing their bankruptcy cases or provided the debtor a full refund. Respondent had no prior discipline.

Rules Implicated: Colo. RPC 1.3, 1.4(a)(3), 3.4(c), and 8.4(d).

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

__________________

> Respondent agreed to represent a litigation client. Respondent was hired after the client had two other lawyers jointly working on the matter. Respondent requested that one of the former lawyers remain on the case to assist him. The client agreed. Respondent did not promptly communicate the basis or rate of his fee to the client. Respondent also did not clearly communicate the work arrangement he had with the former lawyer. When the client wanted to terminate the other lawyer’s representation, respondent explained that he was subcontracted by the other lawyer; therefore, he did not have authority to terminate the other lawyer’s representation from the case. After respondent’s representation was concluded, he sued the client to recover fees when the client refused to pay. Respondent and the client ultimately reached a settlement.

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

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent must attend Ethics School, participate in eight hours of CLE for law office management, and pay all costs associated with the one-year Diversion Agreement.

Fee/Trust Account Matters

> Respondent was retained to give a client mortgage and personal financial planning advice, including advice as to whether to file a bankruptcy petition. The client paid a total of either $700 or $750 in installments. Respondent did not deposit these payments into his COLTAF account; rather, he deposited them into his office account. Respondent asserted he had earned the money at the time he received each installment; however, he did not know at the time he deposited the money into his office account that he had earned it. Respondent did not tell the client he considered the funds earned at the time he received them or that he was not going to place these funds into his COLTAF account. Respondent did not keep the accounting records required by Colo. RPC 1.15(j).

Beginning in December 2009, the client advised respondent his services were no longer needed and requested an accounting for the charges incurred and a refund of the balance. Respondent did not respond to an e-mail from the client in January 2010. After the client e-mailed respondent in February 2010 about the accounting, respondent replied by e-mail that he had decided he should refund all of the fees he had collected. Respondent did not respond to three e-mails sent by the client to him in March 2010 inquiring about the funds. Respondent did not provide the client with a refund until after a request for investigation was filed with the OARC in April 2010.

Rules Implicated: Colo. RPC 1.4 and 1.15(b) and (j).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent must attend Ethics School and Trust Account School, participate in a law office audit, and pay all costs associated with the two-year Diversion Agreement.

__________________

> A client hired respondent in November 2009 to file a bankruptcy petition. Respondent's fee agreement provided for an undefined Basic Flat Fee. It did not provide any earmarks, guideposts, tasks, or events that define when respondent will pay himself the Basic Flat Fee. The fee agreement provided that if the legal services contracted for were terminated by either party prior to the filing of the bankruptcy case, the client could be entitled to a refund to be determined on an hourly-rate basis. The client’s liability was limited to the amount of the Basic Flat Fee.

Respondent’s client contended respondent did not respond to many of the voicemail messages she left for him and did not return calls when he said he would. Respondent had no recollection of messages from the client on certain dates. Nonetheless, on one occasion, respondent apologized for not returning the client’s recent phone calls.

Respondent never filed the client’s bankruptcy petition. The parties disagree as to the reason for the delay. The client terminated respondent in March 2010. Thereafter, respondent sent the client an invoice that stated money was owed to him, in addition to the Basic Flat Fee that was already paid. Respondent advised the client that should she decide to proceed with a bankruptcy petition with his firm, they would waive the balance owed. Respondent returned all of the attorney fees paid to him by the client.

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

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent must attend Ethics School, revise his fee agreements, and pay all costs associated with the two-year Diversion Agreement.

__________________

> Respondent represented a client with a personal injury matter and a workers' compensation matter. The fee agreements for each matter were contingent fee agreements. The termination clauses in both agreements gave respondent options about charging the client in the event of discharge. Respondent performed work on both cases, but before the matters were concluded, the client discharged respondent. Respondent asserted liens on the client’s recovery in both matters. When asked by new counsel to explain the basis for his lien and under which provision in his fee agreements respondent was asserting the liens, respondent failed to explain. Respondent and the former client ultimately reached a settlement regarding the liens.

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

Diversion Agreement: As part of the conditions of the Diversion Agreement, the respondent must attend Ethics School, attend eight hours of CLE for law office management, and pay all costs associated with the two-year Diversion Agreement.

__________________

> Respondent agreed to represent a client regarding numerous matters, including a collection matter. The client paid respondent a total of $2,350. Respondent performed legal work but did not provide the client a written statement of the basis or rate of the fee. With respect to the collection matter, respondent negotiated with the debtor to make payment. During the same conversation, respondent and the debtor discussed the debtor’s interest in viewing and possibly purchasing respondent’s office building. Respondent advised his client of the conversation with the debtor. The client spoke to the debtor and became angry. After that conversation, the debtor refused to make payment, as originally agreed.

Thereafter, the client requested further representation from respondent with additional legal matters. Respondent declined the representation. Approximately two years later, the client contacted respondent and requested an accounting for the funds he previously had paid to respondent. Respondent replied in writing, asking how much the client had paid and advising that the client’s file was in storage. Respondent stated that if the client wanted respondent to prepare a bill, respondent would have to charge the client additional funds. During the course of the disciplinary investigation, respondent prepared an accounting.

Rules Implicated: Colo. RPC 1.5(b), 1.15(b), and 1.7(b).

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

__________________

> Respondent overdrew his COLTAF account. Respondent advanced payments for costs and fees from the COLTAF account prior to having related funds to make these payments in the account. Respondent left unearned fees in the account. By failing to maintain general and client ledgers, and failing to reconcile the account, respondent was unaware of errors that occurred in the COLTAF account. Respondent repaid the money to his COLTAF account once the errors were discovered.

Rules Implicated: Colo. RPC 1.15(a), (d)(1), (i)(3) and (6), and (j)(1) and (2).

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

__________________

> Respondent overdrew his COLTAF account. Respondent paid several business and personal bills from the COLTAF account. By failing to maintain the general ledger and failing to reconcile the account, respondent was unaware of errors that occurred in his COLTAF account. Respondent repaid the money to his COLTAF account once the errors were discovered.

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

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

__________________

> A plaintiff's personal injury law firm received referrals from an out-of-state attorney. In return, the out-of-state attorney expected to be paid a referral fee. The evidence indicated that in one case, the out-of-state attorney received a referral fee from plaintiff’s personal injury law firm.

Rule Implicated: Colo. RPC 1.5(e).

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

__________________

Complying With Court Orders

> Respondent represented a client in a child-support modification dispute. In that proceeding, respondent issued a subpoena duces tecum to a bank and a credit union. These subpoenas were not served on opposing counsel.

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

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

__________________

Former Representation Matters

> An attorney served as a mediator in civil litigation. After the mediation had concluded unsuccessfully, plaintiff's attorney joined the mediator's law firm. The mediator did not give prompt notice to the other party in mediation of the efforts that the mediator’s law firm made to screen his mediation file from the newly hired attorney.

Rule Implicated: Colo. RPC 1.12(c)(2).

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

__________________

Communication With Parties Represented by Counsel

> While attempting to locate an address for an out-of-state witness for the opposing party, respondent had unauthorized, direct contact with a witness, who was a represented party. Respondent then improperly served a deposition notice and subpoena on that out-of-state witness, seeking production of documents in the possession of the opposing party.

Rules Implicated: Colo. RPC 4.2 and 8.4(d).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent must attend Ethics School, participate in eight hours of civil procedure CLE courses, and pay all costs associated with the one-year Diversion Agreement.

A Lawyer Shall Not Practice Law in a Jurisdiction
Without a License to Practice Law

> Respondent paid attorney registration fees. The electronic check was returned due to insufficient funds. Respondent did not realize the check had been returned, because he was having financial problems and numerous checks were being returned due to insufficient funds. Respondent’s license was administratively suspended. Due to a move, he did not receive the notification of suspension and continued practicing law. When he learned of the suspension, he paid the registration fee, but the check was again returned due to insufficient funds. Respondent’s license was suspended again. He was notified of the suspension and paid cash to cover the registration fee. During the time of this with numerous personal issues, including a divorce and health issues.

Rule Implicated: Colo. RPC 5.5.

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent must attend Ethics School and Trust Account School, and comply with the recommendations of his therapist. In the event respondent practices as a sole practitioner, he must have a practice and financial monitor. He must pay all costs associated with the three-year Diversion Agreement.

__________________

Criminal Conduct

> In July 2009, respondent was involved in a one-vehicle accident in which he rolled his vehicle and was transported to the hospital. When respondent was contacted by state patrol, his behavior indicated that he had been drinking. Respondent was placed under arrest for driving under the influence (DUI). Respondent consented to blood alcohol testing and his blood alcohol concentration (BAC) registered .278.

In February 2010, respondent pleaded guilty to DUI. Respondent was sentenced to one-year probation with alcohol supervision and ninety-six hours of useful public service; ordered not to possess or consume alcohol or a controlled substance; ordered to attend weekly Alcoholics Anonymous (AA) meetings; and ordered to attend a victim impact panel. This conviction was respondent’s first alcohol-related offense and he has spent more than ninety-days in in-patient treatment for alcohol addiction.

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 must attend Ethics School, attend AA or an equivalent recovery program at least three times a week for three years, participate in the MEMS 3000 alcohol monitoring system for two years, comply with all terms of the court sentence, and pay all costs associated with the three-year Diversion Agreement.

__________________

> In May 2007, respondent was arrested and charged with DUI, failure to stop at a stop sign, and failure to display proof of insurance. In February 2008, respondent pleaded guilty to DUI and received a deferred judgment and sentence. Respondent failed to report this conviction to the OARC in a timely manner.

In June 2009, respondent was arrested and charged with DUI. The result of the chemical test indicated a BAC of .116. In January 2010, respondent pleaded guilty to DUI in county court and received a deferred judgment and sentence.

Rule Implicated: Colo. RPC 8.4(b).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent must attend Ethics School, abstain from alcohol, attend AA or an equivalent recovery program at least two times a week for two months, submit to breathalyzer testing four times a week for one year, comply with all terms of the court sentence, and pay all costs associated with the two-year Diversion Agreement.

__________________

> Respondent was pulled over and cited in November 2009 after he was observed by a police officer driving the wrong direction and making what appeared to be an illegal left turn. When the officer stopped respondent, he detected a strong odor of alcohol. Respondent consented to a blood draw, which revealed a BAC of .210. This conviction was respondent’s first alcohol-related driving offense.

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 must attend Ethics School, comply with all terms of his probation, and pay all costs associated with the two-year Diversion Agreement.

__________________

> In October 2009, respondent was involved in a rollover accident. The investigating officer determined that respondent's vehicle left the road, returned to the road, and rolled across the lanes of travel. Respondent's BAC was measured to be .136 approximately four hours after the time of the accident.

In February 2010, respondent pled guilty to driving while ability impaired. She was sentenced to serve one year of probation and other conditions.

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 must attend Ethics School, comply with all terms of the court sentence and evaluation report, and pay all costs associated with the two-year Diversion Agreement.

__________________

> Respondent was involved in a minor altercation with the mother of their child during the exchange of the child for visitation with the mother. The altercation resulted in each party being scratched by the other party and each party being charged by the district attorney with criminal law violations based on their conduct. Ultimately, the criminal case against the mother was dismissed by the district attorney and respondent pleaded guilty to harassment, an act of domestic violence—a class 3 misdemeanor. Respondent received a twelve-month deferred judgment and sentence where the primary conditions involve domestic violence treatment and compliance with the law. Respondent had no prior discipline.

Rule Implicated: Colo. RPC 8.4(b).

Diversion Agreement: As part of the conditions of the Diversion Agreement, respondent must attend Ethics School, comply with domestic violence treatment, and pay all costs associated with the one-year Diversion Agreement.

__________________

> Respondent pled guilty to harassmentrepeat telephone calls, in violation of CRS § 18-9-111(1)(f), a class 3 misdemeanor. The underlying matter involved respondent's calls to the employee of his client's customer. The client had asked respondent to call the employee and try to get him to meet with respondent. In the first call, respondent called the employee and did not identify himself by his real name. Respondent admitted that, during this phone call to the employee, he stated the sheriff wanted to meet with the employee. In the second call, respondent left the employee a voicemail identifying himself as an officer with the sheriff’s department and asking if he could meet with the employee the next morning. The employee then called respondent using the number on the employee’s caller ID. Respondent and the employee disputed what was said during the third telephone call. Respondent had been drinking prior to these telephone calls.

Respondent underwent an alcohol evaluation and was diagnosed with alcohol dependence. The evaluator recommended monitored abstinence for a period of one year and individual counseling. This was respondent’s first alcohol-related offense.

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 must attend Ethics School, participate in the MEMS 3000 alcohol monitoring system for one year, abstain from alcohol or any other mood altering substance unless such substance is prescribed by a duly licensed Colorado physician, comply with all terms of the court sentence, and pay all costs associated with the two-year Diversion Agreement.

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