The Colorado Lawyer
Vol. 30, No. 1 [Page 93]
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From the Courts
Matters Resulting in Diversion
Colorado Supreme Court Office of Regulation Counsel
Editor’s Note: Articles describing diversion agreements as part of the Attorney Regulation System are published on a quarterly basis. These articles are contributed by the Colorado Supreme Court Office of Regulation Counsel.
Background Information Regarding Diversion
Diversion is an alternative to discipline. See C.R.C.P. 251.13. 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. Thereafter, ARC or some other entity must approve the agreement.
From August 16, 2000, through November 16, 2000, at the intake stage, Regulation Counsel entered into 8 Diversion Agreements. From August 13, 2000, through October 14, 2000, ARC approved 11 Diversion Agreements involving 15 separate requests for investigation. The PDJ approved 1 Diversion Agreement during this time frame.
Regulation Counsel reviews the following factors to determine if 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 under the rule. See C.R.C.P. 251.13(b). Other factors Regulation Counsel considers that may preclude Regulation Counsel from agreeing to diversion are set forth in the C.R.C.P. 251.13(b). For example, if the misconduct involves dishonesty, misrepresentations, domestic violence or is a pattern of misconduct, the presumption is against diversion.
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. It is also hoped that a diversion agreement will address some of the systemic problems an attorney may be having. For example, if an attorney engaged in minor misconduct (neglect), and the reasons for such conduct were the result of 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 is generally no less than one year or greater than two years.
Types of Misconduct
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 that is organized and taught by attorneys from the Office of Attorney Regulation Counsel. An attorney may also 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; attend CLE courses, and any other conditions that may be appropriate for the particular type of misconduct.
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 that the attorney has breached the Diversion Agreement, then Regulation Counsel must follow the steps provided in C.R.C.P 251.13 before an agreement can be revoked.
The types of misconduct resulting in diversion for the time period described above, generally involve the following: an attorney’s neglect of a matter and/or failure to communicate in violation of Colo. RPC 1.3 and Colo. RPC 1.4 where the client is not harmed or restitution is paid to redress the harm; conflicts of interest in violation of Colo. RPC 1.7(b); violation of a criminal statute in violation of Colo. RPC 8.4(b); and threatening criminal or administrative action to gain an advantage in a civil case against the opposing party or attorney in violation of Colo. RPC 4.5.
Diversion agreements have also addressed misconduct such as unprofessional conduct, communicating with represented parties, failing to maintain accounting records, and conduct that was prejudicial to the administration of justice.
Many cases resulted from personal problems the attorney was experiencing at the time of the misconduct. In these situations, the diversion agreements 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.
Random Samples of Diversion Agreements
Conflict of Interest
—The respondent engaged in a conflict of interest when he represented property owners in connection with defective construction on their residence. The general contractor on the project was respondent’s former client and acquaintance. No disclosure was given by the respondent and no consent was obtained from the property owners. Further, the respondent improperly solicited the property owners’ business. Rules implicated are Colo. RPC 1.7(b), Colo. RPC 7.3, and Colo. RPC 8.4(d) and (g).
—The respondent was charged with driving a vehicle under the influence of alcohol, driving a vehicle with excessive alcohol content on breath, failing to drive in a single lane, second offense in five years, and failing to provide proof of insurance. The respondent was convicted, via a plea bargain, of driving while ability impaired. The rules implicated are Colo. RPC 8.4(b) and C.R.C.P. 251.5(b).
—The respondent’s vehicle was reported by motorists on a Colorado highway to be weaving across several lanes. When the police located the respondent’s vehicle, it was already parked off the road. Upon contact with the respondent, the officer found indications that the respondent was intoxicated and called the state patrol for assistance. The state patrol officer administered roadside sobriety tests which the respondent failed to complete satisfactorily. The respondent was arrested and requested to provide an intoxilyzer breath sample. The respondent’s breath sample registered .297. The respondent was charged with driving while under the influence of alcohol and driving with excessive alcohol content in breath. A subsequent retest measured the respondent’s blood alcohol at .244. It is the respondent’s position that his weaving on the highway was due to his car’s defective steering mechanism. The respondent claims that after pulling his car off the road, he was so agitated by the incident that he prepared and drank two very strong drinks just before the police officer came upon his disabled vehicle. The respondent admits he also had several drinks earlier that day prior to driving. The respondent pled guilty to driving while ability impaired and weaving. This is the respondent’s first alcohol-related driving conviction. The respondent failed to timely report this matter. The rules implicated are C.R.C.P. 251.5(b); C.R.C.P. 251.20(b) and Colo. RPC 8.4(b).
—The respondent was pulled over by the Colorado State Patrol for driving erratically through lanes that were under road construction. The officer noted a strong alcohol odor and requested the respondent perform roadside maneuvers. When the respondent refused, the officer arrested him on suspicion of driving while under the influence. The respondent’s blood alcohol measured 0.141. The respondent pled guilty to driving while ability impaired and self-reported this matter to the Office of Attorney Regulation. This is respondent’s first alcohol-related offense. The rules implicated are Colo. RPC 8.4(b) and C.R.C.P. 251.5(b).
—The respondent self-reported his guilty plea to third-degree assault based upon a domestic dispute with his wife. On the night of the incident, the respondent admitted that he and his wife drank heavily, that his wife threw objects and slapped him, and he then punched her. A neighbor called the Sheriff’s department. Both parties were arrested and charged with third-degree assault and domestic violence. Within one week after the incident, the respondent began treatment with a psychiatrist, which included the prescription of antabuse. In exchange for the plea, the respondent received a twenty-four month supervised deferred sentence. He was ordered to complete an alcohol evaluation, an alcohol treatment plan, a domestic violence evaluation, and thirty-six weeks of domestic violence treatment. The respondent and his wife were prohibited from living together by restraining order. The rules implicated are Colo. RPC 8.4(b) and C.R.C.P. 251.5(b). This is a two-year diversion during which he must continue with approved psychiatric treatment, successful completion of an addiction program, random urine analysis and participation in a peer support program after the addiction program is complete.
—The respondent was convicted of harassment in connection with a single, isolated incident of domestic violence when the respondent argued with his wife in public, grabbed the keys from her car and approached her from behind. There was a dispute about the circumstances of his bodily contact with her. The rules implicated are C.R.C.P. 251.5(b) and Colo. RPC 8.4(b). He was required to complete all required conditions of his deferred judgment. This is a two year diversion.
—The respondent failed to pay experts in several personal injury cases handled on a contingent fee basis. In the first matter, the respondent subpoenaed two physicians to provide testimony on behalf of his client, the plaintiff in a personal injury case. Substantial expense for the physicians was incurred, but at trial the client was not awarded expenses for these physicians. The client was not financially able to pay the physicians so the respondent personally entered into a payment plan with the physicians. The respondent only made one payment. Nearly two years after the trial, the physicians sent a demand letter to the respondent and contacted the Office of Attorney Regulation. The respondent thereafter paid the physicians a lump sum partial payment and has agreed to continue to make payments until the physicians are paid in full. In the second matter, the respondent retained a company specializing in accident recreation for three personal injury cases. The respondent’s clients lost all three trials. None of the clients were able to pay costs. The respondent did not pay the expert company because he disputes the charges, which exceed $13,000. The respondent recently requested fee arbitration through the Colorado Bar Association’s Inter-Professional Committee. If no agreement to arbitrate is achieved, the respondent will petition the court in each case. The rule implicated is Colo. RPC 8.4(d).
—The respondent filed an affidavit in support of a motion with the district court in a pending dissolution of marriage action. The affidavit was purportedly signed by the client. In fact, the affidavit was signed by the client while in another country. Thereafter, the document was faxed to respondent’s office and the respondent then instructed her secretary to notarize the client’s signature as if the client were present before the notary. The rules implicated are Colo. RPC 8.4(a) and Colo. RPC 8.4(c).
—The respondent was contacted by a tile installer for a potential claim against a homeowner regarding work performed on a steam room in the homeowner’s house. The complainant alleged that, in initiating contact with him, the respondent stated that she represented the homeowner. The respondent denied this allegation, and instead asserted that, at the time of her contact with the complainant, she did not identify any client on whose behalf she was contacting the complainant. The respondent felt that identifying a client was not required because she was "investigating" whether to take the tile installer’s case. Additionally, one of the respondent’s other clients came up in the course of conversation. The respondent failed to identify this person as a client, and told the complainant that she was not speaking to the complainant on behalf of that client. The rules implicated are Colo. RPC 4.3 and Colo. RPC 8.4(c).
—The respondent posted an e-mail on a website stating that, in pertinent part, the complainant, a special advocate, submitted a report to the parties "two days prior to (a) hearing." This statement was made in the e-mail without the respondent consulting the file to check the actual period of time before the hearing that she received said report. The complainant had provided the report to the parties one week prior to the scheduled hearing, and the respondent referenced the report and its contents in a motion to reschedule the hearing filed with the court four days prior to the scheduled hearing. Despite being advised of the error by complainant, the respondent took no action to clarify her earlier e-mail. The rule implicated is Colo. RPC 8.4(c).
Confidentiality of Information
—The respondent represented a client concerning significant criminal charges. The respondent informed the client of a plea agreement being offered by the District Attorney’s Office. The respondent discussed the client’s case, and the opinion that the plea agreement should be accepted, with another person who was also being represented by the respondent. The rule implicated is Colo. RPC 1.6.
Failure to Communicate
—The respondent began representation of a client in a civil suit in August of 1997. The client worked for the respondent’s law firm and free legal representation was included as a benefit of employment. A complaint was filed on behalf of the client and the defendant filed an answer. During the pendency of the case, the client’s employment with the law firm was terminated. The client was informed, therefore, the work would be completed on her case on a "no charge" basis. The client took her file with her when she left employment. The respondent did no further work on the civil case, did not withdraw from the case, did not respond to the client’s phone calls, and did not respond to the client’s attempted communications by facsimile. (It should be noted that at the time of this agreement, the client’s case was still active and had not been dismissed by the court.) The rules implicated are Colo. RPC 1.3 and Colo. RPC 1.4.
—The respondent represented the client in a civil suit. The respondent filed a complaint on behalf of the client. A trial date was set. During the pendency of the case, the defendant made an offer of settlement which was rejected by the client. In addition, various witnesses’ testimony changed. The respondent advised the client he would not take the case to trial and would be filing a motion to withdraw. The client informed the respondent he wanted to proceed with the trial. The respondent filed a stipulation for dismissal without prejudice, without the client’s approval. The respondent and the opposing counsel did not appear in court on the trial date until summoned by the court. The client appeared without counsel because the respondent failed to appear. The court allowed the respondent to withdraw and allowed the client to continue with the case. The rules implicated are Colo. RPC 1.2, Colo. RPC 1.3, and Colo. RPC 1.4.
—The respondent was retained to investigate the filing of a bankruptcy on behalf of a client and was paid a total of $1,700 as a flat fee. Thereafter, it was agreed between the respondent and the client that filing bankruptcy would not be in the client’s best interest. After the performance of a small additional amount of work by the respondent for the client, the respondent earned a total of $460 of the $1,700 paid to him. The respondent did not immediately refund the balance to the client. Two months after he was terminated, he refunded the bulk of the client’s funds, and an additional two months later he refunded the balance of the client’s funds. The rules implicated are Colo. RPC 1.15(a), Colo. RPC 1.16(d), and Colo. RPC 1.4.
—The respondent met with the client concerning the representation of the client in a civil assault case. The client provided to the respondent various medical bills and a written narrative concerning the incident. The respondent also represented the client in a traffic case during the same time period. During the traffic case, there were several discussions between the respondent and the client concerning the potential civil case, which was still in the investigative stage. At the conclusion of the traffic case, there was a minor billing dispute, which was eventually resolved by payment by the client. The last payment on the traffic case was made in April 2000. Included with the client’s final payment was correspondence requesting the respondent to continue to pursue the civil matter; however, the statute of limitation had run on the civil matter. The issue was failure to adequately communicate with the client about the status of attorney-client relationship since the respondent claimed he had not agreed to represent the client on filing the civil assault claim and told the client that. From the initial meeting in April 1999 until the respondent received correspondence from the client in April 2000, there was only minimal communication from the respondent to the client concerning the civil case, the status of the investigation, or the respondent’s decision to not pursue the matter. The rules implicated are Colo. RPC 1.3 and 1.4.
—The respondent represented a client in a workers’ compensation matter. Following a hearing, the respondent was successful in obtaining some workers’ compensation benefits for his client. However, the administrative law judge declined to award some of the medical benefits the respondent sought for his client. The respondent believes that the judge erred in this ruling, but determined not to preserve his client’s rights to an appeal based upon his unilateral determination that a reversal was not likely. Although it is not clear whether an appeal would have been successful, the respondent paid his client an amount sufficient to pay the additional medical expenses in settlement of a subsequent malpractice claim. The rule implicated is Colo. RPC 1.4(b).
—The complainant was referred to the respondent through an attorney referral service to consult regarding the loss sustained by his parents-in-law in the shipment of personal items from Portugal to Denver. Both the complainant and the respondent were aware that the claim could have a short statute of limitations. The respondent advised the complainant that any lawsuit filed in Colorado would be risky and that the more appropriate forum was where the loss occurred. No advice in writing existed and the complainant and respondent differ in their recollection of the communication thereafter. The respondent alleges that the complainant did not contact him for several months, when he received four or five calls in one or two days. The complainant alleges that he called the respondent every day or every other day, but he never received a return call. The complainant then wrote the respondent and received no response until the Office of Attorney Regulation was contacted. After the involvement of this office, the respondent signed a contingent fee agreement with the clients and filed a lawsuit in Denver District Court. The respondent contends he again advised the complainant and clients that the lawsuit was high-risk. The respondent contends that he informed his clients of a settlement offer, but the complainant states that no information regarding a settlement offer was conveyed. The respondent has no documentation confirming contact with the clients regarding the settlement offer. The defendants in the lawsuit filed a motion to dismiss based upon the statute of limitations. The respondent contends he never received the motion to dismiss and therefore never responded to it, despite the fact that his correct address was on the certificate of mailing. The district court dismissed the lawsuit and the respondent sent a copy of the order to the complainant and clients. He failed to advise them of the options of filing a motion for reconsideration or an appeal. The rules implicated are Colo. RPC 1.4(a) and Colo. RPC 1.3.
—The respondent represented a client in a real estate case, specifically an application for a special use permit, sought by the clients in order to house or kennel dogs on their property. During the above-mentioned representation, the respondent sent correspondence to a person who had presented written opposition to the respondent’s clients’ application for a special use permit. The correspondence threatened an administrative action against the party’s real estate license. The rule implicated is Colo. RPC 4.5.
—The respondent was retained by the client for representation in a dispute with a contractor hired to remodel the client’s home. The client paid one-half of the contract amount up front, but after seven months, the contractor had still not performed the work. The respondent wrote to the contractor stating the client’s position in the dispute and proposed terms for settlement. The respondent’s letter stated that the client would refrain from filing a criminal complaint for one week to give the contractor time to pay the amount allegedly owed to the client with interest. The rule implicated is Colo. RPC 4.5.
—The respondent was retained to represent a client concerning a decision by the Department of Corrections to place the client within a certain classification of inmates. The respondent was retained to file a Rule 106 complaint. The respondent was paid $600 by the client for the above-mentioned services. The client paid the respondent on December 1st and December 18th. The final decision of the Department of Corrections concerning the client was issued and the Rule 106 action was required to be filed within thirty days of the Department of Corrections’ final decision. The respondent did not file the Rule 106 complaint within the specified time frame but eventually filed the complaint. In mitigation, there were other available remedies to the client under the circumstances. The rule implicated is Colo. RPC 1.3.
—The respondent was retained to represent a client in a divorce proceeding. As part of that case, the respondent was ordered in September 1996 to prepare a Qualified Domestic Relations Order regarding retirement funds awarded to the client. The respondent failed to draft the Qualified Domestic Relations Order until October 2000, four years after it was ordered by the court. There was no harm. The rules implicated are C.R.C.P. 251.13(c) and Colo. RPC 1.3.
—The respondent failed to communicate with a client for two months and failed to return the client’s file once his services were terminated. In addition, the respondent failed to finalize and submit a temporary order stipulation in another client matter. Finally, the respondent was to represent a client in a motor vehicle dealer licensing matter. As the respondent could not attend on the date of the hearing, the respondent notified the client to attend the hearing and request a continuance. The respondent should have withdrawn from the motor vehicle dealer licensing matter prior to hearing or should arranged for another attorney to represent the client at such hearing. The rules implicated are Colo. RPC 1.3, Colo. RPC 1.4(a), Colo. RPC 1.16(a), Colo. RPC 1.16(d) and Colo. RPC 8.4(d).
—The respondent agreed to represent a client in a contract dispute with a municipality. The respondent advised his client that the statute of limitations had run on all but a liquidated damages claim. He filed a complaint in the district court and the city answered. The respondent participated in the case management conference but did not prepare the case management order. The respondent was late providing C.R.C.P. disclosures due to his client’s failure to forward documentation; however, he failed to respond to the city’s motion to compel the disclosures. The respondent additionally did not respond to the interrogatories and requests for admissions served on his client by the city. After his client was deposed by the city, the respondent advised her that the liquidated damages claim was highly speculative. The client instructed the respondent to dismiss the case, but he failed to do so. The court later granted the city’s motion for summary judgment due to the respondent’s failure to respond. The city then moved for its costs and fees. The respondent did not respond to the motion because he felt the lawsuit was groundless. The court entered an order for fees and costs against the client. Although the respondent told the client about the order for fees and cost, he failed to respond to or tell the client about the city’s letter demanding payment. The client therefore did not make payment and was served with C.R.C.P. 69 interrogatories. The respondent failed to instruct the client to serve a copy of her Rule 69 responses on the city and the city garnished the client’s bank account. The respondent paid the fees and costs assessed against the client after the request for investigation was filed by the attorney for the city. The client maintains she is satisfied with the respondent’s work. The rules implicated are Colo. RPC 3.4(c), Colo. RPC 1.3, and Colo. RPC 3.1.
—The diversion agreement addressed the respondent’s actions in two separate criminal cases. In the first case, the respondent was appointed by the Court of Appeals to appeal the client’s sentence of life imprisonment without parole after his conviction of first-degree murder, second-degree murder, and attempted aggravated robbery. The respondent timely filed an opening brief, but filed the reply brief late. The court denied a request for oral argument due to its late filing and then affirmed the trial court’s decision. The respondent filed a request to file a late petition for rehearing without notifying the Attorney General. The Court of Appeals at first granted the petition, then denied it. The respondent then failed to file a timely petition for writ of certiorari. She filed a petition to allow the late filing of the petition for writ of certiorari, but again failed to serve the Attorney General. The court ultimately denied the petition for writ of certiorari due to its untimely filing. The respondent sent a written apology to the client and a motion for substitution of counsel for the client’s signature. The client signed and returned the motion, but the respondent never filed it with the court. In the second case, the respondent was retained to appeal a trial court’s denial of her clients’ pro se Rule 35(c) motion. The clients, a married couple, each had been convicted of attempting to influence a public servant. Both parties had been fined and sentenced to three years probation and community service. The respondent agreed to provide the necessary appellate work for a flat fee of $4,000. She filed a notice of appeal of the denial of the 35(c) motion with the Court of Appeals. She filed the opening brief, but failed to file a reply brief. The Court of Appeals affirmed the trial court order and remanded the case to the trial court with directions. The respondent then entered into a new fee agreement with the clients for a flat fee of $1,500. The respondent presented an oral argument to the trial court and was ordered to file a supplemental brief. After being granted two extensions, the respondent filed the brief twelve days late. The court did not timely rule on the matter despite the fact that the respondent filed two requests for a ruling. The trial court eventually denied the Rule 35(c) motion, but granted the clients’ pro se motion to appoint new counsel in the appeal of the remand of the 35(c) motion. The rules implicated are Colo. RPC 1.3 and Colo. RPC 1.4(a).
—The respondent represented a father who was considering whether to seek a change in custody of his daughter. At that time, the daughter’s mother had primary residential custody. The daughter had been undergoing treatment with a therapist. To determine the propriety of filing a motion to modify custody, the respondent sought information and medical records regarding the daughter’s treatment from the therapist. Both the father and the daughter signed waivers and releases for the therapist to release the daughter’s treatment records to the respondent. The therapist indicated to the respondent that she was considering the release but ultimately decided against providing them. The respondent then had a subpoena to produce records served upon the therapist. At that time, there was no pending action between the father and the mother, nor was there any deposition scheduled. The respondent failed to serve a copy of the subpoena upon the mother or her counsel. The mother’s attorney wrote to the respondent regarding the impropriety of the subpoena and requested respondent withdraw it. The respondent then withdrew his subpoena on the therapist. The rule implicated was Colo. RPC 1.1.
Commingling/Trust Account/Accounting Records Issues
—The respondent commingled client funds and personal funds in his COLTAF account during the period from January 1, 1999, through October 30, 1999. No client funds were misappropriated. The rules implicated are Colo. RPC 1.15(a) and Colo. RPC 1.15(g)(1).
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