Attorney Grievance Commission of Maryland v. Cohen

CATHELL, Judge. Bar Counsel, on behalf of the Attorney Grievance Commission (AGC), petitioner, and at the direction of the Review ¹⁶² Board, filed a Petition for Disciplinary Action with this Court against Steven Robert Cohen, Esquire, respondent, 1 pursuant to Maryland Rule 16-709. In the Petition, Bar Counsel alleges violations of Rules 1.1, 1.3, 1.4, 1.5, 8.1, and 8.4 of the Maryland Rules of Professional Conduct (MRPC), based on two complaints filed against respondent. This Court referred the matter to Judge Mary Ann Stepler of the Circuit Court for Frederick County to conduct an evidentiary hearing in accordance with Maryland Rule 16-709(b).

An evidentiary hearing was conducted on April 26 and 27, 2000, and an Opinion and Order with findings of facts and conclusions of law was filed on June 21, 2000, in accordance with Maryland Rule 16-711(a). Judge Stepler found by clear and convincing evidence that respondent violated MRPC 1.1, 1.3, 1.4, 8.1(a), and 8.4(c) and (d). 2 Pursuant to Maryland Rule 16-711, respondent filed exceptions to the findings of fact made by Judge Stepler. We have independently examined the record and the trial court’s findings. Based upon that review, we hold that the court’s findings of facts and proposed conclusions of law are supported by the record in this case.

Accordingly, we overrule respondent’s exceptions. We shall suspend respondent indefinitely, granting him permission to apply for readmission after six months. I. Facts As stated, supra, this disciplinary action arose out of two complaints. One complaint was filed by Yvonne Crespo, a client that respondent was representing in a custody case.

The second complaint was filed by the Honorable Duncan W. Keir after respondent had appeared before Judge Keir representing clients in two separate bankruptcy proceedings. ¹⁶³ BC Docket No. 98-22-11-6 Complaint of Yvonne Crespo There is evidence in the record, and Judge Stepler found that, on or around July 20, 1996, Ms. Crespo received a letter from an attorney representing Jaymes A. Hall, the father of her minor child, which informed Ms. Crespo that an ex parte emergency relief hearing was scheduled in the Circuit Court for Frederick County for July 25, 1996. Along with the letter, Ms. Crespo also received a Motion for Ex Parte Temporary Custody, a proposed Ex Parte Order granting immediate custody, a Petition for Emergency Custody, and a financial statement of Jaymes Hall. Ms. Crespo’s mother and brother selected respondent out of the telephone book and made an appointment for Ms. Crespo. At her initial meeting -with respondent on July 23, 1996, Ms. Crespo gave respondent the documents she received in the mail, and a retainer fee of $1,590.00.

During the initial meeting, respondent contacted counsel for Mr. Hall to negotiate a settlement. Respondent and counsel for Mr. Hall negotiated a Consent Order on July 26, 1996. Before the Consent Order was presented to the Circuit Court for Frederick County, however, the circuit court, on July 26, 1996, had already denied the ex parte relief requested by Mr. Hall. 3 The Consent Order was executed by the Honorable G. Edward Dwyer, Jr., on July 31, 1996. The Consent Order restricted Ms. Crespo’s custodial rights and her right to travel outside of the jurisdiction. 4 Ms. ¹⁶⁴ Crespo testified that prior to the Consent Order being signed, she informed respondent that she intended to travel to Florida with the minor child.

Respondent incorrectly explained to Ms. Crespo that the Consent Order only restricted her ability to travel outside the United States. As discussed supra, note 8, the language of the Consent Order clearly states otherwise. The consent order, to which she agreed, restricted her ability to travel outside the State of Maryland. Even though Mr. Hall’s request for ex parte relief had been denied, respondent filed an answer to it on August 15, 1996.

Thereafter, the respondent took no action in Ms. Crespo’s case and had no further contact with Ms. Crespo, despite her leaving numerous messages at his office. Frustrated with her inability to contact respondent, Ms. Crespo, asked her brother, Antonio Crespo, to help her contact respondent. In December, 1996, Mr. Crespo went to respondent’s office without an appointment and asked respondent for an explanation as to why he was not returning Ms. Crespo’s phone calls. Respondent was apologetic and promised to be more attentive.

Thereafter, on January 21, 1997, respondent filed a counter complaint against Mr. Hall, on behalf of Ms. Crespo. Respondent then erroneously filed a Motion for Default Judgment against Mr. Hall on April 1, 1997. Mr. Hall had obtained new counsel and, on March 17, 1997, respondent had granted Mr. Hall’s new counsel a thirty-day time extension to file an answer to the counter complaint. Respondent stated that he forgot he had granted the time extension to opposing counsel and respondent entered a stipulation vacating the Motion for Default Judgment.

Mr. Hall’s attorney filed an answer to the counter complaint on April 17,1997. Respondent then began new negotiations with opposing counsel. Respondent, without Ms. Crespo’s knowledge, negotiated with opposing counsel about an overnight visit between Mr. Hall and the minor child. A meeting with both attorneys ¹⁶⁵ and both parties was arranged but respondent never informed Ms. Crespo.

She found out about the meeting from the opposing party, Mr. Hall. Ms. Crespo tried to contact respondent about the meeting by telephone, but she did not receive a return phone call. Ms. Crespo again relied upon her brother, Mr. Crespo, to contact respondent. Mr. Crespo then went to respondent’s office without an appointment and asked respondent why he was not returning his sister’s phone calls and why she was not being kept informed of the status of her case.

Respondent stated that he had sent Ms. Crespo a letter. At the disciplinary hearing, Ms. Crespo testified that she never received any such letter from respondent. Ms. Crespo then sought substitute counsel. Ms. Crespo discharged respondent on or around May 20, 1997, and requested her file and a refund of unearned fees.

On May 27, 1997, respondent’s appearance was withdrawn and a new counsel entered his appearance. The AGC received a disciplinary complaint from Ms. Crespo on July 21, 1997, at which time Ms. Crespo still had not received a refund of unearned fees. Respondent was placed on notice of the complaint by a letter dated August 1, 1997. Respondent sent a letter dated August 13, 1997, to the AGC stating that he had returned a refund to Ms. Crespo.

The AGC received a letter from Ms. Crespo on September 11, 1997, stating that she had not received a refund from respondent. The AGC then assigned the case to John W. Reburn, Bar Counsel Investigator. Bar Counsel contacted respondent on October 28, 1997 to schedule a meeting, which occurred on December 8, 1997. Bar Counsel also faxed to respondent the letter received from Ms. Crespo on September 11, 1997, which stated that she had not received a refund from respondent.

In November, six months after respondent had been discharged and three months after respondent had sent a letter to the AGC stating that the refund had already been sent, Ms. Crespo finally received a refund of $470.00 from respondent. Respondent testified that he was the only person in his office with the ¹⁶⁶ signatory power over escrow accounts. Respondent also testified that he did not know the refund was not sent to Ms. Crespo until he was contacted by Bar Counsel. Respondent had no explanation for why he had stated in August 1997, that he had sent the refund.

Respondent testified that he never received any telephone messages from Ms. Crespo. However, respondent’s secretary, Dawn Rretchmyer, testified that Ms. Crespo called the office frequently for information about her case. Respondent testified that he sent letters to Ms. Crespo, however, Ms. Crespo testified that she had not received any letters from respondent. Bar Counsel testified that upon reviewing respondent’s file, respondent had the wrong address on the file and on the billing statements.

Ms. Crespo’s file in respondent’s office also included his activity logs. Her file had three separate activity logs that appeared to be kept in a disorganized and haphazard manner. One activity log had entries from May 14, 1996 and July 3, 1996, long before respondent had been retained by Ms. Cres-po. Ms. Crespo was not served the original papers in this case until approximately July 20, 1996, and she did not retain respondent until July 23, 1996.

Therefore, the entries could not be applicable to Ms. Crespo and could not have been entered as work completed on Ms. Crespo’s behalf. Based upon the aforementioned findings of fact, Judge Stepler concluded that respondent violated the following in his representation of Ms. Crespo: 1. Respondent violated MRPC 1.1 (Competence), in that he lacked the “thoroughness and preparation necessary” in order to faithfully represent Ms. Crespo; 2. Respondent violated MRPC 1.3 (Diligence) through his failure to keep Ms. Crespo apprized of her case; 3.

Respondent violated MRPC 1.4 (Communication) through his pervasive failure to inform Ms. Crespo of the status of her case; 4. Respondent violated MRPC 8.1(a) (Bar admission and disciplinary matters) by stating in a letter to the Attor ¹⁶⁷ ney Grievance Commission that he had refunded all unearned fees to Ms. Crespo when the refund had not been sent; 5. Respondent violated MRPC 8.4(c) (Misconduct) when he made false representations to Ms. Crespo and Bar Counsel about having refunded all unearned fees; 6. Respondent violated MRPC 8.4(d) (Misconduct) by directly misleading the AGC about having sent a refund to Ms. Crespo when respondent had not sent the refund.

She also found that respondent’s careless business practices, failing to keep a contemporaneous activity log, also violated 8.4(d). BC Docket No. 98-199-11-6 Complaint of the Honorable Duncan W. Keir 5 Judge Keir contacted the AGC about two cases in which respondent had appeared before him. A. Ashley Case There is evidence in the record that, and Judge Stepler found that, respondent was retained by Robin and Kerry Ashley to represent the Ashleys in a bankruptcy case. The Ashleys were seeking bankruptcy protection because they were several months in arrears on their mortgage payments and there was a dispute with the mortgage company as to how much money the Ashleys actually owed.

The Ashleys had not filed state or federal income tax returns for the years 1992 through and including 1996. The Ashleys also had other debts. 6 On May 1, 1997, respondent, on behalf of the Ashleys, filed a Voluntary Petition for Bankruptcy Protection under Chapter 13. As required by the bankruptcy rules, respondent then ¹⁶⁸ filed a Chapter 13 plan within fifteen days. A combined notice, dated June 13, 1997, was sent to respondent and the Ashleys notifying them of the section 341 Creditors’ Meeting scheduled for July 11, 1997, and the plan confirmation hearing scheduled for July 22, 1997.

Respondent did not receive this notice directly as it was mailed to his previous address. Mrs. Ashley testified, however, that she dropped off a copy of the combined notice at respondent’s office when she received it in the mail. Respondent testified that upon receiving the combined notice from Mrs. Ashley, respondent faxed a request on July 11, 1997 to the U.S. Trustees to continue the section 341 Creditors’ Meeting. On July 22, 1997, respondent and the Ashleys attended the scheduled plan confirmation hearing.

The Trustee, Thomas Lackey, instead held the section 341 Creditors’ Meeting and requested a continuance of the plan confirmation hearing. The continuance was granted and the plan confirmation hearing was rescheduled for September 11, 1997. By a Trustee Report filed on July 22, 1997 and a Trustee’s Proceeding Memo filed on July 24, 1997, respondent was given notice that the Ashleys were required to make escrow payments as required under the Bankruptcy Code, make sure that there was not any post-petition arrearage to any secured creditor, make sure that all tax returns due to Federal and State authorities were filed and copies were provided to the Trustee, and provide income verification and valuation for the real property of the Ashleys within thirty days. The plan confirmation hearing was held on September 11, 1997 before Judge Keir. 7 At the hearing on the Petition for Disciplinary Action, Mrs. Ashley testified that respondent had not provided the Ashleys with a copy of the Trustee Report prior to the hearing.

Respondent had told the Ashleys that he would meet with them forty-five minutes before the meeting to prepare them for the meeting, however, respondent was late, ¹⁶⁹ apparently due to a flat tire. Therefore, respondent did not have the opportunity to properly inform the Ashleys about the hearing. Mr. Lackey, Trustee, testified at the plan confirmation hearing that since the plan was filed, three plan payments had been due and Mr. Lackey had not received any payments. 8 Mr. Lackey also testified that the Ashleys’ income tax returns still had not been filed and that Mr. Lackey had not received verification of the Ashleys’ income and the valuation for the real property. Mr. Lackey also testified that the claim of First Union Mortgage had been an allowed claim and was for $15,000.00.

Respondent failed to file an exception to the $15,000.00 claimed by First Union Mortgage, even though the Ashleys claimed to owe only $10,000.00. Mr. Wilkinson objected to the submitted plan because the plan did not include a provision to pay a secured claim held by the United States. The Bankruptcy Code 9 requires that secured claims be specifically identified in the plan and the secured claim of the IRS for unpaid taxes, penalty, and interest due was not ¹⁷⁰ identified. Respondent stated that he would make sure that the tax returns were filed and that of the three delinquent plan payments, two payments would be made that day.

Judge Keir, at the conclusion of the September 11, 1996 hearing, ordered that “the plan[, as] presently on file[, is] denied confirmation with leave to amend on or before ... October 13th. Hearing upon any amended plan will be November 13th at 3:15 p.m. The Court further notes that no further postponements will be granted in this case.” Judge Keir filed an Order Denying Confirmation of Chapter 13 Plan With Leave to Amend on September 12,1997.

The IRS filed a Motion for an Enlargement of Time in Which to File an Amended Proof of Claim on October 1, 1997, because they had not received the tax returns. Judge Keir granted the motion without a hearing. Oh October 10, 1997, the Ashleys filed a debtors’ certificate, which was required by the plan to show that the requirements of the plan were being satisfied by the Ashleys. The certificate, which was filed under the pain and penalty of perjury, showed the payments that had been made to First Union Mortgage and it also was marked that the Ashleys had filed all federal and state income tax returns.

Mrs. Ashley testified, at the hearing on the Petition for Disciplinary Action, that when she picked up the debtors’ certificate from the respondent’s office, the certificate was blank except for an “X” where the Ashleys were supposed to sign. Dawn Kretchmyer, respondent’s secretary, testified that she typed in the information on the certificate about the Ashleys’ payments to First Union Mortgage but did not mark the “X” indicating that all federal and state income tax returns had been filed. Respondent, or someone in his office, marked that the federal and state income tax returns had been filed. The hearing on confirmation of the amended plan convened before Judge Keir on November 13, 1997. 10 At the hearing, ¹⁷¹ Mr. Lackey stated that although the Ashleys were current on their payments under the plan, he had not seen the state tax returns.

Mr. Lackey also stated that the plan was underfunded to cover all of the disbursements that the Ashleys intended to put in their plan. After Mr. Lackey addressed the court, Judge Keir turned his attention to the debtors’ certificate that was filed on October 10, 1997. The certificate, signed under penalty of perjury, stated that all federal and state income tax returns had been filed. Judge Keir, concerned that false testimony had been presented to the court, questioned Mrs. Ashley and respondent about the circumstances surrounding the filing of the certificate.

Mrs. Ashley stated to Judge Keir that she gave the completed tax returns from H & R Block to respondent, along with pre-addressed envelopes. The Ashleys signed the debtors’ certificate on the advice of respondent 11 and in reliance on respondent’s promise to file the tax returns. Judge Keir then questioned respondent as to the location of the missing federal and state income tax returns. Respondent, during the hearing, had looked in his briefcase and found the originals of the federal income tax returns, the Ashleys’ W-2, and the pre-addressed envelopes.

Respondent claimed that the tax returns were probably placed in his file by one of his employees and he was unaware that the returns were still in his possession. Respondent was confused at the hearing about what the order from September 12, 1997 required him to have done. He thought he did not have to file an amended plan prior to October 13, 1997, even though it was stated in the order from September 12, 1997. The clerk’s office had attached an order to dismiss for respondent’s failure to amend, however, Judge Keir had not executed the order.

If the order had been signed, the Ashleys would have lost their ability to file for