Attorney Grievance Commission v. Engerman

Per Curiam The Attorney Grievance Commission, acting through Bar Counsel, filed a petition for disciplinary action against Jay Seth Engerman, alleging violations of the Disciplinary Rules of the Code of Professional Responsibility. We referred the matter, pursuant to Maryland Rule BV9 b, to Albert L. Sklar, an Associate Judge of the Supreme Bench of Baltimore City, to make findings of fact and conclusions of law. After conducting an evidentiary hearing, Judge Sklar filed detailed findings and conclusions as follows: The tripartite petition asserted that the Review Board of the AGC, pursuant to Rule BV7 of the Maryland Rules of Procedure, directed Bar Counsel to file charges against the Respondent, which charges are alleged in three sections of the Petition filed: (1) Part A of the Petition concerning Rudolph Queen, Sr., a former client; (2) Part B of the Petition concerning Steven and Eleanor Queen, former clients; and (3) Part C of the Petition concerning James Harris and Michael Hughes, allegedly ³³² former clients. Bar Counsel asked the Court of Appeals to take such disciplinary action as it thought appropriate.

By an Order dated January 25,1980, the Court of Appeals responded to Bar Counsel’s allegations that Respondent did unethically and unprofessionally violate certain provisions of the Disciplinary Rules (DR) of the Code of Professional Responsibility (CPR) and transmitted the charges to the Supreme Bench of Baltimore City (Eighth Judicial Circuit) to be heard and determined by the undersigned pursuant to Rule BV9 et seq. The pertinent disciplinary rules which Bar Counsel claims have been unethically and unprofessionally violated are: Disciplinary Rule 1-102 "Misconduct. (A) A lawyer shall not: (1) Violate a Disciplinary Rule. (5) Engage in conduct that is prejudicial to the administration of justice.

(6) Engage in any other conduct that adversely reflects on his fitness to practice law.” Disciplinary Rule 2-103 "Recommendation of Professional Employment. (C) A lawyer shall not compensate or give anything of value to a person or organization to recommend or secure his employment by a client, or as a reward for having made a recommendation resulting in his employment by a client, except that he may pay the usual and reasonable fees or dues charged by any of the organizations listed in DR 2-103 (E). (D) A lawyer shall not request a person or organization to recommend or promote the use of his services or those of his partner or ³³³ associate, or any other lawyer affiliated with him or his firm, as a private practitioner, except that: (1) He may request referrals from a lawyer referral service operated, sponsored, or approved by a bar association and may pay its fees incident thereto. (2) He may cooperate with the legal services of any of the offices or organizations enumerated in DR 2-103 (E) (1) through (4) and may perform legal services for those to whom he was recommended by it to do such work if: (a) The person to whom the recommendation is made is a member or beneficiary of such office or organization; and (b) The lawyer remains free to exercise his independent professional judgment on behalf of his client.” Disciplinary Rule 5-103 "Avoiding Acquisition of Interest in Litigation.

(B) While representing a client in connection with contemplated or pending litigation, a lawyer shall not advance or guarantee financial assistance to his client, except that a lawyer may advance or guarantee the expenses of litigation, including court costs, expenses of investigation, expenses of medical examination, and costs of obtaining and presenting evidence, provided the client remains ultimately liable for such expenses.” Disciplinary Rule 5-106 "Settling Similar Claims of Clients. (A) A lawyer who represents two or more clients shall not make or participate in the making of ³³⁴ an aggregate settlement of the claims of or against his clients, unless each client has consented to the settlement after being advised of the existence and nature of all the claims involved in the proposed settlement, of the total amount of settlement„and of the participation of each person in the settlement.” Disciplinary Rule 9-102 "Preserving Identity of Funds and Property of a Client. (B) A lawyer shall: (1) Promptly notify a client of the receipt of his funds, securities, or other properties. (2) Identify and label securities and properties of a client promptly upon receipt and place them in a safe deposit box or other place of safekeeping as soon as practicable.

(3) Maintain complete records of all funds, securities, and other properties of a client coming into the possession of the lawyer and render appropriate accounts to his client regarding them. (4) Promptly pay or deliver to the client as requested by a client the funds, securities, or other properties in the possession of the lawyer which the client is entitled to receive.” In brief, the Bar Counsel’s allegations are as follows. In Part A of the Petition, Bar Counsel charges that the Respondent violated DR 2-103 by suggesting and arranging with Rudolph Queen, Sr., that if Queen would refer clients to Respondent, he, the Respondent, would pay him money and that Queen did, in fact, refer many clients to Respondent who did, in fact, pay Queen for such referrals. In Part B of the Petition, Bar Counsel claims that the Respondent violated DR 2-103 by paying Steven and Eleanor Queen for ³³⁵ referring clients and that he violated DR 5-103 by advancing monies to the Queens for purposes other than for the proper expenses of litigation.

And in Part C of the Petition, Bar Counsel alleges that the Respondent or his agent violated DR 9-102 by continuing to press claims for alleged damages that James Harris and Michael Hughes may have had against State Farm Insurance even after both clients or their agent had advised the Respondent that neither wished to pursue each of their potential claims. Further allegations in Part C of the Petition involved the unauthorized signing or alleged forging of Harris’ and Hughes’ signatures on Personal Injury Protection (PIP) applications, forms and endorsements of PIP checks. Moreover, in each part of the Petition, Bar Counsel alleges that the Respondent violated DR 1-102, the Disciplinary Rule which governs all "conduct that adversely reflects on [one’s] fitness to practice law.” The Respondent was served on February 5, 1980, and answered the Petition on February 15,1980. Included in the Respondent’s Answer was an allegation that Bar Counsel was guilty of laches with respect to the charges set forth in Parts A and B of the Petition.

Also on February 15,1980, the Respondent filed a Motion for Separate Trial of Claims in Part C of the Petition. Oral argument was heard on March 28, 1980, before this Court on Respondent’s Motion for Separate Trials. The Respondent’s attorney, Robert E. Cahill, Esquire, argued that Bar Counsel knew of the allegations contained in Parts A and B of the Petition no later than August 31, 1976, but failed to notify the Respondent of those charges until January, 1979. The Respondent alleged that this was a prejudicial, unwarranted delay which, in turn, allowed Bar Counsel to join the "totally unrelated and dissimilar” claims of Part C to the charges of Parts A and B. Citing the delay involved, the difference between the charges brought in Part C with the rest of the Petition, and the potential prejudice which could arise if all parts of the Petition were heard together, the Respondent argued to have the claims asserted in Part C adjudicated separately.

Bar Counsel, represented by Henry J. Myerberg, cited Attorney Grievance Commission of Maryland v. Stewart, ³³⁶ 285 Md. 251 (1979) and State v. Hutchinson, 260 Md. 227 (1970) in his effort to persuade this Court that no prejudice would arise if all three parts of the Petition were heard together. Bar Counsel urged that granting a bifurcated trial because of the potential prejudice Respondent alleged would be tantamount to ignoring "the professional expertise, experience and judicial temperament with which our legal system has inherently invested a trial judge vis-á-vis a jury comprised of laymen.” Hutchinson at 233 . In an oral opinion rendered the same day, this Court denied the Respondent’s Motion for Separate Trials holding that no prejudice would arise and that a single hearing would save much in the way of time and expense. Since the charges brought by Bar Counsel against the Respondent arose out of three separate matters, this Court will render both a finding of fact and a conclusion of law as to each.

PARTA FINDINGS OF FACT The Respondent admitted in his Answer to the Petition that prior to 1975, Rudolph Queen, Sr., referred potential clients to him and, in some instances, the Respondent thereafter tendered checks from his bank account to Mr. Queen. Eleven of those checks, drawn on the Respondent’s escrow account at the Mercantile-Safe Deposit and Trust Company between May 10, 1974, and December 22, 1975, and ranging in amount from $500.00 to $25.00, were entered into evidence as Petitioner’s Exhibit #1. In his deposition taken on May 2, 1980, the Respondent admitted that, "Yes, I did ask him (Rudolph Queen) to refer clients to me, yes.” Deposition at 17. At the hearing itself, the Respondent freely admitted that the checks in question were given to Rudolph Queen, Sr., for payment of the referral of cases upon the closing of each case.

The Respondent further stated that he did not believe Rudolph Queen, Sr., was "soliciting” cases, nor did he believe his payments to Mr. Queen were improper. Earlier in his ³³⁷ testimony the Respondent said that he did not know that it was incorrect to make payments for referrals. Rudolph Queen, Sr., testified that he referred "maybe 50 or 60 cases” and received money in a "majority” of cases he referred. Mr. Queen stated that while his first payment from the Respondent came in the form of a "gift” from the Respondent, later monies came in the form of cash and checks.

Moreover, Mr. Queen testified that at some point in their relationship, the Respondent told him that he would "like to do better by you” and started payment for referrals on a percentage basis. Mr. Queen stated he received "something like 5% of the cases that materialized.” The Respondent acknowledged at the hearing that he now knew that the payments made were improper after "reading the rules closely.” Respondent also apologized to the Court for his actions. CONCLUSIONS OF LAW This Court finds by clear and convincing evidence that the payments made by the Respondent to Rudolph Queen, Sr., for the latter’s referral of cases is violative of DR 2-103 (C). This Court also finds by clear and convincing evidence that the Respondent’s request to Rudolph Queen, Sr., that the latter refer cases is violative of DR 2-103 (D).

Pursuant to the above findings, this Court also finds that the Respondent has violated DR 1-102 (A) (1), and DR 1-102 (A) (6). PARTB FINDINGS OF FACT The Respondent stated in his Answer to the Petition that on or about April 23, 1973, Steven Queen, the brother of Rudolph Queen, Sr., above-referred to in Part A of the Petition, and Eleanor A. Queen were involved in an automobile collision, as a result of which both were taken to North Arundel Hospital. The Respondent also admitted that Rudolph Queen, Sr., took him to the North Arundel Hos ³³⁸ pital, introduced him to Steven Queen and recommended his services. (Deposition at 41).

Thereafter, the Respondent represented the Queens in their claims arising from said collision. Steven Queen testified at the hearing that the Respondent told him he "could make some bread under the table” if he referred cases. Eleanor Queen also testified that the Respondent initiated a discussion that led to her being told that she would be paid money if she referred cases to the Respondent. While the Respondent denied initiating any discussion of referrals with either Steven or Eleanor Queen, the Respondent admitted in his Answer to the Petition that he told the Queens he would pay if they did refer cases to him.

In fact, after first testifying at the hearing that he had no general discussion of payment for referrals with Eleanor Queen, the Respondent later admitted that he told her that she would be paid if she referred the Abner Stevens case and the Respondent was successful with it. The Respondent then admitted that he paid either Steven or Eleanor Queen for the referral of the Stevens case. At the hearing, both Steven and Eleanor Queen testified they each referred one case and were compensated for it. Bar Counsel elicited testimony from Steven Queen that he referred a man by the name of Harry Spriggs.

Eleanor Queen testified she referred a man by the name of Abner Stevens. Bar Counsel then entered Petitioner’s Exhibit Number 7 into evidence, this exhibit being photostatic copies of nine checks. Five of the checks were drawn on the Respondent’s Suburban Trust account. The other four were drawn on the Respondent’s Mercantile-Safe attorney escrow account.

Check number 4642 made out to Eleanor Queen in the amount of $150.00 was clearly identified by Eleanor Queen at the hearing as her compensation for referring Mr. Stevens. Steven Queen testified he received "$40.00 or $50.00 by check” for his referral but could not identify any particular checks in Petitioner’s Exhibit #7. The Respondent also admitted in his Answer to the Petition that he advanced Seven Hundred Twelve Dollars ($712.00) to Steven Queen for purposes other than the ³³⁹ expenses of litigation, expenses of medical examination, and costs of obtaining and presenting evidence. The Respondent also admitted that at the settlement of the automobile collision matter in which he represented the Queens on or about April 24, 1976, the Respondent deducted from the amount due Steven Queen $712.00, the amount of the advances cited above.

Testimony at the hearing by both Steven Queen and the Respondent clearly shows that the advances were for food and other necessities of the Queens’ home. The Respondent testified that he knew that it was improper for a lawyer to advance funds in this fashion but that he felt sorry for the Queens so he advanced them the money. Bar Counsel introduced into evidence Petitioner’s Exhibits #2 and #3 to show Respondent’s full accounting for the loans made to Steven Queen. Petitioner’s Exhibit #2 contains four of the Respondent’s business cards on the back of which the date and the amount of each loan was recorded along with the signatures of both the Respondent and Steven Queen.

The cards are in the amount of $40.00, $200.00, $25.00 and $100.00. The total of the four cards is $365.00. Petitioner’s Exhibit #3 is an inter-office memorandum signed by Steven Queen indicating that he owed the Respondent $347.00. The total amount represented by these two exhibits is $712.00, the amount the Respondent admitted loaning Steven Queen for purposes other than the expenses of litigation.

CONCLUSION OF LAW This Court finds by clear and convincing evidence that the payments made by the Respondent to Steven Queen and Eleanor Queen for the referral each one made were violative of DR 2-103 (C). This Court also finds by clear and convincing evidence that the Respondent’s assertion to the Queens that they would be paid for referring cases was violative of DR 2-103 (D). This Court does not believe it is necessary to choose between the testimony of the Respondent and the Queens as to who initiated the referral ³⁴⁰ discussions. This Court is satisfied that an expression of the Respondent’s willingness to pay for referrals is sufficient to violate DR 2-103 (D).

This Court also finds by clear and convincing evidence that the advances made by the Respondent to Steven Queen were violative of DR 5-103. Pursuant to the above findings, this Court holds that the Respondent has violated DR Í-102 (A) (1), DR 1-102 (A) (6), and DR 2-103 (D). PART C FINDING OF FACT The Respondent admitted in his Answer to the Petition that on or about November 8, 1976, James Edward Harris and Michael Wesley Hughes, passengers in a vehicle owned by one Caroline High, were involved in an automobile collision in Baltimore City. Testimony by both Harris and Hughes at the hearing indicates that immediately after the accident in question, a man named Monroe appeared on the scene driving a black Fleetwood Cadillac.

Monroe managed to convince Harris and Hughes that they should consult a