State Ex Rel, Oklahoma Bar Association v. Watkins

Facts

In November 2013, D agreed to represent a husband and wife regarding a promissory note and filed a breach of contract action on their behalf. The court dismissed the case and awarded the opposing party attorney fees and sanctions against D totaling $9,099.41. The client filed a grievance. D signed a Diversion Program Agreement to complete classes and pay all associated costs; in return, he received a private reprimand. In December 2013, Chaney hired D after Chaney's wife was killed in an automobile accident. D filed a petition for letters of administration, appointment of personal representative, and determination of heirs. The district court determined heirs and named Chaney as personal representative of the estate. D deposited into his client trust account a $100,000 settlement check received for the death of Jeannie Chaney. D filed notice to creditors, an inventory and appraisal of the estate, consent to partial distribution by the other heirs, and a petition for partial distribution. The estate would be distributed one-half (1/2) to Chaney, one-sixth (1/6) to Shaya Emerson, Mrs. Chaney's adult child, and one-sixth (1/6) each to Mrs. Chaney's two minor children. The petition requested distribution of $70,000 to the personal representative 'in order to pay attorney fees and other costs of administration, and for distribution to the above-described heirs at law.' Five months later, on November 24, 2014, D paid Chaney $32,570.55. Chaney's settlement statement listed deficits for five 'liens filed with court per probate' in the total amount of $1,858.90 and an attorney fee of $33,000. The statement averred a 'total amount due to all heirs and Mr. Chaney' of $65,141.11. Chaney signed the settlement statement and accepted the funds due to him personally. At that point, D had presumably paid out $64,570.55 of the $70,000.00 ordered by the court. D still owed the remaining heirs $32,570.55. On April 30, 2015, Emerson signed a settlement statement from D which referred to her as 'client' a total of seven times. D paid Emerson $10,856.84 bringing the total amount presumably disbursed to $78,286.29 of the $70,000.00 ordered for immediate payment almost ten months earlier. D still owed the remaining heirs $21,713.71. On June 25, 2015, Chaney terminated D's services and requested that D send him the case file and pay the remaining heirs, or anyone else owed, within ten days. D did nothing. On November 21, 2016, Chaney filed a grievance. On February 21, 2017, D withdrew all of the money in his client trust account and filed a motion to interplead $23,573.86.  The court allowed D's withdrawal as counsel and ordered the court clerk to hold the money pending distribution orders. D denied the allegations. From July 2014 through February 2017, D made nine cash withdrawals, seventy-nine transfers to his personal checking account, and two withdrawals for loan payments, all out of his client trust account. Respondent made the first loan payment on December 5, 2016, for $963.41.He made the second loan payment on January 13, 2017, for $660.94. he payments were credited to two different loan account numbers, but both loan payment slips name D as the account owner. P initiated this disciplinary proceeding on January 8, 2018, by filing a complaint against D alleging violations of RGDP 1.3 (discredit upon the legal profession) and Oklahoma Rules of Professional Conduct (ORPC) 1.1 (competence), 1.3 (diligence), 1.4 (adequate communication), 1.15 (safeguard client property), 3.2 (expedite litigation), and 8.4(c) (conduct involving dishonesty, fraud, deceit, or misrepresentation), 5 O.S.2011, ch. 1, app. 3-A. P's complaint alleged that D converted or misappropriated client funds when he failed to timely pay heirs, his client trust account balance was regularly below the amount he owed, and he never established separate bank accounts in trust for the minor heirs as required by title 12, section 83 of the Oklahoma statutes. The complaint alleged that D committed neglect and failed to communicate with clients. The complaint alleged that discipline should be enhanced due to D's diversion program agreement in the previous matter. At the hearing, both Chaney and Emerson testified that D failed to return calls, relocated his office without notifying anyone, and canceled previously scheduled meetings at the last moment four times. Emerson stated that when D finally arrived for one of the meetings he appeared disheveled, and possibly intoxicated. The Bar's investigator, Krystal Willis, testified that D's trust account balance regularly fell below the amount owed to the heirs. D justified his failure to pay or timely respond to Emerson and the other heirs by testifying that he only represented Chaney. Dt claimed that he had responded to Emerson's calls, but they were unable to coordinate schedules.  D testified that he did not realize that assisting his client in getting trust accounts open for the benefit of the minors was his responsibility. D claimed that he couldn't open accounts for the guardian of the children, and the father never provided him information to put into the paperwork regarding accounts for the children. D claimed that he had a rough patch in his life approximately three years before, but that he had not consumed alcohol since April 16, 2016. He admitted that he 'very well could have been' intoxicated when he gave Emerson her check. D testified that he had lost his home, his car, and pawned everything that he had of any value. D admitted that he don't know what happened to the trust account, but knew he had to fix the problems and did. D admitted he should have interpleaded the money to the court as soon as he realized there was a problem. P requested a one to two-year suspension.  The Trial Panel found clear and convincing evidence establishing the facts in the complaint and that D violated RGDP 1.3 and ORPC 1.1, 1.3, 1.4, 1.14 [sic], and 3.2. The Trial Panel recommended suspension of two years and one day.

Issues

Rule of Law

Holding and Decision

Legal Analysis

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