In re: Catherine E. Abbey ( 2017 )

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DISTRICT OF COLUMBIA COURT OF APPEALS
No. 16-BG-700
IN RE CATHERINE E. ABBEY, RESPONDENT.
A Suspended Member of the Bar
of the District of Columbia Court of Appeals
(Bar Registration No. 436925)
On Report and Recommendation
Of the Board on Professional Responsibility
(BDN-370-12)
(Argued April 14, 2017 Decided September 21, 2017)
(Amended October 19, 2017*)
Abraham C. Blitzer for respondent.
H. Clay Smith, III, Assistant Disciplinary Counsel, with whom Wallace E.
Shipp, Jr., Disciplinary Counsel at the time the brief was filed, Jennifer P. Lyman
and Julia L. Porter, Senior Assistant Disciplinary Counsel, were on the brief, for
the Office of Disciplinary Counsel.
*
The amended opinion (1) corrects a typographical error on page 2,
changing “Rule 1.15 (b)” to “Rule 1.15 (c),”; (2) adding a new footnote to read
“This court temporarily suspended Ms. Abbey on October 4, 2016” and (3)
corrects the effective date of Ms. Abbey’s disbarment (on the last line of the
opinion) from “effective thirty days from the date of this opinion” to reflect
immediate disbarment and the fact that “the period of reinstatement will run nunc
pro tunc to November 14, 2016, the date on which she filed the affidavit required
by D.C. Bar R. XI, § 14 (g).”
2
Before BECKWITH and EASTERLY, Associate Judges, and REID, Senior Judge.
REID, Senior Judge: In its Report and Recommendation, dated July 12,
2016, the Board on Professional Responsibility has recommended that respondent,
Catherine E. Abbey, be disbarred from the practice of law in the District of
Columbia because of clear and convincing evidence that she (1) engaged in
reckless misappropriation of entrusted funds, in violation of Rule 1.15 (a) of the
District of Columbia Rules of Professional Conduct, and (2) failed to promptly
notify and/or deliver the funds to the third parties entitled to receive them, in
violation of Rule 1.15 (c).1 Ms. Abbey’s main argument on appeal is that her
misappropriation constituted negligent, rather than reckless, misappropriation and
the sanction should be a six-month suspension. For the reasons stated below, we
accept the recommendation of the Board.
1
This court temporarily suspended Ms. Abbey on October 4, 2016.
3
FACTUAL SUMMARY
During these proceedings, Disciplinary Counsel,2 an Assistant Disciplinary
Counsel, Ms. Abbey, and her attorney agreed to factual stipulations, including the
following. Ms. Abbey was admitted by motion to the Bar of this court in 1993.
Sometime around May 2010, Guy Vouffo was injured in an automobile accident,
and he retained Ms. Abbey to represent him in a personal injury lawsuit. During
Ms. Abbey’s representation, Mr. Vouffo executed an assignment of insurance
benefits to Medtaris Rehabilitation and also signed a separate document
authorizing direct payment to Medtaris Rehabilitation. Ms. Abbey executed a
related document “agree[ing] to follow the aforementioned authorization and
direction of my client to pay Medtaris Rehabilitation any sums due and owing from
the proceeds of any settlement, judgment or insurance payments.” Mr. Vouffo
signed two additional medical authorizations addressed to Doctor’s Community
Hospital, and to Kaiser Permanente. Each of these authorizations stated: “I hereby
direct and authorize [Ms. Abbey] to pay all unpaid medical and hospital bills
2
While the disciplinary proceedings against Ms. Abbey were in progress,
this court changed the name of Bar Counsel to Disciplinary Counsel, effective
December 19, 2015. We use Disciplinary Counsel throughout this opinion.
4
presented to her before the distribution of any proceeds to me out of any sums of
money received by her to which I may be entitled.”
The stipulations of fact also indicated that the Liberty Mutual Insurance
Company issued a check on December 28, 2011, in the amount of $12,500,
payable to Ms. Abbey and Mr. Vouffo. Ms. Abbey deposited the check in her
IOLTA account.3 In January 2012, Ms. Abbey prepared a settlement distribution
sheet, showing that she withheld $4,498.83 for Mr. Vouffo’s medical providers
(after Medtaris Rehabilitation agreed to reduce its bill to $2,700, and Ms. Abbey
agreed to reduce her fee to $3,803.86). In January 2012, she sent a check totaling
$4,003.81 to Mr. Vouffo. She did not issue checks to Medtaris Rehabilitation (in
the amount of $2,700) or Kaiser Permanente (in the amount of $866.44) until
November 14, 2012. The remaining $932.39 (of the amount withheld for medical
providers) was never distributed. On numerous occasions, between January 5,
2012, and November 1, 2012, the balance in Ms. Abbey’s IOLTA account fell
3
Rule 1.15 of the District of Columbia Rules of Professional Conduct
concerns the safekeeping of property. The rule requires all attorneys to keep funds
earmarked for clients or third persons separate from an attorney’s own funds.
Client and third party funds must be placed in a trust account, an “approved
depository,” known as an IOLTA account. Moreover, upon receiving client or
third person funds, an attorney must promptly notify and promptly deliver the
funds to the client and third persons. Rule 1.15 (a), (b), and (c).
5
below the $4,498.83 that she should have retained for all of Mr. Vouffo’s medical
providers. By November 1, 2012, the balance, in her IOLTA account, stood at
$621.26.
Based on additional evidence presented by Disciplinary Counsel, Hearing
Committee No. 7 of the Board found that under the settlement distribution sheet,
which Mr. Vouffo and Ms. Abbey had signed on January 10, 2012, the $4,498.83
reserved for medical providers was to be distributed as follows: $2,700 to
Medtaris Rehabilitation, $625 to Kaiser Permanente,4 $607.83 to Doctors
Community Hospital, $487 to Doctors Emergency Physicians, and $79 to
Diagnostic Imaging. Despite the settlement distribution agreement, Medtaris
Rehabilitation made multiple requests to Ms. Abbey for payment from February
23, 2012 through August 9, 2012; in a letter dated July 12, 2012, Medtaris
Rehabilitation’s representative, Mark Pappas, detailed his efforts to collect
payment from Ms. Abbey and advised her that he would file a Bar complaint. Ms.
Abbey continued to withhold payment to Medtaris Rehabilitation, and on October
3, 2012, Mr. Pappas filed a complaint with Disciplinary Counsel. Nevertheless,
4
Kaiser agreed to settle its bill for $866.44 in mid-November 2012.
6
Ms. Abbey did not turn over the entrusted funds to Medtaris Rehabilitation until
November 14, 2012, the date on which she also paid Kaiser Permanente.
In addition, Hearing Committee No. 7 found that Ms. Abbey withdrew funds
from her IOLTA account before paying all of Mr. Vouffo’s medical providers. On
March 22, 2012, she made a $2,000 cash withdrawal from her IOLTA account. On
November 9, 2012, she made another $2,000 cash withdrawal from the same
account, even though she “was aware of her responsibility to pay all of Mr.
Vouffo’s medical providers.”
In its Report and Recommendation, dated July 12, 2016, the Board adopted
and incorporated by reference the Hearing Committee Report of March 29, 2016.
The Board agreed with the Hearing Committee that there was clear and convincing
evidence that Ms. Abbey acted recklessly, rather than negligently, in
misappropriating entrusted funds. Consequently, in accordance with this court’s
case law, the Board recommended that Ms. Abbey be disbarred.
7
STANDARD OF REVIEW
D.C. Bar Rule XI § 9 (h)(1) provides that “the Court shall accept the
findings of fact made by the Board unless they are unsupported by substantial
evidence of record. . . .” Similarly, “[t]he Board . . . is required to accept the
factual findings of the hearing committee that are supported by substantial
evidence in the record, viewed in its entirety.” In re Samad, 51 A.3d 486, 495
(D.C. 2012). Just as “the Board owes no deference to the hearing committee’s
determination of ultimate facts, which are really conclusions of law,” “[t]his court
reviews the Board’s legal conclusions de novo.” Id.ANALYSIS
The Waiver Issue
Disciplinary Counsel argues that “[b]y failing to take exception to the
Hearing Committee Report and Recommendation and failing to file a brief to the
Board, [Ms. Abbey] waived her right to litigate her issues on appeal before the
[c]ourt.” During oral argument in this court, Ms. Abbey’s appellate counsel
8
indicated that he was retained after the Board proceedings, but that he regarded
waiver to be a question of ultimate fact. The Board stated in its Report and
Recommendation that “Disciplinary Counsel took no exception to the Report and
Recommendation of the Hearing Committee,” but that “[o]n April 7, 2016, [Ms.
Abbey] filed a Notice of Exceptions to the Hearing Committee Report and
Recommendation.” The Board further indicated that “no briefs were filed with the
Board and there was no oral argument; [therefore under Board Rule 13.4 (a)], the
Board will decide the matter on the available record.”5
The waiver issue presents a question of law, and our review is de novo. In
re Samad, supra, 51 A.3d at 495. Our analysis is guided by the following legal
principles. Because “[o]ur consideration of Board findings and recommendations
is similar to our review of administrative agency decisions[,] . . . we do not address
objections that could have been, but were not raised prior to judicial review.” In re
James, 452 A.2d 163, 169 (D.C. 1982). In In re James, we recognized that
“Respondent could have objected to the lack of notice during the proceedings
5
Rule 13.4 (a) of the Rules of the Board on Professional Responsibility
provides in pertinent part: “A party failing to file a brief with the Board waives the
right to oral argument and the Board will decide the matter based on the available
record.”
9
before the Hearing Committee, or at any time thereafter.” Id. at 168. In In re
Holdmann, 834 A.2d 887, 889 (D.C. 2003), a reciprocal discipline case, we cited
several cases, including In re James, in declaring that “we have consistently held
that an attorney who fails to present a point to the Board waives that point and
cannot be heard to raise it for the first time here.” In re Holdmann, supra, 834
A.2d at 889.
Later, in In re Hargrove, 155 A.3d 375 (D.C. 2017), we agreed with
Disciplinary Counsel that respondent had “forfeited” her appellate contentions
because she “had numerous opportunities to challenge the allegations against her
and to object to any procedural errors, but she failed to properly do so”—for
example, she “did not timely file an answer to the specification of charges,” “did
not appear either at a pre-hearing conference or at the hearing before the Hearing
Committee,” and did not “file notice of exceptions to the Hearing Committee’s
findings and recommendations.” Id. at 376. Furthermore, in In re Johnson, 158
A.3d 913 (D.C. 2017), we observed that the Hearing Committee heard an argument
that respondent made on appeal, and the respondent took no exception to the
Hearing Committee’s conclusion but “let the Hearing Committee report be
submitted to the Board without briefing or argument.” Id. at 917. We stated that
10
“[w]hile we re-emphasize that arguments to this court should ordinarily be
presented to the Board to ensure proper appellate review, in this case the Board
explicitly acknowledged the existence of the issue and concurred with the Hearing
Committee’s rejection of the argument”; we further said that “[i]n this posture, and
to put the question to rest, we have determined to address the tardy argument.” Id.Here, Ms. Abbey participated in the disciplinary proceedings against her. In
her answer to the specification of the charges, she denied the violation of Rules
1.15 (a) and (b), as alleged in the specification of charges. She (1) testified before
the Hearing Committee, (2) filed “proposed finding[s] of fact[] and conclusions of
law,” in which she conceded misappropriation but stated that her misappropriation
was not intentional, reckless, or willful, but that it was negligent, and (3) filed a
notice of exceptions to the Hearing Committee Report and Recommendation.
Hence, under In re James, supra, and In re Hargrove, supra, she clearly raised her
objection to the type of misappropriation ruling Disciplinary Counsel sought
before the Board—intentional, reckless or willful as opposed to negligent—“prior
to judicial review.” In re James, supra, 452 A.2d at 169; In re Hargrove, supra,
155 A.3d at 376. Moreover, as in In re Johnson, supra, the Board “explicitly
acknowledged the existence of the [type of misappropriation] issue and concurred
11
with the Hearing Committee’s rejection of [Ms. Abbey’s] argument” that her
misappropriation was negligent instead of reckless. 158 A.3d at 917. Indeed, as
we have previously indicated, the Board specifically declared that it would “decide
the matter on the available record.”6 Thus, as we asserted in In re James, “even
when the complaining party does not get satisfaction from the administrative [here
the disciplinary] body, the appellate court’s task is facilitated by the record of the
agency’s [here the Board’s] attention to the issue.” 452 A.2d at 169. In short, we
are convinced that Ms. Abbey raised the misappropriation issue she presents in this
court before the Board, prior to judicial review, and she has not waived her
argument on that issue, even though she waived oral argument before the Board.
The Board determined that it was able to decide the misappropriation issue on the
basis of the record Disciplinary Counsel and Ms. Abbey made before the Hearing
Committee, and her arguments in this court are consistent with her arguments
before the Hearing Committee. Hence, like the Board, we proceed to consider the
merits of the misappropriation issue.
6
Significantly, the Board invoked its Rule 13.4 (a) regarding waiver only of
the right to oral argument before the Board, and did not and could not have relied
on its Rule 13.5 (because Ms. Abbey noticed exception to the Hearing
Committee’s Report); the Rule specifies that “[i]f no notice of exceptions is filed
within the time allotted, the rights of the parties to brief and argue before the Board
shall be waived, and the Board shall take action on the record.”
12
The Misappropriation Issue
In her appellate brief, Ms. Abbey argues “that by holding funds aside in her
non-trust accounts so as to protect the recipients of the entrusted funds indicates
that [she] demonstrated concern for the safety and welfare of entrusted funds,
which is the ‘central issue in determining whether misappropriation is reckless.’”
She claims that she “never had an overdraft,” and “[a]lthough she admittedly had
deficits in managing her escrow account, she had fashioned a system that assure[s]
that the entrusted funds would be paid to the appropriate parties.” She insists that
while there was misappropriation, it “was negligent rather than reckless[,]” and
“that the typical sanction for negligent misappropriation is six month suspension.”
Disciplinary Counsel essentially argues that under this court’s case law and
based upon the Hearing Committee’s findings in this case, the Board correctly
concluded that Ms. Abbey’s misappropriation was reckless rather than negligent.
Specifically, Disciplinary Counsel contends that “[i]n practice, [Ms. Abbey] did
not differentiate entrusted from non-entrusted funds.” Rather, “she treated all
funds in her possession as her own, which ultimately led to her reckless
misappropriation of the third-party healthcare provider[s’] funds.” In addition,
13
Disciplinary Counsel emphasizes (1) the Hearing Committee’s finding about Ms.
Abbey’s “failure to reconcile her trust account records and reliance on end-of-the-
year accounting that never identified amounts relating to each individual client”;
and (2) the “clear and convincing evidence” that Ms. Abbey “disregarded
inquiries” from Medtaris Rehabilitation about her lack of payment, and her
knowing failure to pay Medtaris while “allow[ing] the balance in her trust account
repeatedly to fall below the amount due to Medtaris.”
“[W]e are faced with a legal question, which we review de novo,” because
“whether any misappropriation resulted from more than simple negligence [is a]
question[] of law concerning ultimate facts.” In re Berryman, 764 A.2d 760, 766
(D.C. 2000) (citing In re Utley, 698 A.2d 446, 449 (D.C. 1997)) (internal quotation
marks omitted). This court’s legal principles concerning misappropriation are well
established. Misappropriation is “any unauthorized use of client’s funds entrusted
to [the lawyer], including not only stealing but also unauthorized temporary use for
the lawyer’s own purpose, whether or not he derives any personal gain or benefit
therefrom.” In re Anderson, 778 A.2d 330, 335 (D.C. 2001) (internal quotation
marks and citation omitted). “Misappropriation happens when the balance in [the
14
attorney’s] trust account falls below the amount due the client.” In re Ahaghotu,
75 A.3d 251, 256 (D.C. 2013) (internal quotation marks and citation omitted).
Reckless misappropriation reveal[s] an unacceptable
disregard for the safety and welfare of entrusted funds,
and its hallmarks include: the indiscriminate
commingling of entrusted and personal funds; a complete
failure to track settlement proceeds; the total disregard of
the status of accounts into which entrusted funds were
placed, resulting in a repeated overdraft condition; the
indiscriminate movement of monies between accounts;
and finally the disregard of inquiries concerning the
status of funds.
Id. at 256 (internal quotation marks and citation omitted). “The severity of the
sanction for misappropriation depends on whether the misappropriation was (1)
intentional or reckless, or (2) merely negligent.” Id. (citing In re Anderson, supra,778 A.2d at 338). “[I]n virtually all cases of misappropriation, disbarment will be
the only appropriate sanction unless it appears that the misconduct resulted from
nothing more than simple negligence.” In re Berryman, supra, 764 A.2d at 769
(citing In re Addams, 579 A.2d 190, 199 (D.C. 1990)).
Negligent misappropriation is an attorney’s non-intentional, non-deliberate,
non-reckless misuse of entrusted funds or an attorney’s non-intentional, non-
15
deliberate, non-reckless failure to retain the proper balance of entrusted funds. Its
hallmarks include a good-faith, genuine, or sincere but erroneous belief that
entrusted funds have properly been paid; and an honest or inadvertent but mistaken
belief that entrusted funds have been properly safeguarded. See In re Choroszej,
624 A.2d 434, 435-37 (D.C. 1992) (Board found that attorney representing client
in claim for personal injury “genuinely believed that he had paid [a doctor],” had
not done so but paid the doctor upon discovery of error; Board concluded that
attorney’s conduct was inadvertent and negligent); In re Ray, 675 A.2d 1381, 1387
(D.C. 1996) (Hearing Committee found no “clear and convincing evidence that
[the respondent] deliberately or recklessly attempted to deprive estate of its funds”
by taking his legal fee without a court order); In re Reed, 679 A.2d 506, 507-08
(D.C. 1996) (Board found failure of attorney to pay a client’s doctor’s bill was
“inadvertent”—attorney believed she had paid the bill but upon discovery of no
record of payment, attorney mailed payment to doctor); In re Chang, 694 A.2d 877(D.C. 1997) (attorney mistakenly believed that funds in escrow account were
sufficient to pay property taxes for which no funds had yet been received; attorney
paid the dishonored checks upon discovery of his mistake).
16
Here, the Hearing Committee’s findings (adopted and incorporated by the
Board), based upon clear and convincing evidence, do not support Ms. Abbey’s
argument that her behavior amounted to negligent rather than reckless
misappropriation. Nor does our case law suggest that Ms. Abbey’s conduct was
simply negligent. The Hearing Committee found that Ms. Abbey received the
insurance settlement check from Liberty Mutual in January 2012; properly
deposited the check in her IOLTA account; and properly prepared and signed
(along with Mr. Vouffo) a settlement distribution sheet in January 2012, showing
the amount withheld for payment to Mr. Vouffo’s medical providers.
Nevertheless, she made a cash withdrawal of $2,000 from her IOLTA account on
March 22, 2012, and another cash withdrawal from the same account on November
9, 2012, despite being “aware of her responsibility to pay all of Mr. Vouffo’s
medical providers.”
The Hearing Committee also determined that one of Mr. Vouffo’s medical
providers, Medtaris Rehabilitation (through its representative, Mr. Pappas), agreed
to reduce Medtaris’s bill from $5,200 to $2,700 after speaking with Ms. Abbey on
January 9, 2012. When Medtaris did not receive the medical fee, Mr. Pappas sent
communications to Ms. Abbey, making multiple requests for payment from
17
February 23, 2012, through August 9, 2012. Even when Medtaris’s representative
notified Ms. Abbey in a letter of July 12, 2012, that he would file a Bar complaint
if Medtaris was not paid the reduced fee on which they had reached agreement,
Ms. Abbey still did not pay the bill. Nor had she paid Medtaris’s fee by October 3,
2012, the date on which Medtaris filed its Bar complaint; in fact, she did not pay
the fee until November 14, 2012. In addition, the record contains no proof that Ms.
Abbey has paid all of Mr. Vouffo’s medical providers, including Doctor’s
Community Hospital, Doctor’s Emergency Physicians, and Diagnostic Imaging.”7
In addition, the Board determined that Ms. Abbey “did not reconcile her
IOLTA records during the time she held Mr. Vouffo’s funds in trust and she did
not keep a ledger.” She also “failed to track settlement proceeds relating to
individual clients.”
7
During her December 1, 2015, testimony before the Hearing Committee,
Ms. Abbey responded to the inquiry from a member of the Hearing Committee
relating to payment of these medical providers. She stated that she “tried to pay
[Doctor’s Community Hospital]” before attending the hearing, “but they’ve not
responded, so [the bill] has not been paid.” She asserted that she received no
response from Doctor’s Emergency Physicians, but that she “[thought Diagnostic
Imaging] has been paid off.” Ms. Abbey acknowledged that she did not have any
documents showing payment.
18
The aforementioned findings of the Hearing Committee and the Board do
not reveal a good-faith, genuine, or sincere but erroneous belief that entrusted
funds were properly safeguarded and paid, or that Ms. Abbey’s failure to pay Mr.
Vouffo’s medical bills in a timely manner was inadvertent or due to an honest
mistake. Thus, Ms. Abbey is not in the same position as the respondents in In re
Choroszej, supra, In re Reed, supra, and In re Chang, supra.Nor can Ms. Abbey succeed in her effort to align her conduct with that of
the respondent in In re Anderson, supra, a case on which Ms. Abbey relies that
also involved a personal injury settlement and alleged violations of Rule 1.15 (a)
and (b). There, the attorney mistakenly thought he had paid the client’s medical
provider. This court concluded that “[Disciplinary] Counsel failed to prove by
clear and convincing evidence a pattern of conduct by [the respondent] manifesting
a reckless disregard of his duty to safeguard [entrusted] funds.” 778 A.2d at 339.
Although Mr. Anderson’s record-keeping system was rudimentary and flawed, we
stated that “our decisions . . . have rejected the proposition that recklessness can be
shown by inadequate record-keeping alone combined with commingling and
misappropriation.” Id. at 340 (citation omitted). We also said that respondent’s
“fail[ure] to pay a single client obligation is not evidence that he flagrantly
19
disregarded the integrity of third-party funds”; respondent “did not
indiscriminately write checks on the operating account, and he did not write checks
that were dishonored or that caused the account to be in overdraft.” Id. Moreover,
“the record [did] not support the finding that respondent ignored post-settlement
inquiries by [his client] . . . .” Id. at 341.
Unlike the respondent in In re Anderson, Ms. Abbey repeatedly ignored
inquiries from Medtaris Rehabilitation about payment of its reduced bill, and failed
to pay all of Mr. Vouffo’s medical providers, while making $4,000 in unexplained
cash withdrawals from the entrusted funds and allowing the balance of entrusted
funds to fall below the level needed to pay the medical providers. 8 Ms. Abbey
made a conscious decision not to make a sharp distinction between entrusted funds
and non-entrusted funds, and as the Hearing Committee and the Board concluded,
she made no effort to reconcile her trust account records, depending instead on an
8
During her December 1, 2015, testimony before the Hearing Committee,
Ms. Abbey admitted on cross-examination that if she had written a $2,700 check to
Medtaris Rehabilitation between September 7 and 24, or October 9 through the end
of October, or on November 1, 2012, the bank would have dishonored the check.
When asked by her counsel whether the $2,000 cash withdrawal she made on
November 9, 2012, went to her office account, Ms. Abbey replied, “I don’t know.”
20
annual accounting that did not pinpoint what amounts were identified with each of
her clients.
Ms. Abbey’s reliance on In re Burton, 472 A.2d 831 (D.C. 1984); In re Pels,
653 A.2d 388 (D.C. 1995), and In re Ahaghotu, supra, does not advance her effort
to convince this court that her misappropriation was negligent rather than reckless.
She relies on these cases in arguing that she “never had an overdraft.” In doing so,
she lifts up only one of the hallmarks of reckless misappropriation identified by In
re Anderson—“total disregard of the status of accounts into which entrusted funds
are placed, resulting in a repeated overdraft condition.” 778 A.2d at 338. In re
Burton, a case resulting in disbarment, involved two disciplinary matters and
violations different from those in Ms. Abbey’s case—failure to deposit client funds
in a separate account, and dishonesty, fraud, deceit or misrepresentation, 472 A.2d
at 831. That case does not compel a conclusion here that Ms. Abbey’s
misappropriation was negligent rather than reckless. In In re Burton, this court,
issued a short order disbarring the respondent; the order incorporated the Board’s
Report and Recommendation which recognized that (1) the hearing committee
“expressly reject[ed] respondent’s contention that in making unauthorized
withdrawals he violated no ethical prescription because he always ‘maintained
21
sufficient funds to satisfy the requirement of the trust,’” and (2) “even if
respondent did have sufficient cash on hand to cover the shortages, it would not
excuse . . . his unauthorized use of trust funds.” 472 A.2d at 838. What the Board
said in In re Burton is applicable to Ms. Abbey’s situation.
In re Pels, a case also resulting in disbarment, concerned a situation similar
to the instant case—a personal injury client, violations of Rules 1.15 (a) and (c),
failure to immediately pay the client’s medical providers, and a trust account that
fell below the level needed to pay medical providers. See 653 A.2d at 389. Both
the hearing committee and the Board concluded that respondent Pels’
misappropriation was reckless, in part because of overdrafts, but also because, as is
true in Ms. Abbey’s case, (1) his “conduct . . . was marked by a pervasive failure to
maintain contemporaneous records accounting for the flow or disposition of client
funds. . .”; and (2) “besides the per se act of misappropriating funds needed to pay
the client’s bills, respondent failed to account for or deliver” the remaining funds
to the client. 653 A.2d at 396. Furthermore, this court “reject[ed] respondent’s
argument that his objective good faith—his reasonable but erroneous belief that he
was entitled to the balance of the funds—reduced his culpability to simple
negligence.” Id. at 397.
22
In re Ahaghotu, supra, involved violations of several rules of professional
conduct, including Rule 1.15 (a) and (b); the respondent was disbarred. 75 A.3d at
253. Similar to Ms. Abbey, Mr. Ahaghotu admitted misappropriation but argued
that it was negligent. Like Ms. Abbey, he received entrusted funds designed in
part to cover the fees of his client’s medical providers. He deposited the funds in
his trust account and was aware that he owed money to a medical provider;
however, prior to paying the medical provider, the funds in his trust account fell
below the amount needed to pay the provider. 75 A.3d at 253-54. Like Ms.
Abbey, the respondent “did not closely reconcile his records and bank statements”
and ignored problems with his trust account. Id. at 254. This court concluded that
the respondent “exhibited an ‘unacceptable level of disregard for the safety and
welfare of entrusted funds’ – that is, ‘a conscious indifference to the consequences
of his behavior for the security of the funds.’” Id. at 253 (citing In re Anderson,
supra, 778 A.2d at 339).
When we apply the legal principles embedded in our misappropriation case
law to Ms. Abbey’s conduct, the record before us lacks clear and convincing
evidence to support a conclusion of inadvertence or honest mistake, or a good faith
belief that the funds entrusted to her were being handled properly. Rather, the
23
record before us contains clear and convincing evidence that Ms. Abbey’s
misappropriation was deliberate and reckless. Ms. Abbey (1) was clearly aware
that she owed entrusted funds to Mr. Vouffo’s medical providers; (2) failed to
reconcile her trust account, examine the status of the trust account on a regular
basis, or institute an accounting system that enabled her to determine what funds
were allocated to what client or what medical provider and the status of those
funds; (3) ignored repeated inquiries about and request for the agreed upon reduced
medical fee by one of Mr. Vouffo’s medical providers; (4) made two $2,000 (total
$4,000) unexplained cash withdrawals from her trust account prior to paying some
of Mr. Vouffo’s medical providers, leaving insufficient funds, for months, to pay
medical providers; and (5) apparently has not yet paid all of the medical providers
from the funds entrusted to her care. See In re Anderson, supra; In re Ahaghotu,
supra.Finally, on this record we must impose the sanction of disbarment. In In re
Addams, supra, this court “reaffirm[ed] that in virtually all cases of
misappropriation, disbarment will be the only appropriate sanction unless it
appears that the misconduct resulted from nothing more than simple negligence”;
this court also declared that it “shall regard a lesser sanction as appropriate only in
24
extraordinary circumstances.” Id. at 191. Furthermore, D.C. Bar R. XI, § 9 (g)
provides in pertinent part that this court “shall adopt the recommended disposition
of the Board unless to do so would foster a tendency toward inconsistent
dispositions for comparable conduct or would otherwise be unwarranted.” We
discern no danger of an inconsistent disposition, and no “extraordinary
circumstances” in this case. Consequently, we adopt the recommended sanction of
disbarment. See In re Ahaghotu, supra, 75 A.3d at 258-59; In re Pels, supra, 653
A.2d at 397-98.
Accordingly, for the foregoing reasons, it is ORDERED that respondent
Catherine E. Abbey is immediately disbarred from the practice of law in the
District of Columbia. For purposes of reinstatement, the period of disbarment will
run nunc pro tunc to November 14, 2016, the date on which she filed the affidavit
required by D.C. Bar R. XI, § 14 (g).
So ordered.