In Re Carter , 59 Idaho 547 ( 1938 )

In liminie, the rule announced by this court in In re Baum,32 Idaho 676, 186 P. 927, is as follows:

"An attorney against whom disbarment proceedings are instituted is entitled to have the charges fully stated, and is not required to defend against or explain any matter not specified in the charges."

This same rule applies to suspension and disciplinary proceedings. Under the above rule petitioner should not have been called upon to answer or defend against any matter not charged. Neither call he be held accountable for any charge not specified, nor for his failure to explain or justify the same.

An examination of the complaint discloses that petitioner is charged with certain serious matters upon which no proof was offered, and that he was specifically charged with having on the first day of July, 1933:

"made a loan for Lelia H. Buchanan, (Now Thompson) to one Edward Abernathy in Washington County, Idaho, taking a promissory note of the said Edward Abernathy to Lelia H. Buchanan, dated at Weiser, Idaho, July 1, 1933, for the sum of $265.00, payable one year after date to Lelia H. Buchanan or order, with interest at 8% per annum; which said note was secured by chattel mortgage of the same date, made by Edward Abernathy as mortgagor to Lelia H. Buchanan, as mortgagee, covering fourteen head cattle and three horses, together with all the increase thereon and covering also all hay grown during the season of 1933, (on described real estate)"

"That thereafter, in the month of May, 1934, the said Edward Abernathy, mortgagor paid the said D.L. Carter, for the mortgagee, the sum of $68.00 to apply on said note and mortgage, but that the said D.L. Carter reported only the sum of $48.00, he the said D.L. Carter retaining $20.00, which he neither reported to nor paid to, Lelia H. Buchanan, his client."

At this time it may be pertinent to observe that the record does not show that the sum of $68 was paid by Abernathy to petitioner, but on the contrary that no money in any amount was paid by Abernathy to petitioner. It is further alleged:

"That in the early part of September, 1934, Abernathy advised Carter that he did not have sufficient hay and feed to care for said mortgaged livestock during the winter and asked the said D.L. Carter to furnish the necessary feed or take the stock; that thereafter, on the 11th day of September, 1934, said D.L. Carter, in lieu of foreclosure, took possession of said livestock. That on the 11th day of September, 1934, at the time said D.L. Carter took possession of said horses and cattle from Abernathy, he gave to the said Abernathy the following receipt:

" 'Mr. Eddie Abernathy: This to make a record of our agreement that I take the 14 head of cattle and calves covered by mortgage, and 3 horses, in full settlement of the note secured by the mortgage. You may keep the horses and work them until you have put in the crops. September 11, 1934, D.L. Carter.' "

Among other material allegations it is alleged in the complaint that in March, 1935, Mrs. Thompson, then Buchanan, called on petitioner to obtain settlement of the Abernathy note, and she alleges, that when she called on petitioner she did not know he had taken possession of the livestock and given Abernathy the above-quoted receipt. It is further alleged that petitioner failed to report to Mrs. Thompson that he had taken said mortgaged property or that he had given said receipt, and:

"But disregarding his duty to his client the said D.L. Carter advised his client, Lelia H. Thompson that Abernathy would pay the note in a few days."

The gist of the charge is therefore that petitioner, sustaining the relationship of attorney and client with Mrs. Thompson, took into his possession certain mortgaged property, without authority from Mrs. Thompson and without notifying her, in payment of the indebtedness due from Abernathy to Mrs. Thompson and gave his receipt therefor. There are allegations in the complaint that Mrs. Thompson employed attorney Welker of Weiser to collect the Abernathy note and that Welker discovered that petitioner had taken possession of the mortgaged property and given the receipt above referred to. It is further alleged that a demand was made upon petitioner for payment and for the delivery of the livestock covered by the mortgage, and:

"That thereupon, D.L. Carter made written tender on the balance due on said note, which tender was refused and the client through her attorneys, demanded the delivery to her of said property taken by D.L. Carter in satisfaction of the mortgage advising said D.L. Carter that the client was entitled to said property and that said D.L. Carter was not entitled to keep said property of the value of approximately three times the amount of said note, thereby profiting by his own conduct.

"Thereupon, said D.L. Carter tendered only a portion of said stock and property and demanded in addition thereto that the client pay him for the feed and the care of said stock; all of which said offers were refused by the client and her attorneys,"

The pertinent facts, briefly stated, in proof of the fore-going allegations of the complaint are substantially as follows: On or about July 1, 1933, Abernathy, a client of petitioner, sought through petitioner to make a loan for $265. Petitioner contacted Mrs. Thompson and obtained the loan above referred to. The relationship of attorney and client did not, at the time of this transaction, exist between petitioner and Mrs. Thompson, petitioner making no charge against Mrs. Thompson for services rendered in connection with the loan, but collected his fees from Abernathy and so informed her. While petitioner had transacted more or less business at different times for Mrs. Thompson, over a long period, he was not under an annual retainer and there existed no continuous relationship of attorney and client between them. The record is without dispute that petitioner, without authority from Mrs. Thompson, possessed himself of the mortgaged property, gave the receipt, and failed to notify her that he had taken possession of the property. Such conduct was reprehensible and unethical, but did not, as stated in the majority opinion: "definitely establish (d) wilful misconduct or fraudulent intent." Suspicion or inferences that may be drawn from the record are not sufficient to disbar or suspend an attorney and expose him to disgrace and beggary. It must be a clear case and must be proved by a preponderance of evidence.The State of Florida ex rel. Rude v. W.B. Young, 30 Fla. 85,11 So. 514. There must be fraudulent, corrupt and bad motive clearly shown before disbarment or suspension could follow. The record fails to show that the taking of the mortgaged property or any other act charged against petitioner was done with such fraudulent, corrupt and bad motive necessary to be shown before disbarment or suspension could follow. (State ex rel. Fowler v.Finley, 30 Fla. 325, 11 So. 674, 18 L.R.A. 401.) It is said in the majority opinion:

"It clearly shows deceit and a breach of the confidential relationship between attorney and client."

With this statement I am not in accord for the reason that the relationship of attorney and client did not exist, and furthermore the taking possession of the livestock covered by the chattel mortgage was open and not deceitful, although unjustifiable.

The evidence discloses that Abernathy went to petitioner in September, 1934, and informed him that he had no hay and no pasturage to feed or care for the mortgaged property and that it was up to petitioner to furnish the feed or take possession of the mortgaged livestock. In this situation, Mrs. Thompson being without the state, on September 11, 1934, petitioner took possession of the mortgaged property and gave the receipt. The record shows that petitioner and Abernathy made every effort humanly possible to sell the mortgaged property to pay the note, but without avail, excepting that three head of cattle were sold for $40, and the amount was indorsed on the note. Petitioner offered as an excuse for taking possession of the mortgaged property that he felt under legal and moral obligation to see that Mrs. Thompson received all the money due upon her note and that his purpose at all times was to sell the mortgaged property for enough to pay the Abernathy note and interest without causing her any loss, and to save Abernathy from foreclosure or other expenses incident to the closing out of the transaction. The evidence is undisputed that petitioner did not appropriate to his own use any of the mortgaged property; that he did not seek to dispose of or sell the same for any purpose other than to pay the note, and that he did not profit by reason of the taking, but on the contrary was put to some considerable expense. Numerous efforts were made by petitioner to settle, both with Mrs. Thompson and her attorneys. Petitioner tendered $300 in payment of the Abernathy note, there then being due approximately $225, and he, petitioner, to retain possession of the mortgaged property. This offer was refused. Petitioner thereupon tendered all of the mortgaged property still in his possession in payment of the Abernathy note, less the cost of feed, care and transportation of the same while in his possession. This offer was likewise refused. Petitioner took the position that he was entitled to be reimbursed for these expenses. An action was filed against petitioner by Mrs. Thompson to replevin the mortgaged property. Before the trial a compromise was reached and the Abernathy note discharged by petitioner paying the balance due on the note, interest, attorneys fees and court costs.

The question therefore arises, in view of the recitals above made and other facts and circumstances appearing in the record in mitigation of petitioner's conduct, was his conduct so unprofessional and miethical as to justify his suspension for a period of one year and the imposition of costs in the amount of $340 as recommended by the state bar commission to the court? The majority opinion modifies the recommendation, reducing the punishment to be inflicted to suspension for four months and the imposition of costs in the amount of $100.

The majority opinion does not go far enough. It should set aside the entire recommendation of the bar commission and in lieu thereof severely reprimand petitioner for his negligence and unethical conduct in the taking of the mortgaged property, particularly since he had not made known to Mrs. Thompson the fact that he had done so and the further fact that he had given a receipt attempting to discharge Abernathy from the indebtedness. It might be here observed that the receipt did not discharge Abernathy and the taking of the mortgaged property by petitioner did not deprive Mrs. Thompson of her lien. She could at any time have foreclosed her chattel mortgage although the livestock was in the possession of petitioner. The result of the transaction between Abernathy and petitioner amounted to nothing more than petitioner assuming, as between himself and Abernathy, the indebtedness due from Abernathy to Mrs. Thompson. Petitioner's conduct, however, in not advising Mrs. Thompson that he had taken the mortgaged property into his possession and that he had relieved Abernathy of the indebtedness to Mrs. Thompson was a matter which the state bar commission was justified in investigating, and was such conduct as merits severe criticism, but not suspension or disbarment. In In re Baum, supra, the following language is found:

"Under charges of this kind, where it appears that the accused acted in good faith, without improper or corrupt motives, and it is not shown that any injury resulted to his client, cause for disbarment does not exist."

The additional statement is made that:

"The power of disbarment is one which should be exercised with caution, and with due regard to the serious consequences which may follow from an exercise of the power."

In In re Wourms, 31 Idaho 291, 170 P. 919, the following rule is announced, quoting from 6 C. J. 581:

"The power (of disbarment) is not an arbitrary and despotic one to be exercised at the pleasure of the court or because of passion, prejudice or personal hostility; it is rather one to be used with moderation and caution, in the exercise of a sound judicial discretion, and only for the most weighty reasons, and upon clear legal proof."

Then follows in the body of the opinion the following pertinent language:

"The consequences visited upon an attorney by his disbarment, degrading him, as it does, in the estimation of his fellowmen and depriving him of the means of making a livelihood to which he should have, and probably has, devoted many years of arduous study and expensive preparation, are so severe that it should only be resorted to in cases of necessity where there is no reasonable ground to believe the imposition of a judgment less severe will adequately protect the public, the courts and the profession."

Petitioner was admitted to this court and all courts of record of this state on September 18, 1911, and for 27 years had practiced his profession and held various important public offices. There is not a scintilla of evidence in the record that petitioner's acts of professional conduct during all of the years he has practiced have been anything but honorable and ethical, other than the one here under consideration. The one and only charge made in the complaint upon which he is called to answer is his taking of the mortgaged property, without the authority of the mortgagee and without informing her of having done so, and retaining the same in his possession. Clearly his conduct cannot be excused, but the record negatives willfulness, fraudulent intent, corruption, bad motive, or design to personally profit by his conduct, which being true, his conduct is not of such a character as justifies the severe penalty imposed in the majority opinion.

With reference to what is designated in the majority opinion "the second situation," the $240 check delivered to petitioner by Mrs. Thompson on May 11, 1933, there is no charge in the complaint with reference thereto and therefore petitioner was not called upon to offer any explanation and the state bar commission had no authority to make any investigation thereof. Suffice it to say there is ample evidence in the record to justify the conclusion that while this $240 check was given by Mrs. Thompson to petitioner to apply on a loan to one Ed. Buchanan, the loan was made direct by Mrs. Thompson and not by petitioner. According to the testimony of Mrs. Thompson herself, the $240 check was given to petitioner while he was ill, suffering excruciating pain as a result of sciatic rheumatism, the check was indorsed and deposited to petitioner's account by his stenographer, Mrs. Hansen, and when petitioner was convinced that he had received the $240, which had not been made to appear on the statement rendered to Mrs. Thompson of the business transactions between them, a full settlement was made, Mrs. Thompson taking petitioner's note, which was satisfactory to her at the time. The note was subsequently paid. Likewise all other indebtedness due Mrs. Thompson was paid, and so far as the record discloses she suffered no monetary loss.

It is quite clear to my mind from the record that in so far as one Brewster, an attorney from a foreign jurisdiction, is concerned, his interest was not to purge the bar of an unprofessional and unethical lawyer, but to use the state bar commission as a means to enrich himself by a substantial attorney fee. It is interesting to read his correspondence addressed to petitioner under date February 6, 1936, wherein the following language is found:

"I did, as you know, prefer charges against you before your Bar Association. . . . . However, if you can arrange any plan, by which you can pay up the Abernathy note in full, and agree to pay your obligations to Mrs. Thompson in full or secure the obligation, and pay the expenses she has been put to, I wouldgladly withdraw any charges if she so requests."

Under date of December 1, 1935, in a communication to petitioner, Brewster uses the following language:

"I can promise you that action will be brought on the notes, that a complaint will be filed with the State Bar Asso. and with the prosecuting attorney and that we shall prosecute not only vigorously but bitterly unless you make full, complete and immediate restitution. I do not know if your state bar asso. will prosecute charges but I do know that if they do not a complete report of the entire matter is going to be given to the press of Weiser, Boise and Portland and if I can get your prosecuting attorney to act we will burn you up.

"I am not bluffing about this and I have no sympathy for you. It is going to do you no good to write that you have been sick, busy or that you are hard up. If you are hard up you had better borrow the money or steal it from some one who will be more lenient than I am going to be. . . . .

"I am not sure that I can get either the district attorney or the bar association to act . . . . if I were living in Idaho I would feel the same way about it but fortunately I do not, live in Idaho and I intend to exact the pound of flesh."

It does seem unjust to me that petitioner should be suspended from the practice of law and at the same time required to pay a fine. The presumption might be justified that his ability to pay the fine would depend upon his right to practice his profession. I cannot convince myself that the judgment imposed is not too severe and feel that a lesser punishment would adequately protect the public, the courts and the profession.