Attorney Grievance Commission v. Berry , 437 Md. 152 ( 2014 )

Attorney Grievance Commission of Maryland v. Steven Gene Berry, Misc. Docket AG No.
62, September Term 2012.
ATTORNEY DISCIPLINE – ATTORNEY MISCONDUCT – DISBARMENT
The Respondent, Steven Gene Berry, violated the Maryland Lawyers’ Rules of Professional
Conduct 1.15(a), 3.3(a)(1), 8.4(b) and (d). These violations stemmed from his dishonest
conduct, over a seven year period, in twelve separate filings, taking Estate money for which
he had no authorization from the Orphans’ Court and concealing disbursements to himself.
The appropriate sanction, the Court of Appeals concluded, was disbarment.
Circuit Court for Montgomery County
Case No. 2819M
Argued: January 14, 2014
IN THE COURT OF APPEALS OF
MARYLAND
Misc. Docket AG No. 62
September Term, 2012
ATTORNEY GRIEVANCE
COMMISSION OF MARYLAND
v.
STEVEN GENE BERRY
Barbera, C.J.
Harrell
Battaglia
Greene
Adkins
McDonald
Watts,
JJ.
Opinion by Battaglia, J.
Filed: February 26, 2014
Steven Gene Berry, Respondent, was admitted to the Bar of this Court on December
15, 1988. On November 26, 2012, the Attorney Grievance Commission, acting through Bar
Counsel (“Bar Counsel”), pursuant to Maryland Rule 16-751(a),1 filed a “Petition For
Disciplinary or Remedial Action” against Berry, charging violations of the Maryland
Lawyers’ Rules of Professional Conduct, including Rules 3.3(a)(1) (Candor Toward the
Tribunal),2 8.4(b), (c) and (d) (Misconduct),3 and Rule 1.15(a) (Safekeeping
1
Rule 16-751(a) provides, in relevant part:
(a) Commencement of disciplinary or remedial action. (1)
Upon approval or direction of Commission. Upon approval or
direction of the Commission, Bar Counsel shall file a Petition
for Disciplinary or Remedial Action in the Court of Appeals.
2
Rule 3.3 provides, in applicative part:
(a) A lawyer shall not knowingly:
(1) make a false statement of fact or law to a tribunal or fail to
correct a false statement of material fact or law previously made
to the tribunal by the lawyer;
3
Rule 8.4 provides, in pertinent part:
It is professional misconduct for a lawyer to:
***
(b) commit a criminal act that reflects adversely on the lawyer’s
honesty, trustworthiness or fitness as a lawyer in other respects;
(c) engage in conduct involving dishonesty, fraud, deceit or
misrepresentation;
(d) engage in conduct that is prejudicial to the administration of
justice;
Bar Counsel’s initial pleading included a charged violation of Rule 8.4(b), which he
subsequently apparently abandoned. Although the hearing judge drew conclusions of law
relative to Rule 8.4(a), Rule 8.4(a) was not specifically charged in the Petition, so we will not
consider it further. Attorney Grievance v. Sapero, 400 Md. 461, 487, 929 A.2d 483, 498
(continued...)
Property),4 concomitant with violations of Section 10-306 of the Business Occupations and
Professions Article, Maryland Code (2000, 2010 Repl. Vol.) (Misuse of Trust Money),5
Section 10-606(b) of the Business Occupations and Professions Article, Maryland Code
(2000, 2010 Repl. Vol.) (Penalties),6 Maryland Rule 16-607 (Commingling of Funds),7 and
(...continued)
(2007) (“[A]n attorney may not be found guilty of violating a Rule of Professional Conduct
unless that Rule is charged in the Petition For Disciplinary or Remedial Action.”).
4
Rule 1.15 provides, in relevant part:
(a) A lawyer shall hold property of clients or third persons that
is in a lawyer’s possession in connection with a representation
separate from the lawyer’s own property. Funds shall be kept in
a separate account maintained pursuant to Title 16, Chapter 600
of the Maryland Rules, and records shall be created and
maintained in accordance with the Rules in that Chapter. Other
property shall be identified specifically as such and
appropriately safeguarded, and records of its receipt and
distribution shall be created and maintained. Complete records
of the account funds and of other property shall be kept by the
lawyer and shall be preserved for a period of at least five years
after the date the record was created.
5
Section 10-306 of the Business Occupations and Professions Article, Maryland
Code (2000, 2010 Repl. Vol.), provides:
A lawyer may not use trust money for any purpose other than
the purpose for which the trust money is entrusted to the
lawyer.
6
Section 10-606 of the Business Occupations and Professions Article, Maryland
Code (2000, 2010 Repl. Vol.), provides, in pertinent part:
(b) Attorney trust accounts. - A person who willfully violates
any provision of Subtitle 3, Part I of this title, except for the
(continued...)
2
Maryland Rule 16-609 (Prohibited Transactions).8
Bar Counsel alleged in its Petition for Disciplinary or Remedial Action that after
Berry’s assumption of the duties of successor personal representative for the Estate of
Patricia Mae Bowles (“Bowles Estate”), Berry withdrew more than $50,000 without court
authority, deposited his own funds into the Bowles Estate account to cover deficiencies, and
submitted multiple accounts to the Orphans’ Court containing false statements and
misrepresentations to conceal unauthorized withdrawals from the Bowles Estate account.
(...continued)
requirement that a lawyer deposit trust moneys in an attorney
trust account for charitable purposes under § 10-303 of this title,
is guilty of a misdemeanor and on conviction is subject to a fine
not exceeding $5,000 or imprisonment not exceeding 5 years or
both.
7
Maryland Rule 16-607 provides, in applicative part:
a. General Prohibition. An attorney or law firm may deposit in
an attorney trust account only those funds required to be
deposited in that account by Rule 16-604 or permitted to be so
deposited by section b. of this Rule.
8
Maryland Rule 16-609 provides, in relevant part:
a. Generally. An attorney or law firm may not borrow or pledge
any funds required by the Rules in this Chapter to be deposited
in an attorney trust account, obtain any remuneration from the
financial institution for depositing any funds in the account, or
use any funds for any unauthorized purpose.
b. No cash disbursements. An instrument drawn on an attorney
trust account may not be drawn payable to cash or to bearer, and
no cash withdrawal may be made from an automated teller
machine or by any other method. . . .
3
Additionally, Bar Counsel alleged that Berry failed to hold and maintain the funds of clients
in trust, while depositing his own funds in his attorney trust account to cover overdrafts, as
well as using client funds to reimburse other clients. In an Order dated December 4, 2012,
this Court referred the matter to Judge Steven G. Salant of the Circuit Court for Montgomery
County for a hearing, pursuant to Rule 16-757.9 Judge Salant issued Findings of Fact and
9
Rule 16-757 provides:
(a) Generally. The hearing of a disciplinary or remedial action
is governed by the rules of evidence and procedure applicable to
a court trial in a civil action tried in a circuit court. Unless
extended by the Court of Appeals, the hearing shall be
completed within 120 days after service on the respondent of the
order designating a judge. Before the conclusion of the hearing,
the judge may permit any complainant to testify, subject to
cross-examination, regarding the effect of the alleged
misconduct. A respondent attorney may offer, or the judge may
inquire regarding, evidence otherwise admissible of any
remedial action undertaken relevant to the allegations. Bar
Counsel may respond to any evidence of remedial action.
(b) Burdens of proof. The petitioner has the burden of proving
the averments of the petition by clear and convincing evidence.
A respondent who asserts an affirmative defense or a matter of
mitigation or extenuation has the burden of proving the defense
or matter by a preponderance of the evidence.
(c) Findings and conclusions. The judge shall prepare and file
or dictate into the record a statement of the judge’s findings of
fact, including findings as to any evidence regarding remedial
action, and conclusions of law. If dictated into the record, the
statement shall be promptly transcribed. Unless the time is
extended by the Court of Appeals, the written or transcribed
statement shall be filed with the clerk responsible for the record
no later than 45 days after the conclusion of the hearing. The
clerk shall mail a copy of the statement to each party.
(continued...)
4
Conclusions of Law, after which this Court held oral argument.
Immediately following argument, a Per Curiam Order disbarring Berry was entered on
January 14, 2014, which stated:
ORDERED, by the Court of Appeals of Maryland, that the
respondent, Steven Gene Berry, be, and he is hereby, disbarred,
effective immediately, from the further practice of law in the
State of Maryland; and it is further
ORDERED that the Clerk of this Court shall strike the name of
Steven Gene Berry from the register of attorneys, and pursuant
to Maryland Rule 16–760(e), shall certify that fact to the Trustees
of the Client Protection Fund and the clerks of all judicial
tribunals in the State; and it is further
ORDERED that respondent shall pay all costs as taxed by the
Clerk of this Court, including the costs of all transcripts, pursuant
to Maryland Rule 16–761(b), for which sum judgment is entered
in favor of the Attorney Grievance Commission of Maryland
against Steven Gene Berry.
Judge Salant’s written Findings of Fact and Conclusions of Law stated:
Findings of Fact and Conclusions of Law [10]
Pursuant to an Order of the Court of Appeals dated December 4,
2012, the above-captioned disciplinary matter was transmitted to
the Circuit Court for Montgomery County, Maryland, for trial
(...continued)
(d) Transcript. The petitioner shall cause a transcript of the
hearing to be prepared and included in the record.
(e) Transmittal of record. Unless a different time is ordered by
the Court of Appeals, the clerk shall transmit the record to the
Court of Appeals within 15 days after the statement of findings
and conclusions is filed.
10
Internal footnotes have been omitted.
5
relating to Respondent’s alleged professional misconduct in
misappropriating funds in an estate escrow account as successor
personal representative and attorney for the estate and for
overdrafting funds in his attorney trust account. The matter came
before this Court for a two-day trial on April 15, 2013. Upon
consideration of the evidence presented at trial and the arguments
of counsel and the parties, this Court finds the following facts to
have been established by clear and convincing evidence:
Findings of Fact
Background
Respondent, Steven Gene Berry (“Respondent” or
“Berry”) was admitted to the Maryland Bar on December 15,
1988. Berry has also been previously admitted to the Oregon Bar
(1978) and the Indiana Bar (1982). Respondent operates a
general solo practice in Bethesda, Maryland that consists
primarily of representing individuals with small traffic or
criminal matters in the District Courts of Maryland, occasional
trust and estate work, occasional domestic relations cases,
relatively simple wills and powers of attorney, and some
court-appointed federal misdemeanor and appellate cases.
Respondent has no associates, secretary, receptionist, law clerk,
or paralegal. Respondent has no previous history of bar
complaints or disciplinary actions.
The Bowles Estate
On February 15, 2005, Respondent was appointed as
successor personal representative in the Estate of Patricia Mae
Bowles (“Bowles Estate”), Estate No. W- 43773, in the Orphans’
Court for Montgomery County. Respondent was appointed to
this position after the original personal representative, Michelle
B. Allen, misappropriated more than $300,000 from the Bowles
Estate. On May 12, 2005, Respondent opened an escrow account
for the Bowles Estate at Mercantile Potomac Bank (now PNC
Bank) titled “Estate of Patricia Mae Bowles, Steven G. Berry
(Personal Representative)” (“Bowles escrow account”).
Respondent opened the account with a check in the amount of
$14,997.66 from Wachovia Bank, where the Bowles escrow
account was originally held by Michelle Allen.
John DeBone, a paralegal with the Attorney Grievance
Commission, reviewed, summarized, and analyzed Respondent’s
6
bank records and accounts submitted to the court. As DeBone
testified, Respondent’s accountings contained three types of
errors: (1) a check went through the bank but the check listed on
the accounting was listed as a different amount; (2) a check went
through the bank but was never listed on an accounting; and (3)
a check listed on the accounting never went through the bank
during the time period reviewed.
Throughout his appointment as successor personal
representative and attorney to the Bowles Estate, Respondent
made numerous unauthorized disbursements to himself for
commission and attorney’s fees and failed to accurately reflect
these disbursements on his accounts to the court. On November
4, 2005, Respondent wrote Check Number 1003 payable to
“Steven G. Berry” as “Successor Personal Representative” in the
amount of $9,500 from the Bowles escrow account, and cashed
the same on November 7, 2005. On November 18, 2005,
Respondent wrote Check Number 1004, again payable to
himself, in the amount of $4,500, and cashed the same on
November 21, 2005. On December 2, 2005, Respondent wrote
Check Number 1005, payable to himself in the amount of $500,
and cashed the same on December 5, 2005. At the time
Respondent withdrew funds for himself in the total amount of
$14,500 from the Bowles escrow account, he had not received
approval from the Orphans’ Court to disburse monies to himself
as successor personal representative, nor did he petition the court
for approval to disburse despite being aware that he was required
to do so. Respondent also had not received consent from the
interested persons of the Bowles Estate to disburse monies to
himself for personal representative commission or counsel’s fees.
On December 6, 2005, after having already disbursed a
total of $14,500 to himself, Respondent filed a Petition for
Allowance of Interim Personal Representative Commission and
Interim Attorney’s Fees (“First Petition”) requesting an interim
personal representative’s commission and counsel’s fee of
$15,834.37 for services he rendered on behalf of the estate and
stating that he applied a 25% professional courtesy discount to
the actual time expended on the case. In the Petition, Respondent
falsely represented that the Bowles escrow account had a “sum
total of $22,671.44.” In fact, as of December 5, 2005, when
Respondent served the Petition upon interested parties, there was
7
a balance of $8,171.44. The balance was $8,171.44 as a result of
disbursements Respondent made to himself totaling $14,500,
which Respondent failed to disclose to the Court in the First
Petition. On January 17, 2006, the Court approved Respondent’s
request for $15,834.37 as and for commission and fees.
Seven months later, on July 17, 2006, Respondent filed his
First Account of Successor Personal Representative for the
period of January 11, 2004 through July 17, 2006. Berry signed
the First Account under oath and under the penalties of perjury.
However, Respondent knowingly and deliberately presented
inaccurate information in his First Account to give the false
impression that his accounting and disbursements of monies held
in the Bowles escrow account were proper and lawful. In his
First Account, Respondent represented that Check Number 1003
was dated 5/24/2005, was in the amount of $21.18, and was
issued to “U.S. Postal Service” for “payment for certified mail
postage.” However, Check Number 1003 was actually dated
11/4/2005, was in the amount of $9,500, and was issued to
“Steven G. Berry” for “Patricia M. Bowles.” Also, Respondent
excluded a copy of Check Number 1003 from his First Account,
although he included copies of most of the other checks he
disbursed from the Bowles escrow account.
In addition to misrepresenting Check Number 1003 in his
First Account, Respondent failed to disclose numerous checks
that he issued to himself from January 11, 2004 to July 17, 2006
without authorization or approval from the Orphans’ Court, as
follows:
Date (issued and posted) Check Number Amount Payee
11/18/05 and 11/21/05 1004 $4,500 Steven G.
Berry
12/2/05 and 12/5/05 1005 $500 Steven G.
Berry
12/6/05 and 12/7/05 1006 $750 Steven G.
Berry
1/19/06 and 1/19/06 1007 $4,000 Steven G.
Berry
3/11/06 and 3/13/06 1008 $6,000 Steven G.
Berry
8
4/28/06 and 4/28/06 1009 $2,000 Steven G.
Berry
5/5/06 and 5/8/06 1010 $2,000 Steven G.
Berry
6/30/06 and 7/3/06 126 $2,500 Steven G.
Berry
In sum, by July 2006, Respondent had taken for himself a total of
$31,750 from the Bowles escrow account without authorization
from the court and without disclosing same to either the Orphans’
Court or to the interested persons.
In his First Account, Respondent additionally
misrepresented that he disbursed Check Number 115, dated
1/21/2006, for the amount of $15,834.37 to Steven Gene Berry
as “personal representative’s commission and counsel fee.”
However, Respondent never presented that check for payment.
Respondent admitted during trial that he never intended to cash
the check, but only wrote it and presented a copy to the court to
give the false impression that he did. Respondent knew that such
information was false and inaccurate, yet included the same to
purposefully conceal the multiple unauthorized payments to
himself.
Respondent subsequently filed eight additional accounts,
all signed under oath and penalties of perjury, and all of which
contained misrepresentations and omissions. On July 31, 2006,
Respondent filed an Amended First Account of Successor
Personal Representative of the Bowles Estate in which he
continued to make the same misrepresentations as he did in his
First Account. On July 10, 2007, Respondent filed his Second
Account of Successor Personal Representative. Not only did the
Second Account contain the same misrepresentations from his
previous account but also contained additional misrepresentations
to conceal the unauthorized disbursements to himself from the
Bowles escrow account. Respondent fabricated the dates,
amounts, and payees on checks, as well as the purpose of the
disbursements of the checks. Respondent provided, in part, the
following in his Second Account:
Date Check No. Amount Payee/Purpose
7/17/2006 126 $25.00 U.S, Postal Service -
9
postage for mailing
the First Account to
the interested persons.
7/31/2006 128 $21.00 U.S. Postal Service -
postage for mailing to
Motion for Summary
Judgment Regarding
the prior Personal
Representative’s
Motion to Approve
Sale of 1053 Grady
A v e n u e ,
Charlottesville,
Virginia with attached
E xhib its to the
interested persons.
10/17/2006 131 $4.88 U.S. Postal Service-
fee for certified mail
Service on Attorney
Richard Paugh.
10/30/2006 132 $10.08 Nelson C ounty,
Virginia, Treasurer -
property tax.
4/5/2007 134 $11.16 U.S. Postal Service -
postage for mailing of
the spreadsheet of
Michelle B. Allen’s
provided financial
information to the
Interested Persons.
The actual disbursements Respondent made for these check
numbers, as revealed by the bank records of the Bowles escrow
account, were as follows:
Date Check Number Amount Payee
10
6/30/2006 126 $2,500 Steven G.
Berry
7/26/2006 128 $3,200 Steven G.
Berry
8/8/2006 131 $1,500 Steven G.
Berry
8/21/2006 132 $2,000 Steven G.
Berry
10/5/2006 134 $2,000 Steven G.
Berry
Respondent never disclosed the actual disbursements to the Court
or to the interested persons of the Bowles Estate. In addition, as
Respondent had done in the First Account, Respondent failed to
disclose in the Second Account the following checks that he
issued to himself from the Bowles escrow account:
Date (issued and posted) Check Number Amount Payee
10/25/06 and 10/26/06 137 $3,200 Steven
G.
Berry
11/2/06 and 11/3/06 140 $1,000 Steven
G.
Berry
11/10/06 and 11/10/06 141 $2,000 Steven
G.
Berry
11/30/06 and 11/30/06 142 $1,000 Steven
G.
Berry
12/14/06 and 12/15/06 143 $1,400 Steven
G.
Berry
1/30/07 and 1/31/07 144 $1,500 Steven
G.
Berry
By July 2007, Respondent had taken a total of $50,550
from the Bowles escrow account without authority or approval
from the court.
11
From April 30, 2008 through May 20, 2010, Respondent
filed his Third, Fourth, Fifth and Amended Fifth Accounts of
Successor Personal Representative, which, again, were prepared
and filed under oath and under penalties of perjury. These
accounts not only contained the same misrepresentations and
omissions from Respondent’s previous accounts, but also
contained additional m isrepresentations concerning
disbursements he made to himself from the Bowles escrow
account. Respondent again fabricated the dates, amounts,
payees, and purposes of the disbursements. For example,
Respondent provided, in part, the following in his Third, Fourth,
Fifth, and Amended Fifth Accounts:
Date Check No. Amount Payee/Purpose
8/9/2007 137 $23.00 U.S. Postal Service -
P o s ta g e F e e f o r
mailing the Second
Account of Successor
P e r s o n a l
Representative and
Petition to Show
Cause.
9/9/2008 1008 $5.20 U.S. Postal Service -
mailing to Attorney
James W. Cox of
M ichie, H amlett,
Rasmussen & Tweel,
PLLC
11/17/2009 1012 $30.25 Nelson C ounty,
Virginia, Treasurer -
property tax.
5/11/2010 1013 $30.25 Nelson C o u n ty,
Virginia, Treasurer -
property tax
5/12/2010 1014 $8,461.78 Register of Wills for
Montgomery
12
County
The actual disbursements Respondent made for these check
numbers, as revealed by the bank records of the Bowles escrow
account, were as follows:
Date Check No. Amount Payee
10/25/2006 137 $3,200 Steven G. Berry
8/22/2008 1008 $60.00 Steven G. Berry
9/24/2008 1012 $100.00 Steven G. Berry
11/21/2008 1013 $10.06 U.S. Postal Service
12/5/2008 1014 $30.25 Treasurer-Nelson
County
Respondent never disclosed the actual disbursements of
these checks to the Court or to the interested persons of the
Bowles Estate. Further, Respondent never corrected any of his
accounts with the Orphans’ Court as to either his omissions or
misrepresentations.
As of May 1, 2010, the balance of the Bowles escrow
account had been reduced to $834.95 after Respondent had made
multiple unauthorized payments to himself. On May 12, 2010,
despite this reduced account balance, Respondent issued Check
Number 1022 in the amount of $8,461.78 to “Register of Wills
for Montgomery County,” when the Bowles escrow account did
not contain sufficient funds to cover the check. In order to cover
the shortfall, on May 11, 2010 and May 13, 2010, Respondent’s
father, Donald Berry, wired $5,000 and $3,000, respectively, into
Respondent’s Attorney Trust Account. On May 12, 2010 and
May 14, 2010, Respondent deposited nearly all of the monies he
received from his father, specifically $4,900 and $2,900,
respectively, into the Bowles escrow account. But for the monies
from his father’s loan, Respondent would not have had sufficient
funds in the Bowles escrow account to cover the entire amount
of Check Number 1022. Respondent purposefully deposited his
own personal funds into the Bowles escrow account to cover the
deficiency caused by his unauthorized payments to himself from
the escrow account.
On August 3, 2010, Respondent filed his Amended
Petition for Second Interim Personal Representative Commission
13
and Attorney Fees (“Second Petition”), which was signed under
oath, requesting an additional $23,828.06 in commission and
attorney’s fees. Respondent attached his invoice for work
allegedly performed on behalf of the Bowles Estate from
December 9, 2005 through May 20, 2010 and indicated that had
he charged his normal fee rate, he would have generated a fee of
$69,919.50. However, when Respondent filed the Second
Petition, only $80.76 remained in the Bowles escrow account
because Respondent has already taken for himself a total of
$50,760 without any authority or approval from the court.
Respondent failed to disclose the disbursements he made to
himself from the Bowles escrow account. Respondent falsely
represented that the Bowles estate had a “balance forward of
$24,534.56" and that it was “SOLVENT”.
On January 14, 2011, the Orphans’ Court granted
Respondent’s Second Petition and authorized Respondent to pay
himself $23,828.06 from the assets of the Bowles Estate. Based
upon the two Orders granting Respondent’s requests for interim
commission and fees, Respondent was authorized by the Court
to pay himself a total of $39,662.43 from the assets of the Bowles
Estate. Significantly, as of February 10, 2009, Respondent had
already paid himself, without any notice to or authority from the
court, a total of $50,760 from the Bowles escrow account as
follows:
Date (posted) Check No. Amount
11/7/05 1003 $9,500.00
11/21/05 1004 4,500.00
12/5/05 1005 500.00
12/6/05 1006 750.00
1/19/06 1007 4,000.00
3/13/06 1008 6,000.00
4/28/06 1009 2,000.00
5/8/06 1010 2,000.00
7/3/06 126 2,500.00
7/26/06 128 3,200.00
8/8/06 131 1,500.00
8/21/06 132 2,000.00
10/5/06 134 2,000.00
14
10/26/06 137 3,200.00
11/3/06 140 1,000.00
11/10/06 141 2,000.00
11/30/06 142 1,000.00
12/15/06 143 1,400.00
1/31/07 144 1,500.00
8/25/08 1008 60.00
9/24/08 1012 100.00
2/10/09 1017 50.00
Total $50,760.00
In January 2011, the Bowles escrow account balance fell
to $50.51, which was insufficient to cover the remaining checks
issued by Respondent to complete the administration of the
Estate. Therefore, on January 24, 2011, Respondent again
deposited his personal funds in the Bowles escrow account in the
amount of $664.99 to cover additional checks he had disbursed
on behalf of the estate.
As previously noted, Respondent took $50,760 from the
Bowles Estate at a time he was only authorized by the Court to
take $15,834.37. Respondent, therefore, unlawfully took
$34,925.63 in commission and fees from the Bowles Estate and
never disclosed the same to the Orphans’ Court. Even
considering the Court’s approval of an additional $23,828.06 in
commission and fees based on Respondent’s Second Petition, for
a total amount approved of $39,662.43, Respondent still
unlawfully took $11,097.57 in commission and fees from the
Bowles Estate over what was approved by the Court without ever
revealing the same.
On August 1, 2011, Respondent filed his Sixth Account
of Successor Personal Representative for the period from May
14, 2010 through July 31, 2011. In his Sixth Account,
Respondent continued to make the same misrepresentations as in
his previous accounts, as well as new misrepresentations as
follows:
Date Check No. Amount Payee/Purpose
2/4/2011 1021 $23,728.06 Seven G. Berry,
Successor Personal
Representative, Counsel
15
Pro Se & Court -
Appointed Special
Administrator - personal
representative’s
commission & attorney’s
fee
2/12/2011 1022 $598.50 Michie, Hamlett, Lowry,
Rasmussen & Tweel,
PLLC - attorney’s fee for
Virginia counsel
4/12/2011 1023 $42.00 Circuit Court for Nelson
County, Virginia -
recording fee for transfer
of rural real property from
Christine A. Bowles to
Patricia Mae Bowles
5/24/2011 1024 $30.25 Nelson County, Virginia,
Treasurer-property tax for
rural lot no. 48-A-63
However, the actual disbursements Respondent made, as
revealed by the bank records of the Bowles escrow account, were
as follows:
Date Check No. Amount Payee
5/11/2010 1021 $30.25 T reasurer N elson
County
5/17/2010 1022 $8,461.78 Register of Wills for
Montgomery
County
5/14/2010 1023 $12.48 U.S. Postal Service
f o r P o sta ge -5 th
account
5/21/2010 1024 $17.92 U.S. Postal Service
16
Respondent never disclosed the actual disbursements to the Court
or to the interested persons of the Bowles Estate. Respondent
deliberately and purposefully misrepresented the amount and
payee of Check Number 1021 to give the court the false
impression that he was making proper and authorized
disbursements to himself from the Bowles Estate, when, in fact,
he had taken above and beyond what the court had authorized to
pay himself as commission and attorney’s fees. Respondent
failed to disclose in his Sixth Account the following checks that
he issued from the Bowles escrow account:
Date Check No. Amount Payee
5/25/10 1025 $15.20 U.S. Postal Service
8/3/10 1026 $16.56 U.S. Post Office
11/15/10 1027 $30.25 T reasurer N elson
County
2/18/11 1028 $598.50 M ichie, H a m le tt,
Lowry, Rasmussen, &
Tweel, PLLC
6/1/11 1029 $42.00 Circuit Court for
N elson County,
Virginia
6/1/11 1030 $42.00 Circuit Court for
N elson County,
Virginia
6/1/11 1031 $30.25 T reasurer N elson
County
By February 2012, Respondent received notice that Bar
Counsel was investigating his disbursements as successor
personal representative and attorney of the Bowles Estate.
However, on March 12, 2012, Respondent filed, under oath, his
Third and Final Petition for Allowance of Successor and Personal
17
Representative Commission and Attorney’s Fees (“Third
Petition”) and failed to disclose to the court disbursements he
made to himself. In his Third Petition, Respondent requested an
additional $26,492.70 in commission and fees, and further
requested, in light of the estate being insolvent, that the original
personal representative’s bond be condemned and applied to his
outstanding commission and fees. Nowhere in his Third Petition
did Respondent mention that as of February 2009, he had taken
$11,097.57 more than he was authorized by the Court to take as
commission and fees. Rather, Respondent falsely claimed that he
incurred expenses “which were paid out of the undersigned’s
own funds in order to carry this matter through to a conclusion
and which are not requested herein simply as a matter of
convenience. . . .” In fact, Respondent never used his own funds
in the Bowles Estate matter, but rather used funds from his
escrow account, making payments to himself approximately
nineteen times between 2005 and 2007, without any notice,
approval or authorization from the court. On April 24, 2012, the
court authorized Respondent to pay himself a total of $26,492.70
in commission and fees. On the same day, the court also
approved Respondent’s request that his commission as personal
representative of the Bowles Estate be taxed as court costs
against the estate so that Respondent could be paid out of the
original personal representative’s $18,000 bond. Accordingly, on
July 6, 2012, Respondent was paid an additional $18,000 by the
bond from Travelers Casualty and Surety Company of America.
With the court’s approval of his Third Petition,
Respondent was authorized to pay himself a total of $66,155.13
($15,834.37 + $23,828.06 + $26,492.70) in commission and fees.
However, Respondent actually paid himself a total of $68,760
($50,760 + $18,000). Thus, even with the court’s approval of his
Third Petition, Respondent took $2,604.87 more than the Court
authorized.
Bar Counsel Investigation and Overdraft of Attorney Trust
Account
On July 20, 2011, Bar Counsel received an overdraft
notice dated July 15, 2011 from United Bank concerning
Respondent’s Attorney Trust Account. The notice reported that
Check Number 1106 in the amount of $125 to Sean Murphy was
presented for payment on June 24, 2011 and because there was
18
insufficient funds at the time of presentation, there was an
overdraft on the trust account in the amount of (negative)
-$141.27. On July 21, 2011, Assistant Bar Counsel, Dolores O.
Ridgell, sent a letter to Respondent requesting his written
explanation of the overdraft notice, along with copies of his
client ledgers, deposit slips, canceled checks, and monthly bank
statements “for the period April 2011 to the present.”
On July 30, 2011, Respondent sent a letter in response to
Ms. Ridgell’s letter of July 21, 2011, attaching copies of his
monthly bank statements, checks, and deposit slips. Respondent
stated that upon discovering the overdraft in the account, he
immediately drafted a check from his office account in the
amount of $175.00, which posted to the escrow account the
following business day, June 27, 2011, and that no client was
adversely affected. Respondent’s letter did not include copies of
his client ledgers. Therefore, on August 9, 2011, Bar Counsel,
Glenn M. Grossman, sent a letter requesting copies of
Respondent’s client ledgers for March through June 2011.
Subsequently, on August 18, 2011, Respondent sent a letter to
Bar Counsel, attaching copies of check stubs, an account ledger
with running balances, and client ledgers. Respondent’s own
check ledgers represent that on multiple occasions, Respondent
maintained a negative balance in his Attorney Trust Account.
Consequently, in September 2011, Bar Counsel informed
Respondent that the matter should be docketed and an
investigation would be conducted. On September 27, 2011, Bar
Counsel served upon United Bank a subpoena commanding the
bank to produce Respondent’s Attorney Trust Account records
for the time period “January 1, 2010 to the present.”
The bank records of Respondent’s Attorney Trust Account
clearly show that from January 2010 to September 2011,
Respondent failed to hold and maintain client funds in the
client’s trust account. During the same time period, Respondent
also used certain clients’ funds to pay for other clients’ matters.
Additionally, Respondent’s client ledgers contained false
representations as to withdrawals and deposits regarding his
clients’ escrow accounts.
Respondent had a contingency fee agreement with his
client Lobsang Wangkang in which Respondent was to receive
one-third of any settlement he recovered on behalf of the client.
19
On May 18, 2011, Respondent deposited settlement proceeds of
$400 in his Attorney Trust Account on behalf of Wangkang. On
June 16, 2011, Respondent disbursed $266.67, two-thirds of the
settlement amount, to Wangkang. Although Defendant’s client
ledger lists a disbursement of $133.33 for attorney’s fees to the
Respondent (one-third of the settlement proceeds), Respondent’s
bank records evidence that this disbursement was never actually
made. On June 24, 2011, Respondent disbursed Check Number
1006 in the amount of $125 on behalf of Wangkang to Sean
Murphy, a process server, leaving only $8.33 remaining in
Wangkang’s escrow account ($400-$266.67-$125=$8.33).
However, on August 23, 2011, Respondent disbursed another
check (Check Number 1120) to Wangkang in the amount of
$266.67, using funds deposited in his Attorney Trust Account on
behalf of clients Adi ($200) and Haas ($500). But for the two
deposits on behalf of Adi and Haas, Respondent would not have
been able to pay Wankang on August 23,2011.
On February 9, 2012, John DeBone met with Respondent
and his attorney, Gary A. Stein, Esquire, at Respondent’s office
to review Respondent’s trust account and client ledgers. After
the meeting, Respondent gave Mr. DeBone, per his request,
documents related to the Bowles Estate and to Respondent’s
other clients, namely: Lobsang Wangkang, Sharon Strand, Lyuba
A. Varticovski, Marcos R. Ardon, Maria E. Parra, including
client ledgers and invoices in relation to Respondent’s
representation of said clients. Respondent’s client ledgers,
invoices, and Attorney Trust Account records showed that
Respondent withdrew his fees that he deposited into his trust
account prior to earning same. The documents further showed
that Respondent made inaccurate entries in his client ledgers
which gave the false impression that he was maintaining an
accurate accounting of his client funds.
In the case of Strand, Respondent represented in his client
ledger that he received from Strand $750 on January 29, 2011
and that he withdrew $750 for attorney’s fees on February 14,
2011. However, the bank records reviewed by John DeBone,
dating from January 2010 through August 2011, show that no
withdrawals were made on behalf of Strand by Respondent on
February 14, 2011 or at any time during this period. Notably,
Respondent’s invoice for Strand stated that on January 31, 2011,
20
he earned $141 to review case materials and to prepare the case
file, leaving an unearned trust balance of $609 ($750 - $141) to
be maintained in his Attorney Trust Account on behalf of Strand.
However, as of February 1, 2011, the Respondent maintained a
total Attorney Trust Account balance of only $480.17, an amount
below that required to be maintained on behalf of Strand.
Similar misrepresentations were made by Respondent in
his client ledgers for Varticovski, Ardon, and Parra. In all three
cases, Respondent stated that certain amounts were received and
disbursed in his client ledgers, when, in fact, they were not. At
trial, Respondent testified that these contemporaneous client
ledgers, which he submitted to bar counsel, and which indicate
that he withdrew funds from the escrow account as and for
attorney’s fees, were in fact false. Also, in all three cases,
Respondent failed to maintain and hold in trust unearned fees in
his Attorney Trust Account on behalf of Varticovski, Ardon, and
Parra.
Conclusions of Law
Respondent has been charged with violating Maryland
Rules of Professional Conduct 1.15, 3.3, and 8.4. This Court
finds that Respondent violated Maryland Rules of Professional
Conduct 1.15(a), 3.3(a)(1), and 8.4(a), 8.4(c), and 8.4(d).
It is undisputed that Respondent misappropriated funds
belonging to the Bowles Estate. There is no dispute that
Respondent took over $34,000 in personal representative
commission and attorney’s fees without authority from the court
or consent of interested parties. It is also undisputed that in all
nine accounts that Respondent signed under oath and submitted
to the court, Respondent knowingly fabricated or omitted
information, including wrong dates, check numbers, amounts on
checks, names of payees, and descriptions of payments from the
Bowles estate account, failing to disclose all the disbursements
he made to himself from the Bowles escrow account. Finally, it
is undisputed that Respondent failed to hold and maintain in trust
funds of clients at all times from January 2010 through
September 2011, and Respondent used other clients’ funds to pay
certain other clients.
21
MRPC 1.15; Md. Rule 16-609; Md. Bus. Occ. & Prof. Code
Ann. § 10-306
(Safekeeping Property and Misuse of Trust Money)
MRPC Rule 1.15(a) provides in part:
(a) A lawyer shall hold property of clients or third persons
that is in a lawyer’s possession in connection with a
representation separate from the lawyer’s own property.
Funds shall be kept in a separate account maintained
pursuant to Title 16, Chapter 600 of the Maryland Rules.
Other property shall be identified specifically as such and
appropriately safeguarded, and records of its receipt and
distribution shall be created and maintained. . . .
MRPC Rule 1.15(c) provides:
(c) Unless the client gives informed consent, confirmed in
writing, to a different arrangement, a lawyer shall deposit
legal fees and expenses that have been paid in advance
into a client trust account and may withdraw those funds
for the lawyer’s own benefit only as fees are earned or
expenses incurred.
Attorney Trust Account
There is clear and convincing evidence that Respondent
violated MRPC 1.15 by using certain client’s funds being held in
the attorney trust account to pay other clients and subsequently
causing an overdraft of the attorney trust account. In doing so,
Respondent also violated Maryland Rule 16-609(a), which states,
“An attorney or law firm may not borrow or pledge any funds
required by the Rules in this Chapter to be deposited in an
attorney trust account . . . or use any funds for any unauthorized
purpose.” Additionally, pursuant to Maryland Rule 16-609(c),
“[n]o funds from an attorney trust account shall be disbursed if
the disbursement would create a negative balance with regard to
an individual client matter or all client matters in the aggregate.”
Respondent’s conduct further violates Maryland Code
Annotated, Business Occupations and Professions § 10-306
which states that “[a] lawyer may not use trust money for any
purpose other than the purpose for which the trust money is
entrusted to the lawyer.”
22
Respondent’s use of client funds to pay other clients was
clearly a misuse of the money Respondent was holding in trust
for his clients. The facts demonstrate that this was a regular
practice of Respondent. For example, as detailed in the facts
above, in August 2011, Respondent paid his client Wankang
$266.67 using funds deposited on behalf of two other clients.
But for these deposits, Respondent would not have been able to
pay Wankang. Eventually, Respondent’s practice caused an
overdraft in his trust account, in violation of bringing
Respondent’s conduct to the attention of Bar Counsel.
Documentation provided to Bar Counsel by Respondent showed
that his attorney trust account continually maintained a negative
balance. Respondent admitted that client ledgers he had
submitted to Bar Counsel indicating that he was properly
maintaining his client’s funds and maintaining an accurate
account of said funds were false. Although Respondent testified
that he corrected the overdraft as soon as he discovered its
occurrence, the fact remains that the overdraft did occur, and that
Respondent regularly used client’s funds to pay other clients, in
violation of MRPC 1.15, Maryland Rule 16-609, and Bus. and
Occ. §10-306.
Respondent failed to withdraw funds from his trust
account only as he earned them as required by MRPC 1.15(c).
For example, as detailed above, Respondent’s invoice for his
client Strand indicated that as of January 31, 2011, he had earned
$141 of the $750 deposited in the trust account on her behalf,
leaving a balance of $609. However, Respondent’s total attorney
trust account balance as of February 1, 2011 totaled $480.17,
$128.83 less than the amount he was required to maintain on
behalf of Strand, evidencing that Respondent withdrew Strand’s
funds prior to earning the same in violation of MRPC 1.15.
Moreover, in the case of several clients, Respondent also failed
to promptly withdraw funds as he became entitled to them as
required by Maryland Rule 16-609(b)(2). Respondent
represented in his client ledger for Strand that he withdrew $750
for attorney’s fees on February 14, 2011. However, Respondent
failed to make any withdrawals from his trust account on
Strand’s behalf on February 14, 2011 or at any time from
February 2011 through August 2011. Respondent followed the
same course of conduct with his other clients as well, namely:
Wankang, Varticovski, Ardon, and Parra, in violation of
23
Maryland Rule 16-609(b)(2).
For these reasons, this Court finds by clear and convincing
evidence that Respondent violated Rule 1.15 by failing to
appropriately safeguard his client’s money and failing to
appropriately maintain his client's funds in his attorney trust
account.
Bowles escrow account
There is clear and convincing evidence that Respondent
violated MRPC 1.15(a) by misappropriating funds in the Bowles
escrow account. Respondent did so by issuing numerous checks
to himself from the Bowles Estate, enumerated in the facts above,
prior to authorization from the court or approval by interested
parties. It is undisputed that Respondent knowingly took over
$34,000 from the Bowles Estate from November 2005 through
February 2009 beyond what had been approved by the Orphans’
Court for him to take as personal representative commission and
attorney's fees. Even assuming arguendo, that Respondent was
approved, nunc pro tunc, by the three Orders of the Orphans’
Court approving Respondent’s Petitions for the earlier
disbursements he made to himself in the total amount of
$66,155.13, Respondent actually took a total of $68,760 as
commission and fees, thereby taking an additional $2,604.87 over
what the Court had authorized him to take as commission as fees.
Thus, in either case, Respondent misappropriated funds from the
Bowles escrow account in violation of MRPC 1.15(a).
Respondent’s use of the Bowles escrow account funds for such
an unauthorized purpose is also a violation of Maryland Rule
16-609 and Maryland Code Annotated, Business Occupations
and Professions § 10-306.
Respondent testified that it was his understanding that he
could petition the court for fees only when the case was
completed. Respondent also testified that he had the
false impression that he could not call the Register of Wills and
get information about petitioning for fees. However, Respondent
presented no evidence demonstrating any attempts to contact the
Register of Wills to see if a clerk was able to provide information
or that he contacted one of his many colleagues to gain
information about obtaining commission and fees as successor
personal representative. Furthermore, despite his assertion that
24
he believed he could not file a petition prior the conclusion of the
case, Respondent did file two petitions prior to filing his Third
and Final Petition.
For the reasons stated, the Court finds by clear and
convincing evidence that Respondent violated MRPC 1.15 by
using the funds in the Bowles account for the unauthorized
purpose of paying himself commission and fees prior to approval.
MRPC 1.15(a); Md. Rule 16-607 (Commingling Funds)
There is clear and convincing evidence that Respondent
violated Rule 1.15(a) (quoted above) by commingling his
personal funds with his client’s funds held in his attorney trust
account and in the Bowles escrow account. In doing so,
Respondent also violated Maryland Rule 16-607, which states,
“An attorney or law firm may deposit in an attorney trust account
only those funds required to be deposited in that account by Rule
16-604. . . .”
Respondent admitted to forty-four out of forty-five
Requests for Admission from Bar Counsel. The only request
Respondent declined to admit was that “[he] maintained [his]
personal funds with the funds of [his] clients and/or third parties
in [his] attorney trust account.” However, the Court finds by
clear and convincing evidence that Respondent did, in fact,
maintain his personal funds with the personal funds of his clients
in his attorney trust account. Respondent testified that he
received a loan from his father, wired from his father’s bank on
three occasions: $5,000 on May 11, 2010, $3,000 on May 13,
2010, and $1,500 on October 6, 2010. Although Respondent
asserted that the wiring of these funds into his trust account as
opposed to his operating account was a mistake, the fact remains
that these funds were in fact transferred into his trust account and
commingled with client funds. Further, despite Respondent’s
assertion that the wiring into his attorney trust account was a
mistake, Respondent did not immediately remove these funds
once wired into the trust account. Furthermore, Respondent did
not transfer these funds into this operating account, but instead
transferred them into the Bowles escrow account. Additionally,
the third allegedly “mistaken” transfer occurred five months after
the first two transfers.
As a result of Respondent’s multiple unauthorized
25
disbursements to himself from the Bowles escrow account,
Respondent had insufficient funds in the account to cover the
actual expenses of the estate. As Respondent admitted both at
trial and in his responses to Request for Admission, in order to
have enough money to pay expenses of the Bowles estate,
Respondent deposited his own personal funds, including monies
from the loans from his father, into the Bowles Estate account.
Therefore, Respondent commingled his personal funds with those
held on behalf of his client as attorney for the Bowles Estate.
Respondent claimed that he did not know that he had to
separate clients’ funds held in escrow and that he did not have
resources to help him learn to manage his accounts. However,
Respondent’s contention that he did not know this ethical rule
does not affect the analysis as to whether Respondent violated
this rule. Under Maryland law, “[c]laimed ignorance of ethical
duties . . . is not a defense in disciplinary proceedings.” Attorney
Grievance Commission v. Awuah, 346 Md. 420, 435 (1997).
Furthermore, Respondent has been an attorney for approximately
thirty-five years. He is a member of the Sandy Spring Religious
Society of Friends, which has several other members who are
attorneys, including Judge Harrington, a retired Maryland judge,
who testified on Respondent’s behalf. Furthermore,
Respondent’s colleague, Christopher Flohr, former president of
the Maryland Criminal Defense Attorney’s Association, and an
adjunct professor of law at the University of Maryland School of
Law, testified that he teaches a course in law practice
management. Certainly, Flohr could have been a valuable
resource to Respondent in understanding how to properly
maintain client funds. Respondent’s assertion that he did not
have the resources to learn how to manage his client’s funds is
simply false. Respondent was and is expected to know the
ethical rules, including the requirement that he is required to
properly maintain his clients’ funds held when held in escrow.
For these reasons, this Court finds by clear and convincing
evidence that Respondent violated Rule 1.15(a) by failing to hold
property of his clients in his possession in connection with a
representation separate from his own property.
MRPC 3.3(a)(1)
Rule 3.3(a)(1) provides:
(a) A lawyer shall not knowingly:
26
(1) make a false statement of fact or law to a
tribunal or fail to correct a false statement of
material fact or law previously made to the tribunal
by the lawyer
There is clear and convincing evidence that Respondent
made numerous false statements of material fact to the court and
failed to correct previously made false statements Respondent
made to the court, in violation of 3.3(a)(1). By his own
admission, Respondent deliberately and knowingly fabricated or
omitted information on all nine of the accounts he prepared,
signed under oath, and filed with the court, including wrong
dates, check numbers, amounts on checks, names of payees, and
descriptions of alleged payments. Respondent also purposefully
and knowingly failed to disclose all the disbursements he made
to himself from the Bowles escrow account. In an effort to
conceal the unauthorized disbursements to himself and his
misappropriation of funds, Respondent made false statements to
the court, claiming that he issued only two checks to himself:
Check Number 115 in the amount of $15,834.37 and Check
Number 1021 in the amount of $23,828.06, the exact amounts the
Court authorized him to pay himself as and for personal
representative commission and attorney’s fees. However,
Respondent never presented Check Number 115 for payment and
Check Number 1021 was not written in the amount of
$23,828.06, but for $30.25 to Nelson County, VA. Respondent
knowingly misrepresented the payee and amount of Check
Number 1021 to give the court the false impression that he was
making proper and authorized disbursements to himself from the
Bowles Estate, when, in fact, he had taken above and beyond
what the court had authorized to pay himself as commission and
attorney’s fee. Respondent never corrected any of these false
statements, even after becoming aware that Bar Counsel was
conducting an investigation.
In addition to submitting accounts rife with fabrications
and omissions, Respondent, again by his own admission,
knowingly fabricated information in his Petitions for Attorney’s
Fees. In both his first and second Petitions, Respondent
misrepresented the balance of the Bowles escrow account as
higher than it actually was at the time he filed his Petitions. The
account had a lesser amount than represented by Respondent due
27
to the multiple unauthorized disbursements he had made to
himself without approval from the Court. Even after being
placed on notice by Bar Counsel of his unauthorized taking of
monies from the Bowles escrow account, Respondent not only
failed to take any corrective action to disclose the actual
disbursements to himself, but filed a Third Petition for
commission and fees with further misrepresentations.
Respondent also continued to conceal the unauthorized
disbursements he made to himself.
Respondent argues in mitigation that he did the work as
provided for in his invoices, and was eventually approved for the
monies he disbursed to himself prior to court approval.
However, at the time he made the unauthorized disbursements to
himself, he was uncertain as to whether the Court would approve
them, particularly because his Petitions requested more than the
statutory limit.
Respondent made numerous false statements to the court
on both his accounts of the Bowles Estate and his Petitions for
fees and failed to correct any of his misrepresentations and
omissions. Respondent testified that he knew he had an
obligation to notify the court that he took more disbursements
than he stated in his accountings and that he failed to do so.
Respondent asserted that this failure was due to a lack of
self-confidence, a lack of experience, and an inability to reach
out to others. However, Respondent has been a member of the
Maryland Bar since 1988 and, since 1988, has had a
responsibility to know and adhere to the Maryland Rules of
Professional Conduct. While Respondent may have been
inexperienced as a successor personal representative, he was not
inexperienced as an attorney bound to the ethical rules. Further,
Respondent had several colleagues at the Sandy Spring Religious
Society of Friends he could have reached out to, in addition to
others, such as Witness Christopher Flohr and colleagues.
For these reasons, the Court finds by clear and convincing
evidence that Respondent violated MRPC 3.3(a)(1) by making
and failing to correct false statements of material fact.
MRPC 8.4
Rule 8.4 provides:
It is professional misconduct for a lawyer to:
(a) violate or attempt to violate the Maryland Lawyers’
28
Rules of Professional Conduct . . .;
...
(c) engage in conduct involving dishonesty, fraud, deceit
or misrepresentation;
(d) engage in conduct that is prejudicial to the
administration of justice . . . .
There is clear and convincing evidence that Respondent violated
the Maryland Rules of Professional Conduct, knowingly made
numerous misrepresentations to the court, knowingly
misappropriated funds, and knowingly engaged in conduct
prejudicial to the administration of justice, all in violation of
MRPC 8.4. Because this Court has found that Respondent
violated Rules 1.15 and 3.3 of the Maryland Rules of
Professional Conduct, Respondent has consequently also violated
Rule 8.4(a). Respondent violated 8.4(c) for the reasons stated in
the MRPC 3.3(a)(1) analysis above.
As to Rule 8.4(d), the Court of Appeals has stated that an
act prejudicial to the administration of justice is one that “tends
to bring the legal profession into disrepute.” Attorney Grievance
Comm'n of Maryland v. Goodman, 426 Md. 115, 128, 43 A.3d
988, 995 (2012) (quoting Att’y Griev. Comm’n v. Rose, 391 Md.
101, 111, 892 A.2d 469, 475 (2006). In Goodman, the Court
further noted that the Court of Appeals has long held that the
commingling of personal and client funds is prejudicial to the
administration of justice. Id. The Court of Appeals has also
found that the intentional misappropriation of funds “erodes
public confidence in the legal profession.” Attorney Grievance
Comm’n of Maryland v. Carithers, 421 Md. 28, 57, 25 A.3d 181,
198 (2011), reconsideration denied (Aug. 11, 2011). In the case
sub judice, Respondent states that his actions did not cause
financial harm to any of his clients. Regardless, his conduct,
including the commingling and misappropriation of funds, is
prejudicial to the administration of justice in that it tends to bring
the legal profession into disrepute and may harm the public’s
confidence in the attorney-client relationship. Therefore, for the
foregoing reasons, the Court finds by clear and convincing
evidence that Respondent violated MRPC 8.4.
Mitigation
29
This matter constitutes the first bar complaint against
Respondent, who has been a lawyer for approximately thirty-five
years. Based upon his time records and invoices, Respondent
earned all fees he had received from his clients and his actions in
this case never resulted in financial loss for any of his clients.
Similarly, in the Bowles Estate matter, despite taking more
commission and fees than the court approved, Respondent’s
actions did not result in receipt of fees or monies that he did not
earn. Furthermore, the Bowles Estate was an complicated matter.
Deputy Register Jane Gardner testified that in her nearly twelve
years with the Orphans’ Court, she had not seen a case like the
Bowles Estate involving so many inappropriate disbursements
without explanation by personal representative Michelle Allen.
Respondent recovered $75,000 of misappropriated funds from
Allen for the estate, obtained a $237,796.17 judgment against her
for the estate, distributed $29,500 to the heirs, and with the help
of Virginia counsel, acted in a foreign jurisdiction to acquire
undeveloped rural property for the heirs appraised at $23,000.
When closing out the Bowles estate, Respondent assigned the
$237,796.17 judgment to the heirs in proportionate shares.
Since this matter began, Respondent has taken the
following steps to correct his problematic office accounts and
ensure compliance with the Rules of Professional Responsibility:
! Respondent requested that the Register of Wills remove
him from the list of attorneys willing to be specially
assigned to cases;
! On February 18, 2012, Respondent attended a Maryland
State Bar Association continuing legal education seminar
entitled “Hanging Out a Shingle” which discussed the
appropriate method of using attorney escrow accounts;
! On November 12, 2012, Respondent attended a
Maryland Criminal Defense Attorneys’ Association
seminar entitled “MCDAA Fall Extravaganza” which
contained components on “Fee Issues and Illegal Funds”
and “Typical Criminal Grievances and How To Avoid
Them;”
! Respondent hired a licensed accountant to set up Quick
Books on his office computer system with separate
ledgers for both his attorney escrow account and office
operating account. The same accountant now reviews
Respondent’s Quick Books system quarterly;
30
! Respondent met with Eric H. Singer, a Maryland
attorney, who has agreed to meet monthly with
Respondent, for a fee, to monitor his attorney escrow
account records if this arrangement is appropriate as part
of an overall disposition of this matter;
! Respondent reviewed his open cases and closed all
remaining collections cases after determining that these
cases were not economically viable;
! Respondent now requires sufficient retainers to support
the costs likely to accrue in new cases he accepts;
! Respondent now maintains a running account ledger for
all active cases with monies in his attorney escrow
account, which must be added up and balanced each time
money goes into or out of the trust account, in addition to
maintaining a separate ledger sheet for each active case
with monies in the trust account;
! Respondent underwent therapy with Adi Shmueli,
Ph.D., a psychologist, and met bi-monthly with him from
January 2012 through June 2012 to better understand the
stresses and influences that contributed to his ethical
lapses and to fashion therapeutic strategies and habits to
avoid further lapses;
! Respondent has repeatedly counseled with elders of his
Quaker Meeting in a specially requested group formally
called a “clearness committee,” confessing his errors as
well as seeking support and guidance in remodeling his
behavior. In addition, Respondent subsequently confessed
his errors and sought support and guidance from former
presiding clerks of his Quaker Meeting at a regular
presiding clerks’ dinner/meeting;
! Respondent has been actively involved in serving the
public in a variety of community or professional activities,
including:
# for at least twelve years with Fathers United, a
self-help group for men going through a child
custody or visitation contest, on a quarterly basis,
as a guest attorney who fields questions from
members;
# for the last two years with Circle Treatment, an
alcohol education and treatment center, on a
quarterly basis, as a guest attorney explaining to
31
group participants how the legal and administrative
law systems work;
# for two terms of four years each in the last ten
years with the Montgomery County Criminal
Justice Coordinating Commission as a
representative of private criminal defense
attorneys;
# for the last ten years with Greater Sandy Spring
Green Space, Inc., a land conservation group, as a
member of the Board of Directors;
# in the late 1990s with the Olney Theater Center
for the Performing Arts, as a member of a
committee that established an endowment fund for
the theater;
# for two terms of three years each with Friends
House Retirement Community, Inc., and Friends
Nursing Home, Inc., as a member of the Board of
Trustees;
# with Sandy Spring Friends Meeting of the
Religious Society of Friends, a Quaker meeting, as
clerk of the Graveyard and Grounds Committee, as
a member and later clerk of the Committee of
Trustees, as assistant presiding clerk and as
presiding clerk.
Conclusion
Wherefore, it is this 29th day of May, 2013, found by the
Circuit Court for Montgomery County, for the reasons set forth
herein, found that Respondent, Steven Gene Berry, has violated
the following Maryland Rules of Professional Conduct: Rules
1.15, 3.3, and 8.4.
“This Court has original and complete jurisdiction over attorney discipline proceedings
in Maryland.” Attorney Grievance v. O’Leary, 433 Md. 2, 28, 69 A.3d 1121, 1136 (2013),
quoting Attorney Grievance v. Chapman, 430 Md. 238, 273, 60 A.3d 25, 46 (2013). “[W]e
accept the hearing judge’s findings of fact as prima facie correct unless shown to be clearly
32
erroneous.” Attorney Grievance v. Fader, 431 Md. 395, 426, 66 A.3d 18, 36 (2013), quoting
Attorney Grievance v. Rand, 429 Md. 674, 712, 57 A.3d 976, 998 (2012). We review the
hearing judge’s conclusions of law de novo, pursuant to Rule 16-759(b)(1).11 O’Leary, 433
Md. at 28, 69 A.3d at 1136.
Bar Counsel has filed no exceptions to Judge Salant’s Findings of Fact and
Conclusions of Law. Berry filed a Motion to Exercise Revisory Power to Receive Additional
Evidence, which we denied, as well as twenty-four pages of written exceptions and
supplements to the Findings of Fact, which his counsel indicated at oral argument were
abandoned. Two factual exceptions in which Berry had attempted to except himself from
knowledge and wilfulness, were particularized at oral argument as immaterial, in addition to
11
Rule 16-759(b) provides in pertinent part:
(b) Review by Court of Appeals. (1) Conclusions of law. The
Court of Appeals shall review de novo the circuit court judge’s
conclusions of law.
(2) Findings of fact. (A) If no exceptions are filed. If no
exceptions are filed, the Court may treat the findings of fact as
established for the purpose of determining appropriate sanctions,
if any.
(B) If exceptions are filed. If exceptions are filed, the Court of
Appeals shall determine whether the findings of fact have been
proven by the requisite standard of proof set out in Rule 16-757
(b). The Court may confine its review to the findings of fact
challenged by the exceptions. The Court shall give due regard
to the opportunity of the hearing judge to assess the credibility
of witnesses.
33
being abandoned.12
We conclude that the hearing judge’s factual findings were supported by clear and
convincing evidence. We agree with Judge Salant’s conclusions of law and find that they are
supported by clear and convincing evidence.
Berry violated Rule 1.15(a) that “[a] lawyer shall hold property of clients or third
persons that is in a lawyer’s possession in connection with a representation separate from the
lawyer’s own property . . . maintained pursuant to Title 16, Chapter 600 of the Maryland
Rules” by commingling personal funds with moneys in the Bowles Estate account and making
unauthorized disbursements. Attorney Grievance v. Thompson, 376 Md. 500, 517-18, 830
A.2d 474, 484-85 (2003) (determining that because the personal representative took
12
In regard to the exceptions, at oral argument, Berry’s counsel stated:
There are two factual exceptions that I will argue today, which
I will let the Court know now, I believe are not material to the
outcome of the situation, they’re more of refining certain factual
things . . . there are nothing in the exceptions that go to whether
any of these rules were or not violated because they were.
***
The first one is the assertion that he didn’t have the resources to
learn how to manage his clients’ funds. . . . It wasn’t a lack of
resources. It was his own ineptitude. He understood that
resources existed to help him out. He didn’t access them. He
failed to reach out. . . . The other one . . . which said that the
client was uncertain about whether the court was going to give
approval for his fee petitions . . . what I am arguing to the Court
is there was no lack of certainty on Mr. Berry’s part as to
whether the court would approve these fee petitions. It was
quite simply, again, a failure of his to do what he was supposed
to do and what he knew the law required, which was to file the
petitions first, before you take the fees.
34
commissions prior to approval from the Orphans’ Court and, therefore, improperly handled
estate distributions, he violated Rule 1.15(a)). Berry also violated Rule 1.15(a), robbing Peter
to pay Paul, by using client funds to pay other clients or fund their cases, running a negative
balance in his attorney trust account and depositing personal funds into the account in
violation of Md. Rules 16-607 and 16-609, as well as Section 10–306 of the Business
Occupations and Professions Article of the Maryland Code. Attorney Grievance v. Thomas,
409 Md. 121, 150-52, 973 A.2d 185, 202-03 (2009).
Berry also violated Rule 3.3(a)(1), requiring that, “[a] lawyer shall not knowingly make
a false statement of fact or law to a tribunal or fail to correct a false statement of material fact
or law previously made to the tribunal by the lawyer.” Berry, in three Petitions for Allowance
of Interim Personal Representative Commission and Interim Attorney’s Fees, filed over seven
years with the Orphans’ Court, failed to disclose the numerous unauthorized payments he
made to himself. Additionally, Berry filed nine Accounts of Successor Personal
Representative with the Orphans’ Court, in which he not only omitted check numbers, but
mis-identified payees on checks and falsified amounts, as well as balances to reconcile each
account. In his Second Account, for example, Berry attested that check number 134 was
issued to the “U.S. Postal Service” for $11.16, when, in reality check number 134 had been
written by Berry to himself for $2,000. Berry’s deceit in concealing payments to himself from
the Bowles Estate is present in each of the accounts, which he never corrected, all in violation
of Rule 3.3. Attorney Grievance Comm’n v. Williams, 335 Md. 458, 471, 644 A.2d 490, 496
(1994) (determining that attorney serving as personal representative violated Rule 3.3 where
35
he “reported an inaccurate figure as the balance in the decedent’s savings account and failed
to file an amended petition correcting that error”).
Berry violated Rules 8.4(c) by “engag[ing] in conduct involving dishonesty, fraud,
deceit or misrepresentation” and 8.4(d) by “engag[ing] in conduct that is prejudicial to the
administration of justice.” Berry made false statements to the Orphans’ Court in twelve
separate filings, including three fee petitions and nine accounts. Attorney Grievance v.
Steinberg, 395 Md. 337, 369, 910 A.2d 429, 448 (2006) (determining that knowingly false
statements made by an attorney in a motion in a bankruptcy proceeding constituted violations
of Rules 3.3, 8.4(c) and (d)). He took funds from the Bowles Estate account without court
authorization. Attorney Grievance v. Sullivan, 369 Md. 650, 655-56, 801 A.2d 1077, 1080
(2002) (concluding that the attorney’s mishandling of an estate account, including taking of
funds without court approval, while serving as personal representative reflected “adversely
on his honesty, trustworthiness and fitness as an attorney” and “was conduct prejudicial to the
administration of justice” in violation of Rules 8.4(c) and (d)). Berry also misused client
funds in his attorney trust account. See Attorney Grievance v. Gallagher, 371 Md. 673, 712-
13, 810 A.2d 996, 1019-20 (2002) (determining that the attorney violated Rules 8.4(c) and (d)
by his intentional deceitful conduct, failing to hold his client’s funds in trust and misleading
the client regarding the use of the funds).
Bar Counsel recommends disbarment, as “[t]his instant case involves both
misappropriation of client funds and repeated misrepresentations to a tribunal by Respondent”
while Berry recommends an indefinite suspension with the right to apply for reinstatement
36
after one year.13
In imposing sanctions, we will consider “the nature of the ethical duties violated in
light of any aggravating or mitigating circumstances.” Attorney Grievance v. Paul, 423 Md.
268, 284, 31 A.3d 512, 522 (2011). With regard to aggravating factors, we look to Section
9.22 of the American Bar Association Standards for Imposing Lawyer Sanctions (1992)
including:
(a) prior disciplinary offenses;
(b) dishonest or selfish motive;
(c) a pattern of misconduct;
(d) multiple offenses;
(e) bad faith obstruction of the disciplinary proceeding by
intentionally failing to comply with rules or orders of the
disciplinary agency;
(f) submission of false evidence, false statements, or other
deceptive practices during the disciplinary process;
(g) refusal to acknowledge wrongful nature of conduct;
(h) vulnerability of victim;
(i) substantial experience in the practice of law;
(j) indifference to making restitution.
Attorney Grievance v. Bleecker, 414 Md. 147, 176-77, 994 A.2d 928, 945-46 (2010). In this
case, factors (b), (c), (d) and (i) are implicated.
Of vital importance in this case is factor (b), “dishonest or selfish motive.” Berry
demonstrated an ongoing pattern of deceitful conduct with the Bowles Estate account,
submitting multiple Petitions for commissions and fees with false account balances and
13
In his written Exceptions to the Findings of Fact and Conclusions of Law, Berry
requested a disciplinary sanction of “a sixty days to a one year period of suspension”, but,
at oral argument, Berry, through counsel, amended his recommendation to an indefinite
suspension with the right to reapply after one year.
37
without disclosing his unauthorized disbursements to himself, as well as submitting nine
fraudulent Accounts to conceal his unauthorized withdrawals, thereby implicating factor (b).
Attorney Grievance v. Seltzer, 424 Md. 94, 117, 34 A.3d 498, 512 (2011).
Factor (c), “a pattern of misconduct,” is also implicated. Berry repeatedly engaged in
deceitful actions throughout the seven years he served as successor personal representative
of the Estate. He disbursed more than twenty unauthorized checks to himself and submitted
three misleading Petitions and nine fraudulent Accounts to the court, rife with falsifications,
to conceal the disbursements. Attorney Grievance v. Penn, 431 Md. 320, 345, 65 A.3d 125,
140 (2013).
Factor (d), “multiple offenses,” is implicated by numerous violations of the Rules. Id.,
citing Bleecker, 414 Md. at 177-78, 994 A.2d at 946. Berry committed numerous violations
of the Rules, not only as a result of his actions as successor personal representative of the
Bowles Estate account, but also because he commingled personal and client moneys in his
attorney trust account. Attorney Grievance v. Fader, 431 Md. 395, 437, 66 A.3d 18, 43
(2013).
Finally, factor (i) is implicated because Berry had been a member of the Maryland Bar
since 1988, demonstrating that he had “substantial experience in the practice of law.” Id.
We also consider mitigation to determine the appropriate sanction. Paul, 423 Md. at
284, 31 A.3d at 522. Under Section 9.32 of the American Bar Association Standards for
Imposing Lawyer Sanctions (1992), mitigating factors include:
Absence of a prior disciplinary record; absence of a dishonest or
38
selfish motive; personal or emotional problems; timely good faith
efforts to make restitution or to rectify consequences of
misconduct; full and free disclosure to disciplinary board or
cooperative attitude toward proceedings; inexperience in the
practice of law; character or reputation; physical or mental
disability or impairment; delay in disciplinary proceedings;
interim rehabilitation; imposition of other penalties or sanctions;
remorse; and finally; remoteness of prior offenses.
Penn, 431 Md. at 343-44, 65 A.3d at 139, quoting Attorney Grievance v. Brown, 426 Md. 298,
326, 44 A.3d 344, 361 (2012). Judge Salant found, in mitigation, that Berry had no prior
grievances; that “[b]ased upon his time records and invoices, Respondent earned all fees he
had received from his clients”; that the handling of the Bowles Estate was complex; that Berry
recovered $75,000 of misappropriated funds and a $237,796.17 judgment for the Estate, from
which $29,500 was distributed to the heirs, and that he worked, with the assistance of local
counsel, to acquire property for the heirs appraised at $23,000. Judge Salant also found that
Berry requested removal of his name from the Register of Wills’ list of available attorneys;
attended seminars regarding appropriate use of escrow accounts and fee issues; closed
existing collections cases that were not economically viable; hired a licensed accountant to
set up and regularly review a new office accounting system; met with an attorney to monitor
his escrow accounts; and altered his existing accounting practice. Judge Salant also found that
Berry underwent therapy, counseled with elders in his Quaker community, and was actively
involved in public service.
“[D]isbarment is warranted where a lawyer acts dishonestly because dishonest conduct
is ‘beyond excuse’: ‘Unlike matters relating to competency, diligence and the like, intentional
39
dishonest conduct is closely entwined with the most important matters of basic character to
such a degree as to make intentional dishonest conduct by a lawyer almost beyond excuse.’”
Penn, 431 Md. at 345, 65 A.3d at 140, citing Attorney Grievance v. Vanderlinde, 364 Md.
376, 418, 773 A.2d 463, 488 (2001); see also Attorney Grievance v. Nussbaum, 401 Md. 612,
643-44, 934 A.2d 1, 19 (2007), citing Attorney Grievance v. Cherry-Mahoi, 388 Md. 124,
161, 879 A.2d 58, 81 (2005); Sullivan, 369 Md. at 655-56, 801 A.2d at 1080; Attorney
Grievance Comm’n v. Boehm, 293 Md. 476, 481, 446 A.2d 52, 54 (1982). Here, Berry
intentionally and knowingly lied to the Orphans’ Court over and over again in twelve different
petitions and accounts during a seven year period. His conduct is beyond justification or
rationalization.
Berry, however, proffers that an indefinite suspension is appropriate, relying upon
Attorney Grievance v. Pleshaw, 418 Md. 334, 15 A.3d 777 (2011),14 Attorney Grievance
Comm’n v. Owrutsky, 322 Md. 334, 587 A.2d 511 (1991), Attorney Grievance v. Kendrick,
403 Md. 489, 943 A.2d 1173 (2008), Attorney Grievance v. Seiden, 373 Md. 409, 818 A.2d
1108 (2003), Attorney Grievance v. Tun, 428 Md. 235, 51 A.3d 565 (2012); Attorney
Grievance v. DiCicco, 369 Md. 662, 802 A.2d 1014 (2002) and Attorney Grievance v. Jeter,
365 Md. 279, 778 A.2d 390 (2001). In Owrutsky, 322 Md. at 355-56, 587 A.2d at 521, we
determined that the attorney’s conduct, although “perilously close to misappropriation of
14
Berry mistakenly characterizes Attorney Grievance v. Pleshaw, 418 Md. 428, 15
A.3d 777 (2011), a reciprocal discipline case, as “a case that involved an indefinite
suspension with the right to reapply after eighteen months.” The sanction imposed was
disbarment.
40
funds” reflected “carelessness and neglect in the handling of these estates and trusts”, and
therefore, warranted a sanction of three years’ suspension. In Kendrick, 403 Md. at 522, 943
A.2d at 1191-92, we imposed an indefinite suspension, because the attorney’s conduct was
“not due to greed or dishonesty, but rather due to obstinateness and incompetence in probate
matters.” Likewise, in Seiden, 373 Md. at 423-25, 818 A.2d at 1116-17, Tun, 428 Md. at 248,
51 A.3d at 573, DiCicco, 369 Md. at 687-88, 802 A.2d at 1028, and Jeter, 365 Md. at 293-94,
778 A.2d at 398, we determined that indefinite suspensions were appropriate because the
attorneys’ conduct was negligent, not intentionally dishonest.
Berry acted dishonestly over a seven year period repeatedly, in twelve separate filings.
He took Estate money for which he had no authorization from the Orphans’ Court and
concealed disbursements to himself. Accordingly, we disbarred Steven Gene Berry.
41