Trumbull Cty. Bar Assn. v. Dull (Slip Opinion) , 2017 Ohio 8774 ( 2017 )

[Until this opinion appears in the Ohio Official Reports advance sheets, it may be cited as
Trumbull Cty. Bar Assn. v. Dull, Slip Opinion No. 2017-Ohio-8774.]
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SLIP OPINION NO. 2017-OHIO-8774
TRUMBULL COUNTY BAR ASSOCIATION v. DULL.
[Until this opinion appears in the Ohio Official Reports advance sheets, it
may be cited as Trumbull Cty. Bar Assn. v. Dull, Slip Opinion No.
2017-Ohio-8774.]
Attorneys—Misconduct—Violations of professional-conduct rules, including
misappropriating client funds—Two-year suspension, with second year
stayed on conditions.
(No. 2017-0490—Submitted June 7, 2017—Decided December 5, 2017.)
ON CERTIFIED REPORT by the Board of Professional Conduct of the
Supreme Court, No. 2016-027.
_______________________
Per Curiam.
{¶ 1} Respondent, Joseph Terrence Dull, of Niles, Ohio, Attorney
Registration No. 0009288, was admitted to the practice of law in Ohio in 1976. In
July 2016, relator, Trumbull County Bar Association, charged him with violating
the professional-conduct rules for, among other things, misappropriating funds that
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a client had instructed him to invest. Dull stipulated to many of the allegations
against him, and after a hearing, the Board of Professional Conduct issued a report
finding that he had engaged in the charged misconduct and recommending that we
suspend him for one year, with the final six months stayed on conditions. Neither
party has objected to the board’s report and recommendation.
{¶ 2} Although we agree with the board’s misconduct findings, we hold that
Dull’s actions require a more severe sanction. For the reasons explained below, we
suspend him for two years, with the second year stayed on the board’s
recommended conditions.
Misconduct
{¶ 3} At the time of his disciplinary hearing, Dull had served for 30 years
as the Niles law director. He planned to retire in February 2017. While serving as
the law director, he also had a solo practice, which he intended to continue after
retiring from public employment.
{¶ 4} In 1996, as part of his private practice, Dull created an investment
trust in which his client Joseph S. Scaglione was the grantor and Dull was the
trustee. Almost 15 years later, in 2011, Scaglione gave Dull two checks totaling
$45,000 and instructed him to invest the money in a Vanguard fund. Dull, however,
failed to do so and instead deposited both checks into his client trust account.
Because Scaglione received monthly account statements from the investment fund,
he discovered that Dull had not invested his money. Due to fluctuating market
conditions, Scaglione later instructed Dull to hold off investing the money until
conditions improved.
{¶ 5} In 2012, Scaglione asked Dull, as trustee of the investment trust, for
$8,000, which Dull paid by check from his client trust account. About three years
later, in 2015, Scaglione requested $27,000 to purchase a new car. But Dull
informed Scaglione that he no longer had any of the money because he had
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January Term, 2017
withdrawn for his own personal use the remaining $37,000 that he had been holding
as trustee of the investment trust.
{¶ 6} Scaglione thereafter terminated Dull as trustee and filed a grievance
with relator. During the disciplinary proceedings, Dull testified that he had moved
his office in 2010 and that overhead for the new space was more than he had
anticipated. He admitted that from 2011 to January 2013, he periodically withdrew
Scaglione’s money from his client trust account to cover his expenses, hoping that
he would make enough money to refund the account before Scaglione requested
more funds from the trust. Dull also admitted that he had failed to properly maintain
client records for his trust account and that he had failed to disclose to Scaglione
and other clients that he lacked malpractice insurance. With assistance from family
members, Dull refunded $37,000 to Scaglione and paid him an additional $11,550,
which represented lost interest and opportunity resulting from Dull’s failure to
initially invest the money.
{¶ 7} Based on this conduct, the board found that Dull had violated
Prof.Cond.R. 1.4(c) (requiring a lawyer to inform the client if the lawyer does not
maintain professional-liability insurance and obtain a signed acknowledgment of
that notice from the client), 1.15(a) (requiring a lawyer to hold property of clients
in an interest-bearing client trust account, separate from the lawyer’s own property),
1.15(a)(2) (requiring a lawyer to maintain a record for each client on whose behalf
funds are held), and 8.4(c) (prohibiting a lawyer from engaging in conduct
involving dishonesty, fraud, deceit, or misrepresentation).
{¶ 8} We adopt the board’s findings of misconduct.
Sanction
{¶ 9} When imposing sanctions for attorney misconduct, we consider
several relevant factors, including the ethical duties that the lawyer violated, the
aggravating and mitigating factors listed in Gov.Bar R. V(13), and the sanctions
imposed in similar cases.
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Aggravating and mitigating factors
{¶ 10} As aggravating factors, the board found that Dull had had a dishonest
or selfish motive, he had engaged in a pattern of misconduct, and his misconduct
had been directed at a vulnerable victim, Scaglione, who the board described as a
trusting and longtime friend of Dull’s. See Gov.Bar R. V(13)(B)(2), (3), and (8).
In mitigation, the board found that Dull had no prior disciplinary record in his 40-
year legal career, he had made full restitution to Scaglione, he had made full and
free disclosures to the board and had had a cooperative attitude toward the
disciplinary proceedings, and he had submitted evidence of good character and
reputation. See Gov.Bar R. V(13)(C)(1), (3), (4), and (5). The board also noted
that at his disciplinary hearing, he was “absolutely willing to acknowledge the
wrongful nature of his conduct.”
Applicable precedent
{¶ 11} “The presumptive sanction for misappropriation of client funds is
disbarment.” Disciplinary Counsel v. Burchinal, 133 Ohio St. 3d 38, 2012-Ohio-
3882, 975 N.E.2d 960, ¶ 17. But, as recognized by the board, because this sanction
“may be tempered with sufficient evidence of mitigating or extenuating
circumstances,” Disciplinary Counsel v. Edwards, 134 Ohio St. 3d 271, 2012-Ohio-
5643, 981 N.E.2d 857, ¶ 18, our sanctions in misappropriation cases have ranged
from disbarment to fully stayed term suspensions.
{¶ 12} After surveying numerous misappropriation cases, the board
concluded that neither disbarment nor an indefinite suspension was warranted here.
Cases with those sanctions, the board noted, generally involved more serious
misconduct, more violations of the professional-conduct rules, an attorney with a
prior disciplinary record, a failure to make restitution or failure to cooperate in the
disciplinary process, or circumstances in which the aggravating factors clearly
outweighed the mitigating factors.
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{¶ 13} In recommending a sanction, the board relied on three
misappropriation cases that it found to be “most comparable” to the present case:
Disciplinary Counsel v. Gorby, 142 Ohio St. 3d 35, 2015-Ohio-476, 27 N.E.3d 510;
Disciplinary Counsel v. Dockry, 133 Ohio St. 3d 527, 2012-Ohio-5014, 979 N.E.2d
313; and Cincinnati Bar Assn. v. Hauck, 129 Ohio St. 3d 209, 2011-Ohio-3281, 951
N.E.2d 83. In Gorby and Dockry, we sanctioned the attorneys with conditionally
stayed one-year suspensions, and in Hauck, we suspended the attorney for one year,
with the final six months stayed on conditions. The board concluded that an actual
suspension was necessary here to protect the public because it would give Dull time
to become more educated about the proper use of his client trust account.
Therefore, the board recommended a one-year suspension with six months
conditionally stayed.
{¶ 14} Although we agree with the board that neither disbarment nor an
indefinite suspension is warranted, we hold that a longer term suspension is
necessary. Dull’s misconduct was more egregious than the misconduct in Gorby,
Dockry, or Hauck. For example, in Gorby, an attorney misappropriated
approximately $5,500 from her sister and brother-in-law, who she represented at
no charge in a foreclosure action. The clients gave her their money with
instructions to use the funds only for payment of their mortgage. But after
depositing the money into her business checking account, she began using some of
the money to pay her own personal and business expenses. The board concluded,
however, that she posed little, if any, threat to the public because her misconduct
“arose in the context of her very contentious family relationship.” Id. at ¶ 15. Based
on these facts, we found that a fully stayed one-year suspension was sufficient to
protect the public. Id. at ¶ 27.
{¶ 15} In contrast, Dull misappropriated significantly more money,
$37,000, over a multiyear period—seemingly because he needed it and the money
was available to him. Thus, we do not have the same level of assurance that he will
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not engage in future misconduct. Indeed, at his disciplinary hearing, he testified
that he had not yet asked his current clients to sign a notice acknowledging that they
were aware that he lacked malpractice insurance, despite the fact that relator had
charged him with that misconduct seven months before the hearing date. Similarly,
he admitted that had not yet commenced retaining the client-trust-account records
that Prof.Cond.R. 1.15(a) requires lawyers to maintain.
{¶ 16} Under these circumstances, a two-year suspension with the second
year conditionally stayed is more appropriate. This sanction takes into account the
significant mitigating factors in this case, gives Dull the necessary time to become
more knowledgeable about the professional-conduct rules relevant to private
practice, and reinforces our long-held position that the continuing public
confidence in the judicial system and the bar requires that strict discipline be
imposed in misappropriation cases. Cleveland Bar Assn. v. Belock, 82 Ohio St. 3d
98, 100, 694 N.E.2d 897 (1998). This sanction is also consistent with other cases
involving attorneys who engaged in isolated incidents of misappropriation in
otherwise unblemished legal careers. See, e.g., Disciplinary Counsel v. Claflin, 107
Ohio St. 3d 31, 2005-Ohio-5827, 836 N.E.2d 564 (imposing a two-year suspension,
with the second year conditionally stayed, on an attorney who misappropriated a
single client’s settlement proceeds and lied about it to a grievance investigator but
had an otherwise unblemished legal career); Disciplinary Counsel v. Gildee, 134
Ohio St. 3d 374, 2012-Ohio-5641, 982 N.E.2d 704, ¶ 16 (imposing a two-year
suspension, with the second year conditionally stayed, on an attorney who
misappropriated funds and engaged in other misconduct in a single client’s case but
had an “otherwise untarnished legal career”).
Conclusion
{¶ 17} For the reasons explained above, Joseph Terrence Dull is suspended
from the practice of law for two years, with the second year stayed on the conditions
that he (1) complete a continuing-legal-education course regarding compliance
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with the rules regulating client trust accounts within six months of this order, in
addition to the requirements of Gov.Bar R. X, and (2) commit no further
misconduct. If Dull fails to comply with the conditions of the stay, the stay will be
lifted and he will serve the full two-year suspension. Costs are taxed to Dull.
Judgment accordingly.
O’CONNOR, C.J., and O’DONNELL, KENNEDY, FRENCH, O’NEILL, FISCHER,
and DEWINE, JJ., concur.
_________________
Flevares Law Firm, L.L.C., and William M. Flevares; and Randil J. Rudloff,
Bar Counsel, for relator.
Comstock, Springer & Wilson Co., L.P.A., and Thomas J. Wilson, for
respondent.
_________________
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