Disciplinary Counsel v. Edwards , 134 Ohio St. 3d 271 ( 2012 )

[Cite as Disciplinary Counsel v. Edwards, 134 Ohio St. 3d 271, 2012-Ohio-5643.]
DISCIPLINARY COUNSEL v. EDWARDS.
[Cite as Disciplinary Counsel v. Edwards,
134 Ohio St. 3d 271, 2012-Ohio-5643.]
Attorneys—Misconduct—Multiple client-trust-account improprieties—Acts involving
dishonesty, fraud, deceit, or misrepresentation—Two-year suspension, all
stayed on conditions.
(No. 2012-0681—Submitted July 10, 2012—Decided December 5, 2012.)
ON CERTIFIED REPORT by the Board of Commissioners on Grievances and
Discipline of the Supreme Court, No. 11-053.
____________________
Per Curiam.
{¶ 1} Respondent, Steve J. Edwards of Grove City, Ohio, Attorney
Registration No. 0000398, was admitted to the practice of law in Ohio in 1979. In
June 2011, relator, disciplinary counsel, filed a complaint alleging that Edwards
had committed professional misconduct by withdrawing $69,500 from his client
trust account for his personal use.
{¶ 2} The parties have submitted stipulations of fact and misconduct, as
well as a number of stipulated exhibits. While they agree that Edwards
committed the acts charged in the complaint and that his conduct violated
Prof.Cond.R. 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) and 8.4(h)
(prohibiting a lawyer from engaging in conduct that adversely reflects on the
lawyer's fitness to practice law), Edwards challenges relator’s allegation that his
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conduct involved dishonesty, fraud, deceit, or misrepresentation in violation of
Prof.Cond.R. 8.4(c).1
{¶ 3} The panel adopted the parties’ stipulations of fact and misconduct,
but declined to find that the evidence established a violation of Prof.Cond.R.
8.4(c). Citing the presence of numerous mitigating factors, the panel rejects
relator’s proposed sanction of a one-year suspension with six months stayed on
conditions, and recommends that we impose a one-year suspension, fully stayed
on conditions, for Edwards’s misconduct.
{¶ 4} The board amended the panel’s findings of fact and conclusions of
law to find that Edwards’s misappropriation of funds from his client trust account
involved dishonesty, fraud, deceit, or misrepresentation and therefore violated
Prof.Cond.R. 8.4(c). Accordingly, the board increased the recommended sanction
to a two-year suspension, fully stayed on the conditions recommended by the
panel.
{¶ 5} Relator objects to the recommended sanction, arguing that
Edwards’s deceitful misappropriation of client funds warrants an actual
suspension from the practice of law. For the reasons that follow, we overrule
relator’s objection, adopt the board’s findings of fact and misconduct, and
suspend Edwards from the practice of law for two years, all stayed on conditions.
Misconduct
{¶ 6} Edwards, a sole practitioner with a practice consisting primarily of
environmental groundwater litigation and personal-injury work, maintained a
client trust account. The funds in that account consisted primarily of proceeds
withheld from his clients’ personal-injury settlements to cover subrogated
interests in those cases. Edwards held those funds while he attempted to negotiate
reductions in the subrogated claims for the benefit of his clients.
1. Relator withdrew an alleged violation of Prof.Cond.R. 8.4(d) (prohibiting a lawyer from
engaging in conduct that is prejudicial to the administration of justice).
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January Term, 2012
{¶ 7} Between May 28, 2009, and October 15, 2010, Edwards wrote ten
checks, totaling $69,500, to himself from his client trust account. The last of
those checks caused his client trust account to be overdrawn by $832.34. In
response to relator’s letter of inquiry regarding the overdraft, Edwards admitted
that he had overdrawn his trust account and also reported his misappropriation of
client funds.
{¶ 8} Based upon this conduct, the parties stipulated and the panel found
that Edwards had failed to hold client funds in an interest-bearing client trust
account separate from his own property in violation of Prof.Cond.R. 1.15(a) and
that he had consequently engaged in conduct adversely reflecting on his fitness to
practice law in violation of Prof.Cond.R. 8.4(h). The board adopted these
findings of fact and misconduct and also found that Edwards had engaged in
dishonesty, fraud, deceit, or misrepresentation in violation of Prof.Cond.R. 8.4(c)
as charged in the complaint. We adopt the board’s findings of fact and
misconduct and find that Edwards’s unauthorized removal of funds from his
client trust account and use of those funds for his own purposes necessarily
involves dishonesty, regardless of whether he made any false representations
regarding his conduct.
Sanction
{¶ 9} When imposing sanctions for attorney misconduct, we consider
relevant factors, including the ethical duties that the lawyer violated and the
sanctions imposed in similar cases. Stark Cty. Bar Assn. v. Buttacavoli, 96 Ohio
St.3d 424, 2002-Ohio-4743, 775 N.E.2d 818, ¶ 16. In making a final
determination, we also weigh evidence of the aggravating and mitigating factors
listed in BCGD Proc.Reg. 10(B). Disciplinary Counsel v. Broeren, 115 Ohio
St.3d 473, 2007-Ohio-5251, 875 N.E.2d 935, ¶ 21.
{¶ 10} Edwards has practiced law for more than 30 years without a
disciplinary violation. See BCGD Proc.Reg. 10(B)(2)(a). He has fully
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cooperated in relator’s investigation, acknowledged the wrongful nature of his
conduct, and blames no one but himself for his misconduct. See BCGD Proc.Reg.
10(B)(2)(d). He testified that during the 17 months that he was misappropriating
funds from his client trust account, he continued to negotiate the subrogated
interests of his clients and pay them as they became due. There are no allegations
that he improperly delayed payment of those interests or that he failed to negotiate
in good faith. There has been no harm to Edwards’s clients or their subrogees—
rather, it is the public perception of the profession that suffers when its members
misappropriate client funds as Edwards has.
{¶ 11} Edwards has made full restitution to his trust account, making a
$17,000 payment in December 2009 (before relator initiated his investigation),
$15,000 in November 2010, and $37,500 in December 2010 (after relator initiated
his investigation), and no clients have been harmed as a result of his misconduct.
See BCGD Proc.Reg. 10(B)(2)(c). He has also submitted letters from a colleague,
four clients, his two employees, and his pastor attesting to his good character and
reputation aside from the charged misconduct. See BCGD Proc.Reg. 10(B)(2)(e).
And Edwards has sought guidance and counsel from attorney Richard F. Swope,
who has agreed to serve as his mentor.
{¶ 12} At the hearing, Edwards testified that he had separated from his
wife in 2005 and that in 2009, he began loaning her money from his client trust
account—$53,900 in all—to support her private-investigation business. He
testified that he “felt that if [he] loaned her money, it would show her that [he]
was able to provide for [his] family, and [he] would—it would be a reason for the
marriage to continue.” Edwards’s wife did not repay the loan, and at the time of
the hearing, the couple was negotiating to dissolve the marriage.
{¶ 13} After Edwards’s misconduct came to light, he reached out to the
Ohio Lawyers Assistance Program (“OLAP”) and submitted to a detailed
psychosocial assessment, in which he was diagnosed with adjustment disorder
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January Term, 2012
with mixed anxiety and depressed mood. He entered into a two-year mental-
health contract with OLAP on November 22, 2010, and has participated in
individual counseling with Judith E. Fisher, M.S.W., L.I.S.W., since December 1,
2010.
{¶ 14} Fisher reports that Edwards became distraught after his wife and
the mother of his two sons left their marriage in 2005 and that he became
obsessed with winning her back and reuniting his family. When his wife
encountered financial difficulties in her business, Edwards believed that she
would be more inclined to return to their marriage if he provided financial
assistance. Edwards was also experiencing his own financial difficulties, having
advanced $200,000 of his own funds for some of his environmental cases when
his clients could not afford to do so and having increased the financial support he
provided to his aging parents. Fisher reports that the combination of these life
events caused Edwards to become depressed, that his depressive symptoms
adversely affected his judgment and behaviors, and that there is a direct causal
relationship between these circumstances and his ethical lapses.
{¶ 15} Fisher indicates that Edwards has worked hard to understand how
his mental issues affected his judgment and has come to realize that he must
dissolve his marriage and curtail his involvement in cases that require significant
outlays of his personal funds. Fisher further states that with the continued
assistance of OLAP and individual counseling, Edwards is capable of
competently, ethically, and professionally practicing law. Therefore, we find that
Edwards’s mental disability qualifies as a mitigating factor pursuant to BCGD
Proc.Reg. 10(B)(2)(g).
{¶ 16} In contrast to these significant mitigating factors, the panel and
board found only one aggravating factor—that Edwards engaged in a pattern of
misconduct over a one-and-a-half-year period. Citing the abundance of
mitigating evidence in this case and distinguishing the two cases cited by relator
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on the grounds that they involved additional aggravating factors such as the
respondent’s lack of remorse or the presence of actual harm to clients, the panel
rejected relator’s proposed sanction of a one-year suspension, with six months
stayed on conditions. Instead, the panel recommended that Edwards be
suspended for one year, all stayed on the conditions that he remain in compliance
with his OLAP contract, continue to participate in counseling with a mental-
health professional, and commit no further misconduct. The board, however,
recommends that we suspend Edwards for two years, all stayed on the conditions
set forth by the panel.
{¶ 17} Relator objects to the board’s recommended sanction, arguing that
an attorney’s misappropriation of funds from a client trust account warrants an
actual suspension from the practice of law.
{¶ 18} We are cognizant that our precedent recognizes that the
presumptive sanction for misappropriation is disbarment. See, e.g., Disciplinary
Counsel v. Hunter, 106 Ohio St. 3d 418, 2005-Ohio-5411, 835 N.E.2d 707, ¶ 37.
We have recognized, however, that this sanction may be tempered with sufficient
evidence of mitigating or extenuating circumstances and typically impose an
actual suspension from the practice of law in cases involving misappropriation,
dishonesty, fraud, deceit, or misrepresentation. See, e.g., Disciplinary Counsel v.
Bubna, 116 Ohio St. 3d 294, 2007-Ohio-6436, 878 N.E.2d 632 (imposing a one-
year suspension with six months stayed on an attorney who commingled personal
and client funds, repeatedly overdrew his client trust account, and failed to pay
medical expenses from a client’s settlement); Dayton Bar Assn. v. Gerren, 103
Ohio St. 3d 21, 2004-Ohio-4110, 812 N.E.2d 1280 (imposing a six-month actual
suspension on an attorney who withdrew for his own use settlement funds that
had been set aside to pay his client’s medical bill, the nonpayment of which
resulted in a judgment against the client).
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{¶ 19} Nonetheless, we have consistently recognized that the primary
purpose of disciplinary sanctions is not to punish the offender, but to protect the
public. See, e.g., Disciplinary Counsel v. O’Neill, 103 Ohio St. 3d 204, 2004-
Ohio-4704, 815 N.E.2d 286, ¶ 53. With that purpose in mind, and in
consideration of the significant mitigating factors present in this case, we
conclude that a two-year conditionally stayed suspension is the appropriate
sanction for Edwards’s misconduct.
{¶ 20} Accordingly, we overrule relator’s objection, adopt the board’s
findings of fact and misconduct, and suspend Edwards from the practice of law in
Ohio for two years, all stayed on the conditions that he extend his existing OLAP
contract for an additional two years from the date of this order, continue to
participate in individual counseling with a mental-health professional, comply
with all recommendations of OLAP and his treating mental-health professional,
and commit no further misconduct. If Edwards fails to comply with the
conditions of the stay, the stay shall be lifted, and Edwards shall serve the entire
two-year suspension. Costs are taxed to Edwards.
Judgment accordingly.
O’CONNOR, C.J., and PFEIFER, LUNDBERG STRATTON, O’DONNELL,
LANZINGER, CUPP, and MCGEE BROWN, JJ., concur.
__________________
Jonathan E. Coughlan, Disciplinary Counsel, and Carol A. Costa,
Assistant Disciplinary Counsel, for relator.
William C. Mann, for respondent.
________________________
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