In Re: Daniel E. Becnel, III

Supreme Court of Louisiana
FOR IMMEDIATE NEWS RELEASE NEWS RELEASE #005
FROM: CLERK OF SUPREME COURT OF LOUISIANA
The Opinions handed down on the 30th day of January, 2019, are as follows:
PER CURIAM:
2018-B-0848 IN RE: DANIEL E. BECNEL, III
Upon review of the findings and recommendations of the hearing
committee and disciplinary board, and considering the record,
briefs, and oral argument, it is ordered that Daniel E. Becnel,
III, Louisiana Bar Roll number 20692, be and he hereby is
suspended from the practice of law for a period of one year and
one day. All costs and expenses in the matter are assessed
against respondent in accordance with Supreme Court Rule XIX, §
10.1, with legal interest to commence thirty days from the date
of finality of this court’s judgment until paid.
WEIMER, J., concurs in part and dissents in part and assigns
reasons.
HUGHES, J., dissents with reasons.
01/30/19
SUPREME COURT OF LOUISIANA
NO. 2018-B-0848
IN RE: DANIEL E. BECNEL, III
ATTORNEY DISCIPLINARY PROCEEDING
PER CURIAM
This disciplinary matter arises from formal charges filed by the Office of
Disciplinary Counsel (“ODC”) against respondent, Daniel E. Becnel, III, an attorney
licensed to practice law in Louisiana.
PRIOR DISCIPLINARY HISTORY
Before we address the current charges, we find it helpful to review
respondent’s prior disciplinary history. Respondent was admitted to the practice of
law in Louisiana in 1991. In 2005, we accepted a joint petition for consent discipline
in which respondent stipulated that he engaged in three instances of neglect of a legal
matter, five instances of failure to communicate with a client, and two instances of
failure to promptly remit funds to third parties. For this misconduct, he was
suspended from the practice of law for one year and one day, fully deferred, subject
to eighteen months of supervised probation with conditions, including the
appointment of a probation monitor and respondent’s attendance at Ethics School.
In re: Becnel, 05-0831 (La. 4/29/05), 900 So. 2d 836 (“Becnel I”).
In 2006, respondent accepted a representation involving post-conviction relief
proceedings when he was not competent to handle the matter. After researching the
issues, respondent determined his client had no non-frivolous claims to support post-
conviction relief. Instead of informing his client of this determination and allowing
him to decide the future course of the representation, respondent simply failed to file
post-conviction pleadings in state court. He thereafter refused to refund any portion
of the $5,000 advance fee paid by his client, claiming he earned the entire amount.
Subsequently, respondent’s client provided him with arguments for a habeas
petition. Respondent continued to believe the arguments were frivolous. Despite
his belief, respondent did not terminate the representation and instruct the client to
seek other counsel; instead, he filed the habeas petition anyway. Because he
believed the arguments were frivolous, respondent deliberately failed to file the
required supporting memorandum, thereby failing to comply with the federal court’s
rules and again neglecting his client’s legal matter. When the magistrate judge
recommended the client’s habeas petition be dismissed, respondent made no effort
to file an opposition on his client’s behalf.
After review, we determined that respondent’s conduct was knowing, if not
intentional. For his misconduct, respondent was suspended for one year, with three
months deferred, followed by a one-year period of unsupervised probation, and
ordered to make restitution of the unearned fee. In re: Becnel, 10-0884 (La.
10/19/10), 48 So. 3d 1042 (“Becnel II”).
Finally, in 2012, we accepted a joint petition for consent discipline in which
respondent stipulated that he engaged in a consensual sexual relationship with a
client. For this misconduct, he was suspended from the practice of law for nine
months. In re: Becnel, 12-2139 (La. 11/2/12), 99 So. 3d 1005 (“Becnel III”).
Against this backdrop, we now turn to a consideration of the misconduct at
issue in the instant proceeding.
UNDERLYING FACTS
In May 2013, respondent’s client, Tammy Rowell, received a partial
settlement in her workers’ compensation case. Because respondent was serving his
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suspension in Becnel III at this time, his wife and law partner, Kathryn Becnel,
handled the distribution of the settlement funds. Ms. Becnel withheld $9,574.50
from the settlement to satisfy a Social Security lien. After subtracting sums owed to
a finance company and to the law firm for attorney’s fees, Ms. Becnel paid Ms.
Rowell her portion of the settlement funds on June 12, 2013.
On August 2, 2013, respondent was reinstated to the practice of law. Shortly
thereafter, Ms. Rowell received the final settlement in her workers’ compensation
case. Unaware that his wife had already withheld funds to satisfy the Social Security
lien, respondent erroneously withheld another $7,659.60 for this purpose.1 After
subtracting an additional sum for expenses, respondent paid Ms. Rowell her portion
of the settlement funds on August 19, 2013.
In August 2014, respondent wrote a check to himself drawn on his client trust
account in the amount of $28,000. Respondent believed this sum represented
attorney’s fees owed to him that had not been transferred from the trust account to
his operating account; however, in actuality, $9,574.50 of the withdrawal
represented the funds belonging to Ms. Rowell and still held in the trust account.
In November 2014, the ODC received notice from Chase Bank that
respondent’s client trust account was overdrawn. The overdraft was the result of a
misplaced deposit and was quickly remedied by respondent. When respondent’s
bank records were reviewed as part of the investigation into the overdraft, the
conversion of $9,574.50 of Ms. Rowell’s funds came to light. In August 2015,
respondent wrote a check to Ms. Rowell in the amount of $10,339.41, representing
the amount owed to her with interest.
Respondent has acknowledged that he converted Ms. Rowell’s funds. He also
acknowledged that he made several mathematical errors in connection with his
1
Respondent had negotiated a reduction in the amount of Ms. Rowell’s Social Security lien, and
the amount of $7,659.60 represented the reduced amount.
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handling of his client trust account, and failed to transfer his attorney’s fees from the
account as they were earned.
DISCIPLINARY PROCEEDINGS
In September 2016, the ODC filed formal charges against respondent, alleging
that his conduct violated the following provisions of the Rules of Professional
Conduct: Rules 1.15(a) (safekeeping property of clients or third persons) and 8.4(c)
(engaging in conduct involving dishonesty, fraud, deceit, or misrepresentation).
Respondent answered the formal charges and acknowledged that he negligently
handled client funds.
Joint Stipulations
Prior to a hearing in the matter, respondent and the ODC filed into the record
the following stipulations:
1. Respondent committed the misconduct alleged in the formal charges (a) by
converting a total of $9,574.50 from his former client Tammy Rowell; (b) by
making several mathematical errors in association with his handling of his
trust account; and (c) by failing to promptly transfer earned attorney’s fees out
of his trust account.
2. Respondent’s misconduct violated Rule 1.15(a) of the Rules of Professional
Conduct. 2
3. Respondent contends that he was negligent in committing the stipulated
misconduct. The ODC contends that respondent’s conduct was “knowing.”
4. It is an aggravating factor that respondent has the following three incidents of
prior discipline: Becnel I (2005), Becnel II (2010), and Becnel III (2012).
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Respondent did not admit to the violation of Rule 8.4(c) alleged in the formal charges, so that
issue remained for determination by the hearing committee.
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5. It is a mitigating factor that respondent had no dishonest or selfish motive in
committing the misconduct alleged in the formal charges.
6. It is a mitigating factor that respondent made full and free disclosure to the
ODC and has demonstrated a cooperative attitude toward these disciplinary
proceedings.
7. It is a mitigating factor that respondent made timely and good faith efforts to
rectify the consequences of his misconduct (a) by paying his client the
proceeds of her settlement promptly after he learned of his accounting error,
and (b) by hiring CPA Angela Willis to regularly audit his trust account.
8. It is a mitigating factor that respondent has exhibited sincere remorse for his
misconduct.
9. It is a mitigating factor that one of the three incidents of prior discipline,
Becnel I (2005), was remote in time. 3
Hearing Committee Report
In its report, the hearing committee determined that the only factual issue
before it was whether respondent’s conduct was negligent or knowing. In resolving
this question, the committee cited respondent’s testimony that he mistakenly
withheld funds from Ms. Rowell’s second settlement to satisfy the Social Security
lien because he was unaware that his wife had already withheld funds for the same
purpose. The committee found there was no evidence presented by the ODC that
respondent actually knew he had Ms. Rowell’s funds in his client trust account for
an extended period of time. The committee also noted the testimony of the ODC’s
forensic accountant that respondent was guilty of “sloppiness” in handling his trust
account. Based upon these findings, and the testimony, exhibits, and joint
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Although not included in the stipulations, the parties also agreed that the applicable baseline
sanction in this matter is a one year and one day suspension from the practice of law.
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stipulations of the parties, the committee concluded that respondent’s conduct was
negligent and did not rise to the level of knowing or intentional.
The committee determined that respondent violated a duty to his client. As
previously stated, his conduct was negligent. He caused injury to his client. As a
result of respondent’s mishandling of Ms. Rowell’s settlement, she was deprived of
a portion of her settlement funds for approximately two years. However, the
committee pointed out that Ms. Rowell actually received some $2,000 in additional
money because respondent had negotiated a reduction in the Social Security lien
from $9,574.50 to $7,659.60. The parties agree that the applicable baseline sanction
is a one year and one day suspension. The aggravating and mitigating factors have
been stipulated to by the parties.
Concerning the issue of an appropriate sanction, the committee recognized
that there are more mitigating factors present in this matter than aggravating factors.
The committee particularly noted respondent’s remorse and the fact that he has hired
a CPA to eliminate the type of error that occurred herein. However, despite the fact
that there are relatively few aggravating factors, the committee gave significant
weight to the fact that this is respondent’s fourth disciplinary proceeding.
Accordingly, the committee recommended that respondent be suspended from the
practice of law for one year and one day, with all but sixty days deferred, followed
by a one-year period of probation governed by the following conditions:
a) Regular audits of respondent’s trust account during the
period of probation shall be performed by a CPA of
respondent’s choosing, subject to the approval of the
ODC, to be submitted quarterly to the ODC, with the
cost and expenses of the audits paid by respondent;
b) At least six hours of respondent’s mandatory
continuing legal education requirements during the
probationary period shall be obtained in the area of law
office practice management/client trust account
management; and
c) Respondent shall successfully complete the Louisiana
State Bar Association’s Trust Accounting Program
during the probationary period.
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Both respondent and the ODC objected to the hearing committee’s report.
Respondent asserted that the sanction recommended by the committee is too harsh.
The ODC objected to the committee’s conclusion that respondent’s conduct was
negligent and its failure to address the violation of Rule 8.4(c) alleged in the formal
charges. The ODC also argued that the sanction recommended by the committee is
too lenient.
Disciplinary Board Recommendation
After reviewing this matter, the disciplinary board determined that the hearing
committee’s factual findings are not manifestly erroneous, and that the committee
correctly found respondent violated Rule 1.15(a), as stipulated. Though it did not
specifically reject a Rule 8.4(c) violation, the committee apparently declined to find
a violation of that rule, which applies to misconduct involving dishonesty, fraud,
deceit, or misrepresentation. In describing respondent’s misconduct, the committee
used terms such as “unaware,” “mistakenly,” and “sloppiness,” suggesting it did not
find respondent’s conduct to be dishonest or that he intended to misrepresent
anything to his client. Indeed, the parties stipulated as a mitigating factor that
respondent had no dishonest or selfish motive. Based upon the committee’s factual
findings, the board declined to find a violation of Rule 8.4(c).
The board determined that respondent violated a duty owed to his client. He
acted negligently and caused harm to his client, inasmuch as she was deprived of
funds to which she was rightfully entitled for two years.
Turning to the issue of an appropriate sanction, the board noted that in cases
involving trust account mismanagement with little or no actual harm, this court has
often imposed fully deferred suspensions. In In re: Alex, 16-1020 (La. 11/15/16),
205 So. 3d 895, an attorney misused and mishandled her client trust account by
making inappropriate payments, failing to disburse attorney’s fees as earned, making
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numerous accounting and procedural errors regarding settlement documents, and
failing to maintain proper documentation. Similar to the instant case, the single Rule
violated was Rule 1.15(a). This court commented that it had imposed fully deferred
suspensions in similar trust account mismanagement cases, but in the case of Ms.
Alex, it found a fully-deferred suspension was inappropriate due to her prior
discipline for similar misconduct. The court imposed a one year and one day
suspension, with all but thirty days deferred, followed by a two-year period of
probation subject to conditions similar to those recommended by the committee in
this matter.
The board noted that although the instant case has many similarities to Alex,
two distinctions can be made. First, respondent has not previously been disciplined
for trust account violations, making this aggravating factor somewhat less egregious
here than in the case of Ms. Alex. Respondent has, however, been disciplined on
three prior occasions. Second, unlike Ms. Alex, respondent’s conduct led to some
measure of client harm. Although respondent made his client whole by promptly
making payment to her, with interest, the client was nonetheless deprived of the use
of her funds for two years. Finding these two distinctions merit the imposition of an
actual suspension, the board adopted the two-month period of actual suspension
recommended by the hearing committee, along with probation and the recommended
conditions.
Based on this reasoning, the board recommended respondent be suspended
from the practice of law for one year and one day, with all but sixty days deferred,
followed by a one-year period of probation governed by the conditions
recommended by the committee. The board also recommended that respondent be
assessed with the costs and expenses of the proceeding.
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The ODC filed an objection to the disciplinary board’s recommendation.
Accordingly, the case was docketed for oral argument pursuant to Supreme Court
Rule XIX, § 11(G)(1)(b).
DISCUSSION
Bar disciplinary matters fall within the original jurisdiction of this court. La.
Const. art. V, § 5(B). Consequently, we act as triers of fact and conduct an
independent review of the record to determine whether the alleged misconduct has
been proven by clear and convincing evidence. In re: Banks, 09-1212 (La. 10/2/09),
18 So. 3d 57. While we are not bound in any way by the findings and
recommendations of the hearing committee and disciplinary board, we have held the
manifest error standard is applicable to the committee’s factual findings. See In re:
Caulfield, 96-1401 (La. 11/25/96), 683 So. 2d 714; In re: Pardue, 93-2865 (La.
3/11/94), 633 So. 2d 150.
Respondent stipulated that he did not disburse $9,574.50 to his client, made
several mathematical errors in handling his trust account, and failed to promptly
transfer earned attorney’s fees out of his trust account. This misconduct amounts to
a violation of the Rules of Professional Conduct as found by the disciplinary board.
Having found evidence of professional misconduct, we now turn to a
determination of the appropriate sanction for respondent’s actions. In determining
a sanction, we are mindful that disciplinary proceedings are designed to maintain
high standards of conduct, protect the public, preserve the integrity of the profession,
and deter future misconduct. Louisiana State Bar Ass’n v. Reis, 513 So. 2d 1173(La. 1987). The discipline to be imposed depends upon the facts of each case and
the seriousness of the offenses involved considered in light of any aggravating and
mitigating circumstances. Louisiana State Bar Ass’n v. Whittington, 459 So. 2d 520(La. 1984).
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The hearing committee and disciplinary board have recommended respondent
be suspended for a period of one year and one day, with all but sixty days deferred.
We acknowledge that such a sanction finds some support in our prior jurisprudence
involving negligent mishandling of a client trust account.
However, the case at bar differs from a typical negligent mishandling case
because respondent has already been disciplined twice by this court for mishandling
client funds. Each time, we imposed relatively lenient sanctions (a fully-deferred
suspension in Becnel I, and a one-year suspension with three months deferred in
Becnel II), in the expectation that respondent would make positive and responsible
changes in his law practice, including the way he handled client and third-party
funds. Rather than accepting these opportunities to correct his accounting practices,
respondent instead continued the same slipshod methods.
Respondent’s actions created both actual and potential harm. The deprivation
lasted for two years and may have lasted longer if not discovered during the ODC’s
investigation of an overdraft. It appears likely, if not certain, that respondent’s
careless accounting practices could have eventually led to a situation where the client
or third-party funds might be unavailable and respondent would be unable to make
restitution. Considering these factors against the backdrop of respondent’s prior
disciplinary history, we must conclude the conduct in the instant case warrants more
significant discipline than a typical case arising from negligent mishandling of a trust
account.
In mitigation, we acknowledge respondent’s lack of a dishonest motive, his
prompt efforts at restitution, cooperation, and remorse. We also believe the record
demonstrates he has taken measures, albeit belatedly, to improve his accounting
practices.
Considering these factors, we will suspend respondent from the practice of
law for a period of one year and one day. We further caution respondent that any
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future mishandling or mismanagement of his trust account will be viewed by this
court in a very harsh light.
DECREE
Upon review of the findings and recommendations of the hearing committee
and disciplinary board, and considering the record, briefs, and oral argument, it is
ordered that Daniel E. Becnel, III, Louisiana Bar Roll number 20692, be and he
hereby is suspended from the practice of law for a period of one year and one day.
All costs and expenses in the matter are assessed against respondent in accordance
with Supreme Court Rule XIX, § 10.1, with legal interest to commence thirty days
from the date of finality of this court’s judgment until paid.
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01/30/19
SUPREME COURT OF LOUISIANA
NO. 18-B-0848
IN RE: DANIEL E. BECNEL, III
ATTORNEY DISCIPLINARY PROCEEDINGS
WEIMER, J., concurring in part and dissenting in part.
In the instant case, the record supports the hearing committee’s determination
that respondent’s misconduct was largely the product of “sloppiness” and
miscalculations of which the respondent was “unaware.” The hearing committee
concluded his conduct was negligent, there was no dishonest or selfish motive, he
demonstrated a cooperative attitude to the disciplinary proceedings, a good faith
effort to rectify his mistake, and sincere remorse. The disciplinary board agreed with
these findings and noted the client was made whole when repaid with interest.
However, I find the number of times respondent has been sanctioned for misconduct
to be troubling. Despite respondent’s lack of a selfish motive and the fact he
apparently represented his client’s interests well–including negotiating a reduction
of a social security lien on the client’s settlement–respondent’s inattention to the
details of handling the funds owed to the client are now part of a lineage of
professional misconduct. Therefore, the present misconduct merits a more serious
sanction than otherwise would be imposed.
In light of the factual determinations of the hearing committee and the
concurrence in those findings by the disciplinary board, I would order a suspension
of one year and one day, with all but six months deferred, followed by a period of
probations with conditions. In other respects, I concur with the majority’s opinion.
01/30/19
SUPREME COURT OF LOUISIANA
No. 2018-B-0848
IN RE: DANIEL E. BECNEL, III
ATTORNEY DISCIPLINARY PROCEEDING
Hughes, J., dissents.
I respectfully dissent from the suspension of one year and one day imposed
and would order a suspension of one year.
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