Erie-Huron County Bar Association v. Smith

[Until this opinion appears in the Ohio Official Reports advance sheets, it may be cited as Erie-
Huron Cty. Bar Assn. v. Smith, Slip Opinion No. 2016-Ohio-881.]
NOTICE
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South Front Street, Columbus, Ohio 43215, of any typographical or other
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SLIP OPINION NO. 2016-OHIO-881
ERIE-HURON COUNTY BAR ASSOCIATION v. S MITH.
[Until this opinion appears in the Ohio Official Reports advance sheets, it
may be cited as Erie-Huron Cty. Bar Assn. v. Smith, Slip Opinion No.
2016-Ohio-881.]
Attorneys—Misconduct—Violations of the Rules of Professional Conduct—
Indefinite suspension.
(No. 2015-1632—Submitted November 17, 2015—Decided March 10, 2016.)
ON CERTIFIED REPORT by the Board of Professional Conduct of the Supreme
Court of Ohio, No. 2015-012.
_______________________
Per Curiam.
{¶ 1} Respondent, Charles Ross Smith III, of Ann Arbor, Michigan,
Attorney Registration No. 0020187, was admitted to the practice of law in Ohio in
1978. In February 2015, relator, Erie-Huron County Bar Association, charged him
with professional misconduct for, among other things, collecting retainers from
clients but then failing to complete the work or to refund their money. Based on
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the parties’ stipulations and the evidence presented at a three-member panel hearing
of the Board of Professional Conduct, the board found that Smith engaged in most
of the charged misconduct and recommends that we indefinitely suspend him from
the practice of law, with conditions on any potential reinstatement. Neither party
has filed objections to the board’s recommendation. Based upon our independent
review of the record, we agree with the board’s findings of misconduct and the
recommended sanction.
Misconduct
{¶ 2} After spending most of his legal career working for other entities,
Smith opened a solo law practice in 2008, focusing primarily in bankruptcy law.
However, in February 2014, he sent a letter to disciplinary counsel indicating that
his deteriorating physical health had caused him to close down his practice. His
letter further stated that many of his clients had paid in advance for legal fees and
court costs and that he was unable to complete the promised work or immediately
refund their money. Relator subsequently received a series of grievances against
Smith from some of those former clients.
{¶ 3} After an investigation, relator discovered that in 43 separate matters,
clients had paid Smith to file bankruptcy petitions on their behalves, but he had
failed to file the petitions or to return their money. Indeed, the parties stipulated
that Smith owes $36,799.69 to those clients. Additionally, relator discovered that
Smith had failed to deposit those advanced funds into his client trust account and
instead had deposited the money into another bank account, which he drew from to
pay various operating expenses for his law office.
{¶ 4} Based on this conduct, the parties stipulated and the board found that
Smith had violated Prof.Cond.R. 1.3 (requiring a lawyer to act with reasonable
diligence in representing a 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(c) (requiring a lawyer to deposit advanced legal fees and expenses
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into a client trust account to be withdrawn by the lawyer only as fees are earned or
expenses incurred), and 1.16(e) (requiring a lawyer to promptly refund any
unearned fee upon the lawyer’s withdrawal from employment).
{¶ 5} Additionally, during its investigation, relator discovered that since
July 2013, Smith had failed to notify his clients that he lacked professional liability
insurance. Thus, the parties stipulated and the board found that Smith had also
violated Prof.Cond.R. 1.4(c) (requiring a lawyer to inform a client in writing if the
lawyer does not maintain professional liability insurance).
{¶ 6} We agree with these findings of misconduct. We also accept the
board’s recommendation to dismiss the remaining charges in relator’s complaint.
Sanction
{¶ 7} When imposing sanctions for attorney misconduct, we consider
several 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 Gov.Bar
R. V(13).
{¶ 8} The board found the following aggravating factors: Smith exhibited
a pattern of misconduct; he committed multiple offenses; his clients were
vulnerable and harmed by his misconduct, as some were in desperate financial
straits and relying on him to protect them from creditors; and he failed to make
restitution. See Gov.Bar R. V(13)(B)(3), (4), (8), and (9). In mitigation, the board
found that he has no prior discipline and he fully cooperated in the disciplinary
process. See Gov.Bar R. V(13)(C)(1) and (4). The board acknowledged that
Smith’s physical health likely caused him to close his practice, but because he did
not submit any substantiating medical evidence at the hearing, the board could not
conclude that his deteriorating health condition was a mitigating factor.
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{¶ 9} As a sanction, the parties jointly recommended that Smith be
indefinitely suspended from the practice of law. The board agreed and added
several conditions on any potential reinstatement, including that he make full
restitution to all affected clients. To support its recommendation, the board cited
Cincinnati Bar Assn. v. Britt, 133 Ohio St. 3d 217, 2012-Ohio-4541, 977 N.E.2d
620, in which we indefinitely suspended an attorney for collecting over $40,000 in
retainers and filing fees from more than 40 clients but then failing to perform the
promised work or to refund his clients’ money. The attorney in Britt also failed to
deposit those advanced fees into a client trust account, and he engaged in dishonest
conduct. Id. at ¶ 13-17. Although we noted that disbarment is the presumptive
sanction for misappropriation of client funds, we concluded that sufficient
mitigating circumstances were present to warrant an indefinite suspension,
including that the attorney had no prior discipline, he cooperated in the disciplinary
process, he admitted to the misconduct, he helped identify the amount of money he
had received from each client, and he made arrangements with another attorney to
complete his clients’ representations. Id. at ¶ 22, 28-32.
{¶ 10} We agree with the board that Britt is instructive here. Smith’s
misconduct is analogous to the attorney misconduct in Britt, and there are similar
mitigating factors, including that Smith has no prior discipline in an otherwise
lengthy career, he fully cooperated in the disciplinary process, he admitted to the
charged misconduct, and he helped determine the amount he received from each
client and the amount still owed. And unlike the attorney in Britt, Smith self-
reported his conduct to disciplinary authorities.
{¶ 11} Thus, having considered Smith’s misconduct, the aggravating and
mitigating factors, and the sanctions imposed in comparable cases, we adopt the
board’s recommended sanction. Charles Ross Smith III is indefinitely suspended
from the practice of law in Ohio. Any future reinstatement shall be conditioned on
Smith (1) making full restitution to all affected clients in the total amount of
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$36,799.69, (2) paying the costs of this matter, (3) committing no further
misconduct, (4) obtaining a passing score on the multistate professional-
responsibility examination, and (5) completing 12 hours of continuing-legal-
education classes with an emphasis on law-office management and management of
client trust accounts, in addition to meeting all other biennial continuing-legal-
education requirements. In addition, if Smith is reinstated to the practice of law, he
must serve a two-year period of monitored probation. Costs are taxed to Smith.
Judgment accordingly.
O’CONNOR, C.J., and PFEIFER, O’DONNELL, LANZINGER, KENNEDY,
FRENCH, and O’NEILL, JJ., concur.
_________________
Nicholas J. Smith, Bar Counsel, for relator.
Charles Ross Smith III, pro se.
_________________
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