MATTER OF ADDAMS

• Decision Date: 06 August 1990
• Docket Number: No. 88-867,88-867
• Citation: 579 A.2d 190
• Parties: In the Matter of Nicholas ADDAMS, Respondent. A Member of the Bar of the District of Columbia Court of Appeals.
• Court: D.C. Court of Appeals

579 A.2d 190

In the Matter of Nicholas ADDAMS, Respondent A Member of the Bar of the District of Columbia Court of Appeals.

No. 88-867.

District of Columbia Court of Appeals.

Argued En Banc March 9, 1990.

Decided August 6, 1990.

R. Kenneth Mundy, Washington, D.C., for respondent.

Samuel McClendon, Washington, D.C., Asst. Bar Counsel for Sp. Litigation, with whom Thomas E. Flynn, Bar Counsel, was on the brief, for the Office of Bar Counsel.

Joan L. Goldfrank, Washington, D.C., Executive Atty., for four members of the Bd. on Professional Responsibility recommending against disbarment.

Before ROGERS, Chief Judge, NEWMAN, FERREN, BELSON, STEADMAN, SCHWELB, FARRELL, Associate Judges, and GALLAGHER, Senior Judge.

ROGERS, Chief Judge:

This matter was originally before the court on the Report and Recommendation of the Board on Professional Responsibility (the Board). The Board unanimously found that respondent Addams violated DR 9-103(A) (misappropriation) and DR 1-102(A)(4) (dishonesty) as a result of intentionally misappropriating client funds and misrepresenting the fact to his client. Four members of the Board recommended that respondent be disbarred and four members recommended that he be suspended for one year and a day. Before the court Addams contended that the record did not support the Board's findings, and, alternatively, that the appropriate sanction was suspension for no more than one year. A division of this court held that the record supported the Board's findings of disciplinary violations and that, in view of our decision in In re Buckley, 535 A.2d 863 (D.C. 1987), disbarment was the appropriate sanction. In re Addams, 563 A.2d 338 (D.C. 1989). On January 24, 1990, the court granted respondent's petition for rehearing en banc, and vacated the division opinion, in order to consider whether there should be a per se disbarment rule for intentional misappropriation and, if not, the extent to which mitigating factors are relevant in determining the appropriate sanction. Order of February 27, 1990.

We now reaffirm that in virtually all cases of misappropriation, disbarment will be the only appropriate sanction unless it appears that the misconduct resulted from nothing more than simple negligence. While eschewing a per se rule, we adhere to the presumption laid down in our prior decisions and shall regard a lesser sanction as appropriate only in extraordinary circumstances. We have found such circumstances in In re Kersey, 520 A.2d 321 (D.C. 1987), and may find other circumstances calling for a lesser sanction in the future. But, as a matter of course, the mitigating factors of the usual sort, see, e.g., In re Reback, 513 A.2d 226, 233 (D.C. 1986) (en banc), will suffice to overcome the presumption of disbarment only if they are especially strong and, where there are aggravating factors, they substantially outweigh any aggravating factors as well. In this case, the mitigating factors fail to meet this standard. Accordingly, we order that Respondent Addams shall be disbarred.

I

The decision of the division sets forth in detail the evidence on which the Board unanimously found that Respondent Addamshad violated DR 9-103(A)¹ and DR 1-102(A)(4)² by the intentional, unauthorized use of funds given him by his client, Norlisha Jackson, for placement in a trust account to pay the holder of Ms. Jackson's promissory note. In re Addams, supra, 563 A.2d at 339-341. We incorporate Parts I and II of the division opinion upholding the findings of the Board of disciplinary violations save only to clarify that we view Ms. Jackson to have been at all times the owner of the funds in the escrow account. See id. at 341.

II

Turning to the issue of sanction, the court is deciding de novo what is the appropriate sanction for Addams' intentional misappropriation of client funds.³ As the opinion by the division makes clear, the members of the Board recommending disbarment acknowledged that this is an unusual case since Addams' client, Ms. Jackson, was satisfied with Addams' representation and Addams was brought to the attention of the Board by the losing party in the lawsuit which Addams won for his client. Id. at 342. These factors, as well as differing views on the effect of the usual mitigating factors,⁴ caused the Board to split on its recommendation to the court of an appropriation sanction.

The four members of the Board recommending that Addams be disbarred relied on Buckley, supra, 535 A.2d 863. Buckley was disbarred for violating DR 9-103(A) and DR 1-102(A)(4) by commingling and misappropriating client funds which he was supposed to hold in trust to pay his client's medical bills, notwithstanding the existence of a number of mitigating factors.⁵ These Board members found that Addams' "misappropriation, like Buckley's, was knowing and intentional," and they viewed Addams' concealment of the withdrawals in the false accounting that he gave to his client to be an aggravating factor. They found no mitigating factors adequate to form a "basis to impose any sanction other than that which is called for by Buckley," interpreting Buckley to stand for the proposition that "the absence of prior discipline is not a factor which serves to mitigate a sanction in a misappropriation case," and they rejected as irrelevant the substantial legalfees Ms. Jackson owed Addams since they viewed such consideration "the functional equivalent of arguing that Addams had no 'corrupt intent.' " They also declined to view client satisfaction as having anything to do with sanction, concluding that it did not alter the Board's responsibility to protect "the entire consuming public."

The other four members of the Board, who recommended a suspension, relied on six mitigating factors, comparable to those in Buckley, in concluding that suspension for a year and a day was the appropriate sanction.⁶ They, too, noted that the complainant was the losing defendant in the client's lawsuit, and maintained that their reliance on these mitigating factors was not an attempt to probe the degree of corruptness of Addams' intent but simply an effort to avoid a "mechanistic per se approach."⁷

The Board did not find that Addams' intent in misappropriating funds was "corrupt" or would satisfy the mens rea for theft or embezzlement under the criminal laws. No such finding is required, see note 9, infra, and the court, like the Board, has no occasion to stigmatize Addams' conduct unnecessarily in this opinion as "theft" or "embezzlement." Subject only to that qualification, it is appropriate to begin our discussion with an observation of the court a generation ago in In re Quimby, 123 U.S.App.D.C. 273, 274, 359 F.2d 257, 258 (1966):

The administration of justice under the adversary system rests on the premise that clients and the court must be able to rely without question on the integrity of attorneys. An act against a client evidencing moral turpitude, even though attributable to some aberration or stress that would warrant the prosecutor in abstaining from criminal prosecution, may nevertheless warrant severe disciplinary action concerning an officer of the court.

When a member of the bar is found to have betrayed his high trust by embezzling funds entrusted to him, disbarment should ordinarily follow as a matter of course. Such misconduct demonstrates absence of the basic qualities for membership in an honorable profession. Only the most stringent of extenuating circumstances would justify a lesser disciplinary action, such as suspension, which implies the likelihood that at some future time the court may again be willing to hold out the embezzler as an officer of the court worthy of clients' trust. The appearance of a tolerant attitude toward known embezzlers would give the public grave cause for concern and undermine public confidence in the integrity of the profession and of the legal system whose functioning depends upon lawyers.

Other courts have reached a similar conclusion.⁸ Thus, in In the Matter of Wendell R. Wilson, 81 N.J. 451, 453-55, 409 A.2d 1153, 1154 (1979), Chief Justice Wilentz, speaking for a unanimous court, pointed out that client trust is "built on centuries of honesty and faithfulness . . . inthe legal profession, the bar as an institution," and that abuse of this trust has "always been recognized as particularly reprehensible." Id., 409 A.2d at 1154-55. Noting that the sanctions have varied because of the presence of mitigating circumstances, Chief Judge Wilentz wrote:

It is therefore important that we reemphasize that the principal reason for discipline is to preserve the confidence of the public in the integrity and trustworthiness of lawyers in general.

* * * * * *

There is nothing clearer to the public . . . than stealing a client's money and nothing worse. Nor is there anything that affects public confidence more — much more than the offense itself — than this Court's treatment of such offenses. Arguments for lenient discipline overlook this effect as well as the overriding importance of maintaining that confidence.

Id.⁹

The highest court in Maryland has long been in agreement, stating in Attorney Grievance Comm'n of Maryland v. Cockrell, 304 Md. 379, 393-94, 499 A.2d 928, 935 (1985), that "when an attorney is found to have betrayed the highest trust imposed in him by appropriating to his own use funds of others entrusted to him, then, absent the most compelling extenuating circumstances, disbarment should follow as a matter of course." Citing Attorney Griev. Comm'n v. Velasquez, 301 Md. 450, 457-59, 483 A.2d 354, 358 (1984) (disbarment ordered for misappropriation of clients' escrow account, as assets of clients are "a sacred trust") (noting cases going back to 1941). The New Hampshire Supreme Court has adopted a rule like our own, see Carroll's Case, 127 N.H. 390, 393, 503 A.2d 750, 751 (1985) ("[o]rdinarily, the misuse of a client's funds justifies disbarment"), emphasizing that "the opportunities and duties of...