Application of Stern

• Decision Date: 12 March 2008
• Docket Number: No. 10 Sept. Term, 2007.,10 Sept. Term, 2007.
• Citation: 403 Md. 615,943 A.2d 1247
• Parties: In the Matter of the Application of Kevin Charles STERN for Admission to the Bar of Maryland.
• Court: Court of Special Appeals of Maryland

943 A.2d 1247

403 Md. 615

In the Matter of the Application of Kevin Charles STERN for Admission to the Bar of Maryland.

No. 10 Sept. Term, 2007.

Court of Appeals of Maryland.

March 12, 2008.

Phillip G. Dantes (Wallace and Dantes, L.L.C.) Towson, MD, for Applicant.

ARGUED BEFORE BELL, C.J., HARRELL, BATTAGLIA, GREENE, MURPHY, JJ., and ALAN M. WILNER and DALE R. CATHELL, JJ. (Retired, specially assigned).

BATTAGLIA, Judge.

In this case we are asked to decide whether to grant the petition for admission to the Maryland Bar of Kevin Charles Stern, who has shown a pattern of financial irresponsibility, misrepresented his financial situation on his law school and Bar applications and exercised poor judgment with regard to a relationship with an underage female. Both the Character Committee and the State Board of Law Examiners recommended that Mr. Stern not be admitted, and we agree that Mr. Stern presently does not possess the requisite moral character and fitness for the practice of law required to be admitted to the Maryland Bar.¹

I. Background

On May 19, 2005, Kevin Charles Stern filed an application with the State Board of Law Examiners ("Board") for admission to the Maryland Bar pursuant to Rule 2.² In accordance with Rule 5(b)(1),³ Mr. Stern's Bar application was forwarded to a member of the Character Committee for the Sixth Appellate Circuit. In the course of the Committee's investigation, additional documents were obtained from Mr. Stern, who also was later interviewed. As a result of matters revealed during its investigation, the Committee conducted a hearing under Rule 5(b)(2)⁴ on September 18 and 19, 2006, during which Mr. Stern, represented by counsel, testified and presented the testimony of two additional witnesses; at least twenty-eight exhibits also were submitted by him, mainly addressing his then current financial status, credit history and disclosures made on his law school and Bar applications. The Committee called three witnesses.

The Committee found that in 1993, Mr. Stern opened a credit account with Discover Card in order to meet his regular living expenses while attending Frostburg State University and to obtain cash advances to finance the startup of his business, Priority Plus, which provided various services to law firms including service of private process.⁵ As of May of 2001, the unpaid balance on the Discover Card account, the Committee found, was $11,190.00.⁶ Eventually the Discovery Card balance was sold to NCO Financial Systems, Inc., a debt collector.⁷ The Committee found that in 2006, after Mr. Stern had submitted his Bar application,⁸ he had negotiated a settlement with NCO. Just 33 days before the Committee hearing, on August 15, 2006, Mr. Stern's mother submitted a check to NCO for $6,000.00 in settlement of the debt.

In 1996, Mr. Stern applied for and received a credit card from Home Depot. The record does not reflect the amount of the unpaid account balance, but subsequently, the delinquent account was sold to Monogram Credit Card Bank of Georgia, which filed suit against Mr. Stern. In July of 2001, Mr. Stern tendered $705.00 to Monogram in settlement.

In 1997, Mr. Stern obtained a credit account from First USA Bank to pay for living expenses and also to finance Priority Plus. The delinquent balance rose to $8,375.73, and subsequently, was sold to Asset Acceptance LLC, which filed suit against Mr. Stern in February of 2003. In March, a judgment was entered against Mr. Stern in the amount of the unpaid balance and two separate writs of garnishment were issued in July of 2004 and April of 2005. Thereafter, following Mr. Stern's submission of his Bar application, he agreed to a settlement.

In 1999, Mr. Stern took out a loan to purchase a car. The past due loan amount grew to $4,476.91, and subsequently, the unpaid balance was purchased by American General Finance. The account was then sold to Debt One, and then, again, to American Coradius International, which, in 2000, obtained a judgment against Mr.Stern. Again, after he had submitted his Bar application, Mr. Stern settled the dispute by remitting $2,638.00 in satisfaction in October of 2005.

Mr. Stern also obtained a credit card from Citibank Visa in 1999. The account's unpaid balance rose to $3,833.07, and thereafter, the Committee found, the account was sold to Unifund, which obtained a judgment in October of 2002.⁹ Mr. Stern satisfied the judgment in November of 2005, again, after he had submitted the Bar application.

In 2002, Mr. Stern opened another credit account, this time with Universal Card; its balance subsequently became $9,985.00. The account was sold to Asset Acceptance, which obtained a judgment in March of 2005. Mr. Stern settled for an unspecified amount and payment was made in September of 2005, once again, after he had completed his Bar application.

The Committee also found that Mr. Stern had had several other unpaid debts. One of them, involving Med 1 Yardmore Emergency Physicians, originated in 2003; the amount due, in May of 2004, was $313.00. Collection on the account was subsequently assigned to NCO, and in February 2005, Mr. Stern paid $251.00 in settlement. Another unpaid debt was with Cingular Wireless, to which Mr. Stern owed $480.00, in 2000. The record reflects that Cingular accepted Mr. Stern's payment in October of 2005, after he had submitted his Bar application.

The Committee further found that, in 2007, Mr. Stern had a student loan payment of approximately $260.00 a month, that was in good standing; his only other outstanding debts were a Capital One credit card that had a balance of $479.00 and a PayPal account with a $50.00 balance. According to a Personal Financial Statement prepared with the help of a financial advisor, Mr. Stern also had savings of $21,500.00, two cars valued at $16,000.00, a bicycle worth $5,000.00, personal effects valued at $15,000.00, and $10,000.00 worth of artwork.

The Committee also determined that Mr. Stern had omitted various credit accounts and other problems either in his law school application or Bar application. In his law school application, dated January 15, 2002, in response to the question, "Do you have any charges or judgments pending against you?", Mr. Stern did not reveal the judgment entered against him, in 2000, for $4,476.91, the amount past due on the car loan purchased by American General Finance. In his Bar application, dated May 1, 2005, in response to question 9(a), "During the last five years I have established or maintained credit with the following," Mr. Stern disclosed that he had established credit with Discover Financial Services and First USA Bank, but did not reveal the other accounts with which he had established credit, including American General Finance, Citibank Visa and Universal Card; in response to the following question on the Bar application, "9 (b) I presently owe money, some part of which has been delinquent for more than 90 days, to the following," Mr. Stern referred to two accounts, Discover Financial Services and Med 1 Yardmore Emergency Physician, but did not reveal the other credit accounts that had been delinquent for more than 90 days, including those with American General Finance, First USA Bank, Universal Card, Citibank Visa, as well as his unpaid bill with Cingular Wireless; in response to the question on the Bar application, "The following is a complete list of all suits in equity, actions at law, suits in bankruptcy or other statutory proceedings, matters in probate, lunacy, guardianship, and every other judicial or other administrative proceeding of every nature and kind, except divorce or criminal proceedings, to which I am or have been a party," Mr. Stern indicated that he had been a party in a tort action in the district court and that there was a pending case in the same court in which Discover Financial Services sought collection of an unpaid debt, but did not reveal the other accounts, which similarly, had resulted in judgments being entered, including the American General Finance, First USA Bank, Citibank Visa and Universal Card accounts.

The Committee further found that Mr. Stern, when he was 26 or 27, had had an inappropriate relationship with a 15 year old female. The relationship, which became sexual after the female turned 16, lasted for approximately seven or eight years and ended in 2006; other allegations included in the young woman's testimony before the Committee were not relied upon.

In response, before the Committee, Mr. Stern proffered that he did not pay his outstanding debts because they became overwhelming, and he believed that making the required minimum payments would be pointless. He also claimed that he had recognized the error of his ways and had sought the assistance of a certified financial advisor. The Committee, although acknowledging the steps Mr. Stern had taken, found these contentions to be shallow. According to the Committee, before Mr. Stern had sought assistance of a financial advisor to correct his debt problems, he knew that his debts had to be paid and had assets to do so, but did not satisfy his obligations. Instead, he continued to increase his debt until no one would extend him further credit. Moreover, the Committee found, that Mr. Stern had not provided any documentation as to his actual income during the period when the debts were incurred, and that he had not explained why he had enough money in his budget in 2003 for a trip to Jamaica. The Committee also concluded that Mr. Stern paid off the majority of his debts with graduation gifts and a loan from his mother.

Mr. Stern also told the Committee that he did not reveal the American General Finance judgment because he was unaware of its existence until he gathered his information to complete his Bar application. The Committee determined, however, that this argument was unavailing, because that there was an affidavit from a private process company averring that Mr. Stern had been served with...