Arm v. State Bar
| Decision Date | 03 May 1990 |
| Docket Number | No. S006791,S006791 |
| Citation | 789 P.2d 922,50 Cal.3d 763,268 Cal.Rptr. 741 |
| Parties | , 789 P.2d 922 Fred H. ARM, Petitioner, v. The STATE BAR OF CALIFORNIA, Respondent. |
| Court | California Supreme Court |
Diane C. Yu, Truitt, A. Richey, Jr., Richard J. Zanassi and Lawrence C. Yee, San Francisco, for respondent.
In this proceeding, we consider the recommendation of the Review Department of the State Bar Court (review department) that petitioner Fred H. Arm, who was admitted to the practice of law in California on January 9, 1972, be disbarred. The recommendation is based on conclusions that petitioner, who has been the subject of three prior disciplinary proceedings, violated his duties as an attorney in two additional instances: First, during a juvenile court proceeding he misled the court by failing to disclose he was about to be suspended from the practice of law for a sixty-day period that encompassed some of the dates being considered for further hearing of the matter, in violation of Business and Professions Code sections 6068, subdivision (d) and 6106, 1 and former rule 7-105(1) of the State Bar Rules of Professional Conduct. 2 Second, he commingled his funds with those in a client trust account by failing to withdraw the funds in the account belonging to him within a reasonable time after his interest in them became fixed, thereby violating former rule 8-101(A) 3 and subjecting himself to discipline under section 6103 ().
As will be explained, we have concluded that petitioner's misconduct in the present proceeding is not sufficiently egregious to warrant disbarment. On the other hand, the combination of petitioner's previous and present transgressions demonstrates a need for substantial discipline to protect the public and the courts, and to preserve public confidence in the legal profession. Those ends will be adequately served, however, by putting petitioner on probation for five years, conditioned on actual suspension from the practice of law for eighteen months.
Petitioner was admitted to the practice of law in January 1972. Since then, and prior to this proceeding, he has been disciplined by this court three times.
In May 1975, petitioner falsely identified himself as a deputy sheriff when he was stopped for a traffic violation. He pled guilty to violating Vehicle Code section 31 (), a misdemeanor. The State Bar Disciplinary Board concluded that the offense did not involve moral turpitude but did involve other conduct warranting discipline.
[789 P.2d 924] As a result, we publicly reproved petitioner in September 1976.
In October 1978, Frank Tracy retained petitioner to attempt recovery of $30,000 lost in an investment scheme. Petitioner recovered some of this money, after which Tracy paid him and terminated his services. In April 1979, petitioner obtained an attorney to represent Tracy's daughter in contested conservatorship proceedings against Tracy. He furnished the attorney with financial information about Tracy, filed a declaration supporting appointment of the daughter as conservator, and falsely represented to the court that he, petitioner, had never had an attorney-client relationship with Tracy. After the daughter was appointed conservator, petitioner, despite having confidential information about Tracy's financial affairs, represented a plaintiff in a lawsuit against Tracy and others on a promissory note. The State Bar Court found that petitioner willfully accepted employment adverse to a former client in violation of former rule 4-101, committed acts of dishonesty (§ 6106), and violated his oath and duties as an attorney. (§§ 6067, 6068, 6103.) In September 1983, we placed petitioner on probation for one year, with no actual suspension.
In August 1974, on petitioner's recommendation, Mr. and Mrs. Wilt paid $10,000 for a limited partnership interest in an enterprise that was to make and sell redwood burl tables. Petitioner misrepresented the venture's profitability and the extent of his own personal financial involvement, and failed to disclose to the Wilts that another investor, whom he had previously represented, had been a compulsive gambler and the subject of a criminal investigation. The Wilts lost their investment, and obtained a civil fraud judgment against petitioner. The review department found that petitioner had entered into a business transaction with clients that was not fair and reasonable to them, failing to disclose facts necessary for them to make an informed decision and failing to advise them to seek the advice of independent counsel, in violation of former rule 5-101. (See rule 3-300.) In mitigation, it found no evidence that petitioner received any money from the business; it also found that he had asked the State Bar for an ethics opinion regarding his failure to disclose the other investor's background. In January 1985, we placed petitioner on suspension for three years, with actual suspension of sixty days effective February 1, 1985.
On January 2, 1985, this court issued the most recent of its three prior disciplinary orders against petitioner. The order stated it was effective February 1, 1985, and included a provision that petitioner be actually suspended from the practice of law "for a period of 60 days from the effective date of this order." The order omitted, however, the provisions set forth in rule 955 of the California Rules of Court (rule 955), under which suspended attorneys may be required to notify their clients and opposing counsel of the suspension.
The hearing at which petitioner was charged with misleading the court took place on Wednesday, January 23, 1985, nine days before the effective date of his suspension, in the San Diego County Juvenile Court. The present record includes a partial reporter's transcript of that hearing. 4 Petitioner appeared as counsel for the mother of the two minor children involved The transcript shows that petitioner first sought immediate consideration of a recommendation favorable to his client ("reunification with the mother" but that the father's attorney asked for "an opportunity to review the proposal and to bring evidence as to the dispositional phase, if possible." The court said it would "set a date for disposition" that could be agreed upon by counsel.
[789 P.2d 925] in the juvenile court proceeding. Also appearing were the father's attorney, Larry Anderson, and an attorney for the minors, Jeffrey Reilly. Presiding was Juvenile Court Referee Gilbert Smith.
Petitioner suggested Friday, January 25, 1985. The minor's attorney mentioned he had a trial that day and suggested Friday, February 1, to which the father's attorney agreed. Petitioner, however, said he would "not be able to make it February 1st," and asked for an earlier date. The minor's attorney had a problem with an earlier date and proposed either February 8 or February 14.
Petitioner then spoke up: (Emphasis added.) The court proposed setting February 1 and 8 as alternative dates. The court then allowed the father's attorney to make a telephone call, following which he asked for February 8. Petitioner said, "I can't make it, your Honor." After further colloquy, the court suggested February 7, to which petitioner responded: But the court declared: "The issue here is far too important to delegate professional responsibilities at this time." The minor's attorney then suggested February 14, which the court started to consider when petitioner asked to approach the bench. The court replied, "Of course," whereupon, according to the transcript, "[a] bench conference [was] held at this time." Immediately thereafter the court set the matter for January 31, 1985, one day before petitioner's suspension was to begin.
At the State Bar hearing petitioner testified that upon approaching the bench he talked to the juvenile court referee outside the presence of other counsel, a circumstance he admitted was "very unusual." He testified he told the referee he would not be available in February or March because he had "a problem with the Bar." He said he deliberately withheld information of his suspension from opposing counsel, Anderson, for fear that the fact would be used to his client's disadvantage.
The juvenile court referee testified that petitioner did not disclose he would be suspended from practice during February and March, but he was not certain what reason petitioner gave for inability to appear during that period. According to the referee, the fact of petitioner's forthcoming suspension would have been material to the selection of a date for continuance, but he could not say how it would have affected the selection. He also said it would have been highly unusual to confer with petitioner at the bench without the presence of other counsel.
Based on this evidence, the State Bar Court concluded that petitioner had violated section 6068, subdivision (d), and former rule 7-105(1) (fns. 1, 2, ante) "by misleading a judge and other attorneys involved in a Juvenile Court proceeding," and that his conduct involved moral turpitude (§ 6106).
The notice to show cause, as amended, charged that petitioner paid a personal debt with a check drawn on a client trust account, thereby commingling or willfully misappropriating client trust funds.
In June 1983, Haze and Noel Rufo retained petitioner to represent them in a dispute over the...
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