Arrick, Matter of, SB-88-0012-D

• Decision Date: 08 June 1989
• Docket Number: No. SB-88-0012-D,SB-88-0012-D
• Citation: Arrick, Matter of, 775 P.2d 1080, 161 Ariz. 16 (Ariz. 1989)
• Parties: In the Matter of a Member of the State Bar of Arizona, Kenneth McClain ARRICK, Respondent.
• Court: Arizona Supreme Court

Page 1080

775 P.2d 1080

161 Ariz. 16

In the Matter of a Member of the State Bar of Arizona, Kenneth McClain ARRICK, Respondent.

No. SB-88-0012-D.

Supreme Court of Arizona, In Banc.

June 8, 1989.

Browder & Kenney, P.C. by Robert W. Browder, Phoenix, for respondent.

Sundberg & Mousel by Gary M. Sundberg, Phoenix, for State Bar of Arizona.

GORDON, Chief Justice.

This case involves an attorney who failed to comply with court orders, inappropriately withdrew funds from his client's trust account, and failed properly to advise and take responsibility for the handling of estate matters. Because the attorney's conduct did not comport with the ethical rules, we impose a six-month suspension from the practice of law. We further order respondent to satisfactorily complete an estate and probate course at an ABA-accredited law school before handling any future probate matters. We have jurisdiction pursuant to Rules 46(a), 52, and 53(e), Ariz.R.Sup.Ct., 17A A.R.S. (1988).

PROCEDURAL HISTORY

The State Bar of Arizona filed a seven-count complaint on August 22, 1985, charging respondent, Kenneth McClain Arrick, with violating the disciplinary rules of the former Arizona Code of Professional Responsibility, Rule 29(a), Ariz.R.Sup.Ct., 17A A.R.S. (1973). ¹ See Rule 53(c). The Local Administrative Committee (Committee), pursuant to Rule 53(c)(4), filed its report August 18, 1987. Based on Counts One, Two, and Seven of the complaint, the Committee recommended an informal reprimand for violations of DR 1-102, DR 5-104, and DR 9-102 of the Code of Professional Responsibility and Rule 29(b) of the Former Rules of the Arizona Supreme Court. Count One involves respondent's delayed compliance and willful disobedience of a court order. Count Two involves respondent's unauthorized removal of funds from his client's trust account and delay for more than 30 days in repaying those funds. Count Seven involves respondent's failure properly to advise the personal representative of an estate and his failure to take full responsibility for correcting a court order regarding that estate. We will discuss each of these charges in greater detail below. The Committee recommended dismissal of Counts Three, Four, Five, and Six of the complaint.

The Disciplinary Commission (Commission) reviewed the case on November 14, 1987, and filed its report on January 20, 1988, pursuant to Rule 53(d). The Commission affirmed the Committee's findings of fact and conclusions of law, but rejected the Committee's recommendation for an informal reprimand and, instead, recommended a six-month suspension from the practice of law. The Commission adopted the Committee's recommendation to dismiss Counts Three, Four, Five, and Six. We agree that dismissal is appropriate on these counts and, therefore, will not address them.

In accordance with Rule 53(e), respondent filed his notice of appeal on January 29, 1988, thus bringing the matter properly before this Court. In disciplinary matters against members of the State Bar, we are an independent trier of fact and law and will impose discipline only if we find clear and convincing evidence of misconduct. Matter of Kersting, 151 Ariz. 171, 172, 726 P.2d 587, 588 (1986); In re Neville, 147 Ariz. 106, 108, 708 P.2d 1297, 1299 (1985). In reaching our conclusions, we give deference and serious consideration to the findings and recommendations of the Committee and the Commission. In re Pappas, 159 Ariz. 516, 518, 768 P.2d 1161, 1163 (1988).

FACTS

Background

In September of 1979, respondent agreed to represent Jeanette Phebus in legal matters arising from the death of her husband, Thomas Phebus. Thomas Phebus died September 15, 1979, and named Jeanette Phebus as personal representative of his estate. At the time of his death, Thomas Phebus owned a substantial interest in a number of oil leases, other personal assets, and life insurance policies. Between September 24, 1979, and November 17, 1980, respondent rendered legal services to Jeanette Phebus in her capacity as personal representative of the estate of Thomas Phebus. Respondent billed and received $3,260. The basis for Count One of the complaint is respondent's failure to comply with a court order regarding reimbursement and overpayment of these funds.

On November 9, 1979, the last will and testament of Thomas Phebus was admitted to probate. The will indicated Thomas Phebus had no living issue and left his entire estate to Jeanette Phebus. Subsequently, Traci Ann Phebus, the daughter of Thomas Phebus by a prior marriage, filed a petition opposing probate of the will and requesting a determination of intestacy. In August, 1982, the parties entered into a will contest settlement agreement whereby Traci would receive a 30% interest in the oil leases and Jeanette would retain a 70% interest. The terms of the agreement required respondent to deposit the royalty income from the leases into his trust account for subsequent distribution. The royalties earned $2,659.15 in interest while in respondent's trust account. Respondent's unauthorized removal and deposit of the $2,659.15 into his personal account forms the basis of Counts One and Two of the complaint. The agreement further provided that respondent receive $10,000 in attorney's fees.

Jeanette Phebus died intestate September 12, 1982. Between November 17, 1980, and September 12, 1982, respondent performed a variety of personal and legal services for her. He kept no records concerning the amount of time or the nature of those services. He testified that his relationship with Jeanette Phebus during this period was "almost like a son."

On November 8, 1982, the court appointed Becky Johnson, Jeanette's niece, to serve as personal representative of her estate. Respondent prepared the petition and order of intestacy as attorney for the Estate of Jeanette Phebus. The petition incorrectly stated that Mary Rose, a friend of Jeanette Phebus, was entitled to inherit from Jeanette Phebus and failed to name known heirs entitled to inherit. When Becky Johnson notified respondent of the errors, he instructed her to appear before the presiding probate judge to correct it. Respondent's failure properly to explain the Mary Rose situation and take full responsibility for correcting the court order forms the basis of Count Seven of the complaint.

In August 1983, while serving as the personal representative of Jeanette's estate, Becky Johnson became the successor personal representative of the Thomas Phebus estate. Following August 1983, she served as personal representative of both estates.

Procedural Events

On November 10, 1982, respondent filed a $15,000 creditor's claim against the Estate of Jeanette Phebus. The creditor's claim asserted that respondent expended over 75 hours on Jeanette Phebus' behalf. Respondent's testimony before the Committee is sometimes contradictory, but essentially claims that the 75 hours included both legal services and personal, non-legal services rendered to Jeanette Phebus from November 17, 1980, to the time of her death, September 12, 1982. Respondent kept no records concerning the amount of time or nature of services rendered during that period and failed to advise the court that he already had received $3,260 in previously billed attorney's fees and was scheduled to receive an additional $10,000 for the will contest settlement agreement.

On January 4, 1983, respondent filed the will contest settlement agreement in the Estate of Thomas Phebus and received the $10,000 in attorney's fees pursuant to that agreement in February, 1983.

On April 6, 1983, respondent filed a Petition for Attorney's Fees against the Estate of Thomas Phebus for $15,000. As in the creditor's claim, respondent failed to advise the court he had already received $3,260 for attorney's fees and, by this time, had also received the $10,000 for the will contest settlement agreement. The petition indicates an excess of 125 hours expended in services to the Estate. In his testimony before the Committee, respondent conceded that this petition includes and essentially overlaps the 75 hours previously submitted on the creditor's claim against Jeanette's estate.

It appears respondent wanted $15,000 in addition to the $3,260 and the $10,000, a total of $28,260, in attorney's fees for services rendered to each estate and to Jeanette Phebus personally. Because he kept no records itemizing his services and because he was uncertain where to collect the additional money, he filed both the creditor's claim against the Jeanette Phebus estate and the petition for attorney's fees against the Thomas Phebus estate. Collection on either one, he testified, would satisfy the other.

In April, 1983, Becky Johnson, as personal representative of both estates, became dissatisfied with respondent's services and fired him.

On October 13, 1983, the court issued an order on respondent's petition for attorney's fees against the Thomas Phebus estate. The court order allowed respondent "reasonable attorney's fees for services rendered to Jeanette Phebus as Personal Representative in the sum of $10,000 and that the Estate of decedent shall receive credit against said sum all amounts heretofore paid to Kenneth M. Arrick from the assets of the Estate of decedent." (Emphasis added.) By this time, respondent had received the previously billed $3,260 and the $10,000 on the will contest settlement agreement, a total of $13,260. He did not return the excess or overpayment of $3,260.

Instead, on October 18, 1983, respondent withdrew an additional $2,659.15 (the interest income from the oil lease royalties) from the trust account for the Thomas Phebus estate. Correspondence and testimony reflect that respondent interpreted the October 13, 1983, order to award $10,000 in addition to the attorney's fees previously received. Therefore, respondent withdrew this amount to apply it to the $10,000 he claimed was due under the October 13, 1983, order.

On October 20, 1983, ...