Attorney Grievance v. Harris

• Decision Date: 16 January 2008
• Docket Number: Misc. Docket AG No. 50, Sept. Term, 2006.
• Citation: 939 A.2d 732,403 Md. 142
• Parties: ATTORNEY GRIEVANCE COMMISSION OF MARYLAND v. Alan Edgar HARRIS.
• Court: Court of Special Appeals of Maryland

939 A.2d 732

403 Md. 142

ATTORNEY GRIEVANCE COMMISSION OF MARYLAND v. Alan Edgar HARRIS.

Misc. Docket AG No. 50, Sept. Term, 2006.

Court of Appeals of Maryland.

January 16, 2008.

Glenn M. Grossman, Deputy Bar Counsel (Melvin Hirshman, Bar Counsel, Atty. Grievance Com'n), for petitioner.

Benjamin Lipsitz, Baltimore, for respondent.

Argued before BELL, C.J., RAKER, HARRELL, BATTAGLIA, GREENE, ALAN M. WILNER (retired, specially assigned) and DALE R. CATHELL (retired, specially assigned), JJ.

BATTAGLIA, J.

The Attorney Grievance Commission of Maryland ("Petitioner"), acting through Bar Counsel and pursuant to Maryland Rule 16-751(a),¹ filed a Petition for Disciplinary or Remedial Action against Respondent, Alan Edgar Harris, on November 1, 2006. Bar Counsel alleged that Respondent violated Maryland Rules of Professional Conduct ("MRPC"), 8.1(a) (Bar Admission and Disciplinary Matters),² and 8.4(a), (c) and (d) (Misconduct).³

In accordance with Maryland Rules 16-752(a) and 16-757(c),⁴ we referred the petition to Judge Dana M. Levitz of the Circuit Court for Baltimore County for an evidentiary hearing and to make findings of fact and conclusions of law. Judge Levitz held a hearing on June 27, 2007, and issued Findings of Fact and Conclusions of Law on August 7, 2007, in which he concluded by clear and convincing evidence that Respondent had violated Rule 8.4(c) by executing an authorization to transfer the ownership of a Washington Mutual Investors Fund account owned by Respondent and his former wife as tenants by the entireties prior to their divorce, based upon Respondent's representation that he was entitled to sole possession. Judge Levitz did not conclude that there were violations of Rules 8.1(a) or 8.4(c) with respect to Respondent's explanation to Bar Counsel that he titled the Fund in his own name to hold the account in a "self imposed trust," nor of Rule 8.4(a) or (d).

FINDINGS OF FACT

I. Undisputed Facts

"Pursuant to Rule § 16-757(c), this Court finds the following facts, which are undisputed, by clear and convincing evidence:

1. Respondent Alan Edgar Harris has been a member of the Maryland Bar since 1960.¹

^1. T.—hearing June 27, 2007.

2. Mr. Harris was suspended from the practice of law in 2002, and has not been reinstated.

3. Mr. Harris was married to Frances M. Harris until they were divorced sometime in 1985.

4. The divorce was filed in Baltimore City and as a result Ms. Harris received the marital home, located at 1 Charles Ridge Garth in Towson; she also retained a mutual fund, unbeknownst to Mr. Harris, named "Washington Mutual Investors Fund-Class A" ("the Fund").

5. The Fund was owned by both Mr. and Ms. Harris as tenants by the entireties until, as a result of the divorce, their respective interests were automatically changed to tenancies in common by operation of law.

6. Carroll Klingelhofer, III, esq., was retained by Ms. Harris in 1988 to prepare a will for herself.

7. Ms. Harris resided at 1 Charles Ridge Garth until her death on June 3, 2005; her will was found soon after her death.

8. In the subsequent probate proceeding, Mr. Klingelhofer represented the estate and Meryk Jankowski was named personal representative.

9. Mr. Harris had been given the original will by the person who found it, and he in turn gave the will to Mr. Klingelhofer.

10. During the course of investigating the nature and extent of Ms. Harris' assets, Mr. Klingelhofer discovered a quarterly statement from the Fund, which listed the owners of the Fund, Mr. and Ms. Harris, as tenants by the entireties, and had a value of approximately $97,514.00.

11. Mr. Klingelhofer sent Mr. Harris a letter dated July 21, 2005, which informed Mr. Harris that the Fund was, by operation of law, now held by Mr. Harris and Ms. Harris as tenants in common (Exhibit # 1).

12. Mr. Harris, in the middle of August, 2005, executed a transfer authorization/stock assignment that had the effect of changing the title of the Fund from being held by Alan E. Harris and Frances Harris as tenants by the entireties to sole ownership in the name of Alan E. Harris (Exhibit # 4).

13. On or about August 16, 2005, Mr. Klingelhofer discovered that Mr. Harris had initiated the transfer that gave Mr. Harris sole ownership of the Fund.

14. On or about September 28, 2005, at Mr. Klingelhofer's suggestion, American Funds froze the account that held the Fund, pending a determination of ownership.

15. In March of 2007, the estate of Ms. Harris received one half of the Fund from Mr. Harris.

16. From the time Mr. Harris indirectly transferred ownership of the Fund to himself, in August of 2005 to March of 2007, Mr. Harris never depleted the Fund and any dividends earned were reinvested into the Fund.

17. Mr. Harris cited concern regarding income taxes assessed against the Fund as the reason for making the transfer. He also expressed the view that he did not trust Mr. Klingelhofer and was suspicious of his motivation for asking questions about this asset and his divorce.

18. Mr. Harris misled Mr. Klingelhofer by saying that he would check the ownership status of the Fund by reviewing divorce papers from 1985; instead of reviewing divorce files, Mr. Harris used this opportunity to cause the transfer of the Fund to himself.

II. Disputed Facts

Although the following facts are disputed, this Court has heard evidence from both parties and finds these facts, pursuant to Rule § 16-757(c), by clear and convincing evidence:

19. Mr. Harris knew, when he took possession of the entire Fund, that he did not have the right to transfer the Fund to himself. Mr. Harris testified that when he received the letter dated July 21, 2005, he did not know what tenancy in common was. He claims that when he transferred the Fund into his name in the middle of August, 2005, he thought that he was entitled to ownership of the Fund as a result of the death of Ms. Harris. This Court finds Mr. Harris' testimony regarding his lack of legal knowledge to be unconvincing. Mr. Harris knew that the Fund's ownership had been converted to tenancy in common. In the letter Mr. Klingelhofer implied that Mr. Harris does not have the sole proprietary right to the Fund if Mr. Harris and Ms. Harris owned the Fund as tenants in common (See exhibit # 1). Having been an attorney for more than 40 years, it is more than likely that Mr. Harris had a basic knowledge of property law when he transferred the Fund to himself. A first year law student is taught that tenants in common do not have the right of survivorship; when one tenant in common dies, her interest in the property goes to her estate, not to the other tenant in common. Mr. Harris knew what his interest in the Fund was, and if he had forgotten, the July 21 letter put him on notice that he did not own 100% of the Fund.

20. Mr. Harris had no reasonable basis for the belief that Mr. Klingelhofer was trying to defraud him with regard to the Fund. Mr. Harris, in a rambling quasi-monologue, testified that he believed that Mr. Klingelhofer was trying to hide the Fund from him. At the hearing Mr. Harris contended that this alleged fraud was the reason that he transferred the Fund to himself. Mr. Harris testified that he believed that he would have waived a claim for fraud against the estate if he did not take possession of the Fund. Mr. Harris argued that he was simply putting the Fund in a "trust" pending future litigation against the estate. This Court finds these contentions to be unconvincing. Mr. Harris, who practiced law for 40 years, could not have believed that a claim for fraud against Ms. Harris' estate would be waived if he did not take full possession of the Fund. Even if Mr. Harris did actually believe in this Machiavellian rule of waiver, no reasonable attorney would believe it. Thus, Mr. Harris' fear of waiving a fraud claim is not a reasonable excuse for transferring the Fund to himself when he knew he was only entitled to half of its value.

21. Mr. Harris did not intend to defraud the estate of Ms. Harris when he transferred the Fund to himself. The Attorney Grievance Commission alleges that Mr. Harris sought to keep and use the value of the Fund for himself when he took possession of 100% of the Fund. The Commission did not present evidence that would support this inference, however. Mr. Harris claims that he was concerned about his own tax liability concerning the Fund. Mr. Klingelhofer, the Commission's only witness, conceded that the value of the Fund was not depleted when it was in Mr. Harris' possession. Furthermore, Mr. Klingelhofer testified that all the dividends from the Fund were reinvested during Mr. Harris' possession of the Fund. Mr Harris' actions during the time period that he held the Fund, i.e. August of 2005 to March of 2007, do not suggest that he wanted to convert the money to his own use. Mr. Harris never used the value of the Fund at all: not as collateral, cash, or otherwise. Mr. Harris simply wanted to control the Fund, so that he would not be personally liable for anything the estate of Ms. Harris did, or did not do, regarding the Fund. In March of 2007, the estate of Ms. Harris received every penny that it was entitled to from the Fund. The fact that American Funds froze the account, does not help to prove that Mr. Harris had the intent to convert the Fund to his own use or otherwise defraud the Estate of Ms. Harris.

22. Mr. Klingelhofer acted ethically at all times in this matter. Mr. Harris has made many and varied allegations of fraud and misconduct against Mr. Klingelhofer. Mr. Harris never presented any support for these allegations besides his own testimony. Mr. Harris' testimony regarding Mr. Klingelhofer's motives regarding the Fund was implausible, to say the least. Mr. Klingelhofer acted as any reasonable estate attorney would when he inquired about Mr. Harris' divorce. An attorney representing an estate in this situation has a duty to find out who is entitled to any significant...