Attorney Grievance v. Zdravkovich

• Citation: 762 A.2d 950,362 Md. 1
• Decision Date: 04 December 2000
• Docket Number: Misc. Subtitle AG No. 8
• Parties: ATTORNEY GRIEVANCE COMMISSION OF MARYLAND v. Dushan S. ZDRAVKOVICH.
• Court: Maryland Court of Appeals

762 A.2d 950

362 Md. 1

ATTORNEY GRIEVANCE COMMISSION OF MARYLAND v. Dushan S. ZDRAVKOVICH.

Misc. (Subtitle AG) No. 8, Sept. Term, 1999.

Court of Appeals of Maryland.

December 4, 2000.

Melvin Hirshman, Bar Counsel and John C. Broderick, Asst. Bar Counsel for the Atty. Grievance Com'n of Maryland, for Petitioner.

Dushan S. Zdravkovich, Riva, for Respondent.

Argued before BELL, C.J., and ELDRIDGE, RODOWSKY,¹ RAKER, WILNER, CATHELL and HARRELL, JJ HARRELL, Judge.

Pursuant to Maryland Rule 16-709(a)² Bar Counsel, on behalf of the Attorney Grievance Commission (AGC) (Petitioner), and at the direction of the Review Board, filed a petition with this Court for disciplinary action against Dushan S. Zdravkovich, Esquire (Respondent). In this petition, Bar Counsel asserted four complaints alleging violations of Rules 1.1 (competence), 1.3 (diligence in representation), 1.4 (communication with clients), 1.5 (fees), 1.15 (safekeeping property), 1.16 (declining or terminating representation), 3.1 (meritorious claims and contentions), 8.1 (disciplinary matters), and 8.4 (misconduct) of the Maryland Rules of Professional Conduct (MRPC), and Md.Code (1992, 1998 Repl.Vol.), § 10-306 of the Business Occupations and Professions Article (misuse of trust money). This Court referred the matter to Judge Pamela R. North of the Circuit Court for Anne Arundel County to conduct an evidentiary hearing and make findings of fact and conclusions of law in accordance with Maryland Rules 16-709(b)³ and 16-711(a)⁴.

I.

Of the four complaints lodged against Respondent, two were voluntarily dismissed by Petitioner at the hearing before Judge North on 19 October 1999 due to insufficient evidence.⁵ After the evidentiary hearing addressing the remaining two unrelated claims, Judge North found, by clear and convincing evidence, that Respondent violated MRPC 1.1, 1.3, 1.4, 1.5(a), 3.1, 8.4(a), and 8.4(d) during his attorney-client relationship with complainant Val Weaver.⁶ Respondent, who has appeared pro se throughout these proceedings, filed with us extensive exceptions to the findings of fact and conclusions of law made by Judge North. Petitioner, who does not take any exceptions to the findings of fact and conclusions of law, recommends that we suspend indefinitely Respondent from the practice of law for his misconduct. From the evidentiary record below, Judge North made the following findings of fact pertaining to Respondent's conduct regarding Val Weaver:

A. General Background

1. Respondent was admitted to practice law in the State of Maryland on 3 November 1981. He is also a member of the bar for the District of Columbia and the former Yugoslavia.

2. The conduct in question arose out of Respondent's representation of Val Weaver and James Impero during litigation filed by North American Technologies Group, Inc. (NATG). At that time, Respondent and Weaver had known one another on a professional and personal level for over 20 years.⁷ Weaver and Impero had enjoyed a professional and personal relationship for 12 years.

3. During his affiliation with NATG, Weaver was responsible for business developments and was a corporate liaison with government agencies and military services. Although referred to by NATG as Vice President of Marketing, Weaver maintains he was an independent consultant.

4. Impero is a bio-chemist who was employed by NATG as a director and an officer of the company.

5. During the dispute, NATG attached Impero's belongings and locked him out of his office. On 23 January 1995, Impero executed a letter of resignation and a letter of understanding with NATG without the benefit of counsel. Impero did not obtain counsel until 10 February 1995, when a Texas law firm informed NATG's law firm of Impero's representation. Weaver, however, testified that Impero formalized an attorney-client relationship with Respondent sometime in or after January 1995.

6. By 13 March 1995, it became unclear whether the Texas firm still represented Impero. According to Weaver, Respondent agreed to serve as general counsel for Impero as of 23 March 1995, with the scope of the representation limited to assisting Impero with his resignation from NATG and the recovery of his personal property. He further testified that Respondent's representation of Impero expanded when Impero became involved in an arbitration proceeding, filed in Chicago, Illinois, between NATG and Biotrace International, Inc.⁸

7. In April 1995, NATG initiated litigation against Weaver and Impero in the Two-Hundredth-Eightieth Judicial District of Harris County, Texas.⁹ The suit asserted numerous causes of action, including breach of contract, fraud, breach of fiduciary relationship, tortious interference with prospective business relations, negligent misrepresentation, slander, libel, tortious interference with existing business relations, deceptive trade practices, and fraudulent transfers.

8. The only evidence on the record establishing Respondent's representation of either Impero or Weaver are two letters and an unsigned and undated copy of a retainer agreement. The first letter, dated 14 April 1995, is from Respondent and refers to Impero as "my client." The second letter, dated 1 May 1995, is from Respondent to Weaver and Impero, in which Respondent states "[t]his office will represent James Impero and Val Weaver in any proceeding in the States of Maryland[,] Texas, and Illinois at a single rate of $150 per hour...." See infra Fee Discussion.

9. Weaver testified that, as of April 1995, his role was that of a [sic] "lightening rod" between Respondent and Impero and that, as a result, he received copies of all documents concerning Impero's legal problems and communicated with both parties on a weekly basis.¹⁰

10. There is no evidence on the record of a retainer agreement between Respondent and Weaver. While Weaver initially stated that he never personally hired Respondent in the Texas matter, he later testified that Impero hired Respondent to represent Impero and Weaver, with Impero agreeing to pay all of Respondent's fees. See infra Fee Discussion. Weaver indicated that he initially relied on Respondent's statements that he represented both Weaver and Impero, but later hired Respondent individually when he became a party to the NATG dispute.

11. Respondent hired local counsel in Texas to assist him with the Texas action; Weaver testified he was not certain if the local attorney represented him or Impero or both.

B. Charles County, Maryland Action

1. On 22 July 1995, Respondent filed a complaint and jury demand on Weaver's behalf in the Circuit Court for Charles County, Maryland. Respondent alleged that service of process for the Texas civil action on Weaver, through his wife, was improper because the Sheriff's affidavit was based on false and misleading information. He also alleged that contractual obligations owed by NATG to the Weavers were never fully discharged, and that NATG owed the Weavers monies, stock options, and stock valued in excess of $2,000,000. Finally, the compliant alleged NATG made defamatory statements against Val Weaver in a New York Stock Exchange press release, published in Maryland, that stated that Weaver had breached the duties he owed NATG.

2. On 24 October 1995, Maryland counsel for NATG filed a Motion to Dismiss in the Charles County action.

3. In a letter to Respondent from Weaver dated 27 October 1995, Weaver, indicating that a dismissal of the Charles County action was a prerequisite to the success of any mediation proceedings taking place in the Texas action, requested that Respondent dismiss the action without prejudice. Respondent did not reply to or act upon Weaver's request.

4. In a letter dated 7 November 1995, Weaver told Respondent that "[t]he state of affairs and apparent conflict now between us forces me to dismiss your legal representation from all activities and matters regarding me [specifically, the federal District Court action [and the Charles County action] and any issues involving Impero and NATG]." At the time he wrote this letter, Weaver did not know that Respondent had not filed the Motion to Dismiss in the Charles County action.

5. On 24 November 1995, Respondent filed a Motion to Withdraw Appearance in the Charles County action. The Charles County Circuit Court initially granted this motion on 13 December 1995. The motion granting the withdrawal was later stricken on 5 January 1996, when the Circuit Court learned that Weaver did not consent to Respondent's withdrawal because Weaver did not know that Respondent had not filed the Motion to Dismiss.

6. On 16 April 1996, NATG filed a second Motion to Dismiss in the Charles County action. Respondent did not answer this motion either.

7. On 28 May 1996, the Circuit Court wrote a letter to Respondent informing him that it had not received an answer to NATG's motions and that, "[g]iven the previous history concerning your representation of Mr. Weaver, [the Court is] forwarding a copy of the Memorandum and Motion to Dismiss directly to him, along with his copy of this letter .... to give [Weaver] every opportunity to respond to the Motion to Dismiss."

8. On 11 June 1996, Weaver informed the Circuit Court that he had not spoken with Respondent since October 1995 and that Respondent refused to communicate with Weaver since that date. Weaver then filed, pro se, a Motion for Voluntary Dismissal. This motion was granted on 18 June 1996.

C. District of Maryland, Harris County, Texas, and Chicago, Illinois Actions

1. On 19 June 1995, Respondent, on behalf of Impero and his company, filed suit against NATG, Biotrace International, three law firms, two attorneys, and the American Arbitration Association in the United States District Court for the District of Maryland. The complaint alleged a breach of fiduciary duty, breach of contract, fraud, wrongful interference with a contract, replevin, and mandamus.

2. On 20 June 1995, Respondent received a letter from the ...