Bennett v. Comm'n for Lawyer Discipline

• Decision Date: 24 March 2016
• Docket Number: NO. 14–14–00470–CV,14–14–00470–CV
• Citation: 489 S.W.3d 58
• Parties: Robert S. Bennett, Appellant v. Commission for Lawyer Discipline, Appellee
• Court: Texas Court of Appeals

489 S.W.3d 58

Robert S. Bennett, Appellant

v.Commission for Lawyer Discipline, Appellee

NO. 14–14–00470–CV

Court of Appeals of Texas, Houston (14th Dist.).

Opinion filed March 24, 2016.

Thomas Clark Wright, Jessica A. Barger, Houston, TX, for Appellant.

Daniel William Davis, Robert M. Roach, Jr., Linda Acevedo, Timothy R. Bersch, Houston, TX, for Appellee.

Panel consists of Justices Boyce, Busby, and Brown.

OPINION

J. Brett Busby

, Justice

Appellant Robert S. Bennett appeals from a final judgment of disbarment signed following a bench trial. The trial court disbarred Bennett after concluding that he violated both Rule 1.15(d)

and Rule 3.02 of the Texas Disciplinary Rules of Professional Conduct in the course of a fee dispute with former client Gary Land.

Bennett argues that the evidence is legally and factually insufficient to support the trial court's conclusion that he violated Rule 1.15(d)

. We sustain Bennett's challenge because there is no evidence that, at the time Bennett's representation of Land was terminated, he failed to refund an advance payment of fees that had not been earned.

Bennett also challenges the legal and factual sufficiency of the evidence to support the trial court's conclusion that he violated Rule 3.02

. We overrule this challenge because there is sufficient evidence that Bennett took actions that unreasonably increased the costs or other burdens of the fee dispute or that unreasonably delayed its resolution.

Finally, Bennett seeks a new trial based on certain evidentiary rulings at trial. Bennett argues that the trial court erred when it: (1) excluded Bennett's expert witnesses from testifying during the misconduct phase of the trial about their interpretations of the Texas Disciplinary Rules of Professional Conduct and the application of those rules to the facts of this case; and (2) excluded testimony regarding Bennett's general character during the misconduct phase of the trial. We overrule this issue because (1) a trial court does not abuse its discretion when it excludes expert testimony on questions of law or the application of law to the facts of the case; and (2) to the extent the trial court abused its discretion when it excluded character testimony, there was no harm because the testimony was admitted during the sanctions phase of the trial.

Because there is legally insufficient evidence to support the trial court's conclusion that Bennett violated Rule 1.15(d)

, and the trial court based its decision to disbar Bennett on its conclusion that he violated both Rule 1.15(d)

and Rule 3.02, we reverse the trial court's judgment of disbarment and remand the case for reconsideration of the appropriate sanction to be imposed as a result of the trial court's conclusion that Bennett violated Rule 3.02.

Background

Gary Land approached Robert Bennett in January 2011 about retaining Bennett as his attorney. Bennett and Land met at Bennett's office, and they spent several hours together discussing Land's legal issues. Land sought to retain Bennett to represent him in a lawsuit arising from a commercial dispute in Amarillo, Texas. Land also wanted Bennett to investigate a potential claim of federal civil rights violations arising out of Land's belief that federal agents had been illegally targeting him by damaging his property with acid, attacking him with invisible energy beams and microwaves, and implanting materials under his skin. Bennett provided Land with an “Attorney Retainer & Dispute Resolution Agreement” during the meeting. Bennett encouraged Land to consult with another attorney regarding the Agreement's contents before signing it. Land made several changes to the Agreement and signed it on February 10, 2011.

The Agreement required Land to pay Bob Bennett & Associates, P.C. a $50,000 retainer. Land paid the retainer in two equal installments. The Agreement provided that the retainer would be used “to insure the payment of fees and may be drawn-down for time billed at the discretion of [Bennett].” The Agreement also included an arbitration clause in the event that a dispute arose between the parties. The arbitration clause provides, in pertinent part:

Our dispute shall be determined by arbitration in Houston, Texas before a panel selected by, and per the rules of the Houston Bar Association Fee Dispute Committee, in accordance with the laws of the State of Texas for Agreements made in and to be performed in Texas. “Disputes” shall include, without limitation, those involving fees, costs, billing, and breach of ethical or fiduciary duties. The arbitration shall be administered by the Houston Bar Association Fee Dispute Committee, pursuant to its Rules and Regulations. Judgment on the award may be entered in any court having jurisdiction and shall include an award for attorney's fees, and a premium charge if sought, along with any fees and expenses associated with the seeking of injunctive relief.... By the signatures on this contract, the Client and Bennett agree that the arbitrator's decision in any such arbitration shall be binding, conclusive, and non-appealable pursuant to the Rules and Regulations of the Houston Bar Association Fee Dispute Committee. Please note that arbitration may result in the client's waiver of significant rights, such as the right to a jury trial, the possible waiver of broad discovery, and the loss of the right to appeal.

Once Land had signed the Agreement, Bennett and his firm began working on Land's legal matters. Over the next several months, Bennett invoiced Land for legal fees and expenses totaling $70,998.38. Bennett applied the retainer to pay the first $50,000, leaving, in Bennett's view, a balance owed of $20,998.38.

Land disputed the bills and ultimately terminated Bennett's representation on August 3, 2011.

Land then hired a new attorney, who demanded that Bennett reduce Land's bill by no less than $35,000. When Bennett refused, Land submitted the fee dispute to arbitration, naming as respondents Bob Bennett and Bob Bennett & Associates, P.C. (collectively “Bennett”). Bennett filed a counterclaim in the arbitration, seeking $25,787.50 from Land in excess of the original retainer. Bennett's counterclaim included nearly $4,000 for work that originally had not been billed to Land, but which Bennett now sought “because of the lack of good faith shown by Mr. Land during this process.”

The arbitration panel unanimously found in favor of Land on January 3, 2012. It ordered Bennett to return $27,500 in unearned advance fees to Land. The panel denied Bennett's counterclaim.

Bennett filed a motion to modify and correct the arbitration award. The panel denied Bennett's motion and issued a detailed explanation of its award. Among other things, the panel stated that its “consideration of the fees charged on both a micro and a macro level left [it] with the firm conviction that [Bennett] overcharged Mr. Land and took advantage of him.” For example, the panel determined that it was unreasonable for Bennett to incur a total of $9,000 in fees in connection with “scheduling appointments with doctors and discussing Mr. Land's claims with doctors who routinely cater to conspiracy theorists who believe they are being targeted by the government.” The panel also explained that

the issues that Mr. Land brought to [Bennett's] attention would have raised immediate and significant flags with any reasonable lawyer. A lawyer in [Bennett's] position should have counseled Mr. Land against spending significant sums investigating and pursuing most of the matters about which he was concerned. Mr. Land should have been told the investigation he sought was almost certain to be futile. [Bennett] failed to do so, and instead appeared to actively encourage Mr. Land's pursuit of these matters. And, once [he] undertook the representation, [Bennett] billed substantial sums without ever advancing the matter to any significant degree.

Land moved to confirm the arbitration award in a district court in Harris County. Bennett responded by asking the district court to vacate the award because “the panel did not make the decision based on facts, evidence and testimony, but on bias and prejudice.” The district court confirmed the arbitration award on July 23, 2012. Bennett appealed the judgment confirming the arbitration award to the First Court of Appeals. Bennett did not obtain a supersedeas bond suspending enforcement of the judgment.

Bennett did, however, initiate a separate lawsuit against Land. Bennett alleged in the separate lawsuit that Land had committed fraud by failing to disclose information to Bennett during the negotiations leading up to Land retaining Bennett.

In October 2012, Land requested an abstract of judgment and a writ of possession to enforce the arbitration judgment. Once the writ was issued, Harris County deputy constables attempted to execute the writ at Bennett's law office. Their efforts were unsuccessful because Bennett “provided an affidavit stating belongings at the firm [are] exempt pursuant to Texas Property Code 42.002(a)(4)

.”

Land then moved to place the law firm in receivership. The district court granted Land's motion and appointed a receiver to “take possession of and sell the leviable assets of Bob Bennett & Associates P.C. and Bob Bennett, Defendant.” Bennett moved for reconsideration of the appointment of a receiver. Bennett argued that he had converted Bob Bennett & Associates, P.C. into a professional limited liability company that was “not subject to seizure or attachment.” Bennett subsequently appealed the order appointing a receiver to this Court.

On January 22, 2013, Bennett filed a cash bond of $30,931.11 to supersede execution on the arbitration judgment. In his appeal of that judgment to the First Court of Appeals, Bennett argued that the trial court's confirmation of the arbitration award should be reversed because the arbitration panel had “exceeded its powers by creating evidence,” “was influenced by the opinion that some of the services performed by Bob...