Black v. State Bar

Decision Date25 July 1972
Citation499 P.2d 968,103 Cal.Rptr. 288,7 Cal.3d 676
CourtCalifornia Supreme Court
Parties, 499 P.2d 968 Arthur S. BLACK, Petitioner, v. The STATE BAR OF CALIFORNIA, Respondent. L.A. 29855, 29935. In Bank

Phil Silver, Hollywood, for petitioner.

F. LaMar Forshee, Ronald W. Stovitz and Christopher M. Reuss, San Francisco, for respondent.

BY THE COURT.

This is a proceeding to review a recommendation of the Disciplinary Board of the State Bar of California in L.A. 29855 that Arthur S. Black be suspended from the practice of law for three months 1 and its recommendation in L.A. 29935 that he be suspended for three months in addition to any imposed in L.A. 29855. 2

The two proceedings were heard by different local committees and were argued at different times before the board. It is appropriate, however, for us to consider the two proceedings together. (Cf. Cutler v. State Bar, 71 Cal.2d 241, 243, 78 Cal.Rptr. 172, 455 P.2d 108.)

Petitioner was admitted to practice in 1962. In both proceedings he was charged in a notice to show cause which violating his oath and duties as an attorney (Bus. & Prof.Code, §§ 6103, 6067, & 6068), wilfully violating rule 9 of the Rules of Professional Conduct, 3 and committing acts involving moral turpitude (Bus. & Prof.Code, § 6106). In one of the proceedings (L.A. 29855) he was also charged with wilfully violating rule 7 of the Rules of Professional Conduct, 4 and in that proceeding it was charged in particular that he wrongfully loaned $10,000 belonging to the Turrentine estate for which he was the attorney to other clients without the administratrix' approval and without any authority and thereby represented conflicting interests (count 1), that in making such loans he intentionally converted to his own purposes $10,000 belonging to his client (count 2), and that he misrepresented to the administratrix that he was required by law and the State Bar to invest at least one-third of the estate and based on this misrepresentation obtained her consent to the investment of one-third of the estate, and thereafter, contrary to her instructions, failed to invest in any proper estate investment and instead loaned the entire $10,000 to other clients (count 3).

In the other proceeding (L.A. 29935) it was charged in particular that a trust account of petitioner into which he deposited a settlement check of a client, Patricia Brown, contained insufficient funds during a period of over two weeks to cover the amount owed her, that he issued a check to her that was dishonored when presented for payment, and that he wrongfully converted $817 belonging to her. He denied the charges in both proceedings.

I. L.A. 29855
A. The Facts 5

In June 1966 petitioner was retained by Mrs. Lorraine Washington to probate the estate of her deceased brother, Harold Turrentine. Mrs. Washington was thereafter made administratrix of the estate, the sole asset of which was a $10,000 insurance policy. In August 1966 petitioner received a $10,000 check representing proceeds of the policy and after securing Mrs. Washington's endorsement on the check deposited it in a trust account.

In September and October 1966 petitioner loaned money of the estate ($3,847.73 and $600) to Mrs. Barbara Heard, a friend of petitioner and a client of his in a personal injury action. From September through December 1966 he loaned the balance of the insurance proceeds to Samuel Goldberg, another friend and client of petitioner. 6 He did not obtain from Goldberg or Mrs. Heard a promissory note or other document signed by the borrower evidencing the obligation. There is evidence that he maintained records pertaining to the loans, which records, according to his testimony, he destroyed. 7 The time within which any creditors of the estate could file their claims had not expired when he made the loans.

Petitioner did not seek approval of the loans from the probate court. The evidence is conflicting as to whether the administratrix agreed to the loans and whether he made the alleged misrepresentation to her.

Mrs. Washington testified: Sometime after the check was received by petitioner he told her it was the law and a requirement of the State Bar that one-third of the estate be invested, and she replied, 'if that's the law . . . go ahead.' 8 She never authorized him to invest more than one-third. He did not tell her the type investment he intended to make and never asked her permission to loan one-third of the money to clients.

Petitioner testified: During a telephone conversation with Mrs. Washington several weeks after the check was deposited in the trust account he asked her permission to lend the money to two clients of his and stated that they would be willing to pay the bank rate of interest for a loan and that he would guarantee the loans, and she stated for him to go ahead. She had theretofore said she was not interested in savings institutions because they did not pay enough interest. The only thing he discussed with her 'regarding one-third' was the amount of his attorney fees from the sale of some Utah property. 9 He believed the loans were proper because he had the authorization of the administratrix, who had told him she was the sole heir. 10 In 1966 he had been in practice only four years, did mainly criminal law, and had not handled any probate before the Turrentine estate, although he had made appearances in estate matters for a former associate.

In November 1968 Lee Freeman was substituted as the attorney for the administratrix, and about the same time he made a demand upon petitioner to account for the estate assets. Petitioner then had on hand in a savings account $4,100.50 plus interest belonging to the estate, but he did not render a complete accounting or turn over the funds to the administratrix until April 18, 1969, at which time the funds due the estate were accounted for by the delivery of a savings and loan passbook which reflected a balance of $10,939.31. Before April 18, 1969, petitioner knew that the administratrix had filed a complaint with the State Bar and petitioner had been cited in the probate proceeding to show cause why he should not, among other things, deliver to the administratrix the insurance policy proceeds.

B. The Findings

The board and local committee found in essence that petitioner loaned money belonging to the estate for which he was the attorney to other clients without the approval of the administratrix or the probate court; in making such use of the estate funds he wilfully represented conflicting interests without making an adequate disclosure of all pertinent facts to the parties involved; he falsely advised the administratrix that he was required to invest one-third of the estate funds; and he wilfully violated his duties as an attorney in making improper and unsafe investments of the estate funds.

C. Whether Evidence Sustains Findings

With respect to the scope of our review we recently stated in Himmel v. State Bar, 4 Cal.3d 786, 793--794, 94 Cal.Rptr. 825, 830, 484 P.2d 993, 998, 'Findings by the local committee and the Disciplinary Board are not binding on this court, and we will weigh the evidence and pass upon its sufficiency. All reasonable doubts will be resolved in favor of the accused and if equally reasonable inferences may be drawn from a proven fact, the inference which leads to a conclusion of innocence rather than one leading to a conclusion of guilt will be accepted. (Citations.)

'The findings, however, must be given great weight, and 'When (the) . . . findings rest primarily on testimonial evidence, we are reluctant to reverse the decision of the local administrative committee, which was in a better position to evaluate conflicting statements after observing the demeanor of the witnesses and the character of their testimony. (Citations.)' (Citations.) The burden is on the petitioner to show that the findings are not supported by the evidence or that the recommendation is erroneous. (Citations.) In meeting this burden, the petitioner must demonstrate that the charges of unprofessional conduct are not sustained by convincing proof and to a reasonable certainty. (Citations.)'

Here petitioner contends, without elaboration, that 'The findings . . . are not supported by but are contrary to the evidence.' This allegation does not sustain his burden of showing that the action of the board is erroneous or unlawful. (Bus. & Prof.Code, § 6083, subd. (c); Simmons v. State Bar, 70 Cal.2d 361, 364--365, 74 Cal.Rptr. 915, 450 P.2d 291; Hyland v. State Bar, 59 Cal.2d 765, 767, 31 Cal.Rptr. 329, 382 P.2d 369.)

Furthermore the recited evidence supports the findings. Although petitioner's testimony conflicted with that of Mrs. Washington as to whether she agreed to the loans and whether he made the alleged misrepresentation to her, the local committee was in a better position than this court to resolve the conflict.

D. Asserted Violation of Petitioner's Privilege Against Self-Incrimination

Petitioner contends that at the State Bar proceedings his privilege against self-incrimination was violated. (U.S.Const., Amends. 5 & 14; Cal.Const., art. I, § 13.) At the local committee hearing the State Bar called him as a witness. Immediately after he was sworn the committee chairman told him '. . . if you have any reason to raise any constitutional or other objections about testifying . . . we would entertain that, otherwise we would be happy to have your testimony.' Petitioner replied, 'I have nothing to hide,' and his attorney stated 'No objections.' Petitioner then proceeded to testify to his version of the facts. Later during the hearing the State Bar indicated it wanted to recall him as a witness. Petitioner objected on the ground that the State Bar 'has not rested (its) case' and that the State Bar's 'seesawing back and forth between one of (its) witnesses' and the 'opposition' was denying him a fair trial. The objection was overruled, and he was told he would 'be called to the...

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