Case of Welts

• Decision Date: 12 February 1993
• Docket Number: No. LD-90-007,LD-90-007
• Citation: 136 N.H. 588,620 A.2d 1017
• Parties: WELTS' CASE.
• Court: New Hampshire Supreme Court

Page 1017

620 A.2d 1017

136 N.H. 588

WELTS' CASE.

No. LD-90-007.

Supreme Court of New Hampshire.

Feb. 12, 1993.

Aeschliman & Tober, P.A., Portsmouth (Stephen L. Tober on the brief and orally), for respondent.

HORTON, Justice.

This action is brought by the committee on professional conduct (the committee), which petitions this court to suspend the respondent, Jeremy Welts, from the practice of law in this State for a period of six months. On October 24, 1990, we appointed a Judicial Referee (Bean, J.) to conduct a hearing on the committee's petition. The referee found, by clear and convincing evidence, that the respondent violated Rules 1.1(a), 1.1(b)(5), 1.1(c)(4), 1.3(a), 1.4(a), and 8.4(c) of the Rules of Professional Conduct (the Rules). The respondent maintains that the evidence presented does not support the findings of ethical misconduct. Failing this argument, he contends that mitigating circumstances favor the imposition of a reprimand rather than a suspension.

Early in 1987, Robert and Mary Dambach consulted with the respondent's law firm regarding financial problems their small corporation was having with its principal lender, New Hampshire Business Development Corporation (NHBDC). In July 1987, they received from NHBDC notice of foreclosure on their home, which was mortgaged along with other property as collateral for the business loan. Their case was assigned to the respondent, who was able to negotiate a settlement with NHBDC, which reduced the outstanding amount of the loan and allowed the Dambachs an additional twenty-seven months for repayment. He also convinced the Internal Revenue Service that a $32,000 claim against his client should be the responsibility of NHBDC. At the time of the NHBDC settlement, it was decided that the Dambachs should bring suit against a consultant they had hired at the insistence of NHBDC. According to the Dambachs, the consultant's mismanagement of their corporation had been a substantial cause of their financial problems.

During the fall of 1987 and the year of 1988, the Dambachs, eager to procure funds with which to repay the outstanding loan balance, urged the respondent to bring suit against the consultant. Sometime around Christmas of 1988, the respondent falsely informed the Dambachs that the suit paperwork had been lost by the sheriff's department, even though the Dambachs understood that service previously had been made. Finally, in June of 1989 at a meeting called by the respondent, he confessed to them that he never had brought suit.

The respondent does not dispute that he misrepresented the status of the litigation to the Dambachs. He does, however, deny that this misrepresentation supports the "array of allegations of ethical misconduct."

The referee found by clear and convincing evidence that the respondent had violated the following Rules of Professional Conduct:

"Rule 1.1(a)--While the services performed were competent representation, the failure to bring suit is a lack of competent representation as is outlined in 1.1(b)(5) and (c)4.

Rule 1.3(a)--Failure to bring suit is also failure to act with reasonable promptness and diligence.

Rule 1.4(a)--Failure to properly inform his clients that suit had not been brought against [the consultant].

Rule 8.4--It is misconduct to engage in conduct involving misrepresentation, under paragraph (c)."

In our review of the referee's findings, "our only function is to determine whether a reasonable [person] could have reached the same decision as the [referee] on the basis of the evidence before him." Bourdon's Case, 132 N.H. 365, 370, 565 A.2d 1052, 1055 (1989) (quotation omitted).

Rule 1.1(a) states: "A lawyer shall provide competent representation to a client." To support his argument that his representation exhibited "overall professional competence," the respondent directs us to the referee's finding that "the work performed by the respondent for the Dambachs was, except for the failure to bring suit and the misrepresentation that he had brought suit, ... of the highest quality." However, "[i]t is not enough for respondent to demonstrate that in some, but not all, instances his conduct satisfied the requirements of the Rules of Professional Conduct." Bourdon's Case, 132 N.H. at 375, 565 A.2d at 1059. As the referee found, the respondent's failure to file suit contravenes the Rules' requirements for "attention to details and schedules necessary to assure that the matter undertaken is completed with no avoidable harm to the [clients'] interest," Rule 1.1(b)(5), and "undertak[ing] actions on the [clients'] behalf in a timely and effective manner," Rule 1.1(c)(4).

The respondent similarly denies that he failed to act with "reasonable promptness and diligence in representing a client," contrary to Rule 1.3(a). He maintains that because the statute of limitations still had a year and a half to run when he revealed his failure to file suit to the Dambachs, "no harm befell the Dambachs by the delay." We disagree. "Even when the client's interests are not affected in substance, however, unreasonable delay can cause a client needless anxiety and undermine confidence in the lawyer's trustworthiness." N.H. Rules of Prof. Conduct 1.3, ABA model code comments. We find no error in the referee's determination that the respondent violated this rule.

Rule 1.4(a) requires a lawyer to "keep a client reasonably informed regarding the status of a matter and promptly comply with reasonable requests for information." The respondent concedes in his brief that he "freely admitted that he failed to properly inform the Dambachs that suit had not been filed, thereby contravening the terms of Rule 1.4(a)."

Finally, the referee found a violation of Rule 8.4(c), which establishes professional misconduct where a lawyer "engage[s] in conduct involving dishonesty, fraud, deceit or misrepresentation." The respondent contends that although he has never denied misrepresenting the status of litigation to the Dambachs, he has never acted in any way that can be characterized as dishonest, fraudulent, or deceitful. Rule 8.4(c) is disjunctive, however. A finding of misrepresentation alone constitutes misconduct.

Finding no error in the referee's ruling, we turn to the determination of the appropriate sanction. Although the committee has petitioned to suspend the respondent for six months, the respondent maintains that mitigating circumstances justify the imposition of a reprimand rather than a suspension. "[The] purpose of the court's disciplinary power ... is to protect the public, maintain public confidence in the bar, and preserve the integrity of the legal profession," Henderson's Case, 130 N.H. 313, 315, 538 A.2d 1222, 1224 (1988), and to prevent similar conduct in the future, Astles' Case, 134 N.H. 602, 605, 594 A.2d 167, 170 (1991). "[D]isciplinary action is not taken as a mode of inflicting punishment for an offense." Silverstein's Case, 108 N.H. 400, 401, 236 A.2d 488, 490 (1967) (quotation omitted). To accomplish the desired ends, every case is judged on its own facts and circumstances. Flint's Case, 133 N.H. 685, 689, 582 A.2d 291, 293 (1990).

The sanction determined must be sufficient to meet the purposes we have stated. It must be determined by giving appropriate weight to the severity of the violations found and to the mitigating circumstances disclosed by the record. As to severity,...