Demergian, In re

• Decision Date: 16 March 1989
• Docket Number: No. S006377,S006377
• Citation: 768 P.2d 1069,48 Cal.3d 284,256 Cal.Rptr. 392
• Court: California Supreme Court
• Parties: , 768 P.2d 1069 In re David Kirkor DEMERGIAN on Disbarment.

Page 392

256 Cal.Rptr. 392

48 Cal.3d 284, 768 P.2d 1069

In re David Kirkor DEMERGIAN on Disbarment.

No. S006377.

Supreme Court of California In Bank.

March 16, 1989.

Kenneth C. Noorigian, Fitzmaurice, Buchbinder & Steres and Fitzmaurice & Steres, San Diego, for petitioner.

Diane C. Yu, Oakland, Truitt A. Richey, Jr., San Francisco, and William F. Stralka, Agoura Hills, for respondent.

THE COURT:

We review the recommendation of the Review Department of the State Bar Court that petitioner David Kirkor Demergian be disbarred. That recommendation was based on petitioner's 1986 conviction after a plea of guilty to misdemeanor grand theft (Pen.Code, § 17, subd. (b)(5)), stemming from his misappropriation of over $25,000 from a client trust account. Petitioner asserts disbarment is excessive in light of his mitigating evidence. In the alternative, petitioner claims his hearing before a retired judge and the denial of his request for a three-member hearing panel violated the due process, equal protection, and privileges and immunities provisions of the California and federal Constitutions. For the reasons set forth below, we find petitioner's arguments unconvincing. Thus, we adopt the recommendation of the review department.

Facts

Petitioner was admitted to practice in California in December 1980. He entered private practice as a sole practitioner. In May 1982, petitioner was hired by Colonel Michael T. Goupil to represent him in a marriage dissolution action filed by his wife, Margaret Price-Goupil.

In December 1984, petitioner received a check for $21,149.82 from the escrow company for the sale of the Goupils' house. He deposited the check in his client trust account pending a distribution order by the court in the Goupils' dissolution action. Deposit of that check brought the balance in the trust account to $23,379.38. On March 15, 1985, petitioner wrote a check for $3,000 on his client trust account and deposited it in his personal checking account, which was overdrawn by $492.14. Less than a week later, petitioner wrote a check for $2,000 on his client trust account, received $1,750 in cash, and deposited the balance in his personal checking account. From December 1984 (when the Goupils' funds were entrusted to petitioner) to April 1985, petitioner misappropriated a total of $10,154.86 from the monies he was to hold in trust on behalf of the Goupils.

During March 1985, Margaret Goupil's attorney, Beatrice Snider, made repeated demands on petitioner for an accounting of the funds from the sale of the Goupil residence. When petitioner failed to provide an accounting, attorney Snider filed an ex parte request for transfer of the trust funds and accrued interest to her client trust account on behalf of the Goupils. On April 1, 1985, petitioner deposited $11,500 in his client trust account in anticipation of the court's order requiring him to pay out the monies owed to the Goupils. On April 3, pursuant to a court order, petitioner wrote Margaret Goupil a check on his client's trust account for $5,787.34 for arrearages of child and spousal support due her from Michael Goupil, and opened an interest-bearing trust savings account in his own name as trustee for the Goupils' pending divorce action. He paid $15,566.52 into the new account from his client trust account.

Between May 3 and May 16, 1985, petitioner withdrew all funds on deposit in the new trust savings account. As he had done during his earlier misappropriations, he spent those funds for his own use, without the knowledge or consent of the Goupils, primarily to purchase cocaine. Petitioner estimates that between October or November 1984 (when he began "free-basing" cocaine) and June 1985, he spent approximately $80,000 on cocaine. He also was drinking heavily.

In early June 1986, petitioner was charged in a criminal complaint with theft of personal property of a value in excess of $400, a felony, arising out of the misappropriation of the Goupils' funds. In September of that year, pursuant to a plea bargain, petitioner pleaded guilty to one count of misdemeanor grand theft (Pen.Code, § 17, subd. (b)(5)). He was sentenced to three-years probation with the conditions that he serve two days in the county jail, make restitution for any amounts still owed to his victims, perform 240 hours of community service, participate in a rehabilitation program as prescribed by the probation officer, and neither use nor possess any dangerous drugs or narcotics without a valid prescription.

This court subsequently ordered petitioner suspended from the practice of law effective January 2, 1987, pending final disposition of this disciplinary proceeding. We also ordered petitioner to comply with rule 955 of the California Rules of Court.

We referred the matter to the State Bar for a hearing, report, and recommendation on the discipline to be imposed. Petitioner requested that the matter be heard before a three-member hearing panel. That request was denied on the ground that the hearing was estimated to take more than one day. (See Rules Proc. of State Bar, rule 558(d) [presiding referee of the State Bar Court is not authorized to grant a three-member panel in cases estimated at more than one day in duration].) Petitioner's case was heard by a retired judge (William A. Munnell), who adopted the stipulation of facts by the parties and recommended that petitioner be disbarred "with the hope that upon proof of full and complete rehabilitation as time will prove ... he be readmitted to the practice of law." Petitioner's request for reconsideration was denied. Thereafter, the review department unanimously adopted both the hearing officer's findings of fact and his recommendation that petitioner be disbarred.

Discussion

1. Constitutional Claims

We turn first to petitioner's contention that denial of his demand for a three-member hearing panel violated the due process, equal protection, and privileges and immunities provisions of both the California and federal Constitutions. Petitioner requested a three-member panel, pursuant to rule 558(a)(3) of the State Bar Rules of Procedure. Although his request was filed in a timely manner, the State Bar Court refused to consider it because a designee of the presiding referee of the State Bar Court determined that the hearing was likely to take more than one day.

Petitioner's constitutional attack focuses on rule 558(d) of the State Bar Rules of Procedure. That rule, however, merely implements Business and Professions Code section 6079, subdivision (b), which requires that a hearing estimated to last more than one day must be conducted by a retired judge, if available. Section 6079, subdivision (b), provides in part: "Subject to the availability of a retired judge as provided in this section, the trial in a State Bar disciplinary proceeding shall be heard by a retired judge if the presiding referee of the State Bar Court or his or her designee determines that the matter or proceeding is complex, or that trial is likely to be in excess of one day, or the circumstances dictate that it cannot be heard by volunteer referees without a likelihood of undue delay or burden to the State Bar Court, the complainant, or the respondent."

Petitioner's due-process claim is without merit. Although an attorney in a disciplinary proceeding has a right to a fair hearing (Emslie v. State Bar (1974) 11 Cal.3d 210, 228, 113 Cal.Rptr. 175, 520 P.2d 991), petitioner does not contend that a hearing before one judge is fundamentally unfair. There can be little doubt that the Legislature constitutionally could provide for hearings before individual judges in all State Bar disciplinary matters. In addition, petitioner demonstrates no prejudice to his cause as a result of his hearing before a retired judge. (See Mrakich v. State Bar (1973) 8 Cal.3d 896, 906, 106 Cal.Rptr. 497, 506 P.2d 633.)

Petitioner's equal-protection claim also fails. He argues that Business and Professions Code section 6079, subdivision (b), establishes an unconstitutional classification based on the amount of evidence a litigant wishes to present. Moreover, he asserts we should apply the "strict scrutiny" test to that classification. At the federal level, strict scrutiny applies only if a legislative classification involves a suspect classification or significantly infringes on a fundamental right. (Plyler v. Doe (1982) 457 U.S. 202, 216-217, 102 S.Ct. 2382, 2394-2395, 72 L.Ed.2d 786.) We have followed the same test in applying the equal protection guaranties now set forth at article I, section 7 of the California Constitution. (Sail'er Inn, Inc. v. Kirby (1971) 5 Cal.3d 1, 16, 95 Cal.Rptr. 329, 485 P.2d 529.)

Petitioner does not allege that Business and Professions Code section 6079 involves a suspect classification. We conclude that it also does not significantly infringe on a fundamental right. Assuming, as petitioner asserts, that he has a fundamental right to be heard in "court" before he can be deprived of his license to practice law, section 6079 does not significantly infringe on that right. Section 6079 does not determine whether petitioner receives a hearing; rather, it affects who conducts that hearing. Retired judges who serve as hearing officers must qualify by virtue of expertise and experience in disciplinary matters, familiarity with broad areas of law, willingness and availability to handle disciplinary matters, and lack of a record of disciplinary sanctions. (Bus. & Prof.Code, § 6079, subd. (f).) In addition, petitioner's initial hearing was only part of the "hearing" to which he is entitled under state law. We must not ignore the role of the review department in recommending discipline and the duty of this court independently to pass on the weight and sufficiency of the evidence supporting that recommendation.

Thus, we apply the "rational basis" test. Under that test, "the decision of the Legislature as to what is a sufficient distinction to warrant...