Departmental Disciplinary Comm. for the First Judicial Dep't v. Kaplan (In re (Admitted)

• Decision Date: 10 December 2013
• Citation: 2013 N.Y. Slip Op. 08219,976 N.Y.S.2d 461,113 A.D.3d 184
• Parties: In the Matter of Bruce H. KAPLAN (admitted as Bruce Howard Kaplan), an attorney and counselor-at-law: Departmental Disciplinary Committee for the First Judicial Department, Petitioner, Bruce H. Kaplan, Respondent.
• Court: New York Supreme Court — Appellate Division

113 A.D.3d 184

976 N.Y.S.2d 461

2013 N.Y. Slip Op. 08219

In the Matter of Bruce H. KAPLAN (admitted as Bruce Howard Kaplan), an attorney and counselor-at-law: Departmental Disciplinary Committee for the First Judicial Department, Petitioner, Bruce H. Kaplan, Respondent.

Supreme Court, Appellate Division, First Department, New York.

Dec. 10, 2013.

Jorge Dopico, Chief Counsel, Departmental Disciplinary Committee, New York (Jun H. Lee, of counsel), for petitioner.

Respondent pro se.

ANGELA M. MAZZARELLI, Justice Presiding, ROLANDO T. ACOSTA, DAVID B. SAXE, HELEN E. FREEDMAN, DARCEL D. CLARK, Justices.

PER CURIAM.

Respondent Bruce H. Kaplan was admitted to the practice of law in the State of New York by the Second Judicial Department on February 26, 1986, under the name Bruce Howard Kaplan. At all times relevant to this proceeding, respondent maintained an office for the practice of law within the First Judicial Department.

In January 2012, the Department Disciplinary Committee (DDC) charged respondent with six violations of the Rules of Professional Conduct (22 NYCRR 1200.0):(1) allowing a non-lawyer to use his IOLA account as a means of sheltering funds from tax and judgment creditors in violation of rule 8.4(c); (2) allowing the aforementioned individual to use his IOLA account as a personal/business account in violation of rule 1.15(b)(1); (3) making a false statement to the Committee in violation of rule 8.4(c); (4) depositing personal and business funds into his IOLA account and transferring/disbursing said funds unrelated to the practice of law in violation of rule 1.15(b)(1); (5) allowing his non-lawyer spouse to be a signatory on his IOLA account in violation of rule 1.15(e); and (6) issuing IOLA checks made payable to “cash” in violation of rule 1.15(e).

In his answer and subsequent stipulation, respondent admitted that he violated the fifth charge, allowing his non-lawyer spouse to be a signatory on his IOLA account in violation of rule 1.15(e), but denied the remaining charges.

On April 25, 2012, a hearing on the charges convened before a Referee. The Committee did not call any witnesses but introduced documentary evidence. Respondent testified on his own behalf and introduced documentary evidence.

Respondent stated that from 2005 through 2010, he worked primarily as a real estate developer and as a result, the amount of time he spent practicing law was greatly diminished and his IOLA account was essentially dormant during the period at issue.

In or about 2007, respondent opened an IOLA account with JP Morgan Chase. Both respondent and his then wife, Aliza J. Kaplan, a non-attorney, were named as the authorized signatories on the account. Respondent explained that his bank suggested that he list his then wife as an additional signatory because of complications that could arise due to respondent's status as a sole practitioner; however, his wife never transacted any business on the account. In addition, respondent admitted that since May 2008 until about 2011, he used his IOLA account as both a personal and business account. Furthermore, he admitted that between 2009 and 2010, he issued 13 IOLA checks made payable to “cash.”

Respondent's misconduct also arose from his efforts to assist his friend, Tracy Cronin, a single mother who was in the midst of severe financial difficulties. In October 2007, HSBC commenced a foreclosure action against Cronin and named, inter alia, the New York State Department of Taxation and Finance, the New York State Workers' Compensation Board and the Internal Revenue Service as defendants because each had filed tax warrants/liens or judgments against Cronin. A schedule attached to the complaint listed the various tax warrants/liens and judgments entered against Cronin. In July 2008, respondent served Cronin's pro se answer on HSBC, which the bank rejected as untimely. By letter of September 3, 2008, respondent proposed settlement terms to HSBC's counsel, but the next day HSBC entered a judgment of foreclosure against Cronin. In October 2008, respondent permitted Cronin to use his IOLA account as a personal/business account. In or about January 2009, Nassau County Supreme Court issued an order, inter alia, staying the foreclosure sale of Cronin's home and directing HSBC to show cause as to why the judgment of foreclosure should not be vacated.

During the course of its investigation, the DDC requested by letter hat respondent specify if, prior to permitting Cronin to use his IOLA account, he was aware of the tax liens and civil judgments entered against her. Respondent, by affirmation, stated that the only specific judgment he was aware of was the September 2008 foreclosure judgment entered by HSBC even though, as previously noted, the October 2007 foreclosure complaint listed the various tax liens and judgments entered against Cronin. Respondent testified that he never reviewed the entire complaint and only became aware of the tax liens and judgments in January 2012 when he was served with the DDC's charges.

Following the liability hearing both parties submitted proposed findings of fact and conclusions of law. On September 28, 2012, the Referee informed the parties by letter that he had sustained all charges and directed that a sanction hearing be scheduled.

On October 18, 2012, a sanction hearing was convened at which respondent testified on his own behalf and called forth three character witnesses, former clients, who testified as to, inter alia, respondent's passionate advocacy, his dedication to his clients, and that he was a “do gooder.” In his mitigation testimony, respondent expressed remorse for his misconduct. The parties submitted post-hearing briefs wherein the DDC argued for a one-year suspension and respondent urged a private reprimand or public censure. By a report dated January 28, 2013, the Referee recommended that respondent be publicly censured. The Referee stated, in pertinent part:

“[respondent] has exercised poor judgment in abusing his IOLA account ... Although he acted selflessly in his efforts to help Ms. Cronin, without any apparent benefit to himself, nonetheless, he has clearly abused his IOLA account and should have realized it at the time.”

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“In contrast to other respondents who have ... demonstrated themselves to be greedy, dishonest, self-centered and indifferent to the needs of anyone but themselves, I find respondent in the instant matter to...