Grievance Committee of Fairfield County Bar v. Nevas

• Decision Date: 28 April 1953
• Citation: 96 A.2d 802,139 Conn. 660
• Court: Connecticut Supreme Court
• Parties: GRIEVANCE COMMITTEE OF FAIRFIELD COUNTY BAR v. NEVAS. Supreme Court of Errors of Connecticut

Page 802

96 A.2d 802

139 Conn. 660

GRIEVANCE COMMITTEE OF FAIRFIELD COUNTY BAR v. NEVAS.

Supreme Court of Errors of Connecticut.

April 28, 1953.

Lorin W. Willis, Bridgeport, for appellant (plaintiff).

David Goldstein, Bridgeport, with whom, on the brief, was Bernard S. Peck, Bridgeport, for appellee (defendant).

Before BROWN, C. J., and JENNINGS, BALDWIN, INGLIS and O'SULLIVAN, JJ.

JENNINGS, Associate Justice.

The grievance committee of the Fairfield County bar filed a presentment charging the defendant with unprofessional conduct. The case was tried in the Superior Court. Judgment was rendered dismissing the presentment. The plaintiff appealed on the principal ground that the finding as sought to be corrected did not support the conclusions reached.

The statement of the case presents a problem. The finding of facts contains 198 paragraphs and even more might be required if a really full statement were made. Plaintiff's exhibits ran through the alphabet and to DD. There were seventeen defendant's exhibits. The bare essentials will take quite a space. The defendant represented the complainant, Elizabeth Pylypchuk, also known as Betty Phillips, in several independent matters, as stated in the finding. All were relevant in the investigation conducted by the trial court, but with one exception they are of no importance here, since in the final analysis no misconduct with respect to them is charged. The value of the defendant's services to the complainant was recognized, and there was no claim that the substantial fees paid to him were excessive. The complainant, as the plaintiff acknowledged, was not a credible witness. The facts found show that this is an understatement. Since she was the only witness of any importance for the plaintiff, its difficulties in attacking the finding and conclusions are manifest. These factors make some condensation possible.

Examination of the claims of law and the brief of the defendant shows that the important issue was his conduct with reference to stock held by him in a corporation which he formed for the complainant. If the plaintiff cannot prevail on this issue, it cannot successfully attack the judgment.

The following findings of fact are supported by the evidence: The defendant has been an attorney at law in this state for more than ten years. He has an office in Westport. He has occupied various positions of importance and enjoys an excellent reputation. The complainant is a worldly woman, familiar with business transactions and particularly with transactions relating to inns and restaurants. In March, 1948, the complainant consulted the defendant with reference to the purchase of Cobbs Mill Inn, on which she had an option for $133,458. The defendant secured a reduction of over $20,000 in the price and obtained better terms on the financing plan. The terms under the defendant's arrangement included the payment of $5,000 on execution of the contract and $15,000 at the closing and the securing of a liquor permit. The conveyance was to run to a corporation to be formed by the complainant. She represented that she would have the funds available with which to consummate the transaction. She did not succeed in raising even the first $5,000, and it was advanced by the defendant. She then requested the defendant to assist her in obtaining the $15,000 for the closing and stated that she would give 40 per cent of the issued stock to any persons advancing that sum. To save the contract for his client and his own $5,000, the defendant advanced the additional sum of $16,482.34, including the fee for a liquor license and sundry expenses, from his own funds. This was not intended as an investment. The defendant expected to find other parties who would invest in the business and permit him to get his money out. He also intended to transfer to such parties the 40 per cent of stock hereinafter described.

The corporation contemplated in the agreement of sale was formed by the defendant under the name of Cobbs Mill Inn, Inc. Capital stock amounting to $2,000 was issued, represented by 100 shares of nonvoting stock and 100 shares of voting stock. Thirty shares of the nonvoting and forty-nine shares of the voting stock were issued to Morris Robinson, an office associate of the defendant; seventy shares of the nonvoting and fifty shares of the voting stock were issued to the complainant. One share of voting stock was issued to Elizabeth Gordon, a stenographer in the defendant's office. All certificates, as was indicated by an indorsement thereon referring to an agreement of May 3, 1948, were subject to other stockholders' rights to purchase. Neither Robinson nor Elizabeth Gordon paid anything for their stock. Both indorsed the certificates in blank and delivered them to the defendant. On April 8, 1948, the complainant drew and signed a paper which contained the following statements: 'In connection with purchase [of Cobbs Mill Inn], Attorney Leo Nevas has provided sufficient funds to make the purchase possible, and he will receive 40% of the net profits after such purchase price money has been paid off. * * * Elizabeth Pylypchuk retains 60% of the 100 shares.' Nothing that was done by the defendant thereafter changed the status of the stock ownership from that known to the complainant as appears in the quoted exhibit and no deception or misrepresentation was practiced by the defendant. It made no difference to the complainant whether the stock was actually owned by the defendant or by somebody else.

The defendant had had a commitment from his brother-in-law and the latter's partner, residents of Hartford, that they would advance $10,000 to complete the purchase, and he informed Robinson that he, Robinson, was holding the certificates as trustee for some person in Hartford. The commitment was never honored because of complications resulting from the complainant's conduct. Robinson an Elizabeth Gordon were nominal stockholders and officers in the preliminary organization of the corporation, after which they were to assign the stock to the ultimate owner. The latter might be the defendant or anyone who succeeded him as lender of the money with which the business was acquired. At the date of the agreement of May 3, the defendant was the only person who had made loans to the complainant or Cobbs Mill Inn, Inc., and the only person represented by Robinson. The 60 per cent stock interest in the name of the complainant was, with her consent, held by the defendant as security for her indebtedness to him.

In August, 1948, Attorney Leonard Schine went to live at Cobbs Mill Inn and the complainant started to consult with him about affairs at the inn and her dealings with the defendant. From then until the first of the year inquiries as to the purchase of the inn were made by persons of substantial means. One of these provided for a...