In re Eaton, No. 5189.

• Court: United States State Supreme Court of North Dakota
• Writing for the Court: NUESSLE
• Citation: 60 N.D. 580,235 N.W. 587
• Parties: In re EATON.
• Decision Date: 01 April 1931
• Docket Number: No. 5189.

60 N.D. 580
235 N.W. 587

In re EATON.

No. 5189.

Supreme Court of North Dakota.

March 3, 1931.
Rehearing Denied April 1, 1931.

[235 N.W. 587]

Syllabus by the Court.

Charges were filed against the respondent, Robert A. Eaton, predicated on violations of subsections 5 and 6 of section 794, Comp. Laws 1913. A hearing was ordered and a referee was designated to take testimony and report the same together with his findings, conclusions, and recommendations. The referee found that the charge predicated on subsection 6 was not sustained, but found that the charges predicated on subsection 5 were sustained, and concluded that the respondent should be disbarred, and recommended accordingly. The record is examined and considered, and held to warrant and sustain the findings, conclusions, and recommendations of the referee.

Syllabus by the Court.

The statute, section 799, Supplement, Comp. Laws 1913, providing that the Supreme Court may, in proper case, suspend or revoke the license of an attorney and counselor at law to practice in the courts of this state, is merely a legislative affirmance of a pre-existing inherent power. In re Simpson, 9 N. D. 379, 83 N. W. 541.

Syllabus by the Court.

A disbarment proceeding is highly criminal in its nature, and the accused has a right to be apprised of the specific charges made against him and is entitled to have the investigation based thereon confined to the charges so made.

[235 N.W. 588]

Syllabus by the Court.

Where, in a disbarment proceeding, the charges against the accused are on account of violations of duties of an attorney as enumerated by the statute, section 794, Comp. Laws 1913, and not on account of violations of duty beyond the statute, offenses of the latter sort will not be considered.

An original proceeding for the disbarment of Robert A. Eaton, an attorney at law. A hearing was had before a referee appointed for that purpose.

Conclusions and recommendations of the referee adopted, and accused's license to practice revoked and canceled.

James A. Manly, of New Rockford, and H. G. Nilles, of Fargo, for the prosecution.

S. E. Ellsworth, of Jamestown, U. L. Burdick, of Fargo, and Robert A. Eaton, of Edgeley, in pro. per., for respondent.

NUESSLE, J.

Heretofore complaint was made touching the professional conduct of Robert A. Eaton, the respondent, a member of the bar of this state. Thereupon such proceedings were had pursuant to the statute, section 801 et seq., Comp. Laws 1913, that on November 14, 1927, formal charges against the respondent were filed by the state bar board. The Honorable G. Grimson, one of the judges of the Second judicial district, was appointed referee by this court to take the testimony in the proceeding and present his findings, conclusions, and recommendations. The charges were served on the respondent, who on April 16, 1928, made his answer thereto. Thereafter hearings were had before the referee, testimony was taken, and on May 24, 1930, the referee filed the record, together with his findings, conclusions, and recommendations, and a memorandum opinion supporting the same. The matter was set down for argument on the question as to whether the report and recommendations should be accepted and adopted. Argument was had before this court on November 10, 1930.

The charges presented by the bar board on which this proceeding is predicated are:

“1. That the said Robert A. Eaton has knowingly and willfully violated his duties as an attorney and counselor of this court, in that he has engaged in offensive personalities not required by the justice of the cause with which he has been charged.

2. That the said Robert A. Eaton has knowingly and willfully violated his duty as such attorney and counselor, in that he has willfully and wrongfully advanced facts or alleged facts prejudicial to the honor and reputation of parties and witnesses not required by the justice of the cause with which he has been charged.

3. That the said Robert A. Eaton has knowingly and willfully violated his duty as such attorney and counselor, in that he has encouraged the commencement and continuance of actions and proceedings from motives of passion or interest.”

These charges are supported by numerous specifications, particularizing the items on which the charges are based.

Section 799, Comp. Laws 1913, as amended (section 799, Supplement), provides:

“The revocation of any attorney's admission to the bar is, and shall constitute, a forfeiture of his office as an attorney or counsellor at law to practice in the courts of this state, but not until a copy of the charges against such attorney shall have been delivered to him by the clerk of the court in which the proceedings shall be had and an opportunity shall have been given him to be heard in his defense.”

Section 800, Comp. Laws, 1913, as amended (section 800, Supplement), provides:

“The certificate of admission to the bar of an attorney and counsellor at law may be revoked or suspended for either of the following causes: * * *

3. For a wilful violation of any of the duties of an attorney or counsellor as hereinbefore prescribed. * * *”

Section 794, Comp. Laws 1913, provides:

“It is the duty of an attorney and counselor: * * *

5. To abstain from all offensive personalities and to advance no fact prejudicial to the honor or reputation of a party or witness, unless required by the justice of the cause with which he is charged.

6. Not to encourage either the commencement or continuance of an action or proceeding from any motive of passion or interest. * * *”

So the charges as presented by the bar board are predicated on alleged violations of subsections 5 and 6, section 794, supra.

[1] The referee found that the first and second charges were sustained by the evidence. His findings and conclusions with respect thereto read as follows:

“That the conduct of the said Robert A. Eaton cannot be excused upon grounds of

[235 N.W. 589]

youth or inexperience; that the matters complained of did not occur in the heat of trial but were carefully thought out and planned after mature deliberation by the said Robert A. Eaton; that said Robert A. Eaton has proved himself unworthy as a member of the Bar of this court.

That the said Robert A. Eaton has been guilty of a willful violation of his duty as an attorney and counselor in engaging in offensive personalities and in advancing facts prejudicial to the honor or reputation of parties and witnesses and not required by the justice of the cause with which he was charged.”

The referee's report is full and detailed. It consists of 49 typewritten pages. It analyzes carefully and at length the evidence offered on the issues presented by the charge and the answer. The record is voluminous. The transcript of the testimony taken comprises more than 600 pages. The exhibits are many in number and include letters, statements, documents, and books, as well as pleadings, affidavits, depositions, and transcripts in various cases that have been in litigation.

Shortly stated, the facts are substantially as follows: The respondent, Robert A. Eaton, was admitted to the bar many years ago. Thereafter he removed from the state and was absent therefrom until some time in 1923. His brother and his nephews had long been engaged in the farm loan business at Fargo. They did an extensive business in the placing of loans in the southern portion of the state. They operated as a copartnership under the name of Eaton & Eaton and owned a holding corporation known as the Eaton Loan Agency. Their principal connection in the loan business was the Union Central Life Insurance Company. They were the financial agents of this company in the territory wherein they carried on their loan business. In 1923 they made an arrangement with the respondent, whereby he was to enter their employ and look after their interests and the interests of the Union Central Life Insurance Company in Dickey and contiguous counties. The respondent entered into this employment and was engaged therein for some time. Friction developed between him and his employers. He complained about and criticized their method of carrying on the business and soon discontinued the connection. Almost immediately thereafter he opened an office for the practice of law at Edgeley, in La Moure county. During the time he was employed by Eaton & Eaton he had had occasion to cover the territory contiguous to Edgeley and interview and become acquainted with many of Eaton & Eaton's loan clients therein. During this period he had access to Eaton & Eaton's files, containing papers and information generally in connection with loans placed in his territory. When he opened his law office at Edgeley, he advertised that he had discontinued his connection with Eaton & Eaton and offered some public criticism of their methods of doing business. This advertising matter is open to the implication that he was inviting litigation against Eaton & Eaton and the insurance company. In the meantime agriculture had not been prospering in this community. Times were hard with the farmers. Loans were in default. Under the method followed by Eaton & Eaton when a loan was made, it was secured by a first mortgage on real estate running to the insurance company, and Eaton & Eaton took deferred commissions which were ordinarily secured by second mortgage on the same real estate. In some cases of default in payment the insurance company and Eaton & Eaton resorted to foreclosure to enforce collection. Usually these foreclosures were by advertisement. After Robert A. Eaton began the practice of law at Edgeley, some of the mortgage debtors, whose mortgages were being thus foreclosed, employed him to enjoin the foreclosures and when actions were begun to defend such actions. In some cases the mortgage debtors employed the respondent without solicitation on his part. In other cases when foreclosures were begun and...