In re Hertz

• Decision Date: 21 February 1918
• Docket Number: No. 20192.,20192.
• Citation: 166 N.W. 397,139 Minn. 504
• Parties: In re HERTZ.
• Court: Minnesota Supreme Court

139 Minn. 504

166 N.W. 397

In re HERTZ.

No. 20192.

Supreme Court of Minnesota.

Feb. 21, 1918.

Proceeding by the State Board of Law Examiners to remove Abraham J. Hertz from his office of an attorney at law for willful misconduct. Proceeding dismissed.C. J. Traxler, of Minneapolis, and E. Southworth, of Shakopee, for applicant.

C. D. & R. D. O'Brien, Keller & Loomis, and T. R. Kane, all of St. Paul, for respondent Hertz.

PER CURIAM.

This is a proceeding brought by the state board of law examiners to remove the respondent, A. J. Hertz, from his office of an attorney at law for willful misconduct as such attorney. The accusation contains five specifications of alleged misconduct.

1. From 1905 until 1916, Fred H. Silsbee was the president and general attorney of the Yeomen of America, a fraternal beneficiary society organized under the laws of the state of Illinois, and acted as executive officer or manager thereof. From time to time he employed respondent to defend actions brought against the society in the state of Minnesota. Respondent's bills for services in these cases were presented to and approved by Silsbee, and after being so approved were paid by the society. It is charged that while handling these cases respondent entered into a secret arrangement with Silsbee under which he paid to Silsbee a part of the fees received from the society, and swelled his bills to the society sufficiently to enable him to do so without loss to himself. If respondent did this, and thereby assisted in transferring to an officer of the society for which he was acting as attorney moneys of the society to which such officer was not entitled, he violated his duty as an attorney. The disputed question is whether such an arrangement was in fact made and carried out.

The present method of determining the facts in cases where an attorney is charged with misconduct is somewhat unsatisfactory. The testimony is taken before a referee and comes here without any findings of fact by those who saw and heard the witnesses. Hearing the testimony as given upon the witness stand and observing the witnesses and parties as they testify is a valuable aid in determining where the truth lies; but this court neither sees nor hears the witnesses, and must reach its conclusions from the cold record without the light which may have been thrown upon it during the taking of the testimony.

The direct evidence upon the question in dispute is flatly contradictory. Silsbee testifies that he made such an arrangement with Hertz, and received payments under it. Hertz testifies that he made no such arrangement and no such payments, but states that, as he was a young practitioner, he intended, at his own expense, to procure an experienced attorney to assist him in the trial of the cases, and so informed Silsbee; that Silsbee suggested that such an expense was unncessary as he (Silsbee) was paid for his time by the society, and would come and help try the cases without cost to Hertz, except for the actual expense incurred in making the necessary trips to St. Paul; that such an arrangement was made, and Silsbee came and took part in trying or settling the cases; that on such occasions he (Hertz) paid Silsbee's railroad fare and hotel bills, but paid nothing more; and that no charge on account of these payments was ever made to the society either in the form of padded bills or otherwise. Silsbee in effect denies the arrangement asserted by Hertz. There is no other direct testimony upon the question in dispute.

Hertz was merely employed to defendant those specific cases which Silsbee turned over to him, and it seems to have been understood that he was at liberty to take other cases against the society. The last business which he transacted for the society seems to have been in 1913. The Yeomen and a number of other fraternal societies had issued policies to a large number of Russian and Rumanian Jews residing in the cities of St. Paul and Minneapolis. Subsequently the societies claimed that many of these policies had been obtained by aged people by misrepresenting their ages, and took steps to cancel such policies and to defend against actions brought upon them, as appears from numerous cases which have reached this court. After his employment by the Yeomen had terminated, Hertz took and prosecuted numerous cases against that and the other societies to enforce payment of the policies above mentioned. In the latter part of 1915 or early part of 1916, and investigation of the management and affairs of the Yeomen was begun by the authorities of the state of Illinois, whereupon Silsbee terminated his official connection with the society by resigning. An Illinois attorney named Lee Mighell became his successor. After investigating the cases then pending, Mighell reported to the society that not 1 per cent. of ‘the Jewish fraternal cases in St. Paul and Minneapolis' were free from the taint of fraud, and that he considered Hertz the leading conspirator, and recommended, as the easiest means of defeating the cases, that proceedings be taken to disbar Hertz. Acting upon this report the society made a written proposition to the other societies interested in which, after reciting what Mighell had reported, they state:

‘Mr. Mighell further says that he and the other members of the firm, Mighell, Gunsul & Allen, will undertake the task of disbarring Mr. Hertz with the understanding that some one will furnish the expenses connected with the effort, and he believes that the firm should be paid a fee of $3,000, providing they are successful, and Mr. Mighell states definitely that no fee whatever will be charged, unless the disbarment proceedings against Mr. Hertz are successful. The case would take several months before reaching the final decision of the Supreme Court, and the expense for the investigation, cost, etc., is estimated at $2,000.’

They further state:

‘Our board has decided to make the following proposition to other interested societies: Namely, we advance the cost connected with the disbarment of A. J. Hertz, and if the proceeding fails we will pay these costs ourselves, but should the proceedings be successful, then each of the fraternal societies interested is to pay the sum of $250. Now, there are twenty societies, more or less, interested, and it will take the cooperation of each one to make the estimated amount which will be necessary to carry out this project. Please take this matter up at once and let us know at the earliest possible moment as to whether you wish to participate in this project with the understanding that if it is unsuccessful you are under no obligation, but should the proceeding against Mr. Hertz prove successful, you are to pay the sum of $250.’

Mighell's position and interest is shown by the foregoing statements. The present proceedings are based upon charges which he made to the board of law examiners, and Silsbee appeared as witness in support of such charges at his instance. We have mentioned these matters as they have some bearing when weighing the evidence. Silsbee testifies to the corrupt agreement; Hertz testifies as positively to the contrary, and gives his various transactions with Silsbee in much detail. The few facts, outside their own statements, which bear upon the question seem to corroborate Hertz fully as strongly as they corroborate Silsbee; and after considering all the facts and circumstances, the court is unable to say that this...