In re Kennedy

Decision Date20 April 1988
Docket NumberNo. 86-1268.,86-1268.
Citation542 A.2d 1225
PartiesIn re Thomas F. KENNEDY, Respondent.
CourtD.C. Court of Appeals

David Epstein, with whom R. Hale Foote, Washington, D.C., was on the brief, for respondent.

Elizabeth A. Kohlman, Asst. Bar Counsel, with whom Thomas H. Henderson, Jr., Bar Counsel, Washington, D.C., at the time the brief was filed, was on the brief, for petitioner, the Office of Bar Counsel.

Before NEWMAN, BELSON, and ROGERS, Associate Judges.

ROGERS, Associate Judge:

The Board on Professional Responsibility ("the Board") found that the respondent Kennedy violated Disciplinary Rule (DR) 3-101(B)1 by engaging in the practice of law while under suspension and DR 1-102(A)(4)2 by (1) failing to remit to his law firm a retainer fee received from a firm client, (2) instructing another client of the firm to send payment to his new office after he had left the firm, and (3) misrepresenting his current salary to the loan office of a savings and loan institution. The Board also found that the seriousness of the conduct and the need for consistency, D.C.Bar R. XI, § 7(3), warranted a more stringent sanction than the ninety day suspension recommended by Bar Counsel and the Hearing Committee, and recommended that Kennedy be suspended from the practice of law for a year and a day.

Kennedy contends that he did not violate DR 1-102(A)(4) because he only engaged in noncriminal acts that were unrelated to the practice of law. He argues that, as evidenced by his abandonment of pursuit of a loan, he did not intend to deceive the bank and that the fee controversy was a private matter with his law firm. He also argues that the recommended sanction is excessive because it is inconsistent with the sanctions imposed in comparable cases, none of his acts led to the harm of any client, and he was unaware he was under suspension for failure to pay his Bar dues. We agree with the Board that Kennedy committed four violations of the rules, but find that the recommended sanction is inconsistent with those imposed in recent, comparable cases. In our view the Board failed to consider the relationship of these noncriminal acts to Kennedy's fitness to practice law, and overestimated the seriousness of Kennedy's failure to pay Bar dues. We conclude that the appropriate sanction is suspension for ninety days.

I. Disciplinary Violations
A. Violation of DR 3-101(B)

Kennedy was admitted to the practice of law in the District of Columbia on March 18, 1977. He was suspended from the active practice of law from December 15, 1981, until November 28, 1983, for his admitted failure to pay Bar membership dues. He actively practiced law in the District of Columbia during this period. Kennedy admitted that he was required to pay yearly dues to the District of Columbia Bar and that he knew he would be suspended for not paying those dues. Kennedy does not contest the findings that he violated DR 3-101(B).

B. Violations of DR 1-102(A)(4)

The Boyd and Patterson Matters. In June of 1982, while Kennedy was associated with the law firm of Van Powers and Legal Associates, LaDonna Rowland Boyd retained him to represent her interests in a potential medical malpractice suit. She signed a retainer agreement and a release of medical records on forms of the Van Powers firm and tendered a $105 retainer fee. Kennedy did not open a file on the Boyd case, did not enter her name or the money received in the firm's log books, and did not remit the money to the firm.

In September of 1983, again while Kennedy was still associated with the law firm of Van Powers and Legal Associates, Dave Patterson retained Kennedy to represent him in a criminal matter. Kennedy completed his work for Patterson prior to February, 1984, when he left the law firm. Kennedy instructed Patterson to send the outstanding balance of the bill, $470, for work previously performed, to Kennedy's new office. Patterson did so, and Kennedy neither tendered the money to Van Powers nor informed his old firm of the payment.

Kennedy does not dispute this factual account on appeal,3 but he contends with respect to the Patterson money that his relationship to Van Powers is still in dispute and that this internal dispute with his former firm neither affected his clients nor concerned the practice of law and, therefore, should not be subject to disciplinary inquiry. He maintains that he was a partner of Van Powers and was entitled to engage in self-help, with regard to a controversy over money, by retaining fees as a set-off.4 There is substantial evidence in the record, however, that Kennedy was a salaried employee who owed his full time and attention to the firm and that firm practice was to remit all fee payments directly to the firm. The record also demonstrates that Kennedy directed Patterson to send the money to him before any specific money controversy with Van Powers arose. Kennedy's response that numerous clients considered him to be their attorney is unsurprising and irrelevant.

The Bank Matter. On June 28, 1983, Kennedy investigated the possibility of refinancing the mortgage on his residence through the Equitable Federal Savings and Loan Association. He admitted telling a bank employee that his annual salary was between $16,500 and $17,000 even though his actual salary at the time was approximately $11,000. He also admitted instructing a secretary at his law firm to verify the false information if the bank telephoned. Nevertheless he contends that a rule violation did not occur because the bank did not rely on his misstatement and he had a reasonable expectation that his salary would be increased to at least $16,500. Reliance is not essential to a finding of dishonesty, as opposed to criminality. See In re Minninberg, 485 A.2d 149, 151 (D.C. 1984). The misrepresentation here was admittedly material and dishonest. See In re Reback, 513 A.2d 226, 231 (D.C. 1986) (en banc). However, Kennedy dropped his pursuit of the loan only after another member of his firm and his secretary expressed their concern over the lie.

The record also demonstrates that Kennedy had no reasonable grounds to believe he would shortly receive a salary increase and that, in any event, his representation was false at the time he made it. Kennedy has not alleged that Van Powers at any time did anything more than hold out the possibility that he would receive an unstated increase at some point in the future. Indeed, the firm had recently and specifically denied Kennedy a salary increase for the relevant period.

Kennedy's essential quarrel with all of these DR 1-102(A)(4) findings, however, is that they do not relate to the practice of law and accordingly should not expose him to disciplinary action. He views the practice of law as restricted in a narrow sense to matters relating to clients and the courts. Thus, in his words, "the Board on Professional Responsibility and the Hearing Committee are increasingly arrogating to themselves ethical oversight of an attorney's conduct in any phase of life, even if it does not involve relations with a client or the court." This statement, while properly counseling restraint in disciplinary actions not directly related to clients and the courts, misconceives a primary purpose of disciplinary proceedings, which is to protect the public by assuring the continued fitness of an attorney to practice law. It also understates the evidentiary value of all dishonest conduct for predicting unprofessional behavior and harm to the public, and ignores the plain language of our disciplinary rules.5 Dishonest conduct by attorneys also erodes public faith in the ethics of practicing attorneys.

This court has consistently upheld findings that acts unrelated to the practice of law may nonetheless violate DR 1-102(A)(4). See In re Hadzi-Antich, 497 A.2d 1062 (D.C. 1985) (submitting falsified resume to prospective employer). The rationale is that some "conduct [in a private capacity] reflects adversely on . . . professional fitness." In re Terrell, No. 85-457 (Feb. 7, 1986). In Terrell, an attorney had received a friend's permission to use the friend's company credit card to rent a car.

This court ordered a sixty day suspension because the attorney used the car beyond the permitted length of time and later attempted to pay for the rental with a check drawn on a closed account. The Board stated, "The combination of inability to manage financial affairs and willingness to lie is obviously a dangerous pattern for a lawyer who may be called upon to handle other people's money."

II. Sanction

Bar Counsel and the Hearing Committee recommended that Kennedy should be suspended for ninety days. The Board recommended that Kennedy should be suspended for a year and day, which will require him to prove rehabilitation in support of an application for reinstatement to the Bar. D.C.Bar R. XI, § 3(2). The Board concluded that the more serious sanction was required in order to be consistent with recent Board recommendations for similar conduct. This court "shall adopt the recommended disposition of the Board unless to do so would foster a tendency toward inconsistent dispositions for comparable conduct or otherwise would be unwarranted." D.C.Bar R. XI, § 7(3). When the court disagrees with the Board as to the seriousness of the offense or the demands of consistency, however, the Board's recommendations are accordingly granted less weight. Reback, supra, 513 A.2d at 230-31.

The Board relied on In re Hutchinson, No. 86-82 (Bd. Prof. Resp. Jan. 25, 1985), in which it recommended a year's suspension for the attorney's presentation of false testimony to the Securities and Exchange Commission and for communicating material inside information. It also relied on In re Schneider, No. 73-83 (Bd. Prof. Resp. Jan. 3, 1986), in which it recommended a year's suspension for an attorney's alteration on eight occasions of credit card receipts in order to recoup legitimate...

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