In re Maguire, 506, 1998.

• Decision Date: 02 March 1999
• Docket Number: No. 506, 1998.,506, 1998.
• Citation: 725 A.2d 417
• Parties: In the Matter of a Member of The Bar of the Supreme Court of the State of Delaware: Michael P. MAGUIRE.
• Court: Supreme Court of Delaware

725 A.2d 417

In the Matter of a Member of The Bar of the Supreme Court of the State of Delaware: Michael P. MAGUIRE.

No. 506, 1998.

Supreme Court of Delaware.

Submitted: February 9, 1999.

Decided: March 2, 1999.

Jeffrey M. Weiner, (argued), Wilmington, Delaware, and Michael P. Maguire (allocution), for Michael Maguire, Respondent.

Michael McGinniss, (argued) and Mary M. Johnston, Office of Disciplinary Counsel, Wilmington, Delaware.

Before WALSH, HOLLAND and HARTNETT, Justices.

PER CURIAM:

This Court has before it a report from the Board on Professional Responsibility ("Board") concerning a petition for discipline filed by the Office of Disciplinary Counsel ("ODC") against the Respondent, Michael P. Maguire ("Maguire"). Maguire has been a member of the Delaware Bar since 1968. Most recently, he operated as a solo practitioner. On May 19, 1997, this Court placed Maguire on interim suspension. In re Maguire, Del.Supr., No. 204, 1997, 1997 WL 328588 (May 19, 1997) (ORDER).

REPORT OF THE BOARD

The Board held a hearing on August 27, 1998, at which the ODC and counsel for Maguire presented arguments. Maguire appeared and made a statement on his own behalf. The Board also received supplemental submissions from the parties dated October 13, 1998. After considering the evidence presented, the Board concluded that Maguire had committed various violations of the Rules of Professional Conduct, including the misappropriation of clients' funds.

Board Case No. 8, 1996

In April of 1994, Christopher M. Slaughter retained Maguire to represent him in a personal injury case. Although Maguire and Mr. Slaughter orally agreed to a one-third contingency fee arrangement, Maguire failed to put the agreement into writing. After determining that the driver responsible for the accident was uninsured, Maguire sought a recovery from Mr. Slaughter's insurance company. The insurance company sent Maguire a $9,000 settlement check made payable to both Maguire and Mr. Slaughter. On August 30, 1995, without obtaining authorization from Mr. Slaughter, Maguire signed Mr. Slaughter's name on the back of the check. Maguire then deposited the full amount of the settlement into his personal checking account. During the next several weeks, Maguire spent nearly the entire $6,000 that constituted Mr. Slaughter's portion of the settlement.

Mr. Slaughter subsequently asked Maguire about the status of the settlement. On November 17, 1995, Maguire issued a check to Mr. Slaughter in the amount of $500 with the notation "advance" without disclosing to Mr. Slaughter that he had already received the full settlement amount and deposited it into his own account. In January 1996, Mr. Slaughter filed a complaint with the Office of Disciplinary Counsel. Maguire distributed the remaining $5,500 in settlement funds to Mr. Slaughter in February 1996. In responding to Mr. Slaughter's disciplinary complaint, Maguire falsely stated that the matter had been resolved when the check from the insurance company arrived and "the funds were distributed the next day." Maguire subsequently lost Mr. Slaughter's file.

Maguire admits that he violated Rule 8.4(c) by "engaging in conduct involving dishonesty, fraud, deceit or misrepresentation" through his misappropriation of approximately $6,000 of Mr. Slaughter's funds from August 1995 until February 1996. By means of explanation rather than excuse,¹ Maguire also asserts that he was expecting a settlement check in another matter to arrive immediately after the check from Mr. Slaughter's insurance company, so that his use of Mr. Slaughter's funds would have been limited to a short period of time. Maguire also admits that he violated Rule 8.4(c) by misrepresenting to Mr. Slaughter that the $500 check sent to him in November 1995 was an "advance."

Maguire also admits that he violated Rule 8.1(a) by "knowingly mak[ing] a false statement of material fact" by falsely stating to the ODC that he had distributed settlement funds to Mr. Slaughter the day after the check from the insurance company arrived. In addition, Maguire admits that he violated Rule 1.5(c) by failing to put the contingency fee arrangement with Mr. Slaughter in writing. Finally, Maguire admits that he violated Rule 1.15(a) by failing to safeguard client property in that he failed to preserve Mr. Slaughter's funds and lost Mr. Slaughter's file.

Board Case No. 11, 1998

In 1995, Antoinette Reason was involved in a car accident in which she ran a red light and hit a vehicle owned by Delmarva Power & Light Company. She was fined for driving without insurance. In addition, Delmarva brought an action against her in Justice of the Peace Court. Ms. Reason retained Maguire to represent her in connection with that action. On her behalf, Maguire filed a third-party complaint against Crown Auto Outlet, Inc. alleging that Crown Auto, which had sold Ms. Reason her vehicle, had misled her by persuading her to obtain insurance from someone who issued her a false insurance card. Subsequently, Delmarva and Ms. Reason entered into a settlement pursuant to which Ms. Reason agreed to pay $5,780.84 plus court costs and interest to Delmarva.

After the trial of Ms. Reason's claims against Crown Auto, the Justice of the Peace Court entered a $9,405.84 judgment in favor of Ms. Reason and against Crown Auto. Crown Auto filed an appeal de novo in the Court of Common Pleas and soon thereafter, counsel for Crown Auto called Maguire and offered to settle the case. Maguire alleges that he spoke to a representative of Delmarva and obtained an indication that Delmarva might accept half of the amount due from Ms. Reason in satisfaction of the outstanding debt. Maguire claims that he assured Ms. Reason that he would pay off the Delmarva judgment against her if she accepted Crown Auto's settlement offer and that she agreed to that proposal. Subsequently, counsel for Crown Auto sent a $4,702.92 settlement check to Maguire in satisfaction of the settlement with Ms. Reason. Maguire deposited the settlement check into his attorney's account. During the next few weeks, Maguire depleted the account that held the Reason settlement funds. As of May 16, 1997, the attorney's account held a balance of only $50.80. As discussed above, the Delaware Supreme Court suspended Maguire from the practice of law on May 19, 1997.

On May 21, 1997, Maguire called a Delmarva employee to see if Delmarva would accept half of the debt in settlement. In response, the Delmarva employee demanded $4,700 and Maguire accepted this demand. On that same day, Maguire sent a fax to Delmarva memorializing the agreement that the claim would be settled on the terms discussed that day.

Maguire failed to pay Delmarva the funds that he had agreed to pay, nor did he deliver such funds to Ms. Reason. Ms. Reason remains liable to Delmarva for the outstanding debt. Maguire asserts in mitigation that Ms. Reason owed him more than $5,000 in unpaid fees and disbursements, and that she had agreed that he could apply the settlement amount to those statements, provided that he also paid off her Delmarva debt.²

Maguire admits that he violated Rule 8.4(c) by engaging in "conduct involving dishonesty, deceit, fraud or misrepresentation" by failing to pay off the Delmarva judgment, as he asserts he had represented to Ms. Reason that he would.

Maguire has also presented to the panel two promissory notes. Pursuant to the first note, Maguire has agreed to make payments totaling $4,700 either directly to Conectiv (Delmarva's successor) or to the Lawyers' Fund for Client Protection in the event that the fund pays the claim, which is now under consideration. The second note relates to the fine assessed against Ms. Reason. There is some evidence that the fine is not enforceable due to the state's failure to pursue the matter. In any event, if Ms. Reason is found to have an obligation to pay the fine and the Fund disburses funds to satisfy the fine, Maguire has promised in the second note to reimburse the Fund for the fine. Similarly, if Ms. Reason pays the fine herself, he has agreed to reimburse her directly.

Board Case No. 102, 1997

In 1993, Josephine Lunness filed a complaint with the Equal Employment Opportunity Commission ("EEOC") against her employer. In September 1995, a Pennsylvania attorney referred Ms. Lunness to Maguire to have him handle the EEOC claim. Although the written referral agreement sent by Maguire to the Pennsylvania lawyer provided for a consulting fee to be paid to the Pennsylvania lawyer, the agreement did not contemplate that the lawyers would each be compensated in proportion to the respective services performed, nor did Maguire provide Ms. Lunness with a written agreement pursuant to which the two lawyers assumed joint responsibility for the representation. Subsequently, Ms. Lunness was injured in an automobile accident and retained Maguire to represent her in that matter as well. On July 12, 1996, Ms. Lunness' insurance company sent a check to Maguire which was payable to both Ms. Lunness and Maguire. Maguire endorsed the check with Ms. Lunness' name without indicating in any way that he was signing with her authorization. Maguire asserts that he had authorization to sign Ms. Lunness' name to the check. In addition, he asserts that the funds received were used pay costs associated with a brief filed on Ms. Lunness' behalf and the cost of storing her damaged vehicle at a service station.

Maguire admits that he violated Rule 8.4(c) by engaging in "conduct involving dishonesty, fraud, deceit or misrepresentation" by signing Ms. Lunness' name to the check without indicating that he was signing her name for her.³ He also admits that he violated Rule 1.5(e) in that the division of fees with respect to the referred matter was not going to be made in proportion to the respective services performed by the two lawyers, but he failed to obtain a written agreement with the client to the effect that the two lawyers would be...