In re Novo

• Decision Date: 25 May 1942
• Docket Number: 36012.
• Citation: 200 La. 833,9 So.2d 201
• Court: Louisiana Supreme Court
• Parties: In re NOVO.

9 So.2d 201

200 La. 833

In re NOVO.

No. 36012.

Supreme Court of Louisiana

May 25, 1942

Rehearing Denied June 29, 1942.

Benjamin Y. Wolf, Chairman, and Frank W. Hart, both of New Orleans, Charles A. McCoy, of Lake Charles, and Eugene A. Conway, of Baton Rouge, Supreme Court Committee on Professional Ethics and Grievances; Hollingsworth B. Barret of Shreveport, member, recused.

Lee J. Novo, of Alexandria, in pro. per.

FOURNET Justice.

The Supreme Court Committee on Professional Ethics and Grievances, upon the complaint of the Alexandria Bar Association, instituted this proceeding against Lee J. Novo, an attorney of the Alexandria bar, seeking his disbarment on charges of professional and ethical misconduct.

The action is predicated on the defendant's alleged violation of his duty (1) toward the Rev. A. Cliff Searcy Novo's client in the matter of Searcy v. Interurban Transportation Company et al., 189 La. 183, 179 So. 75 because of his settlement with Searcy for an amount less than that agreed upon, as evidenced by his retention of a larger portion of the amount recovered in that case as his fee and also by his retention of the sum of $400 as purported expenses incurred during the prosecution of the case, which expenses, it is claimed, were to have been borne by Novo; (2) toward T. H. McGregor, Novo's associate counsel in the case of Searcy v. Interurban Transportation Company et al., by his repudiation of the agreement between them with reference to the distribution of the fee in that case; (3) toward his client Miss Ollie Horner, by compelling her to file suit against him for the recovery of the property (or its value) caused by Novo to be adjudicated to himself at the time when a money judgment obtained Novo for Miss Horner was sought to be satisfied a foreclosure sale; and (4) toward the Hon. R. C. Culpepper, one of the judges of the Ninth Judicial District Court.

The defendant interposed an exception of no cause of action, which we overruled. 196 La. 1072, 200 So. 466. Subsequently, the evidence in the matter was taken before Philo Coco, the Commissioner appointed by this court to receive the evidence in the case. In the report which the Commissioner has submitted to us, which is based on his findings of fact and his conclusions of law in the case, he states that in his opinion the evidence sustains the first, second, and fourth charges brought against Novo, recommending that the defendant be disciplined by this court for his professional misconduct in these respects. As to the third charge, he exonerates Novo.

The defendant has excepted to the Commissioner's report, contending (1) that he settled with the Rev. Searcy in full and according to their agreement after the termination of the Interurban Transportation Company case, pointing out that the cancelled check given by him to Searcy, the receipt signed by Searcy in full settlement, and his complete exoneration by a jury on a charge of embezzling this amount from his client sustain his contention in this respect; (2) that he was justified in refusing to divide his fee with McGregor, since McGregor after the Interurban Transportation Company case was lost the second time in the Court of Appeal for the Second Circuit, terminated his association with the case and turned over to him (Novo) his entire file in the matter, further, that even if he did owe McGregor a percentage of his fee in that case, his refusal to make a settlement of the same, under the circumstances of the case, could not form the basis of a cause for disbarment. He denies that he at any time either threatened or showed any disrespect toward Judge Culpepper of the Ninth Judicial District Court.

Lee J. Novo who has been practicing law in the city of Alexandria, Louisiana, Rapides Parish, since his admission to the bar in 1927, was employed in 1935 to bring suit against the Interurban Transportation Company, Inc., and the Tri-State Transit Company of Louisiana, Inc., by the Rev. A. Cliff Searcy, upon the recommendation of T. H. McGregor, also an attorney at law and former judge of the Court of Appeal for the Second Circuit. By the suit the Rev. Searcy sought to recover damages for his treatment while traveling on a bus of the Tri-State Transit Company from Colfax, Louisiana, to Alexandria, as well as for his treatment after his arrival in the latter city. (For particulars of the case, see Searcy v. Interurban Transp. Co., La.App., 171 So. 468; Id., La.App., 179 So. 93; and Id., 189 La. 183, 179 So. 75.) At the time that Will D. Searcy, brother of the Rev. Searcy, accompanied by Raymond C. Parker, an attorney of Winnsboro, Louisiana, and friend of the Searcy family, called on McGregor, who was well known to the Searcys, with the view of securing his services in the prosecution of the suit, he eas in the employ of the federal government and unable to take the case. However, he referred them to Novo, with whom he was favorably acquainted, and recommended him as the person to give the case every consideration, himself taking them to Novo's office, which was in the same building in which McGregor worked. Novo consented to take the case on a contingent basis, he to receive 40% of any amount that might be recovered against the transportation companies. After the case had been lost in the lower court, McGregor, who had been granted a furlough from the government in the meantime, agreed to become associated with the case while it was on appeal, he to receive a fee of 12 1/2% out of the amount recovered. After the case had been before the Court of Appeal for the Second Circuit on two different occasions, the judgment of the lower court was affirmed on June 30, 1937, Searcy v. Interurban Transp. Co., La.App., 179 So. 93, and a rehearing was denied on July 19, following. Novo then applied for and was granted a writ of certiorari by this court, in order that the judgment of the Court of Appeals might be reviewed. After due consideration, the judgments of both the district and appellate courts were reversed on January 10, 1938, Searcy v. Interurban Transp. Co., 189 La. 183, 179 So. 75, and the Rev. A. Cliff Searcy was granted a judgment against the Tri-State Transit Company of Louisiana, Inc., alone, in the amount of $3,500, which, with interest, amounted to $3,941.38 at the time of the settlement. In addition to the Rev. A. Cliff Searcy, the check in settlement of the judgment was made out in the names of Lee J. Novo, S. R. Holstein, and T. H. McGregor, at the request of McGregor. Novo refused to accept the check as thus made out and threatened to issue a writ of fi. fa. in order to collect the judgment; whereupon the Hon. Pike Hall, the attorney from Shreveport, Louisiana, representing the defendant in the matter, deposited the full amount of the judgment, together with interest, with the Hon. U. T. Downs, the Sheriff of Rapides Parish, for distribution. McGregor immediately wrote a letter to the sheriff calling to his attention the fact that he was one of the attorneys of record in the case, and, as such, entitled to an eighth of the amount held by him. He also called the sheriff's attention to the fact that S. R. Holstein of Winnsboro, Louisiana, had been an attorney of record in the case from its beginning. (It does not appear anywhere in the record that Holstein has ever at any time made claim for any portion of the amount collected from the transit company.) However, upon Novo's presentation of a power of attorney from the Rev. Searcy and his agreement to indemnify the sheriff against any damage he might suffer as the result of his release of the money, the sheriff released the entire amount to Novo. On February 19, 1938, almost immediately after securing the money, Novo drove to his client's home in Winnsboro and while there wrote out a check for $1,700.69, being the Rev. Searcy's share of the proceeds of the judgment secured against the Tri-State Transit Company under an alleged subsequent agreement entered into between Novo and the Rev. Searcy at a time when Novo visited the Rev. Searcy in the hospital, this subsequent agreement modifying the former agreement entered into at the time W. D. Searcy and Raymond C. Parker called on Novo by increasing the amount to be received by Novo from 40% of the amount recovered to 50%, after the deduction of all expenses. This settlement was made in the presence of the Rev. Searcy's mother and brother and Novo was given a receipt by the Rev. Searcy showing that the same was in 'full and final settlement' of the suit brought by the Rev. Searcy against the Interurban Transportation Company et al. The following week Novo received a letter from S. R. Holstein demanding from him the amount of $780.11, allegedly illegally retained by Novo in excess of the amount due him. This demand not being complied with, the Rev. Searcy instituted suit against Novo on March 5, 1938, for $1,000. Five days thereafter, on March 10, 1938, McGregor instituted suit against Novo and against Sheriff Downs on his own behalf, seeking to recover the sum of $492.67, his alleged share of the fee in the Searcy case. While these suits were pending in the lower court, embezzlement charges were preferred against Novo by the Rev. Searcy in the Parish of Franklin and proceedings to have him disbarred were instituted in Alexandria. He was exonerated of the embezzlement charges, but the two civil suits of Searcy and McGregor against him were prosecuted to a successful conclusion, McGregor recovering the full amount claimed by him, the Rev. Searcy recovering a judgment of $664.14. Both of these judgments, together with costs, interest, etc. (amounting to $1,372.66 in all), were paid in full by Novo, leaving him (after deducting the $1,372.66, the sum of $1,700.69 formerly paid the Rev. Searcy, and expenses...