Iowa Supreme Court Attorney Disciplinary Bd. v. Mendez, 14–0426.

Decision Date05 September 2014
Docket NumberNo. 14–0426.,14–0426.
Citation855 N.W.2d 156
PartiesIOWA SUPREME COURT ATTORNEY DISCIPLINARY BOARD, Complainant, v. Richard Clay MENDEZ, Respondent.
CourtIowa Supreme Court

Charles L. Harrington and Nicholas Tré Critelli, Des Moines, for complainant.

Jeffrey David Norris of Law Office of Richard Mendez, Des Moines, and Valerie Lynn Hanna of Law Office of Valerie Lynn Hanna, Glendale, California, for respondent.

Opinion

WATERMAN, Justice.

The Iowa Supreme Court Attorney Disciplinary Board brought a complaint against Richard Clay Mendez, charging numerous violations of Iowa's disciplinary rules. Mendez is not licensed to practice law in Iowa but acquired a Des Moines-based immigration practice and represented Iowa residents in federal immigration proceedings. A division of the Grievance Commission of the Supreme Court of Iowa determined Mendez violated certain rules governing trust accounts, fees, referrals, conflicts of interest, and neglect. The commission, with one member not participating in its deliberations, recommended we order Mendez to cease and desist from the practice of law in Iowa for a period of not less than sixty days, the period recommended by the Board. On our de novo review, we find Mendez violated our rules and order him to cease and desist from practicing law in Iowa for sixty days.

I. Background Facts and Proceedings.

Mendez has been licensed to practice law in California since 1998, but is not admitted to the Iowa bar. He practices chiefly in California, most recently from an office in Burbank. His practice is primarily immigration law, with some criminal defense work. Mendez began practicing in Iowa in July 2011, when he took over two branches of an immigration practice, ASESAL Immigration Services. One branch of ASESAL was located in Des Moines and the other in Grand Island, Nebraska. Mendez assumed representation of ASESAL's clients and retained the majority of ASESAL's staff. He renamed both branches Law Office of Richard Mendez.”

Mendez stated that his Iowa practice is limited to providing legal services to Iowa residents on federal immigration matters, which is permitted by the Iowa Rules of Professional Conduct. See Iowa R. Prof'l Conduct 32:5.5(d)(2) (“A lawyer admitted in another United States jurisdiction, and not disbarred or suspended from practice in any jurisdiction, may provide legal services in this jurisdiction that ... are services that the lawyer is authorized to provide by federal law or other law of this jurisdiction.”). Federal law allows a member in good standing of any state's bar to practice before the federal immigration court. See 8 C.F.R. §§ 1001.1(f), 1292.1(a)(1) (2011).

Mendez's handling of his Iowa immigration practice resulted in ethics complaints by clients, successor counsel, and ultimately the Board, arising out of the following matters.

A. Trust Account Practices. Shortly after purchasing the ASESAL offices, Mendez opened a client trust account, as required by the Iowa Court Rules and the Iowa Rules of Professional Conduct. See Iowa Ct. R. 45.10(2) (“Funds a lawyer receives from clients or third persons for matters arising out of the practice of law in Iowa shall be deposited in one or more identifiable interest-bearing trust accounts located in Iowa.”); see also, e.g., Iowa R. Prof'l Conduct 32:1.15(c). On August 31, Mendez and his Iowa counsel met with the director of the Office of Professional Regulation, the assistant director for boards and commissions for the Office of Professional Regulation, and the client security auditor. One of the purposes of the meeting was to discuss the need for Mendez to comply with Iowa's rules governing client trust accounts. Mendez was provided with a copy of the trust account rules. Those rules included requirements that an attorney provide notice and an accounting to clients upon withdrawing funds. Mendez concedes he failed to provide notices and accountings to forty-three clients upon withdrawal of funds.

B. Nonrefundable Fees. Mendez's written contracts with two clients, Rigoberto Flores and Miguel Angel Arechiga Cuellar, provided that Mendez could charge a $300 minimum fee merely for opening the file, regardless of whether any legal services were provided. The contracts stated: “ATTORNEY reserves the right to charge the minimum fee of $300 by opening the file, if that customer decides to end the contract before accumulating legal fees.”

C. Rigoberto Flores Representation. In September 2011, Rigoberto Flores was charged with fraudulent practices in the third degree, in violation of Iowa Code section 714.11, and identity theft, in violation of Iowa Code section 715A.8. These offenses are aggravated misdemeanors. On September 16, Flores engaged Mendez to represent him and paid Mendez $1000 of their agreed $1500 flat fee for the criminal representation.

Mendez engaged an Iowa-licensed criminal attorney, John D. Hedgecoth, to enter an appearance on Flores's behalf. Mendez stated, [I]t would have been easier to just refer him, but I facilitated the agreement for Mr. Hedgecoth to represent Mr. Flores in the criminal matter.” Mendez and Hedgecoth orally agreed that Hedgecoth would be paid an hourly rate for his services from the $1000 Flores advanced to Mendez. When asked if he could give legal advice on criminal matters, Mendez responded, “Not on criminal matters as pertains to Iowa, but if it was criminal matters relating to immigration consequences, then yes, I believe so.” Mendez testified he never told Flores that he was an Iowa-licensed attorney.

Mendez admits that he did not seek or receive Flores's written approval of the fee-splitting arrangement with Hedgecoth. He likewise failed to give Flores written notice of the withdrawal of any fees paid to his firm or to Hedgecoth's firm. Hedgecoth's billing records show that he ultimately provided Flores with $558 of legal services, but Mendez's records reflect that he paid Hedgecoth $808 out of Flores's account. On top of the $558 paid to Hedgecoth, Mendez billed Flores $1370 for “administrative support.” Flores paid Mendez a total of $1250, making Mendez's net on the case $442 after payments to Hedgecoth.

Flores ultimately entered guilty pleas on both charges. The Board asserts Mendez never personally spoke with Flores or Hedgecoth about the immigration implications of Flores's criminal case, and that Mendez did not advise Flores of the immigration consequences of entering a guilty plea to the charged offenses. Mendez asserts the disposition of Flores's case was unavoidable and denies the allegations that he never personally spoke with Flores and Hedgecoth about the immigration consequences of Flores's guilty pleas. A postconviction court later granted Flores relief, finding that his guilty pleas were not intelligent, knowing, and voluntary because Flores was not informed in Spanish of each guilty plea's potential impact on his immigration status.

When asked if he could explain his fee for administrative support, Mendez stated, “Mr. Flores came to the ... office on, almost on a daily basis asking about his case.... I think we even sent interpreters to interpret for him.... And there was a lot of assistance there.” These services were not itemized or noted in Flores's file. However, the postconviction relief ruling found that a legal assistant from Mendez's office attended Flores's initial meeting with Hedgecoth at the jail to act as a translator.

D. Sergio Guaillas Representation. Sergio Guaillas is a non-United States citizen who was initially represented by another attorney on a visa petition. Guaillas's petition was denied on September 8, 2011. His letter of denial informed him that he had thirty-three days from the date of the letter, or until October 8, to file his notice of appeal.

On September 21, after terminating his first attorney's services, Guaillas spoke with a member of Mendez's staff and engaged Mendez to handle his appeal. That same day, someone in Mendez's office researched Guaillas's appeal.

Mendez failed to file the requisite notice of appeal by the October 8 deadline. Mendez testified he was unable to file the appeal because his office could not get the proper documents from Guaillas's previous attorney. Mendez further testified he orally informed Guaillas of his failure to file the notice of appeal and that this failure could constitute grounds for ineffective assistance of counsel and support a basis to reopen the matter. Nevertheless, Mendez could provide no documentation substantiating this assertion.

On February 16, 2012, Guaillas retained the services of yet another immigration attorney, James Benzoni. The same day, Benzoni provided Mendez with a formal request to transfer Guaillas's file. Mendez testified that he immediately mailed the file, but has no documentation of doing so. Benzoni did not receive the file. In late March, Benzoni again contacted Mendez asking for Guaillas's file. On April 24, Benzoni filed a disciplinary complaint against Mendez. On June 14, Mendez provided Benzoni with Guaillas's immigration file.

Guaillas filed his own disciplinary complaint against Mendez. In his response to this complaint, Mendez stated that he had met with Guaillas on September 21, 2011, and that [a]fter consultation, Mr. Guaillas agreed to retain [him] as his attorney.” Mendez's paralegal also submitted a declaration stating Guaillas signed a retainer agreement with Mendez on September 21. Mendez testified at the hearing before the commission that he had met with Guaillas before November.

But, Mendez's internal billing and time records contradict his testimony. His records show the first time he personally met with Guaillas was well after the October 8 appeal deadline. The September 21 notation in the file states that Guaillas “spoke with RF,” a staff member in the office. The first file notation indicating Mendez met with Guaillas is dated November 18, and Mendez's invoice to Guaillas includes a November 18 entry stating, “Attorney Richard Mendez met with Mr. Guaillas.”

E....

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