Iowa Supreme Court Attorney Disciplinary Bd. v. Wright

• Citation: 840 N.W.2d 295
• Decision Date: 06 December 2013
• Docket Number: No. 13–0780.,13–0780.
• Parties: IOWA SUPREME COURT ATTORNEY DISCIPLINARY BOARD, Complainant, v. Robert Allan WRIGHT Jr., Respondent.
• Court: United States State Supreme Court of Iowa

840 N.W.2d 295

IOWA SUPREME COURT ATTORNEY DISCIPLINARY BOARD, Complainant,

v.Robert Allan WRIGHT Jr., Respondent.

No. 13–0780.

Supreme Court of Iowa.

Dec. 6, 2013.

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

Alfredo G. Parrish of Parrish, Kruidenier, Dunn, Boles, Gribble, Parrish, Gentry & Fisher, LLP, Des Moines, for respondent.

HECHT, Justice.

The Iowa Supreme Court Attorney Disciplinary Board (Board) charged Robert Wright Jr. with violations of the Iowa Rules of Professional Conduct based on Wright's conduct in persuading several of his clients to loan money to another client. A division of the Grievance Commission of the Supreme Court of Iowa found Wright's actions violated several ethical rules and recommended a suspension of his license to practice law. Wright has appealed from the commission's recommendation. After reviewing the record, we find Wright committed ethical violations warranting a suspension.

I. Factual and Procedural Background.

Wright was admitted to the bar and began practicing law in 1981. He developed a general practice, handling criminal cases, family law matters, personal injury and workers' compensation claims, and employment discrimination cases. While representing Floyd Lee Madison in a criminal case in 2011, Wright was presented with documents purporting to evidence that Madison was the beneficiary of a large bequest from his long-lost cousin in Nigeria. Madison represented to Wright that upon payment of $177,660 in taxes owed on the inheritance in Nigeria, the sum of $18,800,000 would be released to Madison. He asked Wright to represent him in securing the transfer of the funds from Nigeria. In consideration for a fee equal to ten percent of the funds recovered, Wright agreed to represent Madison in the Nigerian transaction.

Wright was at that time representing Danny Wayne Rynearson in a pending felony criminal case. Wright knew Rynearson might have funds that Madison could borrow for the purpose of paying the taxes and fees on the Nigerian funds. Armed with this knowledge, Wright approached Rynearson about his willingness to make a loan to Madison. Wright arranged a meeting in his office between Madison, Rynearson, and Rynearson's wife. As a consequence of the meeting, the Rynearsons agreed to make the loan to Madison and drew a check on June 9, 2011, in the amount of $12,000 payable to Wright. Wright prepared and signed a letter dated June 9, 2011, confirming the agreement that his client Rynearson would loan Madison the sum of $12,000 for the purpose of paying the Nigerian tax. Madison signed the document promising to pay Rynearson the sum of $50,000 “upon receipt of [the] inheritance funds.” Wright deposited Rynearson's check in his trust account. Believing more funds were needed to complete the transaction, Wright informed the Rynearsons that he was in immediate need of an additional $12,500 and desperately needed their help. Mrs. Rynearson drew a check in the amount of $12,500 payable to Wright on August 1, 2011. Wright also deposited that check in his trust account. ¹

Wright was also representing Linda Putz at that time in a pending workers' compensation case. The case was nearing completion, and Wright and Putz were awaiting receipt of proceeds of a settlement. Knowing Putz would soon net approximately $25,000 from the settlement, Wright informed her Madison hoped to borrow money to pay Nigerian authorities for an “anti-terrorism certificate” and inquired whether Putz would be willing to loan the sum of $12,500 for this purpose. In a letter to Putz dated August 12, 2011, Wright memorialized a proposed loan agreement calling for Madison to repay the loan with a payment of $50,000 upon his receipt of the inheritance which was anticipated “before August 24, 2011.” Putz later agreed to loan Madison an additional $12,500, and thus loaned the entire net proceeds of her settlement to Madison in consideration for his promise to pay her $100,000 upon receipt of the inheritance from Nigeria. All of the proceeds of Putz's loans to Madison were deposited in Wright's trust account.

The Board subsequently filed a complaint alleging Wright had violated several rules of professional conduct in his transactions with Danny Wayne Rynearson and Putz. Shortly before the hearing on the complaint in front of the grievance commission, Wright presented to the Board a “Disclosure Statement” revealing for the first time that he had also solicited loans for Madison from three other clients in furtherance of the Nigerian transaction.² The statement admitted Wright had solicited and received from Toryan White a loan for Madison in the amount of $7000. The statement also revealed Wright solicited a loan for Madison from another client, Vern Stodden, in the amount of $160,000.³ Lastly, the statement disclosed Wright had solicited and obtained for Madison a loan in the amount of $20,000 from Bob Nunneman. Wright stipulated that he failed to advise White, Stodden, and Nunneman that they should seek independent counsel before making the loans to Madison. Denying that he derived any financial gain from these transactions, Wright urged the grievance commission to consider his voluntary disclosure as a mitigating factor in its determination of the appropriate sanction in this case.

Although Wright's disclosures of additional loan transactions on the eve of the hearing before the commission were a surprise to the Board, no objection was raised to the disclosure statement when it was offered and received in evidence by the grievance commission. In its posthearing brief, the Board urged that Wright's admitted conduct in the transactions with White, Stodden, and Nunneman be considered as an aggravating factor in the determination of the appropriate sanction for any violations committed in the transactions with Rynearson and Putz, on the ground that Wright's conduct involving White, Stodden, and Nunneman was part of a pattern arising from the same Nigerian transaction for which loans made by Rynearson and Putz were solicited.

In the course of his work on behalf of Madison in pursuit of the Nigerian inheritance, Wright communicated with persons he believed were representatives of the “Central Bank of Nigeria,” the “African Union,” and the President of Nigeria. Wright also communicated with Okey Okafor, a person who claimed to be the Nigerian lawyer who had witnessed the decedent's will. Wright also had communications with a person who claimed to be a lawyer in England named Johnson Walkers. Walkers claimed he had, on Madison's behalf, traveled to Nigeria and investigated the legitimacy of the inheritance.

Wright apparently transferred to others all of the loan proceeds he collected from his clients on behalf of Madison.⁴ As the story developed, Wright and Madison were told the inherited funds would be released by the Nigerian authorities for transfer to the Royal Bank of Canada. Later, however, Wright and Madison were told the inheritance—in the form of U.S. currency—had been shipped (for reasons not detailed in the record) in two trunks to Spain where the trunks supposedly came into the possession of a “diplomat” in Madrid. The diplomat demanded payment of €25,600 (25,600 Euros) for his “logistic charges” in return for possession of the trunks. He instructed Wright and Madison to conceal the foreign currency in their luggage ⁵ and travel to Madrid where they were to pay the logistics charges and take possession of the property. Madison traveled to Spain and later told Wright he had seen the two suitcases but failed—for reasons not explained in the record—to obtain possession of them.

Madison recovered no funds from the supposed Nigerian inheritance. As no funds were recovered by Madison, Wright received no compensation for his professional services in the matter. The loans made to Madison by the Rynearsons, Putz, White, Stodden, and Nunneman have not been repaid.

Wright's license is currently suspended under an order of this court entered on August 16, 2012. The current suspension was imposed as a consequence of Wright's failure to cooperate with the efforts of the Client Security Commission to perform an audit of his lawyer trust account.

II. The Board's Complaint.

The Board filed a complaint alleging Wright's conduct in the transactions with Rynearson and Putz violated the following rules: (1) 32:1.1 (requiring representation of a client with the legal knowledge, skill, thoroughness, and preparation reasonably necessary for the representation); (2) 32:1.7 (requiring disclosure and client consent if representing a client when the representation involves a concurrent conflict of interest); (3) 32:1.8(a) (requiring disclosure and client consent when entering into a business transaction with a client or knowingly acquiring an ownership interest or other pecuniary interest adverse to a client); (4) 32:1.8(b) (requiring disclosure and client consent when using information relating to representation of a client to the disadvantage of the client); (5) 32:8.4(c) (prohibiting engagement in conduct involving dishonesty, fraud, deceit, or misrepresentation); and (6) 32:1.2(d) (prohibiting assisting a client in conduct the lawyer knows to be illegal or fraudulent).

III. The Commission's Report.

The Board's posthearing brief withdrew the allegation that Wright violated rule 32:1.2(d) by assisting a client in conduct Wright knew to be illegal or fraudulent. The Board made this withdrawal based on its view that “Wright clearly believed in the legitimacy of Madison's inheritance....” Noting “Wright appears to have honestly believed—and continues to believe—that one day a trunk full of ... one hundred dollar bills is going to appear upon his office doorstep,” the Board asserted before the commission that Wright's conduct might aptly be described as delusional, but not fraudulent.

The commission's report found by a convincing preponderance of the evidence that Wright's...