Kennedy v. State Bar, S006373
| Decision Date | 17 April 1989 |
| Docket Number | No. S006373,S006373 |
| Citation | 770 P.2d 736,257 Cal.Rptr. 324,48 Cal.3d 610 |
| Court | California Supreme Court |
| Parties | , 770 P.2d 736 Terry L. KENNEDY, Petitioner, v. The STATE BAR OF CALIFORNIA, Respondent. |
Lawrence C. Yee, San Francisco, for respondent.
*
We review the unanimous decision of the Review Department of the State Bar Court that petitioner Terry L. Kennedy be disbarred from the practice of law in California. After considering the record and petitioner's objections, we adopt the review department's recommendation.
Petitioner is 43 years old, and was admitted to practice law in California in 1975. From 1976 to 1980, he was in partnership with Attorney MacDonald Jackson in Los Angeles. He was not steadily employed again until 1983, when he worked for a brief period for the law firm of Jacoby & Meyers. In May 1984, he accepted a position with the Los Angeles City Attorney's office, and stayed there until November 1985. Since that time, petitioner has not worked in the legal profession. The State Bar has never disciplined him previously, and no complaints have been filed against him with the State Bar since 1981.
The review department's recommendation stems from petitioner's mishandling of three cases in 1980 and 1981: the Chubbses, Williams and Gibson matters. Petitioner
does not challenge the State Bar's findings of fact in these cases.
Petitioner misappropriated over $8,000 while representing the Chubbs family in a personal injury lawsuit stemming from an automobile accident. He first failed to pay the Chubbses' medical bills from the settlement proceeds. When the Chubbses signed their contingent fee agreement, they authorized petitioner to pay their medical expenses directly from the settlement proceeds. In August 1980, petitioner settled the case with the other party's insurance carrier and gave the Chubbses a settlement disbursement statement reflecting the amounts allotted to their individual recoveries, his contingency fee, and $4,060.82 in payments to certain medical providers. Although he received the settlement funds personally, there were insufficient funds in the client trust account when he wrote checks to the Chubbs family for their recoveries. (Soon thereafter he made good on the checks.) In addition, he never paid their medical bills, yet later told them that he had. 1
Petitioner also failed to turn over money received from the Chubbses' insurance carrier. Soon after the case settled, petitioner filed claims with the Chubbses' insurance company pursuant to a medical payment provision of their policy. He received checks made out to him and the Chubbses for $4,059.98, signed their names without their authorization, and deposited the money in a client trust account. He never informed the Chubbses, however, that he had applied for the money and never gave any of it to them. Mr. Chubbs later learned about the insurance payments and telephoned petitioner, accusing him of misappropriating the money; petitioner responded "Prove it!" and hung up.
After petitioner had represented Kandice Williams for over a year in a real property matter, she grew dissatisfied with his services and retained a new lawyer. The new lawyer sent petitioner a "Substitution of Attorney" form and requested him to sign it and return it with the Williams file. Petitioner did not reply to the letter, nor to a second or third written request. The attorney finally sought relief from the superior court, which ordered the petitioner to turn over the file. Even then, he did not cooperate with Williams's new attorney. 2 In fact, petitioner sued his former client, claiming some interest in the real property. The court ultimately dismissed the action due to petitioner's failure to prosecute.
While representing Ronald Gibson in a personal injury suit stemming from an automobile accident, petitioner both misappropriated funds and refused to consent to a substitution of attorney. As he had done while representing the Chubbses, petitioner filed claims with Gibson's insurance company pursuant to a medical payment provision of his policy without informing Gibson. Petitioner received checks made out to him and Gibson for $2,155, signed Gibson's name without his authorization, and deposited them in a client trust account, but never forwarded the money to Gibson's Gibson, like Williams, grew dissatisfied with petitioner's representation of him and retained a new attorney. Petitioner, however, refused to sign the "Substitution of Attorney" form or turn over Gibson's file to his new attorney until a court ordered him to do so.
doctors. Moreover, when one of the doctors demanded payment, petitioner wrote him a bad check. Gibson was eventually forced to pay the doctors out of his settlement proceeds.
The State Bar instituted formal proceedings against petitioner on September 17, 1982, by issuing a notice to show cause for his actions in the Chubbs, Williams and Gibson matters. Hearings took place between October 1984 and October 1985; petitioner was represented by counsel throughout the proceedings and a psychiatrist testified on his behalf. The referee of the hearing panel concluded that petitioner had willfully misappropriated funds in the Chubbs and Gibson matters in violation of Rules of Professional Conduct, rule 8-101, and that he had willfully failed and refused to turn over client files in the Williams matter in violation of rules 2-111 and 6-101. He also noted that petitioner was a paranoid schizophrenic who required medication to stabilize his personality. He recommended that petitioner be suspended from the practice of law for five years, but recommended that the suspension be stayed and that petitioner be placed on probation, on condition of 90 days of actual suspension, restitution to the Chubbses and several doctors, and regular psychiatric counseling. The review department adopted the referee's findings, but increased the recommended suspension to two years and conditioned petitioner's renewed practice of law on certification by an independent psychiatrist that he is capable of working in an unsupervised environment, as well as on restitution to the Chubbses and the doctors. The department also recommended that petitioner be required to take the medication that his psychiatrist had prescribed to control his schizophrenia.
Petitioner sought review in this court. In March 1987, we returned the matter to the State Bar, however, due to its failure to provide us with a transcript of the hearings. Since neither the State Bar nor petitioner could locate a copy of the transcript, the State Bar set the matter for a hearing de novo in July 1987.
On similar findings of fact, the referee of the second hearing panel concluded that petitioner had willfully misappropriated funds in violation of Rules of Professional Conduct, rule 8-101 and Business and Professions Code, sections 6068 and 6103, and that he had committed acts involving moral turpitude and dishonesty under Business and Professions Code, section 6106. Mitigating these violations were the facts that petitioner's wrongful acts took place at the same time that his partnership with MacDonald Jackson was breaking up, and that no complaints had been filed with the State Bar since that time. The referee also took note of the time that had elapsed since the original hearings, but concluded that petitioner "did not establish any prejudice to him as a result of the delay." In aggravation, the referee emphasized that petitioner had made no effort at reimbursing his former clients or their doctors in the six years since he had misappropriated their money. He recommended disbarment.
Petitioner sought review of the decision of the hearing panel, asserting that he was denied due process because his attorney, Mr. Eagans, was unable to return from Jamaica for the hearing. Despite the fact that the hearing was noticed for July 20, 1987, Mr. Eagans left for Jamaica on July 14, intending to return by July 17. On July 17, however, Mr. Mason, a partner of Mr. Eagans, tried to obtain a continuance of the hearing after learning that Mr. Eagans would not be able to return on time. The request was denied. Mr. Mason renewed the request on the day of the hearing. The referee again refused to continue the hearing, stating that Mr. Mason had at least as much time to prepare for the hearing as In denying petitioner's request for a new hearing, the review department emphasized that petitioner never specified what evidence Mr. Eagans would have offered to the hearing panel that Mr. Mason was unable to present.
Mr. Eagans had planned to spend in preparation.
The review department unanimously accepted the referee's recommendation of disbarment. It justified the harsher recommendation on the grounds that petitioner had made no attempt to reimburse his clients or their doctors in either the year and a half since his last appearance before the State Bar or the seven years since the actual misappropriation.
Petitioner attacks the referee's denial of Mr. Mason's request for a continuance as a violation of his due process rights. To that end, he offers nine pages (over half of his petition) of a verbatim account of the portion of the hearing in which the referee denied the request, and claims that his psychiatrist could not testify at the hearing because Mr. Eagans was out of the country. However, as the review department emphasized, petitioner has not explained why Mr. Eagans's absence prevented the psychiatrist from coming to the hearing. Petitioner and Mr. Eagans received three months notice of the date of the...
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