Kentucky Bar Ass'n v. Geisler

• Decision Date: 30 January 1997
• Docket Number: No. 96-SC-704-KB,96-SC-704-KB
• Citation: 938 S.W.2d 578
• Parties: KENTUCKY BAR ASSOCIATION, Movant, v. Maria T. GEISLER, Respondent.
• Court: United States State Supreme Court — District of Kentucky

Page 578

938 S.W.2d 578

KENTUCKY BAR ASSOCIATION, Movant, v. Maria T. GEISLER, Respondent.

No. 96-SC-704-KB.

Supreme Court of Kentucky.

Jan. 30, 1997.

OPINION AND ORDER

The Board of Governors of the Kentucky Bar Association [hereinafter KBA], as a result of charges instigated against respondent, Maria T. Geisler of Louisville, found her guilty of violating SCR 3.130-4.1 by failing to divulge the fact of her client's death to opposing counsel prior to entering into and consummating settlement negotiations. Neither the KBA nor the respondent requested review of this case. However, this Court, on its own motion, elected to review the question of whether the respondent's actions were within the scope of SCR 3.130-4.1.

The critical facts in the present case involve respondent's filing of a civil action on behalf of Milton F. McNealy for injuries he sustained when he was struck by an automobile while walking along a street in Louisville, Kentucky on November 26, 1993. Subsequent to the filing of the initial complaint, defendant's counsel, P. Kevin Ford, filed a notice to take the deposition of McNealy. Respondent contacted Ford and told him that McNealy was physically unable to give a deposition since he was in very poor health. Consequently, the deposition of McNealy was never taken.

McNealy died on January 26, 1995. Shortly thereafter respondent contacted Ford and stated that her client wanted to settle the case and asked him to forward an offer of a settlement. After an exchange of offers and counter-offers, a settlement was reached on February 9, 1995. On February 23, 1995, McNealy's son, Joe, was duly appointed as the administrator of his father's estate. Ford eventually forwarded the settlement documents along with a settlement check to respondent on March 13, 1995. On March 22, 1995, Ford received back the settlement documents which had been executed by Joe. Upon receipt of the signed documents, Ford learned for the first time of McNealy's death. Ford took no further action to bring the court's attention to the settlement documents that were signed by the Administrator, but instead, sent the agreed order of dismissal to the circuit court which was signed and entered by the court. No appeal was taken.

Thereafter, Ford filed a bar complaint against respondent on May 5, 1995 due to her failure to advise Ford that her client, McNealy, had passed away during the settlement negotiation period of January 26, 1995 through February 9, 1995. The chair of the inquiry tribunal of the KBA charged respondent with violating SCR 3.130-4.1 for failing to divulge the fact of her client's death to opposing counsel prior to entering into and consummating settlement negotiations. After submission to the Board of Governors, the Board determined that respondent was guilty of the charge and recommended to this Court that it issue a private reprimand and a public opinion against an unnamed attorney for the benefit of other members of the KBA.

In its recommendation to this Court, the KBA noted that there is no KBA Ethics Opinion on point with this matter and no Kentucky case law dealing directly with this issue. However, the American Bar Association Standing Committee on Ethics and Professional Responsibility [hereinafter ABA], squarely addressed this issue when it issued Formal Opinion 95-397 entitled, "Duty to Disclose Death of Client."

Deciding that counsel has the duty to disclose the death of her client to opposing counsel and to the court when the counsel next communicates with either, the ABA specifically stated in its opinion:

When a lawyer's client dies in the midst of the settlement negotiations of a pending lawsuit in which the client was the claimant, the lawyer has a duty to inform opposing counsel and the Court in the lawyer's first communications with either after the lawyer has learned of the fact.

ABA Standing Committee on Ethics and Professional Responsibility, Formal Opinion 95-397 (1995).

The ABA's opinion further addressed the question of whether an attorney even has authority to act when her client dies. The opinion determined that prior to death, a lawyer acts on behalf of an identified client. Id. When the death occurs, however, the lawyer ceases to represent that identified client. Id. The ABA maintained that any subsequent communication to opposing counsel with respect to the matter would be the equivalent of a knowing, affirmative misrepresentation should the lawyer fail to disclose the fact that she no longer represents the previously identified client. Id.

Basically, the ABA determined that a lawyer must inform her adversary of the death of her client in her first communication with the adversary after she has learned of that fact. Id. Likewise, the lawyer must also inform her adversary, in the same communication, that the personal representative, if one has been appointed, of her former client is accepting the outstanding settlement offer. Id. Thus, the ABA concluded that a failure to disclose the death of a client is tantamount to making a false statement of material fact within the meaning of Model Rule 4.1(a) (the precursor to our SCR 3.130-4.1). Id.

Respondent argues that the ABA's opinion should not apply to her as it was issued on September 18, 1995, many months after the relevant facts in this disciplinary proceeding. She further maintains that ABA Opinion 95-397 is subject to conflicting conclusions and, thus, should not be followed.

Relying on the additional comments to SCR 3.130-4.1, respondent contends that she did have a duty to disclose "facts" or "evidence." Respondent asserts, however, that an attorney is typically not required to affirmatively reveal evidence that is unknown and potentially helpful to the adverse party. Respondent further maintains that McNealy's death had no significant bearing on the ultimate settlement that was achieved, and that Ford did not oppose the settlement even after it was revealed that McNealy was dead. Finally, respondent contends that Ford knew McNealy had been in poor health and that McNealy's death was a matter of public record reported in the daily newspaper. Respondent argues that she felt she had an ethical...