KENTUCKY BAR ASS'N v. Marcum

• Decision Date: 22 April 2010
• Docket Number: No. 2010-SC-000105-KB.,2010-SC-000105-KB.
• Citation: Kentucky Bar Ass'n v. Marcum, 308 SW 3d 200 (Ky. 2010)
• Parties: KENTUCKY BAR ASSOCIATION, Movant, v. Leo MARCUM, Respondent.
• Court: Supreme Court of Kentucky

308 SW 3d 200

KENTUCKY BAR ASSOCIATION, Movant, v. Leo MARCUM, Respondent.

No. 2010-SC-000105-KB.

Supreme Court of Kentucky.

April 22, 2010.

OPINION AND ORDER

Leo Marcum, KBA Member No. 43870, was admitted to the practice of law in Kentucky in 1971. His bar roster address is P.O. Box 178, Lowmansville, Kentucky 41232. Now before this Court are two KBA files which allege Marcum engaged in professional misconduct. KBA File No. 12492 concerns Marcum's representation of Ella Pauley, and KBA File No. 11629 concerns Marcum's representation of Elmer and Evaleena Mullins. The Trial Commissioner's amended report recommended that Marcum be adjudged guilty of the majority of the charges in both files and that he receive a one-year suspension from the practice of law in Kentucky to run consecutively and separately from sanctions he has received in previous disciplinary matters. Since neither Marcum nor the KBA filed a notice of appeal pursuant to SCR 3.360(4) we now enter a final order pursuant to SCR 3.370(10) adopting the Trial Commissioner's recommendation.

FINDINGS OF FACT

The Trial Commissioner made the following Findings of Fact which, pursuant to SCR 3.370(10), we adopt as our own.

File No. 12492-ELLA PAULEY

Ella Pauley hired Marcum on April 14, 1999, to represent her in a personal injury claim arising from a car wreck. In September 2000, Marcum filed suit against tortfeasor Barry McClanahan in Fayette Circuit Court. However, the address Marcum believed McClanahan lived at was incorrect, and McClanahan was not given notice of the lawsuit nor ever found. Marcum apparently made no other effort to contact McClanahan and on October 30, 2002, the Fayette Circuit Court sent Marcum a CR 77.02 Notice to dismiss the claim for lack of prosecution. Subsequently, on March 14, 2003, the Fayette Circuit Court dismissed the case for lack of prosecution.

On May 14, 2004, Marcum found a new address for a Barry McClanahan and asked the Fayette Circuit Clerk to issue another summons to the McClanahan at that address. On June 18, 2004, Marcum filed a motion to redocket Ms. Pauley's case stating that McClanahan had been found. Marcum's representation that McClanahan had been found, however, was not true. The motion was granted by the Fayette Circuit Court on July 14, 2004.

On July 16, 2004, the McClanahan who was served with notice of the lawsuit called Marcum's office and talked to someone other than Marcum. This person claimed he was not the McClanahan involved in the accident with Ms. Pauley. Marcum did not follow up after learning this information. In August 2004, Marcum asked the Fayette County Sheriff to locate McClanahan and was eventually told in September 2004 that McClanahan had moved to an unknown address. Marcum apparently made no other efforts to locate McClanahan and the case was subsequently dismissed again since McClanahan was not served.

During all of this, the record indicates that Marcum never notified Ms. Pauley of the notice to dismiss for lack of prosecution, the dismissal, or the reinstatement of her case. Further, Marcum did very little to represent Ms. Pauley and gave most of the work on the case to other staff members. Marcum does admit that he failed to respond to KBA letters and requests for information during its investigation into this matter.

Based on these actions, the Inquiry Commission charged Marcum on December 15, 2005, with five counts of misconduct. Count one alleged a violation of SCR 3.130-1.1 for failure to properly represent Ms. Pauley. Count two alleged a violation of SCR 3.130-1.3 for failure to act with reasonable diligence and promptness in representing Ms. Pauley. Count three alleged a violation of SCR 3.310-1.4(a) for failure to keep Ms. Pauley reasonably informed about the status of her case and failure to comply with her requests for information. Count four alleged a violation of SCR 3.130-3.2 for Marcum's failure to take reasonable efforts to expedite litigation in Ms. Pauley's interest. Count five alleged a violation of SCR 3.130-8.1(b) for failure to respond to the KBA's requests for information in connection with this disciplinary matter.

File No. 11629-ELMER AND EVALEENA MULLINS

Sometime in late May or early June, 2003, Elmer and Evaleena Mullins hired Marcum to collect $1,930.00 they paid to builder John Burchett. Marcum called Burchett while the Mullinses were meeting with him and demanded that he return the money. Burchett complied and gave Marcum the money within a few days. Marcum in return gave the Mullinses a check in the amount of $1,630.00, retaining $300.00 for his services. The Mullinses however returned the check and decided that they wanted to sue Burchett for $4,000.00 to recoup attorney fees and other costs. Marcum agreed to represent them and said he would file suit, charging them a one-third contingency fee. However, Marcum provided no written agreement about costs and attorney fees. No evidence has ever been presented to indicate that Marcum filed suit against Burchett. Mrs. Mullins tried to contact Marcum multiple times in the following months but was not successful. In May or June 2005, Mrs. Mullins asked Marcum to return the $1,630.00 to her. She never heard from him and she never received the money. Evidence indicates that Marcum's escrow account has less than the $1,630.00 the Mullinses requested.

In June, 2004, the Office of Bar Counsel requested information from Marcum relating to the Mullins' case. Marcum did not respond. In December 2004, the KBA sent another letter asking for an explanation of the matter and a copy of the escrow record. Marcum did not respond.

On September 9, 2005, the KBA sent Marcum a reminder letter of his failure to respond. This letter also advised him that a review of his escrow account at the Inez Deposit Bank, which the Inquiry Commission had subpoenaed, did not reflect that the money Burchett gave him had been refunded to him. The letter also informed Marcum that his escrow account had a negative balance. Bar Counsel asked Marcum to provide verification that he was keeping money from third parties in his possession in a separate bank account where the bank would notify the KBA if an overdraft occurred. Marcum failed to respond to the letter or any of the KBA's requests for information.

The record discloses that Marcum co-mingled his personal funds with money belonging to third-parties. At the Trial Commissioner hearing, Marcum admitted that "sometimes we have a lot of money in the escrow account that belongs to me." Further, evidence presented at the hearing demonstrated that, from his escrow fund, Marcum advanced to individuals who were not entitled to escrow funds at least $1,000.00, loaned himself money of at least $1,500.00, wrote checks to his son for at least $500.00, wrote checks for cash, wrote a check to West Group for $5,342.00, and wrote a check for $4,000.00 to Premier Motors for a van for the business.

Based on these actions, the Inquiry Commission filed charges against Marcum on December 27, 2007, alleging six counts of professional misconduct. Count one alleged a violation of SCR 3.130-1.3 for Marcum's failure to act with reasonable diligence and promptness in representing the Mullinses. Count two alleged a violation of SCR 3.310-1.4(a) for failure to keep the Mullinses reasonably informed about the status of their case and his failure to promptly comply with their reasonable requests for information. Count three alleged a violation of SCR 3.130-1.15(a) for failure to maintain separate accounts for third-party or client property where the bank would notify the KBA in case of an overdraft. Count four alleged a violation of SCR 3.130-1.15(b) for either failing to deliver funds belonging to Burchett or to the Mullinses or hold said funds in a trust until the resolution of the matter. Count five alleged a violation of SCR 3.130-8.1(b) for failure to respond to letters sent by the KBA requesting information on this disciplinary matter. Count six alleged a violation of SCR 3.130-8.1(c) for professional misconduct by taking $1,630.00 that belonged to the Mullinses to file a lawsuit against Burchett, and then failing to file the lawsuit or return the money.

CONCLUSIONS OF LAW

The Trial Commissioner held a hearing on June 4, 2009. Following the hearing, the Trial Commissioner made the following Conclusions of Law in...