Louisiana State Bar Ass'n v. Thalheim

• Decision Date: 06 April 1987
• Docket Number: No. 86-B-0822,86-B-0822
• Citation: 504 So.2d 822
• Parties: LOUISIANA STATE BAR ASSOCIATION v. Richard A. THALHEIM.
• Court: Louisiana Supreme Court

Page 822

504 So.2d 822

LOUISIANA STATE BAR ASSOCIATION v. Richard A. THALHEIM.

No. 86-B-0822.

Supreme Court of Louisiana.

April 6, 1987.

On Rehearing June 18, 1987.

Thomas O. Collins, Jr., G. Fred Ours, New Orleans, Gerard F. Thomas, Jr., Natchitoches, Roland J. Achee, Shreveport, Robert J. Boudreau, Lake Charles, Robert M. Contois, New Orleans, Frank J. Gremillion, Baton Rouge, Carrick R. Inabnett, Monroe, Harvey Lewis, New Orleans, Alfred S. Landry, New Iberia, Philippi P. St. Pee, Metairie, for applicant.

Richard A. Thalheim, Thibodaux, Julian R. Murray, Jr., New Orleans, for respondent.

MARCUS, Justice.

The Louisiana State Bar Association, through its Committee on Professional Responsibility, instituted a proceeding against Richard A. Thalheim, a member of said association. Prior to the commencement of this proceeding, the committee had conducted investigations of respondent's alleged misconduct in accordance with article 15, section 3 of the articles of incorporation of the association. Notice of the proceeding, which involved five specifications of misconduct, was sent to respondent by certified mail under date of October 7, 1985.

The committee held a formal investigative hearing on four of the five specifications on December 12, 1985, as provided in article 15, section 3(b) of the articles of incorporation. The committee specifically dismissed specification number 5. Respondent was present and represented by Julian R. Murray, Jr. at the hearing. Based upon the evidence adduced at the hearing, the committee, by a majority vote, was of the opinion that respondent was guilty of a violation of the laws of this state relating to the professional conduct of lawyers of sufficient gravity as to demonstrate a lack of moral fitness for the practice of law. Specifically, the committee found that the evidence supported the charges set forth in specifications 1, 2 and 3. On April 30, 1986, the committee instituted in this court a suit for disciplinary action against respondent under the provisions of article 15, section 4(c) of the articles of incorporation. Respondent answered the petition. The court, by order, then appointed Mr. Ben Louis Day as commissioner to take evidence and file a report with this court setting forth his findings of fact and conclusions of law. Louisiana State Bar Association Articles of Incorporation, article 15, section 6(b) and (d).

A hearing before the commissioner was held on September 25, 1986. Respondent was present at the hearing and was represented by counsel. The committee introduced in evidence the entire record of disciplinary proceedings, including the original pleadings filed into the record and the transcripts and original exhibits from the committee hearings, whereupon the committee rested its case. Respondent did not contest the factual allegations. However, he presented evidence of mitigating circumstances. Upon termination of the hearing, the commissioner filed with this court his written report wherein he stated his findings of fact and conclusions of law and recommended that we impose upon respondent a one-year suspension from the practice of law. The committee filed its concurrence in the commissioner's findings of fact and conclusions of law. ¹ Respondent filed an exception to the report of the commissioner insofar as its recommendation of a one-year suspension from the practice of law. After oral argument before this court, the matter was submitted for our determination on the record before the commissioner.

The bar association has the burden of establishing by clear and convincing evidence that respondent was guilty of the alleged specifications of misconduct. Louisiana State Bar Association v. Dowd, 445 So.2d 723 (La.1984).

The following allegations of misconduct have been made against respondent.

Specification No. 1 alleged:

That in your capacity as Attorney at Law, you were retained to represent one Charles E. Jones in a Workmen's Compensation claim. That said claim was settled on or about February 1, 1985, drafts were issued and received by you shortly thereafter. That two drafts were issued, one made payable to the Terrebonne General Hospital in the amount of $4,506.40, and the second draft in the amount of $49,493.60 made payable to Charles Edward Jones and his attorney, Richard Thalheim, Jr. That on or about February the 5th of 1985, you did deposit the draft in the amount of $49,493.60 into one of your bank accounts. That in spite of the demands of your client, you did fail, neglect, and refuse to disburse funds to the client until April 1, 1985. That you have failed to promptly pay or deliver to the client the client's funds which the client was entitled to receive, that you have engaged in conduct that is prejudicial to the administration of justice. That you have engaged in conduct that adversely reflects on your fitness to practice law in violation of Disciplinary Rules DR 9-102(B)(4) ² and DR 1-102(A)(5)(6) ³ of the Code of Professional Responsibility of the Louisiana State Bar Association.

Specification No. 2 alleged:

That in connection with the above detailed settlement of Charles E. Jones, you did on or about February 5th, 1985, deposit the draft in the amount of $49,493.60 into an account numbered 12-15700324-03 with the First Financial Bank. That said account was not an attorney's trust or escrow account, and did, in fact, contain funds belonging both to yourself and to clients. That the client did not receive any of his funds until April 1, 1984, and that you have comingled [sic] and converted funds in violation of Disciplinary Rules DR 9-102 ⁴ and DR 1-102 ⁵ of the Code of Professional Responsibility of the Louisiana State Bar Association.

Specification No. 3 alleged:

That on or about April the 1st, 1985, funds were distributed by you in the settlement of Charles E. Jones Workmen's Compensation case. That said settlement was for the total amount of $54,000.00. That you did charge an attorney's fee of $7,400.00 which is an excessive fee under the Workmen's Compensation statute and is in violation of Disciplinary Rules DR 2-106(A) ⁶ and DR 1-102(A)(5)(6) ⁷ of the Code of Professional Responsibility of the Louisiana State Bar Association.

The facts as set forth in the above specifications are generally not in dispute. Evidence submitted at the investigative hearing established that respondent was retained by Mr. Charles E. Jones to represent his interests in a worker's compensation claim. On February 5, 1985, judicial approval was obtained for settlement of Jones' claim and respondent received and deposited a settlement draft in the amount of $49,493.60 into a checking account used in connection with his law practice. He then advised Jones that it would take approximately ten days for the draft to clear. The checking account into which the settlement proceeds were deposited was not a trust account and in fact was an account containing client and personal funds. The account was used, among other things, to pay the firm's general operating expenses as well as at least some renovation costs of a building into which respondent ultimately moved his practice. During the time in question, respondent did not have a specific account which acted as a trust or escrow account. He operated his law practice through several checking accounts in which running balances were not kept.

On March 18, the bar association received a complaint from Jones attached to which was his South Central Bell telephone bill. It disclosed that Jones called respondent's office 23 times on various dates between February 15 and March 13, 1985. These calls were made regarding disbursement of his settlement. Respondent received notice of Jones' complaint from the association on March 25. Respondent then borrowed $35,100.00 from his mother and deposited those funds into his operating account on April 1, 1985 in order to make the Jones disbursement of $24,238.43, representing his portion of the settlement. Immediately prior to that disbursement, respondent's combined office bank balances totaled only $7,566.79.

The attorney fee which respondent charged Jones in connection with the settlement exceeded by $1,000.00 the statutory fee. Respondent ascribed this error to the inexperience of Mrs. Thalheim, then the employee in charge of preparing such disbursements. The fee question was raised with respondent on or about June 7, 1985 by letter from counsel for the committee. On July 11, 1985, respondent issued a check to Jones for the full fee differential, plus interest.

Respondent presented the following evidence in mitigation of his conduct. He alleges that he was ignorant of the Disciplinary Rules requirement that funds belonging to clients be maintained in a separate clients' trust account. At the time respondent attended Harvard Law School, he claims not to have taken an ethics course as it was not a requirement for graduation from the law school.

Respondent further urges that at the time in question, he was singlehandedly managing over 450 active client files assisted only by a secretary and a bookkeeper. Realizing he needed additional staff and a larger office location, he began remodeling a building to provide new office space in November 1984 and hired an attorney to become associated with him in January 1985. Respondent concluded a lengthy trial in federal court on January 18 in which he secured a 1.6 million dollar judgment for another client. On January 19, he was married and left the country on his honeymoon, returning on January 29. On February 2, his new associate left the office for a week to go on a previously arranged vacation and respondent was faced with numerous post trial motions in connection with the recently concluded trial. It was during this time that the Jones settlement was finalized (February 5). Renovations continued on his new office until the office was moved around March 1. Respondent contends that his delay in concluding the Jones...