Matter of Hanratty
| Citation | 277 NW 2d 373 |
| Decision Date | 16 March 1979 |
| Docket Number | No. 48374.,48374. |
| Parties | In the Matter of the Application for the Discipline of Gerald Hubert HANRATTY, an Attorney at Law of the State of Minnesota. |
| Court | Supreme Court of Minnesota (US) |
R. Walter Bachman, Jr., Administrative Director on Professional Conduct, Lawyers Professionality Bd., St. Paul, for petitioner.
Herbert C. Davis, St. Louis Park, J. W. Cragg, Minneapolis, for respondent.
Considered and decided by the court en banc.
These proceedings are before the Court on a petition for the discipline of Gerald Hubert Hanratty, an attorney at law, brought by the Administrative Director on Professional Conduct, at the direction of the Lawyers Professional Responsibility Board. The basic facts are not in dispute.
Gerald H. Hanratty has been a member of the Minnesota Bar since 1952. In 1965 Hanratty represented Jerry Agar in a tort action and thereafter in his business affairs. In 1968 Agar was divorced and his ex-wife was given possession of their house. The judgment provided that should Mrs. Agar remarry, the house was to be sold and the proceeds divided between Mr. and Mrs. Agar. When Mrs. Agar remarried in 1971, judgments and liens against Agar made it impossible to sell the property. As a result the Family Court of Hennepin County entered a money judgment against Agar in favor of Mrs. Agar to the extent of her interest in the property.
In September 1972, Midwest Federal Savings and Loan Association (hereinafter Midwest) foreclosed its first mortgage on the property. At the foreclosure sale Midwest received the Sheriff's Certificate of Sale after bidding the balance then due on the mortgage plus foreclosure costs. A few days before the redemption period expired, Agar told Hanratty that Midwest had agreed to transfer title to anyone Agar specified upon payment of the mortgage balance due plus expenses. Agar wanted Hanratty to provide $7,500, to take title to the property and to transfer title to a party Agar had already lined up. Hanratty was to receive $1,000 as his fee as well as payment of all of his fees due for legal services previously rendered Agar. Hanratty agreed and, approximately one week later, Agar brought an assignment of the Sheriff's Certificate of Sale to Hanratty who gave Agar a check for $7,500 payable to Agar. Title had been transferred to Hanratty during the period of redemption, but Hanratty contends that he believed he was buying Midwest's title, not redeeming for Agar. During the redemption period, none of Agar's creditors had attempted to redeem the property though it was worth substantially more than Midwest had bid.
Hanratty immediately made arrangements to sell the property to the Prossers, the party Agar had lined up. In the process of investigating Hanratty's title, the title insurance company discovered that Jerry Agar was then living at the premises. As proof that Agar had no adverse title interest to which the liens against him could attach, the company required an affidavit from Hanratty which stated that Agar had no right, title, or interest in the property and would receive none of the proceeds. Hanratty signed the affidavit admittedly knowing it was false. When Hanratty subsequently transferred title to the Prossers, he received over $27,000. Out of the proceeds Hanratty retained enough to cover his payment to Agar, his past due bills and his $1,000 fee. He turned over part of the remainder to Agar and the rest to a friend of Agar's, Lawrence Lee Schuppel, to buy a farm in Schuppel's name for Agar.
Later Schuppel sold the farm property to prevent his credit rating from being ruined by Agar's failure to pay bills due on the property. Schuppel then contacted Hanratty, told him he had Agar's money, and turned over to him $8,040 in cash. Because his bank was closed, Hanratty placed the money in his personal account by using a night depository box. Hanratty contends that he had expected to receive a check and was not prepared to handle cash.
The next day Hanratty sent a check to Agar for $8,040, less additional legal fees Agar had incurred with Hanratty. Agar disputed the amount due Hanratty and Hanratty later cancelled the initial check and sent Agar a larger amount. Agar was still dissatisfied and the dispute ended up in Conciliation Court where Hanratty's fees were upheld. Nevertheless, Agar filed a complaint against Hanratty with the Lawyers Professional Responsibility Board. This proceeding arose out of the investigation begun as a result of Agar's complaint.
Pursuant to Rule 14, Rules on Lawyers Professional Responsibility, the case was referred to a referee, Retired District Court Judge C. A. Rolloff, for a hearing. The referee concluded that Hanratty knowingly and intentionally had allowed Agar to use his name in fraudulently purchasing the homestead and had acted as a conduit in transmitting Agar's fraudulently held funds between Agar and Schuppel. Further, the referee concluded that Hanratty had knowingly signed a false affidavit and had failed to maintain proper trust fund procedures.
Hanratty denies that he acted with fraudulent intent in taking title to the property. Questions on intent are always difficult because they involve the often unspoken motives of individuals.1 If the necessary intent is found, the actions would support a finding of fraud on the part of Hanratty. Cf. Slagle v. Slagle, 187 Minn. 1, 244 N.W. 79 (1932). In signing the affidavit that stated that Agar had no interest in the property, however, Hanratty's intention is not an issue. He admitted that he signed it, knowing that part of it was materially false, for...
To continue reading
Request your trial