Smith, In re
| Decision Date | 29 March 1976 |
| Docket Number | No. 48038,48038 |
| Parties | In re Raymond R. SMITH, Attorney, Respondent. |
| Court | Illinois Supreme Court |
William J. Harte, Chicago (Lawrence Stanner, Chicago, of counsel), for respondent.
John Dixon, Chicago, for the administrator of the Attorney Registration and Disciplinary Commission.
This is a disciplinary proceeding against respondent, Raymond R. Smith, pursuant to Supreme Court Rule 751 (Ill.Rev.Stat.1973, ch. 110A, par. 751). Respondent was charged with conversion of a client's funds. The Hearing Board and the Review Board of the Attorney Registration and Disciplinary Commission have recommended that respondent be disbarred from the practice of law, and he contests the propriety of that sanction.
Respondent was retained by the mother of Domingo Villarreal, who had been appointed as guardian of her minor son, to prosecute an action for damages suffered by Domingo as a result of injuries he received from an accident which occurred in 1968. It was agreed that respondent was to receive a fee of 25 percent of any amount recovered if the case was settled through negotiations and 33 1/3 percent if the case went to trial. Respondent then engaged Errett O. Graham as an associate counsel to handle the case, and a complaint was timely filed. By August 18, 1972, Villarreal had become 18 years of age, and having attained his majority, he was substituted as plaintiff. On that same day, the case was settled with the opposing party before trial for $69,000, which was later paid on September 6, 1972.
In either September or October 1972, a conference was held with Villarreal and his father at respondent's office. At this conference, respondent informed Villarreal that he was charging him a fee of 33 1/3 percent. Villarreal apparently discussed the matter with his father, who spoke only Spanish, and expressed no objection to this fee charge. Respondent and Villarreal also made an oral agreement whereby the latter agreed that respondent would hold Villarreal's portion of the settlement recovery until he became 21 years of age.
On September 11, 1972, respondent deposited the entire amount of the recovery in his personal banking account. He then used these funds that same day to purchase a cashier's check payable to Errett O. Graham in the amount of $13,847.35. This amount was paid to cover three separate items: $8,625 was Graham's attorney's fee, which was only one-half of 25 percent of the total recovery; $222.35 was for expenses advanced by Graham in prosecuting the case; and $5,000 was in repayment of a personal loan Graham had previously made to respondent. On September 11, respondent also purchased a second cashier's check with these funds for $9,000. The check was payable to the Cook County Department of Public Aid for amounts that agency had advanced to Villarreal. Respondent later used these funds to purchase a third cashier's check on September 15, 1972. This final check was in the amount of $19,847.97 and was payable to the sheriff of Cook County for redemption of property from a judicial sale ordered in the foreclosure of a mortgage that had been executed by respondent and his wife on a house which they owned. It is uncertain whether these actions by the respondent occurred prior or subsequent to the conference at which it was agreed he would hold Villarreal's portion of the recovery.
Sometime after the above-mentioned events and before Villarreal became 21 years old, he changed his mind with respect to respondent holding his money and requested that he be paid the total amount due. Respondent refused to pay Villarreal, explaining that he had invested the money in a house. He offered to give Villarreal the house or secured notes in exchange for the money due, but these offers were rejected.
Throughout his period of time, although sporadically and with no pattern, and on occasion at the request of Villarreal, respondent would give Villarreal small sums of money, which both parties termed as 'interest' on the money respondent was holding. These 'interest' payments, which were made from approximately September 1972 to May 1975, totaled $5,711.75. However, except for the $9,000 which was paid to the Cook County Department of Public Aid on Villarreal's behalf, no part of the principal of the settlement was forwarded to Villarreal.
As a result of respondent's refusal to turn over the settlement proceeds, Villarreal filed a complaint with the Attorney Registration and Disciplinary Commission in the latter part of 1973. Subsequent to the filing of this complaint, Villarreal asked respondent for $10,000, which he needed immediately for a family matter. On September 22, 1973, respondent complied with this request and paid Villarreal $10,000.
On April 4, 1974, the administrator of the Attorney Registration and Disciplinary against respondent, charging him with conversion of a client's funds. The matter was submitted to the Hearing Board on September 20, 1974, and following a hearing the Board entered its findings and recommendation. However, for reasons unrelated to the present issue, the Review Board of the Commission directed...
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