State ex rel. Oklahoma Bar Ass'n v. Arthur

• Decision Date: 07 December 1999
• Docket Number: No. SCBD-4440.,SCBD-4440.
• Citation: 991 P.2d 1026,1999 OK 97
• Parties: STATE of Oklahoma ex rel. OKLAHOMA BAR ASSOCIATION, Complainant, v. Robert H. ARTHUR, Respondent.
• Court: Oklahoma Supreme Court

991 P.2d 1026

1999 OK 97

STATE of Oklahoma ex rel. OKLAHOMA BAR ASSOCIATION, Complainant, v. Robert H. ARTHUR, Respondent.

No. SCBD-4440.

Supreme Court of Oklahoma.

December 7, 1999.

Janis Hubbard, Assistant General Counsel, Oklahoma Bar Association, Oklahoma City, Oklahoma, for Complainant. Robert H. Arthur, pro se, Duncan, Oklahoma, for Respondent.

OPALA, J.

¶ 1 In this disciplinary proceeding against a lawyer, the issues to be decided are: (1) Does the record submitted for our examination provide sufficient evidence for a meaningful de novo consideration of the complaint's disposition?¹ (2) Is a 30-day suspension an appropriate disciplinary sanction for respondent's breach of professional ethics? We answer both questions in the affirmative.

I INTRODUCTION TO THE RECORD

¶ 2 The Oklahoma Bar Association [Bar] charged Robert H. Arthur [Arthur or respondent], a licensed lawyer, with one count of professional misconduct.² The pretrial order consists of stipulated facts, conclusions of law and agreed circumstances to be considered in mitigation of the charges together with recommendation of discipline. Respondent admitted to having violated Rules 1.8(a)³ and 1.8(b)⁴, Oklahoma Rules of Professional Conduct [ORPC].

¶ 3 Following receipt of the parties' joint brief and upon consideration of the testimony on file and stipulations, the trial panel issued a report with its findings of fact and conclusions of law together with a recommendation for discipline. In accord with the parties' stipulations, the Professional Responsibility Tribunal [PRT or trial panel] found that Arthur violated ORPC Rules 1.8(a) and 1.8(b). It recommended that Arthur be privately reprimanded and that he bear the costs of the proceedings.

II THE RECORD BEFORE THE COURT CONTAINS SUFFICIENT EVIDENCE FOR A MEANINGFUL DE NOVO CONSIDERATION OF ALL FACTS RELEVANT TO THIS PROCEEDING

¶ 4 In a bar disciplinary proceeding this court functions in an adjudicative capacity as a licensing authority vested with exclusive original jurisdiction.⁵ Its cognizance rests on the constitutionally invested, nondelegable power to regulate the practice of law. The court's authority includes the licensure, ethics, and discipline of legal practitioners in this state.⁶ Before deciding whether discipline is warranted and what sanction, if any, is to be imposed for the misconduct alleged, this court conducts a nondeferential, full-scale, de novo examination of all relevant facts,⁷ in the course of which the recommendations of the trial panel are neither binding nor persuasive.⁸ The court is not guided by the standard-of-review criteria applicable in the context of corrective process on appeal or on certiorari. In the latter context mandated deference may require that another tribunal's findings of fact be left undisturbed.⁹

¶ 5 The court's duty can be discharged only if the trial panel submits a complete record of its proceedings.¹⁰ Our initial task is to ascertain whether the record is sufficient to permit (a) an independent determination of the critical facts and (b) the crafting of appropriate discipline. The latter factor is to be guided by (1) what is consistent with the discipline imposed upon other lawyers who have committed similar acts of professional misconduct and (2) what discipline avoids the vice of visiting disparate treatment on the respondent-lawyer.¹¹

¶ 6 Arthur has admitted, and the record supports, the charge of professional misconduct. Upon consideration of the record, we conclude that its contents are adequate for this court's de novo consideration of respondent's professional misconduct.

III THE CHARGES LODGED AGAINST THE RESPONDENT

¶ 7 The charges against Arthur rest on three loans he solicited and received from two clients. Beginning in 1994, Arthur performed estate planning among other legal services for an elderly couple, Mr. and Mrs. Detrick.¹² While providing these services, he obtained financial information about his clients and used that knowledge to approach them about lending him money. On 25 October 1995 he obtained a $6,000 loan from the Detricks and signed a promissory note. In the following year, he received from Mrs. Detrick¹³ two more loans in the amounts of $4,500 and $3,000, neither of which transactions was memorialized by an agreement in writing.¹⁴ All three loans were unsecured. It was Mrs. Detrick's understanding that Arthur would make timely repayments at a 7% annual interest rate. The terms of the latter two loans were not reduced to writing¹⁵ and sent to Mrs. Detrick. Nor did Arthur request that she seek the advice of independent legal counsel to protect her interests.¹⁶ The record does not reveal that Arthur obtained the written consent of his clients, a step that is required by ORPC Rule 1.8(a)(3).¹⁷

¶ 8 Arthur failed to repay the loans despite repeated reassurances he would do so. Mrs. Detrick eventually sought the assistance of another lawyer to help her secure repayment of the obligation that was then in default. Only after Mrs. Detrick contacted the Bar, and professional disciplinary proceedings were imminent, did Arthur make arrangements to repay the loans.¹⁸

IV ENTERING A BUSINESS TRANSACTION WITH A CLIENT

¶ 9 The Bar has charged Arthur with violating ORPC Rule 1.8(a)¹⁹ by entering into a business transaction with a client without complying with the prescribed method for avoiding a potential conflict of interest between himself and the client. This allegation stands coupled with one that to the disadvantage of the clients and in breach of ORPC Rule 1.8(b)²⁰ Arthur used financial information gleaned in the course of his representation.

¶ 10 While representing a client a lawyer is often privy to financial information that may lead the legal practitioner to approach a client about entering into a business transaction.²¹ Once in a disciplinary hearing evidence of a lawyer/client business transaction is adduced by clear and convincing evidence,²² the burden shifts to the attorney to show that the business dealing in question was indeed free from legal taint.

¶ 11 Arthur admits that he procured a loan from his client without complying with the procedure prescribed by Rule 1.8(a) and (b). By his conduct Arthur has impermissibly used information obtained in the course of client representation with a view to entering into a business transaction for a purely personal purpose. There is here no question about the respondent's breach of professional discipline. The sole issue is whether a more severe sanction should be imposed.

¶ 12 On de novo consideration, we adopt the PRT's findings of fact and conclusions of law, holding that more severe discipline is warranted because respondent entered into a business transaction with a client and used information gained in the course of representation to the client's disadvantage.

V A THIRTY-DAY SUSPENSION IS AN APPROPRIATE SANCTION FOR RESPONDENT'S PROFESSIONAL MISCONDUCT

¶ 13 The primary purpose for imposing professional discipline is not to punish the offender but to protect the public by a thorough inquest into the respondent's continued fitness to practice law.²³ Imposition of discipline is designed to foster these aims rather than to be a purely punitive measure for a lawyer's misconduct. Mitigating circumstances may be considered in assessing the quantum of discipline that is appropriate.²⁴

¶ 14 As for mitigating factors, we are reliably informed that respondent has repaid the borrowed funds²⁵ and cooperated throughout the disciplinary proceedings. Respondent's professional record reflects neither previous blemishes nor a pattern of misconduct. Moreover, the record shows that respondent's misconduct neither resulted from a client's deception nor caused grave economic harm.²⁶

¶ 15 Although both the PRT and the Bar recommend that respondent be privately reprimanded (and that he bear the costs of these proceedings), the court is of the view and holds that the severity of the offence (combined with a lack of compelling mitigating factors) warrants a license suspension for thirty days.

¶ 16 Respondent's misconduct results from three separate violations of the ORPC. Upon de novo review, the court concludes that there is clear and convincing evidence of respondent's violations charged in the complaint. In appropriate instances an attorney may be disciplined more severely than the PRT and Bar have recommended. This is especially true when the degree of discipline the court imposes is consistent with other decisions in like cases.

¶ 17 Respondent's license to practice law is accordingly suspended for thirty days and he shall pay the costs of this proceeding — in the sum of $227.23 — not later than ninety days after this opinion becomes final.

¶ 18 SUMMERS, C.J., and LAVENDER, KAUGER, WATT, and BOUDREAU, JJ., concur.

¶ 19 HARGRAVE, V.C.J., and HODGES, J., concur in part and dissent in part.

HODGES, J., concurring in part and dissenting in part.

¶ 1 I would impose a public reprimand.

1. The record consists of the pretrial order (which contains stipulated facts, agreed conclusions of law, factors to be considered in mitigation of the charges and agreed recommendation of discipline), a transcript of the hearing held before the Professional Responsibility Tribunal, exhibits offered by both parties, which were admitted in evidence at that hearing, and the Report of the Professional Responsibility Tribunal.

2. This bar disciplinary proceeding was commenced on 26 March 1999 by the filing of the Bar's complaint in accordance with the provisions of Rule 6 (Formal Proceedings Before Supreme Court and Professional Responsibility Tribunal), Rules Governing Disciplinary Proceedings [RGDP], 5 O.S.1991, Ch. 1, App. 1-A. The pertinent terms of RGDP Rule 6.1 are:

The proceeding shall be initiated by a formal complaint prepared by the General Counsel, approved by the Commission, signed by the chairman or vice-chairman of the Commission, and filed with the Chief...