State v. Pringle, 55316
| Citation | 667 P.2d 283,233 Kan. 726 |
| Decision Date | 05 July 1983 |
| Docket Number | No. 55316,55316 |
| Parties | STATE of Kansas, Petitioner, v. B.L. PRINGLE, Respondent. |
| Court | United States State Supreme Court of Kansas |
Roger N. Walter, Topeka, disciplinary counsel, argued the cause and was on brief for petitioner.
B.L. Pringle, Topeka, argued the cause and was on the briefs pro se for respondent.
This is an original proceeding in discipline. The complaint against B.L. Pringle arose out of the respondent's representation of Delbert Parker.
Delbert Parker, a resident of Greenleaf, Kansas, was engaged in the business of farming. He also operated a grain elevator and trucking business in partnership with his son. As a result of his business enterprises Parker incurred substantial indebtedness. Respondent had represented Delbert Parker and his family for about ten years, for the most part, defending Parker from claims of his creditors.
In addition to his other enterprises, Delbert Parker owned and farmed land in Canada. He was represented there by a Canadian solicitor, Edward A. Komarnicki. In the course of their relationship Parker entrusted certain funds to the Komarnicki Law Firm. A garnishment in the amount of $19,064.40 was filed against the firm by a creditor of Parker. Komarnicki contested the legal validity of the garnishment.
Respondent was the lawyer for Delbert and Evelyn Parker in the United States at the times pertinent to the allegations of the complaint. Respondent consented to an arrangement whereby he would hold the funds garnisheed pending a determination of legal validity of the garnishment. By letter dated September 17, 1980, the Komarnicki Law Firm sent respondent $19,064.40 in Canadian funds to be held in trust for the Parkers. The trust conditions under which the Komarnicki Law Firm remitted the funds to respondent were set forth in Komarnicki's letter as follows:
The trust funds held by respondent for the Parkers were never invested in an interest bearing account. Respondent deposited the funds in the B.L. Pringle Special Account, Account No. 78-310-2, First National Bank of Topeka, Kansas, on October 1, 1980. The balance in the account prior to the deposit was $14,869.25. On October 17, 1980, the First National Bank debited respondent's special account for the difference in currency value between Canadian and United States funds in the amount of $2,764.33, leaving a balance of $16,300.07 held by respondent in trust for the Parkers. On October 17, 1980, after the Canadian discount debit, the balance in Account No. 78-310-2 was $11,537.67.
The balance in respondent's special account fell below the amount held in trust for the Parkers ($16,300.07) as of October 9, 1980. Thereafter the account never again reflected a balance sufficient to total the amount held in trust. The balances reflected on the monthly statements on Account No. 78-310-2 after the deposit of the Parkers' funds which were subpoenaed and admitted into evidence are as follows:
October 15, 1980 $14,906.50
November 13, 1980 $ 4,297.85
December 12, 1980 $ 979.85
January 13, 1981 $ 24.49
February 12, 1981 $ .70 -
March 12, 1981 $ 81.35 -
April 14, 1981 $ 12.92
May 12, 1981 $ 961.19 -
June 12, 1981 $ 135.90 -
July 14, 1981 $ 135.90 -
August 12, 1981 $ 135.90 -
September 9, 1981 $ .00
November 13, 1981 $ 12.21
December 14, 1981 $ 12.80
January 13, 1982 $ 5.82
After depositing the Parkers' funds in his special account, respondent withdrew those funds in a series of cash withdrawals over a period of about three months, keeping those funds in cash in his office in his desk drawer.
Respondent claims that Delbert Parker contacted the respondent to insure transfer of the funds from Komarnicki. Respondent explained to Mr. Parker that the funds would be subject to garnishment. If placed in respondent's client's account, they would be labeled as funds belonging to Mr. Parker and two banks having judgments against the Parkers could locate the funds. Mr. Parker then asked respondent to hold the funds. Late in September, 1980, after respondent received the check for Parkers' funds, a second conference was held in respondent's office. Respondent explained to Delbert Parker that if the funds were placed in an interest-bearing account, the Parkers' name would have to appear on the account. Parker determined that since he had already been garnisheed in Canada, plus the numerous outstanding judgments against him in the United States, that the respondent should hold the funds in cash at the respondent's office. Parker denies that either conversation occurred.
The regular monthly statements of the First National Bank maintained on respondent's special account reflect only the net balance, and the amount of any deposit or debit. They do not reflect the source of any funds being held therein by the respondent. Specific transactions corresponding in total to a withdrawal of the amount held in trust for the Parkers ($16,300.07) and allegedly transferred to respondent's office in cash could not be identified from the bank records maintained on respondent's Special Account No. 78-310-2. Respondent did not produce any other records identifying or providing an accounting of the withdrawal of the Parkers' funds. Respondent claimed that his register showing specific withdrawals from his trust account had been lost when he moved his office.
Ultimately the Canadian garnishment was set aside. Komarnicki, by letter dated January 26, 1981, instructed respondent to release to the Parkers the funds remitted pursuant to the trust conditions set out in his previous letter. At the time respondent would have received this notice he had withdrawn virtually all the funds in his special account. January 29, 1981, respondent's special account showed a balance of $3.84.
Subsequent to Komarnicki's letter in January of 1981, respondent did not return all the funds held in trust. However, Delbert Parker did receive partial reimbursement of the funds in a piecemeal fashion. Respondent paid Parker in cash $1,000.00 on February 11, 1981; $2,500.00 by check number 828 drawn on his special account dated April 24, 1981; and $10,000.00 by check number 836 on his special account dated May 5, 1981. The $10,000.00 check was returned and not paid by the First National Bank for the reason of insufficient funds.
Delbert Parker testified that he requested return of the entire amount held in trust in a meeting with respondent on February 11, 1981. According to Parker, respondent said the money was invested and could not be obtained for sixty to ninety days. However, on that date Parker contends respondent gave him a personal check for $1,000.00. (Respondent's records indicate payment was in cash.)
Parker also testified that he again requested the return of the funds in a meeting with respondent on April 23, 1981. Parker required the money to plant a crop in Canada. According to Parker, respondent advised him he would have the funds the following morning. On April 24, 1981, respondent told Parker the funds were unavailable due to an error in processing the withdrawal. On that date, however, respondent gave Parker a $2,500.00 check drawn on his special account and promised another $10,000.00 would be sent to Parker in Canada within a short time.
Subsequently respondent sent Parker the $10,000.00 check drawn on his special account dated May 5, 1981. That check eventually was not honored because of insufficient funds. At the time he mailed that check, respondent also mailed Parker the following accounting:
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