Stevens v. Thomas
| Decision Date | 04 November 1987 |
| Docket Number | Nos. 44391,44666,s. 44391 |
| Citation | 257 Ga. 645,361 S.E.2d 800 |
| Parties | , RICO Bus.Disp.Guide 6786 STEVENS v. THOMAS, et al. BROWN REALTY ASSOCIATES, INC., et al. v. THOMAS, et al. |
| Court | Georgia Supreme Court |
Ervin H. Gerson, Bailey, Stevens & Gerson, Atlanta, for Ronald S. stevens.
Jeffrey L. Sakas, Harold A. Horne, Jr., Sakas & Horne, Atlanta, for Annie Thomas et al.
William J. McKenney, David M. Kupsky, McKenney & Froelich, Atlanta, for Brown Realty Associates, Inc., et al.
Jeffrey Sakas, Sakas & Horne, Robert S. Whitelaw, Atlanta, for Annie Thomas et al.
These cases arise out of a common lawsuit and we granted a motion to consolidate the appeals. The lawsuits of five separate plaintiffs, Annie Thomas, Eddie Mobley, Irene Alexander, Mary Nell Craig, and Ann C. Bryant Johnson, (appellees) against the same defendants, Brown Realty Associates, Inc., Alonza C. Brown, Sr., Gladys R. Brown, and Alonza C. Brown, Jr., (hereinafter the Browns) were joined for trial in the Dekalb Superior Court. The plaintiffs asked that the suit be certified as a class action based upon an alleged number of similarly situated individuals with claims against the Browns.
The complaint, based upon fraud, violations of the Fair Business Practices Act and violations of the civil RICO statutes, alleges that the Browns have engaged in a scheme of acquiring the homes of the plaintiffs and others through "foreclosure fraud". The essence of the alleged scheme is that the Browns or their agents contact homeowners who are behind in payments and offer to make a loan to prevent foreclosure. Homeowners think they are executing loan documents involving security deeds and in fact are executing warranty deeds and rental agreements, thereby unknowingly giving up all interest in the real estate except as tenants or tenants with an option to purchase at some later date.
A brief summary of the procedural chronology of the case may be helpful to an understanding of the issues involved. The original complaint was filed in 1984 and was followed by the filing of several other suits alleging the same acts. In February, 1986, the court held hearings regarding a restraining order to prevent the Browns from obtaining coercive affidavits from potential class members. The court ruled from the bench that both the Browns and their attorney were prohibited from obtaining affidavits from potential class members and that they were further restrained from contacting them except insofar as the Browns contacted them in the normal course of business. In April, the trial court certified the case as a class action. In May, the court entered an order disqualifying Ronald Stevens as counsel for the Browns because of his part in contacting possible adverse parties and because of coercive tactics, awarding attorney fees in an amount to be set later against Stevens and the Browns, and concluding that if plaintiffs were successful, potential class members would have two years from judgment in which to "opt in" to the class. In July, the court found the Browns in contempt of the court's earlier order against obtaining affidavits. This order was affirmed in Brown v. Thomas, 257 Ga. 68, 354 S.E.2d 830 (1987). Finally, in January, 1987, the court entered an order awarding plaintiffs a specific amount of attorney fees to be paid in equal amounts by the Browns and Stevens.
1. Both the Browns and Stevens appeal from the orders of May, 1986, and January, 1987, disqualifying Stevens and awarding attorney fees to the plaintiffs. The disqualification of Stevens because of his activities in obtaining affidavits from potential class members was based on the court's finding that he violated DR 7-104(A)(2) of the Georgia Code of Professional Conduct, which prohibits a lawyer's giving advice to a person not his client if there is a reasonable possibility that the interest of his client might come into conflict with the interest of that person, and that he violated DR 1-102 of the ABA Model Code of Professional Responsibility, which prohibits conduct which is prejudicial to the administration of justice.
In the order of May, 1986, the court ruled that Stevens be disqualified instanter and that reasonable attorney fees, in an amount to be determined at a later hearing, be assessed against Stevens and the Browns and divided equally between them. He ruled that Stevens could not appear again except to represent himself in any hearing on attorney fees and costs. A hearing was held in September on the question of attorney fees. Stevens was notified of the hearing by mail but did not appear. In an order of January, 1987, the court awarded attorney fees in the amount of $9,608.00 to be paid in equal amounts by Stevens and the four named defendants. The court found that the defendants had been found in contempt on April 19, 1986, and that the attorney fees were awarded for the plaintiffs' legal fees in bringing the Motion for Citation of Contempt which resulted in the order of April, 1986. No order of April 19, 1986, appears in the record. The reference must have been to the order of May 2, 1986, which does not refer to contempt but, rather, to a violation of disciplinary rules.
Appellants argue that since the class had not been certified at the time of the activities of Stevens in obtaining the affidavits, the potential members were not deemed to be represented by plaintiffs' counsel. Further, argue appellants, Stevens held a good faith belief that the affidavits would be helpful to the court in deciding whether to certify the action as a class action. Stevens contends that the only possible basis for the award of attorney fees against him would be the court's power to punish contempt under OCGA § 15-1-4(a)(1) and (2) and insists that he was not in contempt of any court order. Finally, he complains that he was not afforded due process of law by the trial court in that he was not notified of the hearing which resulted in the award.
We find that the Browns' and Stevens' appeals from Stevens' disqualification are not timely. The disqualification was the sanction imposed by the court because of the violations of the disciplinary rules found by the court. The disqualification was to take place instanter and was thus immediately appealable. The fact that the amount of attorney fees was not set until a later date does not affect the status of the disqualification as a final, appealable order. We also find that Stevens' argument that he was denied due process is without merit in that the court order specifically indicates that he was notified by mail of the hearing in September on the amount of the attorney fees. The fact that he had been disqualified from representing the defendants does not bolster his argument that he did not receive proper notice. Since the order of disqualification reserved to him the right to represent himself at the hearing on attorney fees, he remained counsel of record for this event for purposes of notice.
The Browns also contend that the award of attorney fees and the sanction of allowing potential class members to opt into any successful judgment for two years were error. Their argument is based on the fact that the court found Stevens disqualified because of his violation of disciplinary rules. The Browns argue that since they are non-lawyers, the disciplinary rules do not apply to them. Since in the written order of May, 1986, there is no mention of contempt, the Browns insist that there is no basis for an award of attorney fees against them even if attorney fees could be awarded against Stevens due to violation of disciplinary rules.
We find that the court lacked authority to impose sanctions upon the Browns or Stevens based upon a violation of the disciplinary rules. The Browns are not subject to attorney discipline. The discipline of attorneys is solely within the province of the Supreme Court of Georgia. Carpenter v. State, 250 Ga. 177, 297 S.E.2d 16 (1982). The only exception to this court's exclusive jurisdiction over attorney discipline is the power of the trial court to disbar an attorney pursuant to Standard 66 of the Rules and Regulations of the State Bar of Georgia. Therefore, we remand to the trial court the question of sanctions for a determination whether the sanctions were imposed upon Stevens and the Browns as a penalty for contempt or as a penalty for violations of the disciplinary rules.
2. The Browns appeal from the order of the trial court certifying the action as a class action. Ordinarily, this order would be appealable only if an application for interlocutory review were granted after the trial court certified the matter for immediate review....
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