The Florida Bar v. Korones, SC92873.

• Decision Date: 27 January 2000
• Docket Number: No. SC92873.,SC92873.
• Citation: 752 So.2d 586
• Parties: THE FLORIDA BAR, Petitioner, v. N. David KORONES, Respondent.
• Court: Florida Supreme Court

752 So.2d 586

THE FLORIDA BAR, Petitioner, v. N. David KORONES, Respondent.

No. SC92873.

Supreme Court of Florida.

January 27, 2000.

John F. Harkness, Jr., and John Anthony Boggs, Staff Counsel, Tallahassee, Florida, and David R. Ristoff, Branch Staff Counsel, Tampa, Florida, for Complainant.

Martin Errol Rice, St. Petersburg, Florida, for Respondent.

PER CURIAM.

We have for review the complaint of the Florida Bar and the referee's report regarding alleged ethical breaches by N. David Korones. The referee has recommended a ninety-day suspension. The Florida Bar has sought review, requesting disbarment. We have jurisdiction. Art. V, § 15, Fla. Const.

STATEMENT OF THE CASES AND FACTS:

CASE NO. SC92873

On April 27, 1998, the Bar filed a complaint against Korones. On November 20, 1998, Korones stipulated to the following facts: In 1988, Korones' uncle died testate in North Carolina. Korones, a residual beneficiary of the estate, qualified as executor of the estate. Korones filed an inventory with the North Carolina court listing the approximate value of the estate at $343,752. During the years 1989-1991, Korones (1) converted $123,750 to his own use, (2) paid himself $7,611 in fees, and (3) paid himself $4,750 and his son $7,000 more than the other beneficiaries. On July 22, 1994, Korones submitted a purported final accounting to each of the residual beneficiaries falsely stating that after receipts and payments, $115,291.53 remained in the estate. After Korones was removed as personal representative of the estate, the successor representative brought suit against Korones and a substantial judgment in favor of the estate was entered.

Korones stipulated to the following violations: (1) Rule Regulating the Florida Bar 4-8.4(c) ("A lawyer shall not ... engage in conduct involving dishonesty, fraud, deceit or misrepresentation ....") and (2) Rule Regulating the Florida Bar 5-1.1(a) ("Money or other property entrusted to an attorney for a specific purpose ... must be applied only to that purpose. [A] refusal to deliver over such property on demand shall be deemed a conversion."). Korones also stipulated to minor trust account violations. With the referee adopting and approving these stipulations, testimony at the November 20, 1998, hearing consisted of evidence submitted on behalf of Korones in mitigation of discipline and the Bar's cross-examination of witnesses.

In her report, the referee recognized that the conversion of funds is a serious matter. However, she reasoned that mitigating factors in Korones' case warranted discipline less severe than disbarment, those factors being (1) personal or emotional problems (including marital problems and "significant financial stress due to the expenses of educating three children in private schools and colleges"); (2) good faith efforts to make restitution; (3) full and free disclosure to the disciplinary board; (4) cooperative attitude towards the proceedings; (5) good character and reputation; (6) mental or physical disability or impairment (i.e., heart problems which caused Korones to experience dizziness, lack of balance, high blood pressure and erratic heartbeats, and which ultimately led to heart surgery in 1995; the taking of medications which had the potential to impair Korones' judgment); and (7) remorse. The referee also found the following aggravating circumstances: (1) dishonest or selfish motive and (2) substantial experience in the practice of law. She stated that two incidents of negligence in 1982 and 1985, for which Korones received private reprimands, were too remote to be considered aggravating factors.

The referee recommended that Korones be suspended for ninety days. In recommending this discipline, the referee relied upon cases in which attorneys had misappropriated or mishandled client funds and this Court imposed discipline less severe than disbarment. See Florida Bar v. Condon, 647 So.2d 823 (Fla.1994)

; Florida Bar v. Cramer, 643 So.2d 1069 (Fla.1994); Florida Bar v. MacMillan, 600 So.2d 457 (Fla.1992); Florida Bar v. Schiller, 537 So.2d 992 (Fla.1989). The referee further noted that a ninety-one day suspension, which requires an attorney to demonstrate rehabilitation before being reinstated, was not necessary because Korones had already demonstrated rehabilitation. The referee also added that more severe discipline would only delay the time that it would take for Korones to begin repaying the individuals who loaned him the money to make final restitution to the beneficiaries in this case. The Bar seeks review of the referee's recommendation.

On July 23, 1999, Korones filed a motion to supplement the record. In this motion, Korones stated that he reached a settlement agreement with the beneficiaries of his uncle's estate and had paid them $110,000 in restitution. The funds were gathered by members of Korones' community. With his motion, Korones provided the affidavit of the attorney who negotiated his settlement with the beneficiaries. In this affidavit, the attorney stated that "counsel for the Estate is in the process of preparing and obtaining execution of a satisfaction of the Judgment entered against Mr. Korones." The Bar had no objection to the motion. On August 26, 1999, the Court granted Korones' motion to supplement.

CASE NO. SC96628

On September 10, 1999, Korones pled guilty to grand theft and received two years' probation for his misappropriation of the funds from his uncle's estate. On September 28, 1999, the Bar filed a "Notice of Determination or Judgment of Guilt," and requested the entry of an order suspending Korones, pursuant to Rule Regulating the Florida Bar 3-7.2(e). On September 29, Korones filed a "Petition to Modify or Terminate Suspension and Motion to Consolidate." In his petition, Korones argued that the referee's report in case number SC92873 demonstrated that there is good cause for modification of a rule 3-7.2 suspension. The Bar filed a response to this petition, arguing that suspension should be imposed and that Korones' petition to modify suspension should be denied.

Case numbers SC92873 and SC96628 were consolidated and after oral argument, this Court entered an order denying Korones' petition to modify or terminate suspension. See Florida Bar v. Korones, 744 So.2d 458 (Fla.1999).

DISCIPLINE

With the foundation that Korones has stipulated to rule violations, the issue upon which this Court must focus is whether the referee's recommendation of a ninety-day suspension is reasonably supported by existing case law. See Florida Bar v, Fredericks, 731 So.2d 1249, 1254 (Fla.1999). In reviewing a referee's recommendation of discipline, the Court's "scope of review is somewhat broader than that afforded to findings of fact because, ultimately, it is [the Court's] responsibility to order an appropriate discipline. Discipline must be fair to the public and to the respondent and `must be severe enough to deter others who might be prone or tempted to become involved in like violations.'" Florida Bar v. Anderson, 538 So.2d 852, 854 (Fla.1989) (citation omitted) (quoting Florida Bar v. Lord, 433 So.2d 983, 986 (Fla.1983)).

This Court has held that "[i]n the hierarchy of offenses for which lawyers may be disciplined, stealing from a client must be among those at the very top of the list." Florida Bar v. Golub, 550 So.2d 455, 456 (Fla.1989)(quoting Florida Bar v. Tunsil, 503 So.2d 1230, 1231 (Fla.1986)). This Court has also held that disbarment is presumed to be the appropriate discipline for misuse of client funds; however, this presumption can be rebutted by mitigating circumstances. See Florida Bar v. Shanzer, 572 So.2d 1382, 1383 (Fla.1991)

. The reason that misuse of client funds warrants such a severe discipline has been articulated as follows:

The single most important concern of this Court in defining and regulating the practice of law is the protection of the public from incompetent, unethical, and irresponsible representation. The very nature of the practice of law requires that clients place their lives, their money, and their causes in the hands of their lawyers with a degree of blind trust that is paralleled in very few other economic relationships. Our primary purpose in the disciplinary process is to assure that the public can repose this trust with confidence. The direct violation of this trust by stealing client's money, compounded by lying about it, mandates a punishment commensurate with such abuse.

Florida Bar v. Ward, 599 So.2d 650, 652 (Fla.1992) (emphasis removed) (quoting Florida Bar v. Dancu, 490 So.2d 40, 41-42 (Fla.1986) (citation omitted)).

In the instant cases, Korones converted approximately $123,752 to his personal use, paid himself $4,750 more than the other beneficiaries, and paid his son $7,000 more than the other beneficiaries. Korones testified during the hearing that he paid his son because his son threatened to report him to the Bar if Korones failed to provide additional proceeds. Korones further testified that he filed a false accounting with the beneficiaries, stating that $116,000 remained in the estate when there were actually only a few dollars left.

The current status of Florida law indicates that, despite the mitigating circumstances found by the referee, a ninety-day suspension is far too lenient for these violations. The only two cases upon which the referee relied for leniency where this Court imposed a ninety-day suspension were Florida Bar v. Behrman, 658 So.2d 95 (Fla.1995), and Florida Bar v. Cramer, 643 So.2d 1069 (Fla.1994). However, these cases are easily distinguishable from Korones' situation. In Behrman, the referee found that while Behrman wrongfully disbursed trust account funds, he did not act criminally or fraudulently. 658 So.2d at 96. The referee also noted that Behrman had limited experience in the practice of law. Id. at 97. In the instant cases, Korones, who has thirty-six years of experience in the practice of law, admitted that he...