Misconduct Or Vendetta?

Another case on the oral argument calendar this week in Ohio

Columbus Bar Association v. Kinsley F. Nyce, Case no. 2017-1078
Franklin County

The Board of Professional Conduct recommends that Columbus attorney Kinsley F. Nyce be disbarred for violating a number of rules governing Ohio lawyers, including failing to notify clients that he didn’t maintain malpractice insurance while representing them.

Nyce has denied all allegations made by the Columbus Bar Association and maintains his only error was using older forms to notify his clients of his lack of insurance. He suggests that no sanction by Ohio Supreme Court is warranted.

Charges Stem from Real Estate Lawsuit
The professional conduct board’s report to the Court notes that Nyce represented two entities, Arthur Goldner & Associates (AG), and NC Plaza in a Franklin County lawsuit filed by Whitt Sturtevant. At the time of the lawsuit, Arthur Goldner was the chief executive officer of his Illinois-based company, and Rick Aronhalt was AG’s on-site manager in Columbus. The board concludes Nyce never notified Goldner that he didn’t carry professional liability insurance.

Whitt Sturtevant prevailed in the lawsuit against the companies, and Goldner hired Stephen Jones to replace Nyce and handle the appeal. Jones discovered that AG’s property liability insurance would have covered three of the claims brought against it, but that Nyce failed to advise AG to contact its insurer. At Jones’ advice, AG filed a belated claim with the insurer, which acknowledged it would have covered the cost of defending against the claims, but denied coverage because the claim was filed too late.

Jones told AG the failure to seek the insurance coverage could constitute legal malpractice by Nyce. Jones sent a letter to Nyce asking for information regarding his malpractice insurance. Nyce ignored repeated requests by Jones to prove he had malpractice coverage.

Jones filed a grievance with the Columbus Bar Association against Nyce for not cooperating. The bar association pressed Nyce for information about his insurance. Nyce admitted at a board panel hearing that he never personally carried malpractice insurance. He said he notified Aronhalt, who he had worked with before Aronhalt represented AG, that he didn’t have insurance. Nyce stated Aronhalt was the agent for AG that he communicated with directly about all AG matters.

The board noted the professional conduct rules require an attorney who doesn’t carry malpractice insurance to disclose that to clients in writing; sign the notice; have the client sign and date the notice acknowledging receipt; and maintain a copy of the signed notice for five years. The board found Nyce violated the rules by not notifying Goldner about the lack of malpractice insurance and Nyce never received Goldner’s written consent to continue to represent AG while uninsured.

Incident Leads to Further Inquiry
Based on the investigation of the AG case, the Columbus Bar Association’s disciplinary investigators asked Nyce for a list of clients for a three-year period and copies of their signed notices informing them he wasn’t insured. The board found Nyce couldn’t supply notices for 30 clients he represented between 2012 and 2015. Nyce produced some forms citing rule Disciplinary Rule 1-104, which was a rule under the former Ohio Code of Professional Responsibility that the state stopped using in 2007. The code has been replaced by the Ohio Rules of Professional Conduct, and Prof. Cond. R. 1.4(c) is the current rule that mirrors DR 1-104.

In 2016, Nyce produced forms for some but not all of his clients, and the board found none of them fully complied with the new rule. It found some cited the old rule, were undated, didn’t have Nyce’s signature, or appeared not to have an authentic client signature. When pressed about the whereabouts of the signed forms, Nyce responded many of the notices were lost in a flood at his office. The board noted that a year earlier, when asked about the forms, Nyce never mentioned a flood.

Based on the questions about the forms, the board found Nyce violated the rules for failing to notify clients about the lack of insurance and for failing to respond for requests for information in a disciplinary matter. He further violated the rules by acting deceitfully and dishonestly toward the bar association and the hearing panel.

Financial Records Examined
The bar association also asked Nyce to produce records from his court-required Interest on Lawyers’ Trust Accounts (IOLTA) account where he must hold client funds. The board found Nyce failed to respond to repeated requests for the full amount of requested information, and found he violated several record-keeping rules.

Some of the allegations against Nyce center on the use of the IOLTA account while caring for his elderly mother who lived in Vermont. Starting in 2013, his mother resided in a Burlington, Vermont, nursing facility and then in a rehabilitation facility until her death in 2015. At the time she entered the first nursing home, she had assets in excess of $700,000, which included large amounts in two Vermont bank accounts on which Nyce and his brother, Roger, were also listed. She also owned a home.

At the time of her death, she owed the two nursing homes $205,000 for their care, and by then she had no assets to pay the debts. The board indicates that Nyce and his brother systematically withdrew all the money from their mother’s accounts and took ownership of her home. Of the withdrawals, more than $584,000 was placed in Nyce’s IOLTA account before he moved the money into other accounts.

When asked to explain the reason for placing the money in the IOLTA, Nyce claimed it was for “clients” of his and his mother who weren’t legal clients. The money was to be held for nine individuals that Nyce wouldn’t name. The board concluded the story of the nine clients was a “complete sham” and charged Nyce with using his IOLTA account to launder the money withdrawn from Vermont accounts and to shield the assets from the Vermont nursing homes seeking to collect payment. The board charged Nyce with rule violations for the misuse of the client accounts.

Board Recommends Disbarment
The board concludes that disbarment is warranted because Nyce:

• acted with a dishonest and selfish motive
• committed multiple offenses
• engaged in a pattern of misconduct
• refused to acknowledge the wrongful nature of his conduct
• failed to cooperate in the disciplinary process
• submitted false evidence, made false statements, and used deceptive practices during the disciplinary process

The board indicates that Nyce presented no mitigating factors and notes that he has no prior disciplinary record.

“From the beginning, [Nyce] displayed open and undisguised hostility toward he disciplinary system, the attorneys representing [the bar association], and the panel. It would be difficult to imagine an accused attorney demonstrating less respect for the disciplinary process or less remorse for his misconduct,” the board report states.

The board concludes that Nyce is no longer fit to “practice in a profession grounded on trust, integrity, and candor.” And the only appropriate sanction is disbarment, it asserts.

Attorney Claims Vendetta
Nyce responds to the charges by stating he has been in compliance with the rules at all times and the clients were fully informed of his lack of malpractice insurance. Nyce claims he is the victim of a “box job,” which he describes as an attempt by the bar association to target him for investigation. He asserts that the bar association’s attempt to collect information from him was done in concert with Jones and a Vermont attorney seeking to file lawsuits against him. He responds that he has no duty to assist the bar association in helping his legal adversaries develop their lawsuits.

Bar Association Supports Disbarment
The bar association supports the board’s recommendation of disbarment and charges that Nyce “distorts the evidence” presented in the board’s panel hearing and misrepresents his conduct. It notes that, in stark contrast to Nyce’s view of the case, the board found he violated many of his ethical duties and harmed clients.The bar also indicates the Supreme Court has recently disbarred other attorneys with no prior disciplinary records for committing rule violations similar to the ones the board found Nyce violated.

– Dan Trevas

Docket entries, memoranda, briefs (including amicus briefs), and other information about this case may be accessed through the case docket.

Contacts
Representing the Columbus Bar Association: Steven Nolder, 614.221.9790

Representing himself pro se, Kinsley F. Nyce: 614.562.2254

(Mike Frisch)