Due Process Violation Found But Attorney Disbarred For Other Misconduct

The Maryland Court of Appeals has disbarred an attorney.

The court held that rule violations must be specifically alleged and that findings of uncharged misconduct violate due process

Petitioner excepts to the hearing judge’s conclusion that Respondent violated Rule 19-308.1(a), by falsely misrepresenting to Petitioner that his attorney trust account had a balance of at least $2,800.00. Petitioner charged Respondent with violating Rule 19-308.1 by intentionally misleading Petitioner regarding the name of the hotel authorized to withdraw the $2,800.00 from his attorney trust account, and Respondent’s concealment of Ms. Cone’s identity and contact information. Petitioner did not, however, charge Respondent with violating Rule 19-308.1 for misrepresenting the amount of money in his attorney trust account. Although Petitioner agrees with the hearing judge’s conclusion that this action violated Rule 19-308.1, Petitioner excepts, citing In Re Ruffalo…

Based on the holdings in Ruffalo, Costanzo, and Patton, we sustain Petitioner’s exception on this point. The hearing judge should not have concluded that Respondent violated Rule 19-308.1 by misrepresenting the amount of funds in his attorney trust account, because it was not alleged in the Petition.

The court sustained other violation findings

Maryland Rule 19-410(b) requires attorneys to disburse funds from an attorney trust account by check or electronic transfer. “[A]n attorney trust account may not be drawn payable to cash or to bearer, and no cash withdrawal may be made from an automated teller machine or by any other method.” Md. Rule 19-410(b). Respondent violated Maryland Rule 19-410(b) when he issued a $900.00 check payable to cash. Although Respondent may have issued this check for Ms. Cone and delivered the cash to her, the action of issuing a check payable to cash violates Maryland Rule 19-410(b).

Finally, Maryland Rule 19-410(c) requires an attorney to maintain a positive balance in her or his attorney trust account. If disbursement of funds would create a negative balance in the attorney’s trust account, the attorney shall not disburse the funds. Respondent maintained an attorney trust account with a negative balance. He generated several transactions that resulted in a negative balance in his attorney trust account. These actions constitute a violation of Maryland Rule 19-410(c).

Sanction

Respondent acted knowingly and intentionally, rather than negligently. He continues to blame Ms. Cone, a former client, for his misconduct and fails to take responsibility. Respondent places great weight on his lack of a prior disciplinary record, but fails to acknowledge the aggravating factors. Although Respondent attempted to rectify the situation with Ms. Bernhardt by using his own funds, Respondent failed to do so timely, and only provided restitution after Petitioner initiated its investigation. Respondent consistently misled Ms. Bernhardt to believe that he was actively engaged in the recovery of her settlement funds. Following precedent and considering the aggravating factors presented, we hold that Respondent’s conduct warrants the ultimate sanction of disbarment.

(Mike Frisch)