Delegation Without Suspervision Draws Suspension

A 30-day suspension with automatic reinstatement has been ordered by the Indiana Supreme Court

Respondent and his son Arthur Johnson (“Arthur”), both partners in their firm at the time, represented a transportation company (“Client”) in two separate matters—a breach of contract action and a labor dispute. Client’s CEO, Danette Garza, was Client’s sole point of contact with the firm. Respondent led Garza to believe that Respondent would have primary responsibility for the two matters and that Arthur would assist him.

After some initial activity in the breach of contract action, Respondent delegated all internal responsibility to Arthur and paid the matter no further attention. Arthur, in turn, wholly neglected the matter, which resulted in a series of adverse rulings. Arthur was largely nonresponsive to Garza’s inquiries and, when he did respond, misrepresented the status of the case. Respondent also was nonresponsive to Garza’s inquiries. Due to the neglect of Respondent and Arthur, the breach of contract action resulted in two five-figure sanction awards and a default judgment of approximately $1.8 million against Client. Client first learned of all of this when its bank account was seized during garnishment proceedings. Successor counsel later appeared for Client and moved to set aside the default judgment based on the neglect of Respondent and Arthur.

A similar sequence of events played out in the labor dispute. Respondent internally delegated the matter to Arthur without informing Garza, Arthur proceeded to wholly neglect the matter, and both Respondent and Arthur were largely nonresponsive to Garza’s inquiries. Respondent knew of Arthur’s failure to timely file an answer, noncompliance with discovery, and a resulting order to show cause; yet Respondent did not increase his attention to the case or take any remedial steps. Successor counsel appeared for Client at the show cause hearing and thereafter worked to comply with the pending discovery orders, and Respondent subsequently withdrew his appearance.

(Mike Frisch)