Service Charge

An agreed public reprimand of the Massachusetts Board of Bar Overseers

The respondent represented an elderly client in certain probate and estate planning matters. The respondent also performed non-legal services for the client which included: (1) assisting his client in transitioning from a skilled-nursing facility to her private residence where she would obtain home care after a serious fall; (2) paying certain bills; and (3) performing certain banking activities as her power of attorney.

The respondent operated a business called Senior Living Services Group (“SLSG”), which provided elder care coordination services to the client and was affiliated with his law firm. The respondent provided the eldercare services to the client pursuant to an agreement that provided for SLSG to (1) coordinate with vendors who provided services to the client (such as home care vendors); (2) receive and pay the vendor’s invoices from funds the respondent held in trust for the client; and (3) pay the respondent as owner of SLSG a 20 percent administrative fee on each invoice paid (“SLSG Agreement”). SLSG had no employees and operated exclusively through the respondent and other employees of his law firm. These services constituted “law-related services” as defined by Mass. R. Prof. C. 5.7(a) and were thus subject to the Massachusetts Rules of Professional Conduct.

The SLSG Agreement was a business transaction between the client and the respondent in which the respondent obtained a pecuniary interest adverse to the client, as defined by Mass. R. Prof. C. 1.8. The terms of the SLSG arrangement were unfair and unreasonable to the extent that they permitted the respondent to collect a 20% administrative fee on any vendor invoice submitted regardless of the amount of the vendor bill or the amount of work performed by SLSG. The respondent failed to obtain his clients’ informed consent to the SLSG transaction in a writing containing the essential terms of the transaction; namely, the services to be covered by the SLSG 20% administrative fee versus the respondent’s legal fees; the respondent’s collection of the 20% administrative fee regardless of the amount of work performed by SLSG; and the potential conflicts of interest relating to the SLSG Agreement. In particular, the SLSG Agreement permitted the respondent to collect 20 percent on the home care vendor bills which
ranged from $11,000 to $13,000 on a bi-weekly basis regardless of how much or little work SLSG performed.

Mitigation

The respondent was admitted to practice in 1994 and had no prior disciplinary history. In mitigation, the respondent returned to the client all fees he collected (including those billed as legal fees and those billed through SLSG). Additionally, the respondent returned to the client all fees that respondent paid from the client’s accounts to the home care vendor.

(Mike Frisch)