First Cousins, Once Removed

An attorney who rented office space and had business dealings with his cousin was sanctioned by the Louisiana Supreme Court.

Respondent and Mr. Domingue are first cousins, once removed. They were socially close. In 2009 and 2010, Mr. Domingue was a stockbroker and financial advisor with an office in Abbeville; respondent, having been admitted to the bar in 2005, was beginning his law practice in New Orleans. Mr. Domingue wanted to help respondent grow his practice and offered to let him use an office in his business suite in Abbeville as his law office. Respondent accepted this offer. Mr. Domingue also provided respondent with cash advances and access to a credit card for the operation of his law practice, and he paid off respondent’s student loans. Both Mr. Domingue and respondent understood that these transactions were loans that respondent would have to repay.

An attorney-client relationship between respondent and Mr. Domingue began on December 13, 2010, when respondent agreed to represent Mr. Domingue in a defamation action against Mr. Domingue’s ex-wife. By the time Mr. Domingue became respondent’s client, Mr. Domingue had already begun to loan respondent money. The great majority of the loan transactions occurred after respondent had established an attorney-client relationship with Mr. Domingue. Respondent was providing his legal services to Mr. Domingue free of charge. The attorney-client relationship continued until May 2014.

The precise amount of funds Mr. Domingue loaned to respondent is unknown, but respondent executed three different promissory notes in favor of Mr. Domingue, in the amounts of $500,000, $151,675.61 and $151,675.61. Respondent testified that at the time he executed the $500,000 promissory note, he owed Mr. Domingue approximately $250,000, but the promissory note recited the higher amount so that Mr. Domingue could obtain a $500,000 life insurance policy on respondent to protect his investment.

On July 17, 2020, respondent filed for Chapter 11 bankruptcy. Mr. Domingue filed a proof of claim in the bankruptcy proceeding amounting to $1,110,753.10. Later, Mr. Domingue and respondent entered into a stipulation wherein respondent agreed that Mr. Domingue would be allowed a general unsecured claim in the bankruptcy case in the amount of $541,910.41 and that $350,000 of said claim would not be discharged and would survive the completion of the Chapter 11 Plan unless paid under the Plan. This stipulation left the sum of $191,910.41 as potentially dischargeable. As of December 21, 2022, respondent had not made any payments to Mr. Domingue under the Chapter 11 Plan.

At some point, Mr. Domingue asked respondent to begin to repay the loans, but respondent had trouble doing so. Respondent offered to enter into a payment arrangement whereby a percentage of his net profits would be paid to Mr. Domingue. However, respondent was careful to inform Mr. Domingue that “I cannot provide you with a contract that gives you an ownership interest [in my law firm], cannot form a partnership with you, and cannot share fees in order to repay you for financing my firm. … In keeping with our many discussions, I intend to make a proposal where the repayment obligation will vary each year based on my gross income that year.” Respondent testified that he offered to pay Mr. Domingue a percentage of his entire income, not to share legal fees with Mr. Domingue. Given the email exchanges between respondent and Mr. Domingue, the committee found this testimony credible.

The court found the Respondent had engaged in an improper business transaction with a client

Upon review of the findings and recommendations of the hearing committee and the disciplinary board, and considering the record, briefs, and oral argument, it is ordered that Adam Granville Young, Louisiana Bar Roll number 30124, be and he hereby is suspended from the practice of law for a period of one year and one day. It is further ordered that all but ninety days of this suspension shall be deferred. Following the completion of the active portion of his suspension, respondent shall be placed on probation for a period of two years, governed by the conditions set forth in this opinion.

(Mike Frisch)