Dismissal Overturned; Reprimand Imposed

The Nevada Supreme Court overturned a hearing panel dismissal and imposed a reprimand of an attorney.

Unearned fees

The fee agreement at issue provided that the $15,000 fee was for “legal services to be rendered” and indicated that Sull would send billing statements to the client explaining how any deposited fees would “be applied towards the balance of the legal services rendered.” By the terms of the agreement, the client’s fees in this matter were paid in advance. Consistent with RPC 1.15(c), those fees should have been deposited in a client trust account and withdrawn by Sull only as fees were earned or expenses incurred. Sull instead treated the funds as “earned upon receipt,” placing the client’s funds directly into her operating account without first performing the work to earn those funds. By doing so, Sull violated RPC 1.15. We cannot agree with the hearing panel’s contrary conclusion.

Termination and accounting

Sull’s client had previously retained Sull for two other matters, one of which is still pending. Each matter was distinct and had its own fee agreement. See RPC 1.2(c) (“A lawyer may limit the scope of the representation if the limitation is reasonable under the circumstances and the client gives informed consent.”). The third matter was the E-2 Visa Application, which formed the basis of the State Bar’s complaint. The record establishes that the client terminated the representation for the E-2 Visa after Sull had completed some work but before Sull filed the application. Because the E-2 Visa was a separate representation from the other matters, we conclude that the client terminated the representation, triggering RPC 1.16. The fact that Sull remained counsel of record for the client on an unrelated matter has no bearing on whether the client terminated Sull’s representation for the E-2 Visa. The record fails to support the hearing panel’s finding that the client had not terminated the representation.

Sull delayed providing the client with an accounting of work performed and a refund of unearned fees for several months after the representation for the E-2 Visa terminated. The record demonstrates by clear and convincing evidence that Sull violated the duty to “surrender[] papers and property to which the client is entitled and refund[] any advance payment of fee or expense that has not been earned or incurred.”

Conclusion

Sull violated the Nevada Rules of Professional Conduct by mishandling client funds and by failing to account for and refund client funds after the client terminated her representation. Given the clear evidence of violation, we reverse the hearing panel’s order dismissing the disciplinary charges against Sull. Considering the aggravating and mitigating circumstances, particularly that Sull has had no prior attorney discipline, we conclude that a reprimand is sufficient to serve the purpose of attorney discipline.

The case is IN THE MATTER OF DISCIPLINE OF HARDEEP SULL, BAR NO. 12108. (Mike Frisch)