Surcharges And Other Charges

An associate attorney’s report of misconduct led to findings that drew a censure from the New Jersey Supreme Court.

The misconduct was described by the Disciplinary Review Board

First, in eight client matters (Elite Transcripts, Inc.; the Estate of Rochelle Lewis; the Estate of Iannoaccone; the Walker Guardianship; the Walker Foreclosure; the Estate of Paylor-Koffi; the Estate of Franklin Anthony; the Estate of Shaughnessey; and in connection with the representation of Jim Steiner), respondent admittedly imposed a prohibited, two-percent surcharge on billed fees for “costs incurred and not otherwise billed. Respondent conceded that, pursuant to ABA Comm. on Ethics and Professional Responsibility, Formal Op. 93-379, (December 6, 1993) (entitled “Billing for Professional Fees, Disbursements and Other Expenses”), such a surcharge is prohibited and constitutes a per se violation of RPC 1.5(a). Moreover, the OAE’s investigation revealed that, in some client matters, the Firm billed clients for actuals costs and further billed clients the two-percent charge “for costs incurred and not otherwise billed.”

Respondent’s fee overreaching did not, however, occur solely in connection with the improper, two-percent surcharge. He also committed fee overreaching in the Kaczala matter; the Estate of Rochelle Lewis matter; the Walker Guardianship matter; the Paylor-Koffi matter; and the Rauch matters by engaging in “omnibus” billing without supporting billing records.

Next, respondent committed fee overreaching, by other means, in two client matters. In the Concetta Hagel matter, he improperly applied Concetta’s retainer to her son Matthew’s matter without written authorization to do so. In the Dorothy Dobak matter, he improperly retained the client’s $610 retainer balance without her written authorization.

Respondent committed final acts of fee overreaching in the Estate of Doris Krisa matter, the Estate of Eda Sharenow matter, and the Estate of Nancy Mamis-King matter by improperly charging legal fees in addition to receiving an executor’s commission, contrary to N.J.S.A. 3B:18-6.

Sanction

Given respondent’s violations of RPC 8.4(d), as exacerbated by his further violations of RPC 1.4(b) and (c), the baseline censure could be enhanced to a short term of suspension. However, to craft the appropriate discipline in this matter, the Board considered the application of aggravating and mitigating factors.

The Board found no aggravating factors independent of the volume of client matters in which respondent overreached and failed to communicate. However, the breadth of that aspect of respondent’s misconduct was considered in setting the baseline discipline and, thus, was not further weighed in aggravation.

In respect of mitigation, the Board accorded substantial weight to respondent’s unblemished disciplinary record since his 1988 admission to the bar. Moreover, respondent stipulated to his wrongdoing and consented to discipline. Years have passed since respondent committed the misconduct under scrutiny, and respondent has not engaged in any other misconduct. Respondent has already made restitution in all three estate matters in which he improperly billed legal fees following his appointment as executor. He further agreed with the Board’s request that he refund to the affected clients the improper two-percent surcharge within sixty days of the Board’s decision in this matter. Proof that those refunds have been remitted and the checks honored shall be provided to the OAE within that same sixty-day period. The Board determined that a term of suspension, thus, is not necessary to protect the public and preserve confidence in the bar.