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Commonwealth of Massachusetts

NO. BD-2007-059

IN RE: ARTHUR M. KHOURY1

S.J.C. Judgment of Disbarment entered by Justice Greaney on January 22, 2008.2

SUMMARY3

In the fall of 2004, a client hired the respondent to probate the will of the clientís uncle. The uncle had died in August 2004, and the client was the nominated executor. The will had been drafted by the respondent and was then in the respondentís possession. The estate consisted of some jewelry and bank deposits left to several friends and relatives including the client.

The respondent began an uncontested probate proceeding, secured the clientís appointment as executor in April 2005, and filed an estate inventory in May 2005. The client marshaled the estate bank deposits and paid the final expenses. In addition, the client prepared for the respondent an itemization of the estateís receipts and expenditures. After payment of the expenses, the estate funds totaled about $77,000 plus interest. There were no claims against the estate, which was ready for disposition and distribution by the fall of 2005.

In October 2005, on the respondentís instructions, the client delivered to the respondent the itemization, a ring bequeathed to another relative, and the estate funds in the amount of $77,285.34. The respondent told the client that he would hold the ring and the funds for distribution when the probate was concluded.

Instead of placing the estate funds in a segregated, interest-bearing account, the respondent deposited them to an IOLTA account used for his conveyancing practice. Between October and December 2005, the respondent commingled some of the estate funds with his own funds and intentionally misused all those funds with the intent to deprive the beneficiaries of their funds at least temporarily and with actual deprivation resulting. The respondent did no further work of substance on the estate. He deliberately delayed concluding the probate in order to conceal his conversion of the estate funds.

During 2006, the client and some of the other beneficiaries repeatedly asked the respondent about the status of the estate. The respondent failed to answer some of those inquiries. When he did reply, the respondent intentionally misrepresented that he was working on the estate in preparation for final distributions. The respondent also failed to deliver the ring to the named beneficiary or answer the clientís inquiries about its whereabouts.

In December 2006, the respondent sent the beneficiaries a purported account of the estate funds and assent forms, which he instructed them to sign and return. The account was intentionally false because it represented that, after deductions for claimed fees, the respondent was holding all the estate funds for distribution under the will. The beneficiaries returned the signed assents. Thereafter the respondent failed to answer their further inquiries. The respondent never disclosed his dissipation and conversion of the estate funds to the client or the other beneficiaries. He failed to keep complete records of the funds in his IOLTA account, including the estate funds, and never accounted for the estate funds and property.

The respondentís commingling and intentional conversion of the estate funds violated Mass. R. Prof. C. 1.15(b) and C. 8.4(c). His intentional misrepresentations to his client and the other beneficiaries and his solicitation of assents to a false account to be filed in court violated Mass. R. Prof. C. 4.1(a) and 8.4(c) and (d).

The respondentís failure to seek his clientís lawful objectives in the representation, act with reasonable promptness and diligence, keep the client reasonably informed about the representation, and explain the status of the matter to the extent reasonably necessary to permit the client to make informed decisions about the representation violated Mass. R. Prof. C. 1.2(a), 1.3, and 1.4(a) and (b). By failing promptly to distribute the estate funds and property and failing to account for the funds and property, the respondent violated Mass. R. Prof. C. 1.15(c) and (d)(1). The respondentís failure to keep required records of the estate funds and property and other trust funds violated 1.15(f)(1)(B)-(F) and (f)(3).

The respondent was admitted to the Massachusetts bar in November 1964. On July 10, 2007, by assent, the respondent was temporarily suspended from the practice of law in the Commonwealth pursuant to S.J.C. Rule 4:01, ß 12A. After his temporary suspension, the respondent returned the ring to the client. He made no restitution of the estate funds and owes the beneficiaries $77, 285.34 plus interest.

Bar counsel commenced disciplinary proceedings against the respondent by a petition for discipline filed and served in August 2007. The respondent failed to answer. As a result, the allegations of the petition were deemed admitted under Section 3.15(e) of the Rules of the Board of Bar Overseers. The Board voted on November 19, 2007 to recommend the respondentís disbarment. On January 22, 2008, the Supreme Judicial Court entered a judgment by which the respondent was disbarred retroactive to August 14, 2007, the date of his compliance with the terms of his temporary suspension.


FOOTNOTES:

1 See 23 Mass. Attíy Disc. R. ____ (2007) for prior proceedings.

2 The complete Order of the Court is available by contacting the Clerk of the Supreme Judicial Court for Suffolk County.

3 Compiled by the Board of Bar Overseers based on the record before the Supreme Judicial Court.



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