 |
 |
 |
|
|
|
June 22, 2011 On June 22, 2011, the Supreme Judicial Court approved a new rule, Section 4.5B of the Rules of the Board of Bar Overseers, “Taking Out-of-State Depositions Pursuant to Subpoena” in bar disciplinary proceedings. The rule provides that, when the Board approves an application by bar counsel or a respondent to take an out-of-state deposition, the Board will issue a request, addressed to the corresponding disciplinary authority in the jurisdiction where the deposition will occur, asking that a subpoena (or subpoena duces tecum) be issued for a specified date, place and time. If the corresponding disciplinary authority cannot issue or declines to issue a subpoena for the deposition, then the party requesting the deposition may apply to a single justice of the SJC for leave to take the deposition pursuant to the Massachusetts Letters Rogatory statute, G.L. c. 223A, §10. For the purposes of the statute, the disciplinary proceeding is considered to be an “action pending in this Commonwealth.” The new rule applies to depositions under both Section 4.9 (discovery depositions) and Section 4.10 (testimonial depositions of unavailable witnesses) of the Board rules, but does not affect the standard that “substantial need” must be shown obtain to obtain approval to take discovery depositions. The new rule can be found by clicking here. June 22, 2011 On June 22, 2011, the Supreme Judicial Court amended the rules concerning recusal of members of the Board of Bar Overseers, as well as of hearing officers including hearing committee (“HC”) or hearing panel (“HP”) members and special hearing officers (“SHOs”). The revisions, which are effective September 1, 2011, both consolidate and add to existing provisions on recusal and provide in substance the following:
OBC/BBO HIGHLIGHTS
January 23, 2012
Index
Recent Rules Changes
The changes are implemented by striking Board Rule Section 3.54 in its entirety and the second sentence of Section 3.50(g). They are replaced by a new Subchapter G under Chapter 4 (“Miscellaneous Matters”). For a full copy of the revised rules, click here.
June 22, 2011
On June 22, 2011, the Supreme Judicial Court amended Rule 4:02 by adding section (10). This provides that residential addresses of attorneys as disclosed on their registration statements shall be treated as confidential and used only by the Board of Bar Overseers and the Office of Bar Counsel to communicate with lawyers or otherwise in the course of the business of the Board or Bar Counsel. The residence addresses will not otherwise be disclosed to a third party except as ordered by a Single Justice of the Court.
The practical effect for someone seeking to obtain a home address of a Massachusetts lawyer from the Board of Bar Overseers or the Office of the Bar Counsel is that one must get an order from the Court requiring such disclosure.
This restriction does not apply to any lawyer who designates a home address as a place of business. The office address of any attorney in good standing in Massachusetts will continue to be available on the website of the Office of the Bar counsel using the following link: http://massbbo.org/bbolookup.php
The full text of the new section can be found by clicking here.
The following case summaries were compiled by Assistant Bar Counsel Jeffrey D. Woolf.
September 27, 2011
In Matter of Richard S. Weiss, 460 Mass. 1012 (2011), the Supreme Judicial Court held that an attorney could be suspended from the practice of law for the same conduct that previously resulted in his being sanctioned by a judge of the Probate and Family Court. This decision was issued pursuant to the SJC’s 2009 order initiating a pilot program modifying the procedure for appeals to the full bench from decisions of the single justice in bar discipline cases.
In the Probate Court proceedings, the respondent had been required to resign as a guardian, to forgo fees he claimed to have earned and to pay certain sums to the guardianship estate. Following the actions of the Probate Court, bar counsel initiated disciplinary proceedings against the respondent. The respondent and bar counsel stipulated to certain facts and jointly recommended that the respondent be suspended from the practice of law for a year and a day, and submitted the stipulation and recommendation to the Single Justice. The respondent thereafter nonetheless moved to dismiss the disciplinary charges against him on the ground of res judicata, asserting that the Probate Court sanction precluded bar discipline.
The full Court disagreed, noting that the principles of res judicata did not apply because, among other things, bar counsel was not a party to the underlying action and had no standing to join it, nor was bar counsel in privity with the Probate Court, even though both were concerned with the respondent’s behavior. Moreover, there could not be res judicata because the probate judge could not impose disciplinary sanctions on an attorney. The Court noted that duties and powers of bar counsel and the Board of Bar Overseers (as well as the superintendency power of the SJC) are not preempted or compromised by the decisions of a court in an underlying action.
Accordingly, the Court denied the respondent’s motion to dismiss and affirmed his term suspension from the practice of law.
August 19, 2011
In Matter of Pudlo, 460 Mass. 400 (2011), the Supreme Judicial Court suspended an attorney for one year, with six months stayed on the condition that he provide quarterly audit reports of all trust accounts for two years. The genesis of the respondent’s misconduct lay in his failure to keep track of funds advanced by a litigation client in 1997 and 1998 and his failure generally to maintain appropriate records of trust funds through 2008 when the petition for discipline was filed. The respondent also was found to have neglected the underlying civil case for which the litigation client had retained him.
Some of the funds received from the client were retainers for attorney’s fees and other funds were to be used for case expenses. Advance payments by a client to be used for the payment of legal fees must be deposited in an IOLTA account. However, advance payments for case expenses can be deposited into an attorney’s business account. Due to the respondent’s failure to identify and segregate funds, he lost track of the money, negligently misspent it before it was earned and ultimately could not fully account for funds received toward expenses.
The Court found that much of the respondent’s misconduct occurred before the 2004 changes to Mass. R. Prof. C. 1.15, which clarified an attorney’s obligations concerning the handling of client funds advanced for case expenses and attorney’s fees, including the requirement of a written itemized bill before or at the time of the withdrawal of the funds. The Court also noted that because of the potential for misunderstanding and confusion, it has declined to apply the presumptive sanctions for misuse of classic client funds to mishandling of retainers and expenses, regardless of whether the misuse was intentional or negligent. Matter of Sharif, 459 Mass. 558 (2011) (three-year suspension with third year stayed for intentional misuse of retainer). In the totality of the circumstances in this case, the Court upheld the Board’s recommendation of a term suspension.
July 15, 2011
In Matter of Scola, 460 Mass. 1003 (2011), a lawyer who handled real estate closings through an IOLTA account that had a substantial deficit, thereby using one client's funds to meet another's obligations, was suspended for six months, with the suspension stayed for a one-year probationary period.
The IOLTA account of the respondent, a real estate practitioner who handled closings for lenders, initially became underfunded in 2004 because of non-receipt of funds from the lender for a transaction. Because of the volume of the respondent’s practice, he was unaware that these funds were not received. The respondent did not reconcile his IOLTA account, believing (mistakenly) that his real estate software package did this.
In 2006, a check written on the respondent’s IOLTA account was returned for insufficient funds and bar counsel asked the respondent to examine his IOLTA account. The respondent hired an independent accountant to manage his books and mistakenly believed the source of the problem had been located. However, in 2007, another IOLTA check was returned for insufficient funds. The respondent again investigated and incorrectly believed that he had reached the root of his problems but had not because he had not yet located the underfunded 2004 transaction.
After concluding in January of 2008 that the IOLTA account could not be reconciled, bar counsel instructed the respondent to stop using the IOLTA account and to open a new one. The respondent nevertheless continued using the old IOLTA account for another six weeks. During this time, two refinancings he conducted were without sufficient funds, resulting in temporary deprivation of funds to other clients.
The Court concluded that the respondent’s misuse of funds for two years, due to inadequate record-keeping, was unknowing and became intentional only when he continued to use the account after being instructed not to do so. The Court concluded that the misconduct, including the respondent’s knowing misuse of client funds with temporary deprivation required a term suspension of six months. The Court stayed the suspension with probationary terms, however, in light of the “significant mitigating factors” including the fact the respondent did not personally gain by his conduct and did not use client funds for his own benefit; he did not commingle funds; and he committed no fraud.
April 25, 2011
In Real Estate Bar Association for Mass., Inc. v. National Real Estate Information Services [REBA v. NREIS], 459 Mass. 512 (2011), the Supreme Judicial Court was faced with two questions certified to it by the U.S. Court of Appeals concerning the unauthorized practice of law. REBA v. NREIS, 608 F.3d 110 (1st Cir. 2010). REBA sued NREIS for declaratory and injunctive relief, alleging that NREIS’s business of providing lenders with settlement services to close residential real estate mortgage transactions in Massachusetts involved the unauthorized practice of law. The Supreme Judicial Court first noted the difficulty in defining “the practice of law” and that many activities, that could constitute “the practice of law” are undertaken by non-lawyers. Therefore, the “unauthorized practice of law” must involve activities that fall “wholly within” the practice of law.
The Court then noted that real estate conveyancing consisted of a series of “connected but discrete activities.” Because of deficiencies in the record, the Court could not decide whether or not NREIS had engaged in the unauthorized practice of law. However, it reviewed a number of closing-related activities, and concluded that the following do not constitute “the practice of law”: (a) ordering a title examination or receiving a title abstract; (b) ordering public reports (such as property appraisals, municipal lien certificates, flood reports and tax certificates); (c) preparing HUD-1 settlement statements and “mortgage-related forms”; (d) some closing-related activities, such as reviewing documents to make sure they were properly executed, or delivering them to the registry of deeds for recording (as they are primarily clerical in nature); (e) disbursing mortgage funds; and (f) issuing title insurance commitments and policies.
By contrast, the Court concluded that preparing a deed does constitute the practice of law and must be performed by a lawyer. Likewise, by way of “advice” to the First Circuit, the Court stated that an attorney must be “involved” in the closing or other settlement of real property conveyances, which is more than simply being present at the closing. For example, determining whether the seller or borrower-mortgagor has marketable title is a determination that must be made by an attorney, which can be done before the closing. Likewise, an attorney is also required to effectuate a valid transfer of the interests being conveyed at a closing, including the transfer of title and the transfer of consideration, such as the sale or loan proceeds.
All recent bar discipline decisions of the Board of Bar Overseers and the Supreme Judicial Court can be found at Recent Disciplinary Decisions.
