Disciplinary Board of the Supreme Court of the State of North Dakota v. Matson
2015 ND 222
| N.D. | 2015Background
- Jesse D. Matson, admitted 2011, faced three consolidated disciplinary matters involving client representation in divorce and child-support matters and a prior reprimand with unpaid costs.
- Matson was served with petitions and failed to answer, resulting in default and admission of the allegations; a dispositional hearing followed.
- Repeated deficiencies: slow or ceased communication, late filings, inadequate preparation/competence, attending unrelated hearings during trial, and errors on child-support calculations.
- Two clients paid retainers ($2,000 and $4,000) that were deposited into Matson’s operating account; Matson had no IOLTA/trust account and did not refund unearned balances or provide itemized billings/files on request.
- The hearing panel found violations of Rules 1.1 (competence), 1.3 (diligence), 1.4(a) (communication), 1.5(a) (fees), 1.15 (safekeeping property), and 1.16(e) (termination/refund), and noted aggravating factors including prior discipline and failure to pay prior assessed costs.
- Recommended sanction: suspension for six months and one day, continuing legal education on the rules of professional conduct as a condition of reinstatement, and payment of disciplinary costs ($6,287.52 in these matters and $4,485.43 from the prior matter). The Court accepted the recommendation and ordered compliance.
Issues
| Issue | Petitioner’s Argument | Matson’s Argument | Held |
|---|---|---|---|
| Default/admission for failure to answer | Matson’s failure to respond = default; allegations are admitted | (No response) | Court treated Matson as in default; allegations deemed admitted. |
| Competence, diligence, communication (Rules 1.1, 1.3, 1.4) | Matson’s slow responses, late filings, poor preparation, and attending other hearings harmed clients | (No response) | Violations found for lack of competence, diligence, and adequate communication. |
| Handling of retainers/trust accounts (Rule 1.15) | Retainers were not earned-on-receipt and belonged to clients; depositing them in operating account and lacking IOLTA violated Rule 1.15 | (No response) | Violations found for failing to keep client funds separate and not maintaining a trust/IOLTA account. |
| Failure to refund unearned fees and deliver files (Rule 1.16(e)) | Matson failed to refund credit balances and to surrender files, injuring clients | (No response) | Violation found for failing to refund unearned fees and surrender client files. |
| Appropriate sanction (suspension vs. disbarment/longer suspension) | Suspension for 6 months + CLE + payment of costs appropriate under standards for commingling/improper handling causing injury | (No response) | Court accepted panel’s recommendation: suspension six months and one day, CLE requirement, payment of assessed costs; concurring/dissenting justices argued for longer suspension or interim suspension/disbarment given facts and prior discipline. |
Key Cases Cited
- In re Disciplinary Action Against Hann, 819 N.W.2d 498 (N.D. 2012) (discusses when retainers may be earned-on-receipt versus client property)
- In re Disciplinary Action Against Hoffman, 834 N.W.2d 636 (N.D. 2013) (trust account/retainer handling precedents cited for Rule 1.15 requirements)
- In re Wilson, 409 A.2d 1153 (N.J. 1979) (seminal discussion supporting disbarment for knowing misappropriation of client funds)
- In re Disciplinary Proceeding Against Simmerly, 285 P.3d 838 (Wash. 2012) (misappropriation of client funds causing potential/actual injury supports disbarment)