Florida Bar v. Watson
76 So. 3d 915
| Fla. | 2011Background
- Referee found Watson guilty of misconduct and recommended 90-day suspension; Court adopts three 4-8.4(c) violations and four 5-1.1(b) violations; Court imposes a three-year suspension nunc pro tunc Oct. 1, 2009; case involves misused third-party funds held in trust in multiple transactions; investors Brown, Reid, Bury, Hooks, and others claim loss and lack of disclosure; letters drafted on Respondent's letterhead created perception funds remained in trust; Respondent failed to provide accounting or truthful information about fund transfers.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Watson violated 4-8.4(c) and 5-1.1(b) | Bar argues intentional misrepresentation and fiduciary breaches | Watson argues negligence, not intent | Guilty of three 4-8.4(c) violations and four 5-1.1(b) violations |
| Appropriate sanction for misuses of trust funds | Bar seeks longer suspension given harm to four victims | Watson seeks 90-day suspension | Three-year suspension warranted; probation nullified; costs awarded |
| Was the referee’s finding of negligence supported, or was conduct deliberate or knowing | Bar contends deliberate/knowing misconduct | Watson contends negligent/unclear intent | Court adopts deliberate/knowing standard; affirm intent findings for 4-8.4(c) violations |
| Did the written letters and trust-account handling constitute dishonesty | Letters misrepresented investments and funds held in trust | Watson asserts client-based duties and lack of proof of reliance | Dishonest letters and misrepresentations found; intent shown |
| Effect of the lack of probation terms | Nullity if probation lacks enforceable terms | Probation should be permitted | Probationary remedy disapproved; sanctions imposed without probation terms to enforce |
Key Cases Cited
- Fla. Bar v. Fredericks, 731 So.2d 1249 (Fla. 1999) (intent can be proven by deliberate/knowing conduct; not require motive)
- Fla. Bar v. Nicnick, 963 So.2d 219 (Fla. 2007) (upholds factual sufficiency for intent when conduct is deliberate or knowing)
- Fla. Bar v. Forrester, 818 So.2d 477 (Fla. 2002) (intent element in disciplinary violations requires deliberate/knowing conduct)
- Fla. Bar v. Riggs, 944 So.2d 167 (Fla. 2006) (misuse of client funds; disbarment/disciplines a severe sanction; supports three-year suspension)
- Fla. Bar v. Joy, 679 So.2d 1165 (Fla. 1996) (fiduciary duty when lawyers hold funds for multiple principals; implied duties)