In Re the Discipline of Corey
2012 UT 21
| Utah | 2012Background
- Clayne Corey used a client's settlement funds to cover four months of firm operating expenses and then sought to place funds in a trust or execute a promissory note to cover the shortfall; the client refused to sign and demanded repayment.
- The district court found five Rule violations (safekeeping property and misconduct) but imposed suspension with a stay, based on purported mitigating evidence and restitution goals.
- The Stager settlement ($122,500) was deposited into Corey's operating account, draining the firm's balance; Stager never received a trust account disbursement, and Corey failed to repay the remaining funds after litigation.
- Corey faced OPC disciplinary action; the district court weighed aggravating factors (prior misconduct, pattern of safekeeping failures, and failure to restitution) against mitigating factors (arachnoid cyst and medication) but stayed suspension to facilitate restitution.
- The Utah Supreme Court reversed, disbarred Corey for intentional misappropriation, and held that compensation-impaired mitigation was not compelling enough to rebut the presumptive disbarment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether presumptive discipline for intentional misappropriation is disbarment | OPC urged disbarment | Corey argued no intent to injure and thus suspension | Disbarment is presumptively warranted for intentional misappropriation |
| Whether Corey acted with intent to benefit himself | Corey knowingly used client funds for firm expenses | Corey claimed mixed knowledge and negligence | Yes, intent to benefit self found; conduct constitutes intentional misappropriation |
| Whether mitigating mental impairment constitutes truly compelling mitigation | Mitigation shows reduced responsibility | cyst/medication mitigate misconduct | Not truly compelling; disbarment stance prevails |
| Whether prior misconduct and other aggravators overwhelm mitigation | Aggravation outweighs mitigation; discipline warranted | Recovery post-cyst suggests mitigation | Aggravation and lack of compelling mitigation support disbarment |
Key Cases Cited
- In re Discipline of Ennenga, 37 P.3d 1150 (Utah 2001) (misappropriation and mitigating factors in discipline)
- In re Discipline of Johnson, 48 P.3d 881 (Utah 2001) (precedent on professional discipline standards)
- In re Discipline of Babilis, 951 P.2d 207 (Utah 1997) (disbarment presumption for intentional misconduct; compelling mitigation)
- In re Discipline of Ennenga, 37 P.3d 1150 (Utah 2001) (mitigation standards and disbarment framework)
- In re Discipline of Ince, 957 P.2d 1233 (Utah 1998) (misappropriation and disciplinary consequences)