Iowa Supreme Court Attorney Disciplinary Board v. Aaron J. Thomas
2014 Iowa Sup. LEXIS 25
| Iowa | 2014Background
- Thomas, a 2002 law licensee in Iowa, joined his father’s Anamosa practice.
- Emily Street retained Thomas in 2009 for a car-accident claim under a contingent fee; settlement occurred in 2011 for $23,000.
- Street’s settlement funds were payable to multiple parties, with Thomas holding a trust account and a 30% contingent fee plus expenses.
- Thomas disbursed funds from Street’s settlement beyond his fee/authorized expenses, including personal and other third-party payments.
- Thomas did not promptly, or adequately, account for funds, failed to communicate with Street, and failed to respond to disciplinary inquiries.
- The Grievance Commission found misappropriation and rule/Code violations; the Board moved for license revocation; the Supreme Court revoked the license on de novo review.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Thomas committed misappropriation by converting client funds | Street/Board: funds were converted with no colorable claim | Thomas: some funds were legitimately payable per agreement | Yes; no colorable claim, funds were converted |
| Whether Thomas violated ethics rules and statutes governing trust accounts and communication | Board: violations of 32:1.15(a)(d), 32:8.4, 32:1.4, 32:1.3, 45.2(2); Code §602.10119 | Thomas: acknowledged trust-account confusion but argued defense or lesser fault | Yes; multiple violations established |
| Whether license revocation is appropriate sanction given misappropriation | Board: revoke license due to misappropriation | Thomas: potential future claim to funds or lesser sanction | License revoked; past cases show revocation warranted for client-funds misappropriation |
| Whether the Board’s recommended discipline was properly grounded in the record | Board: six-month suspension with ethics training would suffice | Thomas: contesting scope of discipline | Court imposed revocation; sanctions appropriate given misappropriation |
| Whether restitution affects the sanction | Restitution does not preclude revocation | Restitution completed but does not mitigate severity | Restitution does not preclude revocation |
Key Cases Cited
- Stowe, 830 N.W.2d 737 (Iowa 2013) (convincing preponderance standard in de novo review of ethics matters)
- McCarthy, 814 N.W.2d 596 (Iowa 2012) (convincing preponderance standard defined; heightened burden in ethics cases)
- McCann, 712 N.W.2d 89 (Iowa 2006) (colorable future claim distinction in sanctioning trust-account violations)
- Powell, 830 N.W.2d 355 (Iowa 2013) (trust-account withdrawals before earned fees; colorable claim considerations)
- Ottesen, 525 N.W.2d 865 (Iowa 1994) (disemployment of lawyers who convert client funds; license revocation standard)
- Reilly, 708 N.W.2d 82 (Iowa 2006) (consequences of misappropriating client funds; revocation precedent)
- Wengert, 790 N.W.2d 94 (Iowa 2010) (restitution does not preclude revocation; trust-account violations trigger severe sanctions)