757 S.E.2d 609
W. Va.2014Background
- Ira M. Haught, a West Virginia attorney admitted in 1983, faced two disciplinary complaints: (Count I) from Gerald Heister on behalf of National Rendezvous and Living History Foundation (NRLHF) regarding $11,402.50 received from clients Linda and Richard Blizard; (Count II) from Jack and Wanda Wright regarding a deed transaction omitting mineral interests and Haught’s responsiveness.
- Bank records showed Haught deposited $11,402.50 into his IOLTA trust account on June 30, 2008, but the account balance soon thereafter did not reflect that amount; Haught later issued the Blizards a $7,062.50 check on September 11, 2009 after a deposit the day before.
- Haught initially told disciplinary investigators he received and held the $11,402.50 in cash in his office safe at the Blizards’ request; documentary evidence contradicted that claim and Haught could not produce supporting receipts or family-trust records.
- For the Wrights, evidence (messages, testimony, and file cards) supported that Haught acted for the Wrights or at least had an attorney-client relationship; Haught repeatedly provided inconsistent statements about who retained him (seller Tonkin, purchaser Thompson, or the Wrights).
- The Hearing Panel Subcommittee found clear and convincing evidence that Haught violated Rules 1.15(a), 8.1(a), and 8.4(c) and (d); recommended a three-year suspension plus additional sanctions. The Supreme Court reduced the suspension to one year but adopted the additional sanctions (supervised practice, extra CLE, CPA audits, costs).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Haught failed to safeguard client funds in violation of Rule 1.15(a) | Bank records show deposit to IOLTA then withdrawals and transfers inconsistent with maintaining the Blizards’ funds; Haught lacked receipts and credible explanation. | Haught claimed clients requested cash be held in his safe and that funds were effectively managed via Haught Family Trust adjustments. | Court: Violation proved. Haught deposited funds to IOLTA but did not keep them properly; last-minute replenishment does not excuse failure to safeguard. |
| Whether Haught made false statements to disciplinary authorities (Rule 8.1(a)) and engaged in dishonest conduct (Rule 8.4(c),(d)) regarding the Blizard funds | Disciplinary Counsel: Haught falsely told investigators he held cash in safe and denied depositing to IOLTA; documentary evidence contradicted him. | Haught asserted mistaken recollection and explanations involving Family Trust funds; denied intentional falsehoods. | Court: Violation proved. Subcommittee’s finding that Haught’s sworn statements were false and not credible adopted (Rule 8.1(a); 8.4(c),(d) as to dishonesty). |
| Whether an attorney-client relationship existed with the Wrights and whether Haught knowingly misrepresented that relationship (Rules 8.1(a), 8.4(c)) | Wrights: messages, timely payments, and their reasonable belief show Haught represented them; Haught misrepresented who retained him to avoid responsibility. | Haught: He represented the seller (Tonkin) or Thompson earlier; no written retainer; sometimes uncertain who called first; acted as accommodation later. | Court: An attorney-client relationship with the Wrights existed; Haught knowingly made material false statements about who retained him, violating Rules 8.1(a) and 8.4(c). |
| Appropriate sanction | Disciplinary Counsel/HPS: three-year suspension plus supervised practice, CLE, audits, costs. | Haught: challenged findings and sanctions; sought dismissal. | Court: Adopted findings largely but reduced suspension to one year; imposed HPS recommended additional sanctions (2-year supervised practice plan on reinstatement, 9 extra CLE hours, two years of CPA audits, costs). |
Key Cases Cited
- Committee on Legal Ethics v. McCorkle, 192 W.Va. 286, 452 S.E.2d 377 (W. Va. 1994) (de novo review for legal questions and sanction decisions; factual findings afforded deference)
- Committee on Legal Ethics v. Blair, 174 W.Va. 494, 327 S.E.2d 671 (W. Va. 1984) (Supreme Court is final arbiter of lawyer discipline decisions)
- Lawyer Disciplinary Board v. Santa Barbara, 229 W.Va. 344, 729 S.E.2d 179 (W. Va. 2012) (affirming standard of review principles in disciplinary matters)
- Lawyer Disciplinary Board v. Blevins, 222 W.Va. 653, 671 S.E.2d 658 (W. Va. 2008) (no ‘no harm, no foul’ defense for mishandling client funds)