Lorain Cty. Bar Assn. v. Nelson
2022 Ohio 1288
| Ohio | 2022Background
- Kenneth A. Nelson II was previously disciplined (public reprimand 2015; two-year suspension with 18 months stayed in 2017) and reinstated in 2018 subject to one year of monitored probation focused on trust‑account and recordkeeping requirements.
- While on probation, Nelson accepted 18 Modest Means Program referrals (standard $500 retainer; $75/hr billing) and, instead of depositing retainers into a client trust account, treated them as earned and kept them in an improper account.
- Lorain County Bar Association (relator) opened an investigation in early 2020, served notice in April 2020, and Nelson met with the ethics committee May 18, 2020; on May 22 he filed an application to terminate probation with an affidavit attesting compliance and asserting no disciplinary proceedings were pending.
- Relator charged Nelson with violating Prof.Cond.R. 1.15(a) and 1.15(c) (trust‑account duties), Prof.Cond.R. 3.3(a)(1) and 8.4(c) (false statement/ dishonesty), and failing to cooperate with the investigation (8.1(b), Gov.Bar R. V(9)(G)).
- At hearing Nelson produced only one fee agreement (dated after the investigation began), claimed the other agreements were lost when he vacated his office, and maintained he believed the retainers were flat fees “earned upon receipt”; the board found his testimony suspect, concluded he violated 1.15(a) and 1.15(c), and found a knowing false statement as to pending disciplinary proceedings; the cooperation counts were dismissed but counted as aggravation.
- The board recommended a two‑year suspension with one year stayed and two years of monitored probation with a monitoring attorney; the Supreme Court adopted the misconduct findings and imposed that sanction (one year stayed on conditions), with monitored probation and monthly reviews of fee agreements and trust‑account records; costs taxed to Nelson.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did Nelson violate trust‑account rules by not depositing Modest Means retainers into a client trust account? | Relator: retainers were advance fees that must be held in a client trust account under Prof.Cond.R. 1.15(a),(c). | Nelson: believed the program fees were flat "earned upon receipt" and relied on his own fee agreements (Prof.Cond.R. 1.5(d)(3) exception). | Court: found violations of Prof.Cond.R. 1.15(a) and 1.15(c); Nelson failed to prove compliance for 17 of 18 clients. |
| Did Nelson knowingly make a false statement in his application to terminate probation? | Relator: Nelson knew of the pending investigation and thus knowingly misrepresented that no disciplinary proceedings were pending (violating 3.3(a)(1) and 8.4(c)). | Nelson: he believed he was in compliance and that relator’s inquiry was not a disciplinary proceeding. | Court: overruled Nelson’s argument and held he knowingly misrepresented that no proceedings were pending; violations of 3.3(a)(1) and 8.4(c). |
| Did Nelson fail to cooperate with the disciplinary investigation? | Relator: Nelson delayed producing fee agreements, objected improperly, and gave evasive responses (violating 8.1(b) and Gov.Bar R. V(9)(G)). | Nelson: documents were misplaced after vacating office; cooperated eventually and claimed mitigating circumstances. | Court: board dismissed the formal violation allegations but treated Nelson’s delays and evasiveness as aggravating conduct. |
| What sanction is appropriate? | Relator: indefinite suspension warranted given repeated and similar prior misconduct. | Nelson: at most a fully stayed two‑year suspension with monitored probation (relies on comparable precedent). | Court: imposed two‑year suspension with one year stayed on conditions, plus two years of monitored probation with monthly review by monitoring attorney; costs taxed to Nelson. |
Key Cases Cited
- Lorain Cty. Bar Assn. v. Nelson, 152 Ohio St.3d 222 (2017) (prior two‑year suspension for similar client‑trust‑account violations)
- Lorain Cty. Bar Assn. v. Nelson, 153 Ohio St.3d 1239 (2018) (reinstatement with monitored probation condition)
- Mahoning Cty. Bar Assn. v. Gerchak, 144 Ohio St.3d 138 (2015) (fully stayed two‑year suspension for single‑client unearned‑fee violation with strong mitigation)
- Disciplinary Counsel v. Dockry, 133 Ohio St.3d 527 (2012) (fully stayed one‑year suspension where trust‑account misuse was offset by mitigation and restitution)
- Disciplinary Counsel v. Adelstein, 160 Ohio St.3d 511 (2020) (fully stayed one‑year suspension for commingling, mismanagement, and recordkeeping failures with mitigation)
- Disciplinary Counsel v. Lawson, 130 Ohio St.3d 184 (2011) (discipline may increase when prior sanctions fail to deter repeat misconduct)
- In re Disbarment of Lieberman, 163 Ohio St. 35 (1955) (principle that repeat offenses justify greater discipline to protect the public)