ATTORNEY GRIEVANCE COMMISSION OF MARYLAND v. GERALD NEY KLAUBER
Misc. Docket (Subtitle BV) No. 4, September Term, 1978
Court of Appeals of Maryland
Decided October 10, 1978
283 Md. 597
Michael E. Marr for respondent.
James A. Frost, Assistant Bar Counsel, for petitioner.
SMITH, J., delivered the opinion of the Court. GILBERT, J., filed an opinion concurring in the result at page 600 infra. ORTH, J., filed a dissenting opinion at page 603 infra.
Bar Counsel acting on behalf of the Attorney Grievance Commission of Maryland filed a petition on June 28, 1978 seeking suspension of Respondent, Gerald Ney Klauber, under Maryland Rule BV16 as then in effect. This suspension was sought by virtue of the final judgment entered in the United States District Court for the District of Maryland on June 22, 1978 cоnvicting Klauber of violating
Rule BV16 as it then existed provided that we might suspend an attorney, pending our further order, who was convicted of a crime involving moral turpitude, with further provision as to the procedure to be followed upon the completion of any appeals the attorney might have filed. In Attorney Grievance Comm‘n v. Reamer, 281 Md. 323, 379 A. 2d 171 (1977), Chief Judge Murphy said for the Court:
“We need not decide in this case whether a conviction for mail fraud, in any and all circumstances, will always involve moral turpitude. It is enough that we determine in this case, from a review of the allegations of the indictment and the District Court‘s charge to the jury, and the jury‘s verdict, that the crimes of which Reamer was convicted plainly involved moral turpitude.” Id. at 328.
In that case the jury instructions made it abundantly clear that to convict the jury must find that acts were committed with an actual intent to defraud. We said:
“The jury‘s finding of guilt of mail fraud and aiding and abetting in a mail fraud under these instructions, in light of the allegations of the indictment that he procured false and fraudulent medical reports and bills, clearly indicates that Reamer‘s сonvictions involved moral turpitude within the contemplation of Rule BV16.” Id. at 329-30.
The instruction to the jury in this case apparently did not limit a conviction to a finding of moral turpitude as in Reamer. The jury was told:
“The Government has introduced evidence which it claims shows that the defendant paid individuals known as runners and MTA bus drivers moneys in exchange for those individuals referring to him clients who had been injured in automobile and bus
accidents. The use of such individuals is relevant in this case if you find that the procurement of clients by such persons was part of the schеme as alleged in the indictment. “The law of the State of Maryland prohibits an attorney from compensating or agreeing to compensate another person for procuring clients. Furthermore, the Code of Professional Responsibility which applies to attorneys practicing in the State of Maryland provides in part as follows:
‘A lawyer should not compensate or give anything of value to a person or organization to recommend or secure his employment by a client, оr as a reward for having made a recommendation resulting in his employment by a client. Likewise, a lawyer shall not accept employment when he knows or it is obvious that the person who seeks his service does so as a result of conduct described herein.’
“If you should find that as a part of a scheme to defraud, the defendant paid certain individuals for the purpose of procuring as clients persons who had been involved in automobile and bus accidents, and if you should further find that the defendant knew or should have known that such payments were violations of Maryland law or violations of the Code of Professional Responsibility applicable to Maryland lawyers, then you may consider such violation as evidence of the intent with which the defendant acted in this case.”
It may follow from this instruction that the jury could have found Klauber guilty without finding an intent on his part to defraud. His appeal is still pending. Hence we cannot say at this point in time, particularly before the Fourth Circuit speaks, that Klauber necessarily stands convicted of а crime involving moral turpitude.
It must be borne in mind that Rule BV16 does not make suspension mandatory, but makes it discretionary in this
The petition is denied. In denying the petition in this instance we do not pass upon whether Klauber would be subject to suspension upon the timely filing of a petition under the revised Rule BV16 since the matter is not before us.
It is so ordered.
Gilbert, J., concurring:
If we were writing on a clean slate, I would have no hesitancy in joining in part in Judge Orth‘s dissent. As it is, however, I believe we are bound by this Court‘s recent decision in Attorney Grievance Commission v. Reamer, 281 Md. 323, 328 (1977), wherein a unanimous Court said, “We need not decide in this case whether a conviction for mail fraud, in any and all circumstances, will always involve moral turpitude. It is enough that we determine in this case, from a review of the allegations of the indictment and the District
I know of no other way to interpret that language than to construe it to mean exactly what the majority sаys it means. We are, therefore, in the instant case, bound to look to the jury charge as given by the Judge of the United States District Court for the District of Maryland to the Klauber trial jury:
“The law of the State of Maryland prohibits an attorney from compensating or agreeing to compensate another person for procuring clients. Furthermore, the Code of Professional Responsibility which applies to attorneys practicing in the State of Maryland provides in part as follows:
‘A lawyer shall not cоmpensate or give anything of value to a person or organization to recommend or secure his employment by a client, or as a reward for having made a recommendation resulting in his employment by a client. Likewise, a lawyer shall not accept employment when he knows or it is obvious that the person who seeks his service does so as a result of conduct described herein.’
“If you should find that as a part of a scheme to defraud, the defendant paid certain individuals for the рurpose of procuring as clients persons who had been involved in automobile and bus accidents, and if you should further find that the defendant knew or should have known that such payments were violations of Maryland law or violations of the Code of Professional Responsibility applicable to Maryland lawyers, then you may consider such violation as evidence of the intent with which the defendant acted in this case. However, as I have previously informed you, the defendant is not on trial in this case fоr any act or conduct not alleged
in one of the counts of this indictment.” (Emphasis supplied.)
Plainly, the hiring of “runners,” while a clear violation of the Canons of Professional Responsibility, Md. Rule 1230, is not a crime involving moral turpitude. Under that charge, if the jury believed the government‘s case was weak, they may well have considered the employment of “runners” as evidence of fraudulent intent and thereby bootstrapped the government‘s case to a strength it otherwise would not possess. Of course, I do not knоw that this is what happened, but as the majority makes clear, it could have happened, and that is enough to preclude a finding that “the crimes of which . . . [Klauber] was convicted plainly involved moral turpitude.” Attorney Grievance Commission v. Reamer, 281 Md. at 328.
I cannot, with any degree of reasonable certainty, state that the portion of the District Court judge‘s charge dealing with the “runners” had no effect on the jury‘s verdict.
As I have earlier indicated, this is the conclusion to which I am propelled by Reamer. My basic quarrel is not with the majority‘s reasoning in this case but with Reamer, which I would оverrule, because in it I think the Court articulated a rule that it was absolutely unnecessary to promulgate, and in which it now finds itself enmeshed. Reamer was convicted of mail fraud, and whether that offense constituted moral turpitude should not have been the deciding factor. Reamer should not have contained the phrase “and the District Court‘s charge to the jury.” This Court should only look to the allegations of the indictment and the verdict of the jury thereon. We should not be in the position of evaluating the District Court Judge‘s jury chargе. That task the Congress wisely placed in the hands of the Fourth Circuit Court of Appeals. We should have left it there.
The Courts regulate the practice of law, Pub. Serv. Comm‘n v. Hahn, 253 Md. 571, 253 A. 2d 845 (1969). See also Lukas v. Bar Ass‘n of Montgomery County, 35 Md. App. 442, 371 A. 2d 669 (1977). The Court, as the regulator of persons who practice law in this State, owes a duty to the
The same inherent and fundamental judicial power to act in proceedings involving the discipline of members of the bar employed in Maryland State Bar Ass‘n v. Boone, 255 Md. 420, 429-32, 258 A. 2d 438 (1969), and alluded to in In re Diener and Broccalino, 268 Md. 659, 685, 304 A. 2d 587 (1973), cert. denied, 415 U.S. 989 (1974), should have been utilized in Reamer, Rule BV16 notwithstanding.
Bound by the decision in Reamer, I reluctantly concur in the result reached by the majority.
Orth, J., dissenting:
I do not join the majority opinion in this proceeding because I believe that their conclusion flies directly in the teeth of reason, common sense and the record before us.
On 21 April 1978 Gerald Ney Klauber, an attorney at law, was found guilty by a jury in the United States District Court for the District of Maryland of seventeen felonious offenses proscribed by the laws of the United States. Sixteen of them concerned mail fraud, and the remaining offense was racketeering activity predicated upon mail fraud. See
The Attorney Grievance Commission of Maryland was created with authority to supervise and administer the discipline and inactive status of attorneys entitled to practice in the courts of this State. Maryland Rule BV 2 a. Bar Counsel, aрpointed by the Commission, subject to approval of this Court, is the principal executive officer of the disciplinary system affecting attorneys. Rules BV 1 c and BV 4. Klauber had been admitted by this Court on 5 June 1959 to practice law in all the courts of this State. On 28 June 1978 Bar Counsel instituted proceedings to suspend Klauber from the practice of law pursuant to Rule BV 16 a as then in effect:
“If an attorney is convicted in any judicial tribunal of a crime involving moral turpitude, whether the conviction results from a plea of guilty or of nolo contendere or from a verdict after trial, and regardless of the pendency of an appeal or any other post-conviction proceeding, the Bar Counsel shall file charges with the Court of Appeals alleging the fact of the conviction and requesting that the attorney be suspended from the practice of law. A certified copy of the judgment of conviction shall be attached to the charges and shall be prima facie evidence of the fact that the attorney was convicted of the crime charged.”1
Klauber answered our show cause order, Rule BV 16 b, claiming that “none of the offenses for which he was
A majority of the Court deny the petition to suspend. They do so on the ground that the instruction to the jury “apparently did not limit a conviction to a finding of moral turpitude . . . .” They quote the particular instruction оf the trial court which leads them to this conclusion and say: “It may follow from this instruction that the jury could have found Klauber guilty without finding an intent on his part to defraud.” Noting that an appeal from the judgments was still pending, they state: “Hence we cannot say at this point in time, particularly before the Fourth Circuit speaks, that Klauber necessarily stands convicted of a crime involving moral turpitude.” I do not agree.
The trial court‘s instructions to the jury were comprehensive, thorough and specific. The transcript of the instructions consists of some forty pages, about twenty-five of which dealt with the offenses set out in the indictment. The judge explained the indictment. He read the statute under which the sixteen mail fraud counts were brought,
The judge designated three elements which were required to be proved to establish the offense charged in each of the sixteen counts. The second and third elements related to the use of the mails. The first was:
“The act or acts of the defendant of having devised, or of having intended to devise, a scheme or artifice with the specific intent to defraud, or to attempt to defraud, certain named insurance companies out of money or property by means of false or fraudulent representations, as to bills or medical reports submitted by defendant to these companies for the settlement of his clients’ personal injury claims, as charged. . . .” (emphasis added).
After discussing the meaning of “scheme,” “artifice,” and a “false or fraudulent representation” the judge said:
“In proving that [Klauber] devised or intended to devise a scheme or artifice to defraud, as charged, the Government is not required to prove beyond a reasonable doubt every representation alleged in the indictment; it is only required to prove a sufficient number of such representations to show beyond a reasonable doubt that the defendant devised or intended to devise a scheme or artifice to defraud one or more of the insurance companies named in the indictment in one or more of the ways alleged in the indictment.”
He explained “intent to defraud“:
“To act with ‘intent to defraud’ means to act knowingly and willfully and with the specific intent to deceive, ordinarily for the purpose of either
causing some financial loss to another, or bringing about some financial gain to oneself or others.”
He discussed the proving of intent to defraud:
“Fraudulent intent ordinarily may not be proved directly, because there is no way of fathoming or scrutinizing the operations of the human mind. But you may infer the defendant‘s intent from the surrounding circumstances. You may consider any statement made and done or omitted by a defendant, and all other facts and circumstances in evidence which indicate his state of mind. It is ordinarily reasonable to draw the inference that a person intends the natural and probable consequences of acts knowingly done or knowingly omitted.
“Fraudulent intent is not presumed or assumed; it is personal and not imputed; and one is chargeable with his own personal intent and not with that of some other person.”
It was at this point that the judge gave the instruction quoted by the majority and relied upon by them in concluding that the charge did not limit a conviction to a finding of moral turpitude. The relied upon instruction went no further than to enable the jury to consider evidence that Klauber paid runners to secure his employment by a client as some “evidence of the intent with which [Klauber] acted . . .” in carrying out the scheme to defraud so carefully outlined in the earlier part of the charge. It went to his state of mind but clearly did not permit the jury to return a verdict of guilty on a mere finding that Klauber paid runners. Paying runners may have been in furtherance of the scheme to defraud but the judge in nowise suggested that such evidence was exclusive еvidence on which to convict.
The charge must be considered as a whole. Atran v. Furness, 251 Md. 216, 224, 246 A. 2d 767 (1968), citing Wilhelm v. State Traffic Comm., 230 Md. 91, 185 A. 2d 715 (1962). It should not be fragmented and brief comments be excised therefrom, or words, phrases or sentences selected
“[T]he question here is . . . did the defendant, Gerald N. Klauber, intend to defraud?”
This intent on the part of Klauber to defraud was the keynote and the tenor of the instructions. There is simply no way in which the instructions of the trial judge can be reasonably construed as permitting the jury to return a verdict of guilty on the crimes charged without finding that Klauber devised, or aided and abetted in devising, a scheme or artifice to defraud. Patently, a scheme or artifice “to defraud” requires an “intеnt to defraud.” An intent to defraud encompasses moral turpitude. See Attorney Grievance Comm‘n v. Walman, 280 Md. 453, 459-460, 374 A. 2d 354 (1977). In other words, from a review of the allegations of the indictment and the District Court‘s charge to the jury, and the jury‘s verdicts, the crimes of which Klauber was convicted plainly involved moral turpitude. See Attorney Grievance Comm‘n v. Reamer, 281 Md. 323, 328-330, 379 A. 2d 171 (1977).4 Thus, the suspension of Klauber would be within the ambit of the
As noted supra, the applicability of the former provisions of Rule BV 16 to Klauber is not questioned here, and the majority expressly do not now pass upon whether the new provisions of that Rule are applicable. Even if Klauber falls in a nether land so that neither the old nor the new Rule applies to him, action should be taken forthwith to suspend him. We said in Pub. Serv. Comm‘n v. Hahn Transp., Inc., 253 Md. 571, 583, 253 A. 2d 845 (1969) that the regulation of the practice of law and of its practitioners is, and essentially and appropriately should be, a function of the judicial branch of the government. If Rule BV 16, as formerly in effect or as revised, is not applicable to Klauber, I would invoke this inherent power with regard to him. The nature of the felonious acts of which he was convicted, as shown by the allegations of the indictment, the trial court‘s instructions and the jury‘s verdicts, cry in clear voice that he be suspended from the practice of law pending the determination оf the convictions whether or not moral turpitude was involved. The conduct which the jury found beyond a reasonable doubt was engaged in by him makes a mockery of the trustworthiness, honesty and good faith required of those given the privilege to practice law. To permit him to practice in the face of his convictions stigmatizes an honorable profession.
Notes
In the memorandum of law submitted in support of his answer, Klauber questions the constitutionality of Rule BV 16. That point was not raised in his answer.
“Whoever, having devised or intending to devise any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representations, or promises, . . . for the purpose of executing such scheme or artifice or attemptingso to do, places in any post office or authorized depository for mail matter, any matter or thing whatever to be sent or delivered by the Postal Service, or takes or receives therefrom any such matter or thing, or knowingly causes to be delivered by mail according to the direction thereon, or at the place at which it is directed to be delivered by the person to whom it is addressed, any such matter or thing, shall be fined not more than $1,000 or imprisoned not more than five years or both.”