DISCIPLINARY COUNSEL v. CROSBY
No. 2009-1172
Supreme Court of Ohio
December 29, 2009
124 Ohio St.3d 226, 2009-Ohio-6763
Submitted September 30, 2009
{¶ 23} We therefore indefinitely suspend respondent from the practice of law in Ohio. Pursuant to
Judgment accordingly.
MOYER, C.J., and PFEIFER, LUNDBERG STRATTON, O‘CONNOR, O‘DONNELL, LANZINGER, and CUPP, JJ., concur.
David M. Rickert, for relator.
LANZINGER, J.
{¶ 1} Respondent, William Matthew Crosby of Cleveland, Ohio, Attorney Registration No. 0002451, was admitted to the practice of law in Ohio in 1982. The Board of Commissioners on Grievances and Discipline recommends that we suspend respondent‘s license to practice for 24 months, based on findings that he engaged in long-standing fraudulent trust-account practices and deliberate decep-
{¶ 2} In April 2008, relator, Disciplinary Counsel, filed a three-count complaint against respondent alleging multiple violations of the former Code of Professional Responsibility and the current Rules of Professional Conduct, effective February 1, 2007.1 Respondent filed an answer, and a panel of the board held a hearing on the complaint in December 2008. The panel prepared written findings of fact, conclusions of law, and a recommendation that respondent be suspended from the practice of law for two years with one year stayed on conditions. The board adopted the panel‘s findings of fact and conclusions of law but recommended that respondent be suspended for 24 months.
Misconduct
{¶ 3} During 2005 and 2006, respondent practiced law as Crosby Law Offices, L.L.C., and worked primarily in the areas of workers’ compensation, personal injury, and tort law. Around December 2006, he ceased practicing as Crosby Law Offices, L.L.C., and accepted a position as of counsel for his wife‘s law firm, Elizabeth A. Crosby and Associates. While he operated his solo practice, respondent maintained two bank accounts, an Interest on Lawyers Trust Accounts account (“IOLTA“) in the name of the Crosby Law Offices, L.L.C., and a general operating account in the name of the Crosby-Dodge Law Group, L.L.C. (“operating account“). Respondent had amended the signature card for the IOLTA to designate Carol Mazanec as an authorized signer on the account to allow her authority to write checks. Mazanec provided clerical, administrative, and paralegal services for respondent during the years 2005 and 2006 and wrote and signed a number of checks from the IOLTA on behalf of and as authorized or ratified by respondent.
{¶ 4} All of the violations alleged by relator arise from the use and maintenance of respondent‘s IOLTA.
Count I—Use of the IOLTA as a Personal and Operating Account
{¶ 5} From the testimony and exhibits admitted at the hearing, it is clear that respondent used his IOLTA as a personal bank account and operating account from January 2006 to May 2007. There were approximately 20 checks payable to Mazanec, in a stipulated amount of $57,713, which represented wages or bonuses. On 18 occasions, there were electronic withdrawals for the payment of phone bills
{¶ 6} Respondent acknowledged that he knew business expenses should not be paid from his IOLTA. He also stated that he inadvertently wrote checks to Brooks Brothers and Wyatt Tractor for personal expenses from the IOLTA.
{¶ 7} We accept the board‘s finding that respondent violated DR 1-102(A)(6) and its counterpart,
Count II—Failure to Properly Maintain and Safeguard the IOLTA
{¶ 8} At the hearing, respondent conceded that he did not properly train Mazanec and did not properly supervise her with regard to the IOLTA. Although respondent represented that he had had his accountant train Mazanec, she herself testified that she was not given any training on how to use an IOLTA by either respondent or his accountant. The panel found that Mazanec‘s testimony was more credible.
{¶ 9} Respondent stated that he was not aware that Mazanec had used the IOLTA to pay telephone bills from Verizon, Ameritech, and AT & T or personal expenses at Home Depot and CVS but that he later had ratified her actions. In addition, he was not aware that Mazanec had used the IOLTA to negotiate a check written to her by her boyfriend. A simple review of the IOLTA statements would have revealed the inappropriate electronic withdrawals for the telephone bills, but respondent admitted that he did not personally reconcile the banking statements. Instead, respondent stated that he held earned attorney fees in his IOLTA and basically kept a running total of the amount owed to him in his head. During this time period, the IOLTA incurred overdraft fees of $118.50.
{¶ 10} Finally, respondent testified that he was surprised at the extent of moneys that he had intended to be deposited into his operating account that were never deposited there. He also asserted that he kept a portion of his earned attorney fees in his IOLTA to pay unexpected client expenses and that only
{¶ 11} We therefore accept the board‘s findings that respondent violated DR 1-102(A)(5) and its counterpart,
Count III—Failure to Promptly Withdraw Earned Funds
{¶ 12} Between 2006 and 2007, respondent settled five cases. Although he promptly paid each client the appropriate share of the award, respondent failed to promptly withdraw his fee from the IOLTA. Instead, respondent would withdraw his fee in multiple checks over several weeks or months. Respondent‘s actions led to commingling of client funds with his personal funds in the IOLTA. For example, respondent settled a matter at the end of April 2006. Throughout May 2006, respondent disbursed funds to his clients and caused several checks of various amounts to be issued. By the end of May, there was still $7,292.64 of respondent‘s personal funds in the IOLTA. Respondent then deposited a settlement check for another client in early June 2006, resulting in the commingling of funds. Relator contends that commingling occurred again in November and December 2006.2
{¶ 13} Respondent explained that he did not immediately remove all his earned attorney fees because he wanted to maintain a buffer in the event that unexpected expenses related to a case arose. Mazanec testified that she could not recall
{¶ 14} We accept the board‘s finding that respondent violated DR 1-102(A)(5) and its counterpart,
Sanction
{¶ 15} Even before the General Assembly authorized the creation of IOLTAs in
Aggravating and Mitigating Circumstances
{¶ 16} To determine the appropriate sanction, the court looks at a nonexhaustive list of aggravating and mitigating circumstances, which is found in Section 10(B) of the Rules and Regulations Governing Procedure on Complaints and Hearings Before the Board of Commissioners on Grievances and Discipline (“BCGD Proc.Reg.“). In mitigation, the board noted that respondent had no prior disciplinary record, BCGD Proc.Reg. 10(B)(2)(a), and that there was no evidence that a client failed to receive all money due, BCGD Proc.Reg. 10(B)(2)(h).
{¶ 17} As for aggravating factors, the board determined that respondent had displayed a dishonest and selfish motive by using his trust account to keep funds safe from collection procedures by taxing authorities and judgment creditors. BCGD Proc.Reg. 10(B)(1)(b). It found that respondent‘s misuse of his trust account continued over several years and represented a pattern of misconduct.
{¶ 18} Respondent objected to the use of the evidence of tax issues and outstanding judgments and also disputed that he had failed to cooperate in the disciplinary process. Based on our review of the record, we agree with the board regarding the mitigating and aggravating factors.
Comparable Cases
{¶ 19} For attorneys who have commingled funds or failed to properly maintain their IOLTAs, the sanction has ranged from a stayed six-month suspension, Disciplinary Counsel v. LaRue, 122 Ohio St.3d 445, 2009-Ohio-3604, 912 N.E.2d 101, to an indefinite suspension, Wise, 108 Ohio St.3d 381, 2006-Ohio-1194, 843 N.E.2d 1198. The panel looked at Wise, Morgan, 114 Ohio St.3d 179, 2007-Ohio-3604, 870 N.E.2d 1171, and Disciplinary Counsel v. Vogtsberger, 119 Ohio St.3d 458, 2008-Ohio-4571, 895 N.E.2d 158. In Vogtsberger, the respondent admitted that he had deposited personal funds into his client trust account to shield them from creditors. Id. at ¶ 4. Vogtsberger also had been suspended in May 2006 from the practice of law for failure to comply with continuing legal education (“CLE“) requirements. Id. at ¶ 5. Based on these circumstances, we imposed a two-year suspension with one year stayed on conditions. Id. at ¶ 11. The same suspension was given to the respondent in Morgan, 114 Ohio St.3d 179, 2007-Ohio-3604, 870 N.E.2d 1171, ¶ 13. Although Morgan did not have a prior disciplinary record, he engaged in a pattern of misconduct and failed to participate in the disciplinary proceedings. Id.
{¶ 20} In Wise, the respondent failed to maintain client ledgers, records, or receipts for funds deposited into his IOLTA and also used his IOLTA as a personal checking account. 108 Ohio St.3d 381, 2006-Ohio-1194, 843 N.E.2d 1198, ¶ 4-6. Although there was no evidence that a client had been harmed, we determined that Wise‘s prior disciplinary offenses, his extended misuse of the IOLTA, his multiple overdrafts, and his lack of candor and sense of responsibility warranted an indefinite suspension. Id. at ¶ 16.
{¶ 21} Respondent‘s extended misuse of his IOLTA and his failure to maintain adequate records are similar to the actions in Wise. The aggravating factors are also substantially similar; however, respondent does not have any prior disciplinary record. Although we do not believe an indefinite suspension is required, we do find that an actual suspension is warranted.
{¶ 22} Respondent is therefore suspended from the practice of law in Ohio for 24 months. We condition respondent‘s reinstatement on his (1) satisfactorily completing 12 hours of additional CLE in law-office management and accounting
{¶ 23} (a) Certificate of Judgment No. ST00069639 in the principal sum of $6,717.51;
{¶ 24} (b) Certificate of Judgment No. ST98045500 in the principal sum of $5,729.50;
{¶ 25} (c) Certificate of Judgment No. ST02085583 in the principal sum of $4,262.04;
{¶ 26} (d) Certificate of Judgment No. ST03091227 in the principal sum of $3,761.74;
{¶ 27} (e) West Publishing Corp. v. Crosby, case No. 1999 CVF 013387 judgment in the principal sum of $2,408.44;
{¶ 28} (f) National City Bank v. Crosby, case No. 01 CVF 647, judgment in the principal sum of $1,349.42;
{¶ 29} (g) Certificate of Judgment No. ST96022309 in the principal sum of $386.54;
{¶ 30} (h) Imagenet v. Crosby, case No. 2000 CV1 2786, judgment in the principal sum of $362.43;
{¶ 31} (i) Certificate of Judgment No. ST97027119 in the principal sum of $315.37;
{¶ 32} (j) Certificate of Judgment No. ST96022308 in the principal sum of $164.20;
{¶ 33} (k) Certificate of Judgment No. ST99051486 in the principal sum of $142.72; and
{¶ 34} (l) Certificate of Judgment No. ST98040329 in the principal sum of $129.18.
{¶ 35} Costs are taxed to respondent.
Judgment accordingly.
MOYER, C.J., and LUNDBERG STRATTON, O‘CONNOR, O‘DONNELL, and CUPP, JJ., concur.
PFEIFER, J., concurs in the suspension of the respondent for 24 months but would stay 12 months of the suspension.
Jonathan E. Coughlan, Disciplinary Counsel, and Robert R. Berger, Assistant Disciplinary Counsel, for relator.
Lester S. Potash, for respondent.