In re Blau
Alan W. Friedberg, Chief Counsel, Departmental Disciplinary Committee, New York City (Stephen P. McGoldrick of counsel), fоr petitioner.
Gary S. Fish for respondent.
OPINION OF THE COURT
Per Curiam.
By motion dated June 20, 2007, the Departmentаl Disciplinary Committee seeks an order pursuant to
The Committee submits bank records tending to show that, from January 9, 2006 until March 31, 2006, respondent misappropriated and converted $317,730.55 belonging to the estate of Marilyn Mitnick, which he had been retained to represent in February 2005. While respondent claims that a portion of the monies he withdrew were attributable to his agreed fee of 5% of the estate‘s gross value, the executrix denies having agreed to any such fee, and, in any event, the Committee demonstrates that the sum total оf the estate funds disbursed by respondent far exceeded the amount to which he would have been entitled under the alleged undocumented fee agreemеnt. In this regard, the Committee points to the draft of the estate tax return respondent prepared, which lists his legal fee as $63,916. The Committee also presents evidence that, in connection with respondents’ representation of Barry and Linda Lustig in the sale of their home, respondent has not accounted for his disрosition of the purchaser‘s $93,000 deposit or for a discrepancy of approximately $300,000 between the amount of sales proceeds he reсeived from the purchaser and the amount he remitted to the Lustigs. In addition, the Committee presents evidence that respondent misappropriated a $53,000 deposit payment he received on behalf of another client in connection with an aborted real estate transaction. Finally, the Committee presents evidence that respondent improperly used his IOLA account to pay personal expenses on various occasions.
In opposition, respondent‘s counsel argues that, while respondent may have commingled funds due to negligent recordkeep
We reject counsel‘s assertion that respondent has fully accounted for his disbursements of the estate‘s funds. The copies of checks in the record, which counsel claims to constitute an adequаte accounting of respondent‘s handling of the estate‘s funds, show only the payees, and do not indicate the legal matters, if any, to which the payments were related. Thus, respondent has not fully accounted for his disbursements involving the estate.
Respondent also fails to address the Committee‘s allegations involving respondent‘s apparent misconduct in connection with the Lustig transaction, and the evidence demonstrating his apparent misappropriation of thе $53,000 deposit he received in connection with the aborted real estate transaction. With respect to respondent‘s improper use of his IOLA account to pay personal expenses, counsel offers mitigating evidence to argue for an admonition or censure. However, such arguments arе misplaced at this juncture, where the issue is whether to impose an interim suspension.
The record also establishes that respondent failed to comply with his оbligation to document his fee arrangement with the executrix of the Mitnick estate, which failure has generated the present dispute concerning the amоunt of his fee in that matter. While counsel contends that respondent was not obligated to reduce the fee arrangement with the estate to writing because it did not involve a contingency fee (see Code of Professional Responsibility DR 2-106 [
At a minimum, the documentary evidence establishes that respondent withdrew more money than he would have been
Further, the scienter necessary to sustain a charge of intentional conversion is established by evidence that an attornеy, with knowledge that he did not have permission or authority to withdraw client or third-party funds, used those funds for the attorney‘s own purposes (see Matter of Kirschenbaum, 29 AD3d 96, 100 [2006]). Here respondent аdmitted at his deposition that he did not have permission to transfer the Mitnick estate funds to his IOLA account, and that he nonetheless disbursed those funds to pay his persоnal expenses immediately after transferring them to the IOLA account. Moreover, even if respondent intended to repay the funds when he took them, and notwithstanding that he apparently has repaid some portion of the funds and (as reflected in a recent stipulation with the executrix) intends to return an additionаl $68,516.15, this does not necessarily negate the evidence that respondent acted with venal intent when he misappropriated the funds (see id.).
In sum, based upon respondent‘s admissions made during his deposition, as well as the substantial documentary evidence of his mishandling and misappropriation of client and third-party funds, and in light оf his failure to date to establish his legal entitlement to those monies, we conclude that respondent is guilty of professional misconduct immediately threatening the public interest and should be immediately suspended from the practice of law pursuant to
Accordingly, the Committee‘s motion should be granted and respоndent suspended from the practice of law, effective immediately, until such time as disciplinary matters pending before the Committee have been concluded and until further order of this Court.
Respondent suspended from the practice of law in the State of New York, effective the date hereof, until such time as disciplinary matters pending before the Committee have been concluded and until further order of this Court.