230 A.D. 172 | N.Y. App. Div. | 1930
The respondent was admitted to practice as an attorney and counselor at law in the State of New York, at a term of the Supreme Court of the State of New York, Appellate Division, Second Department, on April 4, 1923.
The petition charges that respondent has been guilty of misconduct as an attorney at law in the improper solicitation of retainers from persons having claims for personal injuries, and in the presentation, prosecution and collection of fraudulent claims for personal injuries and property damage alleged to have been sustained. A supplemental petition charged misconduct in that he commenced actions in the Municipal Court of the City of New York, Borough of Manhattan, Second District, and issued and filed summonses in such actions in which he falsely and fraudulently misstated the addresses of the respective plaintiffs in order to deceive and mislead the court and the defendants to whom the summonses were addressed.
The matter is now before the court on a motion for such action as the court may deem just and proper, following the filing of the report of the learned referee to whom the matter was referred
On the charge of improper solicitation it appears that following his admission, in 1923, he had no negligence cases during that year. In 1924 he had about 30 accident cases; in 1925 he had 82; in 1926 his business jumped to 533 cases, and in 1927 he had 1,193. With few exceptions, the actions were brought in the Municipal Court of the City of New York, Borough of Manhattan, Second District. Respondent’s testimony is that he represented garages catering almost exclusively to taxicab owners, taxi owners associations, a co-operative association composed of installment dealers, several coat and apron supply laundries, and other associations; that the suits were mostly by chauffeurs, members of these various associations. He testified that his various clients came to him without solicitation, except some of them were recommended by various taxicab people, friends of theirs, or the owners of garages, or his cousin in the insurance business who wrote their business for them, but outside of that nobody ever solicited them; further, “ I want to say this, that the average settlements in the cases were nominal, so much so that they just barely paid a little over and above the actual disbursements and the time and the help and whatever I had in the office; very many of them were for small property damage claims, and many of them were for a greater amount.” Other than showing the numbers of actions instituted, no attempt was made by petitioners to controvert respondent’s denial of soficitation. The referee states in his report: “ This statement [that the business came to him without solicitation] was not controverted by the petitioners, and although the fact of so many suits brought by a young lawyer, who had only been practicing law two or three years, is very suspicious, yet in view of an uncontradicted explanation, which on its face is plausible, I feel bound to report that in my opinion the charge should be dismissed for want of sufficient evidence to support it.”
On the false address charge, the record shows it was tbe custom in the respondent’s office to put upon the printed summonses, under the heading left in blank for that purpose “ Plaintiff’s Address,” addresses without regard to whether it was the true address or not. The testimony is that some of the addresses used Were those of public schools, a private hospital, a parochial school, loan office, commercial buildings, vacant lots, and many were purely fictitious. Miss Helen Turlcfield, who testified she was in respondent’s employ as a stenographer from 1916 to 1930, gave the following testimony: “ * * * When I first started working for Mr. Katz this girl Shirley told me to bring the cases in the Manhattan Second District
When respondent in August, 1928, knew that this witness had indulged in these practices, he continued her in his employ for nearly a year, the blame being placed on Miss Shirley’s instructions to her.
Respondent’s testimony is that he did not examine the summons to see what address was given to show the plaintiff’s address; that was mere routine in the office and was left to the clerk and the girl. He offered no better explanation. The following is an extract from his cross-examination: “ Q. Now I ask you whether you consider it an honest thing to have said to the Municipal Court that John Jones lived at one address, whereas in truth and in fact he lived at another? Do you consider that honest or not? A. I don’t consider it dishonest. I don’t see where it prejudices anybody. Today the Municipal Court have jurisdiction — Mr. Harper: I move to strike out the last part of the answer. Motion granted.”
The referee stated that he could not avoid the inference that in resorting to false addresses on the summonses respondent’s employees were acting under the instructions of respondent, who, upon his own statement, did not see anything dishonest in such misleading of the court. The referee said: “Even if he did not give such instructions I am unable to see how such a reprehensible custom could have been carried on for years without his knowledge.” This court cannot believe that respondent was unaware of what was being done. The provisions of the Municipal Court Code entitle a defendant to have a case moved to the district where he resides or has his place of business, if the action is commenced in a wrong district. It is presumed that respondent knew that. Whatever the motive was, respondent cannot escape responsibility for the deception practiced upon thé court and the defendants in the actions by feigning ignorance of what was being systematically done in his office. ■
As to the charges involving the presentation, prosecution and collection of fraudulent claims, the report of the referee covers two
(1) The Scheiner case. In January, 1925, respondent instituted an action in the Municipal Court of the City of New York, Borough of Manhattan, Second District, entitled Harry Scheiner against the Coney Island Laundry Company for $1,000 damages for personal injuries alleged to have been sustained as the result of an alleged collision between the laundry company’s horse and wagon and the taxicab which Scheiner was alleged to have been operating. The defendant answered. A physical examination was held at respondent’s office. Respondent negotiated for a settlement and finally settled with the insurance company interested for $75.
Respondent’s testimony is that early in January, 1925, his clerk, Charles Forschleiser, told him that, while he was out of his office, a man by the name of Scheiner had called, said he had been recommended, and gave particulars with reference to an accident in which his taxicab was involved with a truck belonging to a Coney Island laundry. Forschleiser gave him a memorandum (which respondent was unable to produce). Respondent instituted suit. Some months after the representative of the insurance company asked if he would agree to settle the matter for seventy-five dollars. Respondent wrote Scheiner at the address given on the Forschleiser memorandum. Scheiner did not reply. In the fall of 1925 he made inquiry of one Kaplan as to whether he knew a man named Scheiner. While engaged in conversation with Kaplan, one Laulicht came up, injected himself into the conversation and said he guessed he knew Scheiner and thought he had recommended him to respondent. Laulicht said if he saw Scheiner he would send him up to respondent. In the latter part of November a man called at respondent’s office and his clerk reported to him that there was a man by the name of Scheiner waiting to see him. Respondent had never met Scheiner. Respondent’s testimony then proceeds: “ He said his name was Harry Scheiner and that some of his friends told him his case was settled. I said, ‘ Not settled, but I had an offer and that depends on you. Where have you been all this time? You haven’t been in New York.’ He said, ' Well, I just came back recently and I was up State.’ And I said, ‘ What were you doing there? ’ He said, ‘ When I was up there I was so sick, I couldn’t do anything.’ I said, ‘ That didn’t prevent you communicating with me.’ He said, ' What is the difference? Give me my money.’ I said, ‘ You can’t get your money.’ He said, ‘ Well, call up the company and tell them to give me my money.’ I said to him, ‘ To be frank with you I never saw you and I don’t recollect you.’ He got into an argument with me and he said, ‘ You know I saw
George Stone Jarrett, chief adjuster for the Union Indemnity Company, formerly with the Ocean Accident and Guarantee Corporation, identified the report of Dr. Robert James Bell, covering the physical examination of one Henry Scheiner at the office of respondent on March 9, 1925. The report states that respondent was present. Jarrett testified that the case had been assigned to him and he called respondent’s office on the telephone and discussed a settlement for seventy-five dollars. He placed the matter in his settled file on his desk. The release did not come in for a month or five weeks and then he called respondent’s office on the telephone and asked for respondent. Jarrett’s testimony of the telephone conversation is as follows: “ The conversation was with the person that I spoke to at the attorney’s office, that they hadn’t heard from the client, they didn’t know where he was, they thought possibly he might be dead. So I wrote a little memorandum in my file as a safeguard. If the man was not dead I wanted an investigation, and, if he was dead, to check it up and get a death certificate if possible. So the investigator in his report said there was no death certificate; he could not find any. So the thing dropped then for the time being until I should judge about three weeks or a month later, and the attorney then called me and he said he was Mr. Katz, and he said a client had just entered his office, and I said, ‘ Well, are you sure he is the man? ’ He said, ‘ Yes.’ Then I spoke to the investigator again and I asked him, * Are you sure there was no death certificate? ’ and that the man was actually living as far as they knew. I told him to get an affidavit from this man to the effect that he was the man and the claimant in this case.” (He told this to respondent.) “ That was the time Mr. Katz told me that the client walked into his office. So he took this affidavit and sent the man down to my office. I asked the man who he was and he said, ‘ Harry Scheiner.’ I asked him if he had signed the affidavit and he said, yes, he had signed the affidavit. I said, ' We understood you were dead,’ and he said, ‘No, I have been up in the Catskills all summer ’ or up in
Daniel M. Laulicht testified that the Scheiner suit was instituted by respondent after the settlement by another attorney of the alleged claims of the occupants of the taxicab alleged to have been involved in the accident with the truck belonging to the Coney Island Laundry Company. These claims were fraudulent. (See Matter of Sprung, 229 App. Div. 501.) There was an individual named Harry Scheiner who owned and operated a taxicab. Laulicht’s testimony is that the situation was explained to Scheiner and he actually submitted to a physical examination at respondent’s office, at which, Laulicht testified, respondent was present. Thereafter respondent told Laulicht that he had an offer to settle the case for seventy-five dollars, and Laulicht told him to go ahead and settle it, as it was as good as could be had because Scheiner had died. (A certificate of the death of Harry Scheiner in May, 1925, was produced and is part of the record.) Laulicht arranged with Fuhr to pose as Scheiner for the purpose of executing the affidavit and release and so informed respondent. This arrangement was carried through and Fuhr executed the release and affidavit, and went to the insurance company’s office, as was testified to by respondent, Fuhr and Jarrett, and the money collected from the insurance company.
There was produced a report of Dr. Robert J. Bell covering the examination of Scheiner. The report states that the examination was had “ at office of M. Katz, 305 Broadway, New York City, March 9, 1925, 4 p. m., Mr. Katz, present.” Dr. Bell is dead. His signature to the report was properly identified, and the proof was that the report came from the files of the insurance company, that the doctor was employed by the insurance company, and such reports were required by the company and made in the regular course of its business. Objection is made that the report is not properly admissible as proof of the statements therein contained. In Leland v. Cameron (31 N. Y. 115) the Court of Appeals said: “ The rule of evidence applicable to entries made by deceased persons, is thus stated in 1 C. & H., note 675 : that all entries or memoranda made in their course of business or duty by any one who would, at the time, have been a competent witness of the fact which he registers, are competent.”
We think that the report was admissible. Respondent denies that he was present at such an examination. That issue would be important only if we believed that he knew Scheiner was being impersonated by Fuhr and was a party to the fraud being perpetrated on the casualty company. If he in good faith believed that the man who appeared before him was Scheiner, his presence at the physical examination would have been material.
We find, a conflict in the testimony as to details, between that given by Laulicht on the one hand, and respondent and Fuhr on the other. Fuhr corroborates respondent on the essential points in controversy. He admits impersonating Scheiner and asserts respondent’s ignorance of the deceit. The learned referee, after analyzing the testimony of respondent and Fuhr and ignoring Laulicht’s testimony in this particular case, reached the conclusion that respondent was a party to the fraud played upon the insurance company. While the transaction is highly suspicious and reeks of fraud, we do not believe the testimony is sufficient to warrant a finding of respondent’s participation therein.
(2) The Yellow Taxicab fraud. In January, 1925, respondent instituted four actions in the Municipal Court of the City of New York, Borough of Manhattan, Second District, wherein the'defendant was the Yellow Taxicab Corporation, and the plaintiffs were, respectively, Jack Hirsh man, Benjamin Laulicht, Sophie Monshein and May Banks. The actions were eventually settled for a total of $125, which respondent received from the defendant therein. It is now beyond dispute that the accident alleged as the basis for such suits never in fact occurred; that the claims were fraudulent, and no injuries were sustained by the individuals named as plaintiffs. The only question is, Did the respondent knowingly participate in the fraud?
The testimony of Daniel Laulicht is that soon after he met respondent he explained to the latter his ability to “ frame ” cases; that before the actions against the Yellow Taxi Corporation were brought Laulicht had a conversation with respondent, the substance of which was that Laulicht was to see that "a report was put in by a driver of a yellow taxi of an accident which never in fact occurred. Through introduction by one Jack Hirsch, a driver was induced by Laulicht to make a fraudulent report. Laulicht had a conversation with the taxi driver in which he outlined to the driver the facts, previously prepared between respondent and Laulicht, which the driver was- to report. The report was made. Thereafter
Abraham Pindek testified that he took the acknowledgment of a person who was introduced to him as the individual named in the release; the details of the introduction, or who introduced him, he was unable to recall. He contradicted Laulicht’s testimony.
Jack Hirsch gave testimony generally corroborative of that of Daniel Laulicht. He testified that he introduced the Laulichts to one Benjamin Reisman, a driver of a taxicab for the Yellow Taxi Corporation. He denied talking with respondent about a case against that corporation and testified the first time he learned of an action started by respondent in the name of Jack Hirshman against the Yellow Taxi Corporation was at the hearing before Mr. Justice Wasservogel in the Ambulance Chasing Investigation.' Hirsch testified the Laulichts introduced him to respondent in 1925 and respondent knew and addressed him as Hirsch. Hirsch further testified that, at the request of the Laulichts, he submitted to a physical examination at respondent’s office, and gave the doctor such information as the Laulichts had told him to; that respondent was present and answered most of the questions asked by the physician.
Sophie Monshein testified that she did not know respondent, had never been to his office, had never submitted to a physicial examination at his office, and had not been involved in the accident in question.
The testimony of Benjamin Reisman, the taxi driver, is con
As to this Yellow Taxicab fraud, we have the Laulichts on one hand claiming respondent as a willing participant, conspiring and arranging the details in anticipation of inquiry on the part of the defendant; on the other hand, we have the respondent disavowing all knowledge of the fraud and picturing himself a victim of Laulicht’s machinations. We quote from the report of the referee: “ Which of them is to be believed? A self-confessed rascal, who was then serving a sentence upon plea of guilty of a fraud? Or a lawyer, who, by the testimony of several witnesses was of good standing and repute?
“ After much weighing of the evidence pro and con, I have reached the conclusion that the convict told the truth and that the respondent was guilty of unprofessional conduct in being a party to the fraud in question.”
This court is thoroughly familiar with the capabilities of the Laulichts in “ framing ” cases. Their methods of operation and the part played by attorneys in assisting them to perpetrate their frauds have been considered by this court on other occasions. (See Matter of Sprung, 229 App. Div. 501; Matter of Kopleton, Id. 111; Matter of Katz, Id. 103; Matter of Cohen, Id. 478.)
The referee in his report said: “ A fraud of obtaining money by means of four plaintiffs claiming damages never sustained in a collision, which never occurred, could not be carried out without the aid of a lawyer. Would the concocter of such a plot be likely to use a lawyer, whose eyes he must blind as well as those of the defendant, a lawyer who might discover the plot before its consummation and if he were an honest man denounce the concocter? Or would he be more likely to employ one, whose mouth he could seal by making him a co-conspirator? These men of the underworld are shrewd in their way. There was nothing to fear from any source but an honest lawyer acting in good faith for dishonest persons.”
After consideration of the testimony, the referee reached the conclusion that he could not credit respondent’s denial of complicity in the fraud in the Yellow Taxicab case. In reaching this conclusion, the referee took into consideration respondent’s testimony in the Scheiner case as well.
In these proceedings where the Laulichts have been shown to be the leaders, this court has placed no credence on their testimony alone. A review of the entire record now before us convinces us that respondent well knew the character of the Laulichts, knew what they were doing, conspired with them and played his part in the carrying out of their fraudulent schemes. The Laulichts
In March, 1925, respondent was named as attorney of record for Benjamin Lewis and Daniel Lewis in their actions against Kofsky & Cassell, copartners trading as Victory Moving and Trucking Company, and Sheeran, as receiver of the New York Railways Company. Respondent admits these actions were instituted with his authority, and he continued to act as attorney until September, 1925, when another attorney was substituted and settled the actions.
We are satisfied that respondent participated in the frauds in the Yellow Taxicab cases, as found by the referee. His whole connection with the Laulichts shows that he was no innocent victim of their machinations, but a ready and willing agent and tool.
Upon the whole record, we think the respondent is unfit to remain a member of the bar, and has demonstrated the absence of those qualities without which he should not be permitted to remain therein. While the Scheiner case may be said to be not proven, and it was impossible to obtain evidence of solicitation in his sudden outburst of successful business, there are elements of evidence even in those charges which show his general unfitness to practice. There can be no reasonable doubt of his guilt as to the statement of false addresses for the plaintiffs in the Municipal Court actions or as to bis guilty participation in the Yellow Taxicab fraud.
The respondent should be disbarred.
Finch, McAvoy, Martin and O’Malley, JJ., concur.
Respondent disbarred.