*1 NIX, C.J., Before LARSEN, FLAHERTY, zappala jj. McDermott, and papadakos,
OPINION THE OF COURT PAPADAKOS, Justice.
This disciplinary proceeding report stems from a Disciplinary Board of the Supreme Pennsylvania1 Court dissented, disbarment, One board member recommending and three participate adjudication. members did not in the Kanuck, Jr., George J. recommending Respondent, that from the of law this Commonwealth suspended found, alia, of five The Board inter period years. 1-102(A)(3) Rule had violated *2 1-102(A)(4) (illegal involving turpitude), conduct moral Rule fraud, deceit, (conduct or involving dishonesty, misrepresen- tation), 1-102(A)(5)(conduct Rule to the adminis- prejudicial 1-102(A)(6) (conduct and Rule that ad- justice), tration of law). practice hearing reflects on fitness to After versely matter, in recom- Hearing this the Committee testimony of the sanction of disbarment. The imposition mended Board, matter, after review of the entire concluded that the and recommended a sanction of disbarment was too severe (5) the year suspension investigation five with costs of Having heard prosecution paid by Respondent. to be oral and after a of the record argument, full review submitted the Board and of of by Disciplinary briefs the Office Coun- Respondеnt, appropriate sel and we conclude that the sanc- and, in is imposed five-year suspension tion to be this case therefore, accept the of the Board. recommendation 16, 1986, May
The record reveals that on a Petition for was filed the of Discipline against Respondent by Office Disciplinary petition charges Counsel. That set out five detailing conduct violations of several constituting Discipli- Rules of the nary Responsibility. Code Professional Re- spondent filed an answer in which he subsequently denied every allegation petition.” “each and contained the Hearings Hearing were held 2.06 on before Committee 25 and September January On Committee found that had violated DR1- 102(A)(3),(4), (5), (6); 6-101(A)(3); 7-101(A)(l), (2), (3); 9- 102(A) 9-102(B)(2), (3), (4),2 and recommended that disbarred. filed exceptions to report Committee and a three-member panel of disciplinary charged 2. violations are: DR 1-102. Misconduct (A) lawyer A shall not: argument Board heard oral on the exceptions. April On the Board submitted its report recommenda- (3) Engage illegal involving turpitude. conduct moral deceit, fraud, involving dishonesty, Engage in conduct (4) misrepresentation. (5) prejudicial Engage administration in conduct is
justice. (6) adversеly any on his Engage other conduct that reflects law. fitness Failing Competently to Act DR 6-101. (A) lawyer A shall not: (3) legal Neglect a matter entrusted to him. Representing Zealously DR 7-101. a Client (A) lawyer intentionally: A shall not objectives through client Fail to seek the lawful of his reason- Rules, ably except Disciplinary opposing permitted by law and the available means 7-101(B). lawyer provided by DR A does not violate this Rule, however, acceding by requests to reasonable client, rights prejudice which do counsel not of his commitments, being fulfilling punctual professional all avoid- *3 tactics, ing courtesy trеating offensive or with and consideration persons legal process. all in the involved (2) carry employment with a Fail to out contract of entered into services, may permitted professional client for he withdraw as but 2-110, 5-102, under DR DR and DR 5-105. (3) damage Prejudice during profes- his or client the of course the 7-102(B). relationship, except required sional under DR Preserving DR Identity Property 9-102. of Funds and of a Client. (A) firm, paid lawyer All of clients law funds to a or other than expenses, deposited advances for and costs shall be in one or more identifiable bank accounts in the state maintained in whiсh the law belonging office is shall be lawyers situated and no deposited to the law firm or except therein as follows: may (1) reasonably pay charges be to bank Funds sufficient deposited therein. part presently or (2) part and belonging in to a client Funds therein, deposited but lawyer must be potentially or law firm to the may withdrawn lawyer firm belonging the or law portion the isit right lawyer law firm to receive of or the when due unless the client, not disputed portion shall event the disputed by in which the finally dispute resolved. the is be withdrawn until (B) lawyer A shall: prompt- (2) properties of a client Identify label securities and and deposit place place or other ly upon receipt a safe box and them in practicable. safekeeping as soon as of funds, securities, other (3) and complete of all Maintain records coming lawyer and possession of the properties the of a client into regarding them. appropriate accounts to his client render requested by (4) a client pay deliver client as Promptly securities, funds, possession of the properties in the or other lawyer is to receive. which the client entitled of tion which made thе same fact substantially findings Committee, identical conclusions of as did the law but a five year suspension recommended retroactive to the Respondent’s original suspension, date of December (which was the result of a Petition for suspension Emergen- cy Suspension Interim previously Order filed Office 208(f) Pa.R.D.E.). of Counsel pursuant to Rule 29, 1987, dated By May Order this Court issued a Rule on why show cause he should not be disbarred. 208(e)(3) See Rule 208(e)(2) Pa.R.D.E. Pursuant to Rule Pa.R.D.E., granted we for oral Respondent’s request argu- ment. On November we heard argument and the now ripe matter is are decision. The facts not in nоvo, dispute. Having reviewed record de we find no basis for disturbing the findings Board’s as set forth in the and, therefore, report, substantially adopt them the dis- cussion that follows. The relevant facts each of charges made Office of Disciplinary peti- Counsel’s tion will be set forth separately, Respondent’s followed by explanation in mitigation. Respondent admits miscon- duct, regard funds, commingling but denies that any converted funds. also argues He that the Commit- tee erred in failing consider his testimony mitigation of violations, the charged in their recommendation of disbarment.
Charge I relates to Respоndent’s representation Mr. closing Mrs. Zuercher in a real on Robert estate Janu- 11,1985, at ary they gave which time a check in *4 $12,451.86. sellers, portion amount of due the Mr. Hoffman, $11,631.86. Mrs. Respondent James was advised the Hoffmans that would in money he hold the an pending escrow account resolution of certain title matters. consent, knowledge without their or in deposited were in Respondent’s personal account American Bank and to purchase money were used order in $6,250.00 the amount of payable Prudential Insurance This Company. money paid order was to Prudential obligation client, satisfy Kohler, another Raymond discussed in Charge addition, $5,000.00 will be II. Hoffman funds were used in settlement of a malpractice claim against asserted Respondent Koehler, Daniel by matter which is discussed in Charge III. After several complaints Hoffman, Mrs. Respondent made restitution by delivering a check in $9,631.86 the amount of on March $2,000.00 25, a check for April on Hoffmans. Respondent attempted justify the delay payment by explaining that the title search presented prob- lems regard to defects in the chain of title which had resolved, to be anticipated the possibility of unde- termined costs. Respondent pointed out that the delay paying over the funds only sixty ninety was days, which he did not consider under the unreasonable circumstances. The actual delay paying over the entire amount due the Hoffmans was 104 days. Respondent presented no testimo- ny concerning the fact that the funds were deposited into personal account and were converted by Respondent to pay obligations to, of, owed or on behalf other clients. II
Charge relates to Respondent’s representation of Ray- Kohler, mond a disabled employee of Connоlly Cement who Company, received disability payments from Prudential $17,441.00. Insurance in the Company amount of Respon- dent was retained Mr. pursue Kohler to a claim for disability payments against the Social Security Administra- Respondent tion. was successful in obtaining an on award Kohler, behalf of Mr. who then was required to reimburse Prudential under its subrogation rights, for the disability payments Prudential had made to Mr. Kohler. On June 1983, a $5,000.00 check the amount of was delivered to Respondent by Mrs. Kohler which was to be remitted to Prudential as partial payment of the aforementioned debt. This check was depоsited by personal into a checking account in Merchants National Bank on June drew checks on this account between June 13 and June reducing the balance to $89.55. of the checks None issued was payable Prudential, nor authorized to use the funds for any other *5 purpose. gave Mrs. Kohler subsequently Respondent a $8,000.00 3, 1984, second check for dated February which he other deposited along unrelated funds into his escrow account Merchants Bank. This was amount also to be remitted to Respondent Prudential. drew checks against reducing this account March balancе as of 1984 to $1,042.92. None these issued to checks was Prudential. checks, $6,644.85, One of the in the amount of was made Bank payable First State with the notation “For Edward Smith, L. et ux payoff.” This became payment necessary because had he Respondent dissipated funds received at a January settlement on which part of were to pay off a mortgage held First Bank. This will be discussed in Charge IV. 24, 1984,
On December one approximately and one-half (IV2)years after he received the initial check from Mrs. Kohler, $4,000.00 Respondent withdrew from personal account in American Bank and a purchased order money payable 18, 1985, to Prudential. On January purchased $6,250.00 another order money amount of payable Prudential. year This was one after approximately Respon- dent had second received the check from Mrs. Kohler. The money used for this order belonged Mr. and Mrs. Hoffman, which obtained at settlement on January mitigation, Respondent testified that the delay in was payment dispute due to the amount to which was Prudential entitled and that he was entitled to from attorney’s fee Prudential the amount of $2,750.00 out of the funds involved. presented no testimony regarding the cоnversion of balance of the funds.
Charge III that in alleges Daniel Koehler January, engaged Respondent regarding the of a mobile purchase home. A August check for dated $548.00 delivered to by Mr. Koehler. This amount of approximately constituted sales tax and the $500.00 This *6 deposited fee. check was Respondent’s balance was in in an escrow account First National Bank by Respondent 26, 11, 1978, By on 1978. November the balance September to in reduced None of the checks the account was $168.09. in was issued connection with the drawn on this account to Mr. Koehler. Resрondent services to rendered also be for neglected to a certificate of title the mobile home obtain in Koehler’s name. Mr. later, 1984, Mr. years six Koehler
Approximately sell the mobile home to Elesta Mclnturff. He decided to 16, On June again Respondent attorney. retained as agreement executed a sales was wherein Koehler $7,500.00. agreed sell the trailer for Mclnturff to agreed to a payment as down and the balance to be pay “... $500.00 Kanuck, of Atty. George receipt to J. in trust until title paid filed executed and with the Commonwealth of properly dеlivered to on Pennsylvania.” Mclnturff also $7,450.00 16, 1984, a in the amount of with the June check This deposited by notation “taxes 450 trailer" 7000.” was into his escrow account Merchants Bank. to to satisfy was be used outstand- purchase money trailer, taxes, on off ing mortgage pay unpaid to back rent, other expenses. Approximately lot miscellaneous to his fee. paid By was $500.00 31,1984, was reduced to August the account balance $89.03. repairs of used to for Only pay these was $969.32 mortgage lot No was made on the and Mr. payment rent. to receive demands for from the payment Koehler continued attempts He made several unsuccessful mortgagee. also Respondent. Harrisburg He called learned contact in the party that the title was still name who sold him. trailer to counsel, October, 1984,
In Mr. Koehler retained new Shmookler, Esquire, complete the sale and Stuart funds involved. arrange proper disbursement correspondence, Respondent to Mr. response Shmookler’s $5,722.42 of the funds on December accounted for six months after the funds were entrusted to approximately made mortgage payments included three him. This amount 1984, leaving a and November оf September, October on mortgage, paid due on the which was balance $975.00 pressed malpractice 1984. Mr. Shmookler December damages by Respondent’s caused to Mr. Koehler claim for of the case. This claim was settled for negligent handling $5,000.00 $10,000.00, checks for each drawn on paid by two account in American Bank dated personal Respondent’s March I, Charge Respondent discussed under previously
As $11,631.86 paid the sum of to be to Mr. and entrusted with Respon- These funds were deposited Mrs. Hoffman. $5,000.00 Respondent withdrew personal dent’s account. *7 11, 1985, March same in anothеr deposited these funds on account, $5,000.00 to payable and drew a check for personal Shmookler, Esquire. Stuart his failure to the
Respondent attempted explain obtain time of the sale by stating certificate title about the he his office and he the title relocating was involved lost it. testified Mr. forgot about that when regard Koehler contacted him in 1984 with to the sale of the trailer, him Respondent advised that he would have to duplicate resigned original obtain a title and have it the by sellers, original had lost title. because However, (sic) Respondent could not lоcate the Niebaums (the record of title shows the name as W. and Charles Kneebone). Bonnie L. found the Subsequently, Respondent signed (sic). title He that at the by Niebaums testified matter, in this hearing disciplinary time of the the title in his possession attorney certificate was still as his advised it, (N.T. him then prepared to hold on to but was to file it 117-118). is While the record silent as to the fate of the 1978, paid Respondent January, which was $500.00 transfer, tax it appears sales on the obvious that since place, paid transfer never took was never money explanation Respon- There was no madе Respondent. dent his use of these funds he had in his concerning which possession for six approximately years.
Charge relates to Respondent’s IV representation of Mar- cousin, lyn Nagy, purchase of real estate which place took on January 1984. The settlement statement showed outstanding mortgage with First State Bank in $6,576.20. the amount of Nagy gave two checks to Respon- dent; $2,190.12 one in the amount of marked “settlement fee,” the other a purchase money mortgage check in the $40,000.00 amount of made payable to “George Kanuck, Attorney for Marlyn B. Nagy.” Respondent deposited both checks in his account escrow on January 1984. Respon- dent drew a number of checks against this account so that by January 1984, the outstanding balance was reduced One of these checks $437.28. was drawn in the amount $33,200.42 made payable to the Smiths. none of the checks was issued in payment of the First State Bank mortgage. Respondent then utilized the funds of another client to satisfy obligation. II, this Charge Under testimo- ny presented was concerning a payment on February $8,000.00 by Mrs. Kohler for pay- ment to Instead, Prudential. Respondent used the Kohler funds by issuing $6,644.95 a check in the amount of to First State Bank marking the check “Edward L. Smith et ux payoff.” The delay payment mortgage ap- proximately one month.
Finally, Charge alleges V that on December Parks, Frederick J. President of Triton Enterprises, Inc., *8 entered agreement into an for the purchase of a liquor license from Mr. Green, and Mrs. Gerald J. who were represented by Respondent. The agreement called for a $1,800.00 deposit of paid be the by buyer and to be held by Respondent escrow until settlement. Paragraph 7 of the agreement provided, If “... the license transfer is not approved the by Pennsylvania Liquоr Board, Control Sellers shall refund the entire license fee to Buyer.” William Makames, Esquire, Parks, for Attorney Mr. forwarded a $1,800.00 check for payable to Respondent which he marked liquor “escrow license R-15897.” This check was deposited on December by Respondent into a non-escrow account held jointly by George J. Kanuck or Julia A. Ka-
169 nuck. February Settlement was held on 1984. 27, 1984,
by January Respondent had issued seventeen account, checks against reducing the above joint balance to $437.28.
Respondent’s testimony concerning the use of these $1,800.00 funds was that the constituted fees various legal matters Green, which he had handled for Mr. and that Mr. agreed Green to allow him to this payment have as his fee. Mr. Green did not testify.
The Disciplinary Respondent’s Board found that conduct respect to these general pattern matters involved a between funds, 1978 to 1985 of repeated commingling of use, conversion of client funds Respondent’s own using one client’s funds to pay off another client’s obligation, and III, with respect Charge failure to legal render the services required thereby damaging the client. The Board incidents, noted that these were not isolated but constituted multiple flagrant violations of Rules of Disciplinary Proce- dure concerning accountability proper funds and manage- ment of client funds. The Board disagreed with the Com- mittee’s finding of no mitigating circumstances its recommendation of disbarment reasoning that there was one only complaint filed alleged “victims” which Further, subsequently withdrawn. restitution was made by Therefore, in all cases. the Board determined that the proper sanction for the violations3 involved should year five suspension from the of law retroac- tive original of suspension, date December
Initially, we note that our review in attorney discipline Thus, is cases de novo. we are not bound findings of the Hearing Board, Committee or the Disciplinary except guidelines for judging the credibility witnesses. Of Lucarini, Counsel v. Disciplinary Pa. fice of (1983). 472 A.2d “Our task in cases such as this is protect public preserve and to public confidence in legal profession (Citations and the judicial system. 3. The Board found violations of the same Rules as the Committee, see Fn. 2.
170 omitted.) must accomplishing this task we balance public concern for with a for the respect welfare substantial attorney continuing professional interest that an has in involvement in of law....” Discipli Office of Lewis, 1138, nary Counsel v. 493 Pa. 426 A.2d (1981). 1142
Respondent’s violations of
Disciplinary
Rules consti-
him
tute serious misconduct which
subject
makes
to the
imposition
203(a).
of discipline. Pa.R.D.E.
The only ques-
whether,
tion this Court must now decide is
on the facts
here, we should order
presented
Respondent’s disbarment
impose a
of discipline.
lesser form
Disciplinary sanctions
designed
“are not primarily
effects,
for their punitive
but
their positive
effect of
protecting
public and the
Berlant,
of
from
integrity
the courts
unfit
In re
lawyers.”
(1974).
458 Pa.
328 A.2d
In our decision
Knepp,
Counsel v.
497 Pa.
Office of
(1982),
explained
The power of
court to
attorney
disbar an
should be
caution,
exercised with
there
great
but
should
no
exercising
hesitation in
it
clearly appears
when it
that
isit
protection
demanded for the
public.
court
admitting
attorney
him
practice endorses
to the
public
professional
confidence in his
worthy
rela-
tions, and if he becomes
it is its
unworthy,
duty to
Case,
withdraw its endorsement.
Davies’
Pa. 116.
Id.,
In response charges, presented evi- dence оf mitigating circumstances summarized as follows: Respondent testified that at all relevant times to the five charges, he had more than sufficient funds to cover the amounts which were to be escrowed. the funds located in were accounts other than his escrow account. the fact stressed became aware before him, any complaint against filed all had clients been fully Respondent acknowledged reimbursed. While that he oper-
171 in a casual and practice very ated what little law there was manner, that it wrong and admitted unprofessional in subject fail to maintain escrow accounts proper transactions, he denied he used his clients’ funds for personal Despite his benefit. the fact that escrow accounts, commingled Respondent his other among became at maintains that all times the funds his clients were protected.
Also, in mitigation, explained that he had Respondent given up the of law for the essentially practice except charges friends and in the in the instant relatives involved Respondent starting matter. testified that in 1978 he ran Representative. for the Office of State He took office in his began practiсe. Gradually 1979 and to wind down law on less he took work and 1981 he terminated his secre- sold his in a tary, partner- law office and interest three-way home, his ship, performed moved office to his and most of his Respondent own clerical duties. stated that this time only people clients he had left were who had either favors, worked on his wanted campaign who or old clients who Respondent were friends. took on no new cases, only legal and the he performed work at this time was in the nature of friends family favors for for which charged he little or nothing. regard With to unanswered or clients, unreturned telephone Respondent calls from testi- fied that his telephone mother answered the most times and took messages Harrisburg him. was in three and four days a week and he returned the calls as soon as he could. stated that point at this concept began nothing. of an escrow account to mean He commingle started to client funds with funds pertaining funds, other personal businesses and own not because he needed money, longer but because he no had an office Allentown where the bank in which he had an located, escrow account was and he was often out of town. resigned Legislature from the accept presidential appointment to serve as a U.S. Com- Commission, missioner on the Delaware River Basin federal work rules precluded his exercising outside employ- ment other than casual duties. asserts that he gave up the practice law on a except very casual serving mostly (N.T. basis relatives and friends 106-128). Respondent further asserts that it is his intention “not to again, ever law especially Pennsylvania.” Re- spondent contends that while some form of punishment inis funds, order for his commingling of clients’ severity the discipline must temрered by presented the facts this case. Respondent points out that the report and recom- mendation of the Committee made no mention whatsoever of his at the testimony hearing. Nor was there an investi- *11 gation into his assertion that sufficient funds were available in bank accounts other than those in which client funds deposited, were to cover the amount of funds entrusted to him. Respondent asserts that shoddy bookkeeping and unethical behavior are two different things, and that the Committee erred as a matter of law in failing to consider If this testimony. was a matter of credibility, Respon- dent believes that the report should so have stated. Final- ly, Respondent contends that since he has had no prior disciplinary problems, since restitution was made in all cases, since all of the parties involved were friends or relatives, since no monies were outstanding prior start since, of the disciplinary inquiry, times, at all sufficient funds were available in accounts other than his escrow him, account to cover funds entrusted to these facts should reduce the sanction imposed on him to a suspension for time already served on suspension, from December 1985 to present. alternative, In the re- Respondent quests that he resign be allowed to in good standing with the understanding agreement or that practice he never law again. We note that even after the close of testimony, provided was the opportunity to finan- submit cial support documentation to his repeated averments that he had in money other accounts to cover the amount should holding have been in escrow. alleged that he maintained such records at the office of his prior (N.T. 137-138). counsel. The record reflects that no such of testi- since the close submitted has been documentation that is on evidence 1986. on mony September indicates financial condition Respondent’s concerning record against filed complaint foreclosure mortgage that a 131-132). that We note further (N.T. July, him invitation sub- the Committee’s accepted had documentation, not have relevant it would been mit such which mitigation violations either as a defense convincing quite evidence. It is clear and proven by were its discretion as exercised the Committee obvious Respondent’s claims of no credence give finder of fact wealth. Bоard, recommendation, neither the nor making their nature into consideration the took Hearing Committee the fact that the clients limited Respondent’s the Respon- friends or relatives of either
involved here were also irrelevant. find that these facts are we dent. all facts considering relevant recognize necessity We mindful of the and we are discipline, fashion appropriate in disciplinary results reached consistency need for punished radically is not so that similar misconduct cases case, each concerned that We are also ways. diffеrent novo de jurisdiction as it is to our exclusive subject presented. of the facts review, totality on the decided *12 A.2d at 190. How- Pa. at 472 Lucarini, 504 supra, Respondent. ever, helpful facts are not these additional on an attorney a lesser standard impose The does not Code of small, acting or who is on behalf is whose facts satisfied that these We are not friends relatives. miscon- severity Respondent’s the of mitigate sufficiently the discipline five-year form of less than duct as to a justify the Board. suspension recommended are no miti- argues also that there Counsel Disciplinary light of the urges and disbarment circumstances gating of this recommenda- support here. egregious violations tion, Disciplinary cites Disciplinary Counsel Office Lucarini, Coun- Disciplinary supra; v. Counsel Office of v. Disciplinary and Counsel Knepp, supra; sel v. Office of Lewis, supra, involving cases factual situations similar case, all present three resulted the disbarment respondent of the attorneys.4 We have previously declined and again adopt decline to a rule per requiring se disbar- ment of any who attorney commingles or converts clients’ accounts, funds or impropеrly shifts funds in escrow re- gardless See, present other facts in the case. Lucar- ini, 504 Pa. at at supra, A.2d 190. There is no evidence that Respondent intended to embezzle his clients’ funds. The record is clear that he apparently “borrowed” the made restitution in every case. Neverthe- less, the unauthorized use of client funds is inexcusable even accompanied by when intent return them. Hav- ing considered all charges, accept five we the recommenda- tion of the Board and the is here- suspended from the practice of law in this Common- a period wealth for of five years, effective December Further, 1985. is ordered to the costs of pay investigation in this matter. Accordingly, Rule why Respondent Show Cause Should Not be is Disbarred discharged.
LARSEN, J., files dissenting opinion. a LARSEN, Justice, dissenting.
I I adopt dissent. would rule of per se disbarment (steals) any attorney who converts money. client’s Thus, I respondent. would disbar the Lucarini, Knepp present While the are Lewis cases similar to the case, there are also factual differences which should be noted. All commingling three cases involved the and conversion of clients' funds Knepp neglect legal and the case involved matters. Knepp charging case legal also involved the of excessive fees. The represent prop- Lewis case involved the intentional failure a client erly. forgery. Lucarini case also involved These latter violations Further, Lewis, present respondent are not here. received had
prior private discipline only Knepp on two unrelated matters. made disciplinary after proceeding, restitution he learned of the and he lied investigator. *13 Lucarini continued in unethical behavior after the started, investigation cooperate and refused to Counsel.