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Florida lawyer suspended for 1 year for converting client funds and conditioning repayment on complaint withdrawal

Hello everyone and welcome to this Ethics Alert which will discuss the recent Florida Supreme Court opinion that suspended a lawyer for 1 year for failing to repay client funds and conditioning payment of the funds to the client on withdrawal of her Bar complaint.  The Florida  Supreme Court opinion is The Florida Bar v. Michael Eugene Wynn, No. SC-1323 (February 16, 2017) and is here:

The lawyer stipulated that he had converted $500.00 that he received from a client for his own use and then conditioned repayment on the client’s agreement to withdraw a complaint that she had filed with The Florida Bar.  The lawyer also failed to notify his employer of the disciplinary proceedings.

“On October 10, 2013, Respondent emailed Ms. Rhodes (the client) informing her that $500 was needed for the costs of deposition transcripts. On October 10, 2013, Ms. Rhodes paid $500 to Respondent to be used towards the cost of deposition transcripts and wrote in the memo “Legal Fees.” Respondent deposited the $500 into his business operating account on October 15, 2013, rather than to his trust account. Respondent failed to pay for the deposition transcripts as had been intended.”

“On November 8, 2014, Respondent arranged for Ms. Rhodes and Mr. Rhodes to meet him at MidFlorida Bank in Arcadia, Florida in order to repay the $500. During the meeting, Respondent presented Mr. and Mrs. Rhodes with a receipt of funds he drafted. Ms. Rhodes signed the document, which was notarized, without any discussion about its contents. The receipt of funds indicated that the funds were repaid and requested that the Bar complaint be dismissed. Respondent repaid the $500 upon the condition that Ms. Rhodes would request dismissal of the Bar grievance she filed against Respondent. By letter dated November 9, 2014, Respondent provided a copy of the receipt of funds to the Bar and requested closure of the file.” (emphasis supplied).

The referee accepted the stipulation an recommended a 90 day suspension followed by two years of probation wherein the lawyer would be required to be monitored by another lawyer, submit quarterly reports by a CPA (if in private practice), undergo an office procedures and record-keeping analysis by the Diversion/Discipline Consultation Service (DDCS-formerly LOMAS), attend ethics school, a trust accounting workshop, and a stress management workshop, and pay the Bar’s costs.

After confirming that the Court has wide discretion in imposing discipline and after reviewing relevant cases, the opinion stated as follows:

“Here, as in several of the cases discussed above, Respondent converted client funds for his own use and repaid the funds at a later time. In addition, as in Frederick, he attempted to condition the repayment upon the client’s agreement not to complain to the Bar about his misconduct. Based on the existing case law, we conclude that the Bar is correct that a one-year suspension, followed by two years’ probation with the conditions recommended by the referee, is warranted. As we have noted many times, misuse or misappropriation of client funds is one of the most serious offenses a lawyer can commit, and disbarment is presumed to be the appropriate punishment. Fla. Bar v. Travis, 765 So. 2d 689, 691 (Fla. 2000). We see no reason under the circumstances of this case, even given the referee’s uncontested findings of mitigation, to impose anything less than a rehabilitative suspension.” (emphasis supplied).

Bottom line: this case clearly illustrates that lawyers are held to an extremely strict and fiduciary standard when handling client funds and, as the opinion states, disbarment is presumed to be the appropriate punishment for misuse or misappropriation of client funds.  In addition, it is unethical for a lawyer to condition repayment of client funds to a withdrawal of a Bar complaint (or an agreement not to file a complaint).

Be careful out there…and don’t do this.

Disclaimer:  this e-mail is not an advertisement, does not contain any legal advice, and does not create an attorney/client relationship and the comments herein should not be relied upon by anyone who reads it.

Joseph A. Corsmeier, Esquire

Law Office of Joseph A. Corsmeier, P.A.

29605 U.S. Highway 19, N., Suite 150

Clearwater, Florida 33761

Office (727) 799-1688

Fax     (727) 799-1670

[email protected]

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