Attorney Grievance Comm'n of Md. v. Steinhorn

462 Md. 184

198 A.3d 821

ATTORNEY GRIEVANCE COMMISSION OF MARYLAND

v.Neil Warren STEINHORN

Misc. Docket AG No. 15, September Term, 2017

Court of Appeals of Maryland.

December 20, 2018

Argued by Erin A. Risch, Deputy Bar Counsel (Lydia E. Lawless, Bar Counsel, Atty. Grievance Commission of Maryland), for Petitioner.

Argued by Richard D. Rosenthal of Jacob & Myerberg, P.A. (Towson, MD), for Respondent.

Argued before Barbera, C.J., Greene,^* Adkins, McDonald, Watts, Hotten, Getty, JJ.

Barbera, C.J.

On June 26, 2017, the Attorney Grievance Commission of Maryland ("Petitioner"), acting through Bar Counsel, filed in this Court a Petition for Disciplinary or Remedial Action ("Petition") against Neil Warren Steinhorn ("Respondent"). The Petition alleged, among other things,¹ violations of the Maryland Lawyers' Rules of Professional Conduct ("MLRPC") 3.3 (Candor Toward the Tribunal) and 8.4 (Misconduct).² Those charges arise from misleading complaints Respondent filed with the District Court of Maryland sitting in Baltimore County while representing the Council of Unit Owners of Kingswood Commons, Inc. ("Kingswood"), a homeowners' association, in several debt collection cases. Specifically, Respondent inflated the damages sought on the complaint form by thirty percent without separately indicating, as the form requires, that this increase constituted his attorney's fees.

Pursuant to Maryland Rules 19-722(a) and 19-727, this Court designated the Honorable Keith R. Truffer ("hearing judge") of the Circuit Court for Baltimore County to conduct an evidentiary hearing and make findings of fact and conclusions of law. The hearing was held on March 13, 2018. Respondent testified and presented evidence on his behalf. On April 27, 2018, the hearing judge issued written findings of fact and conclusions of law, concluding that Respondent did not commit any violations of the MLRPC.

Bar Counsel, on behalf of Petitioner, took no issue with the hearing judge's findings of fact but filed exceptions to each conclusion of law. Petitioner asserts that Respondent violated MLRPC 3.3(a)(1) and 8.4 because he provided the District Court with false information, misled the District Court with that information, and engaged in disreputable conduct. Petitioner also excepts to the hearing judge's finding of certain mitigating factors and asks us to consider other aggravating factors in addition to the ones the hearing judge found. Respondent counters that although he made a mistake, he did not violate any of the MLRPC.

On October 9, 2018, this Court heard oral argument in this matter. Petitioner asks us to disbar or, in the alternative, suspend Respondent. Respondent requests that we affirm the hearing judge's legal conclusions and dismiss this action. For the following reasons, we agree with Petitioner that Respondent violated MLRPC 3.3 and 8.4 and, consequently, suspend Respondent from practicing law indefinitely with the right to apply for reinstatement no sooner than six months after the suspension takes effect.

I.

A. The Hearing Judge's Findings of Fact

1. Background

Respondent was admitted to the Maryland Bar in 1974. In 1979, after a five-year stint as an Assistant State's Attorney, Respondent transitioned to private practice. On June 4, 1990, Respondent was convicted of money laundering and transporting stolen goods, United States v. Steinhorn , 927 F.2d 195, 196 (4th Cir. 1991), and subsequently, in September 1990, this Court suspended him from practicing law in Maryland. Thereafter, on February 1, 1994, following affirmance of his convictions,³ this Court disbarred Respondent by consent. Attorney Grievance Comm'n v. Steinhorn , 333 Md. 580, 636 A.2d 480 (1994).

In October 2007, this Court granted Respondent's Petition for Reinstatement to the Maryland Bar. In re Reinstatement of Steinhorn , 401 Md. 698, 934 A.2d 948 (2007). Since his reinstatement, Respondent has handled exclusively debt collection cases, representing homeowner associations, small businesses, and bail bondsmen. In one such matter, Respondent assisted Kingswood in collecting past due condominium fees from several condominium unit owners.

2. Respondent's Court Filings

As part of his work for Kingswood, Respondent filed two form complaints—entitled DC-CV-001, Complaint/Application and Affidavit in Support of Judgment—with the District Court of Maryland sitting in Baltimore County in 2014. The first complaint, filed on January 14, 2014, sought to recover $9,120 in delinquent condominium fees from Aileen Pratt, a condominium unit owner. The second complaint, filed on April 2, 2014, also sought to collect $9,120 in outstanding condominium fees from Jason Green, another condominium unit owner. Respondent submitted affidavits in support of those claims, which were signed by Marc Greenberg ("Greenberg"), an agent of Kingswood. Greenberg relied on Respondent's representations about the accuracy of those filings.

The $9,120 figure listed on both complaints represented unpaid condominium fees for a four-year period (2011-2014) plus Respondent's thirty-percent attorney's fee.⁴ In other words, of the $9,120 sought in the complaints, $6,912 was for the outstanding HOA fees and $2,208 was for attorney's fees.⁵ Respondent conjoined the unpaid assessments ($6,912) with the agreed-upon attorney's fees ($2,208) in each complaint filed with the court, listing one figure ($9,120) in the damages line, leaving the line designated for attorney's fees blank (see image below).

3. The Complaint to the Attorney Grievance Commission

In 2016, Kingswood terminated Respondent's representation and replaced him with Brian Fellner, Esq. ("Fellner"). Fellner discovered that Respondent did not timely remit several payments he collected for Kingswood. Fellner then filed a complaint with Petitioner, alleging that Respondent's delay was unwarranted. Bar Counsel investigated and determined that Respondent was also inflating the amount of damages sought in his court filings, and that he failed to rectify the issue once it was called to his attention. Petitioner concluded that such conduct violated MLRPC 3.3 and 8.4, among other charged violations.⁶

4. Respondent's Testimony

During the hearing on his conduct, Respondent "candidly admitted" that he made a mistake, and he "denied any intent to deceive the court." He testified that he only sought to collect that which was rightfully owed to him based on his fee agreement with Kingswood.

The hearing judge found, as a matter of fact, that Respondent's testimony was credible and that Respondent never intended to make a false statement to the District Court. The hearing judge was persuaded by the fact that Respondent did not personally benefit from his conduct. The judge was also swayed by Respondent's sincere remorse and his implementation of new office procedures to prevent those issues from reoccurring.

B. The Hearing Judge's Conclusions of Law

Based on the record and the above-summarized findings of fact, the hearing judge concluded that Petitioner failed to demonstrate, by clear and convincing evidence, that Respondent violated MLRPC 3.3(a)(1) and 8.4 (a), (c), and (d). As noted at the outset, Petitioner has filed exceptions to the hearing judge's conclusions of law.

II.Standard of Review

"In attorney discipline proceedings, this Court has original and complete jurisdiction and conducts an independent review of the record." Attorney Grievance Comm'n v. Good , 445 Md. 490, 512, 128 A.3d 54 (2015) (citation omitted). Where, as here, neither party has filed exceptions to the hearing judge's findings of fact, we treat those facts as established.

Attorney Grievance Comm'n v. Reno , 436 Md. 504, 508, 83 A.3d 781 (2014) ; see also Md. Rule 19-741(b)(2)(A). We review de novo the hearing judge's legal conclusions, Md. Rule 19-741(b)(1), to determine if they are supported by clear and convincing evidence, Md. Rule 19-727(c), and we decide, if the attorney committed misconduct, the appropriate sanction. Attorney Grievance Comm'n v. Butler , 456 Md. 227, 238, 172 A.3d 486 (2017).

III.The Rule Violations

Based upon our independent review of the record, we disagree with the hearing judge's legal conclusions and hold that Respondent violated MLRPC 3.3(a)(1) and 8.4(a), (c), and (d).

MLRPC 3.3, Candor Toward the Tribunal ⁷

MLRPC 3.3(a)(1) provides, in pertinent part, that a lawyer shall not "knowingly ... make a false statement of fact ... to a tribunal." This duty is premised on the idea that "[e]very court has the right to rely upon an attorney to assist it in ascertaining the truth of the case before it." Attorney Grievance Comm'n v. Smith , 442 Md. 14, 34, 109 A.3d 1184 (2015) (citation omitted). Therefore, "an attorney ‘must be candid at all times with a tribunal or inquiry board.’ " Butler , 456 Md. at 238, 172 A.3d 486 (quoting Attorney Grievance Comm'n v. Joseph , 422 Md. 670, 699, 31 A.3d 137 (2011) ). Accordingly, a lawyer violates MLRPC 3.3(a)(1) when he or she knowingly provides the court with false information, Smith , 442 Md. at 34, 109 A.3d 1184 (citing Attorney Grievance Comm'n v. Ward , 394 Md. 1, 32, 904 A.2d 477 (2006) ), or fails to correct any false information previously provided, Joseph , 422 Md. at 699, 31 A.3d 137.

Petitioner excepts to the hearing judge's conclusion that Respondent did not violate MLRPC 3.3(a)(1). Petitioner contends that the hearing judge applied an erroneous legal standard in concluding that Respondent's filings were not "knowingly false" because he had "no intent to deceive anyone" and no "party suffered any harm." Respondent counters that he made an honest mistake, but the factual findings of the hearing judge compel the legal conclusion that he did not violate MLRPC 3.3(a)(1). We agree with Petitioner and therefore sustain its exception.

As an initial matter, we reject Respondent's assertion that we are compelled to uphold the hearing judge's legal conclusions because we have accepted his factual findings as established. According to Respondent, the only...