Catledge v. Mississippi Bar, No. 2003-BA-00840-SCT.

913 So.2d 179

William E. CATLEDGE v. The MISSISSIPPI BAR.

No. 2003-BA-00840-SCT.

Supreme Court of Mississippi.

March 24, 2005.

COPYRIGHT MATERIAL OMITTED

James Lawton Robertson, Laura G. McKinley, Jackson, attorneys for appellant.

Michael B. Martz, Adam Bradley Kilgore, attorneys for appellee.

EN BANC.

DICKINSON, Justice, for the Court.

¶ 1. On March 27, 2002, the Mississippi Bar filed a formal complaint against attorney William E. Catledge, alleging that he violated Mississippi Rules of Professional Conduct 1.3 (diligence), 1.4 (communication), 1.15 (safekeeping property), and 8.4(a), (c) and (d) (misconduct). These alleged violations arose from Catledge's representation in the wrongful death litigation of Mary Shields, the mother of a two-year-old child killed in a house fire. The litigation was settled, and Shields's portion of the settlement ($7,871.43) was sent to Catledge on October 11, 2000. Catledge obtained Shields's endorsement of the settlement check at a correctional facility where she was an inmate on October 12 and, four days later, deposited the check into his payroll account. Catledge did not use his trust account because of problems he attributed to bank error.

¶ 2. Catledge paid $500.00 to Shields's correctional facility account on October 23, 2000, leaving a balance due to Shields of $7,371.43. Between October 18 and November 3, Catledge and his bookkeeper wrote checks on the payroll account for firm expenses,¹ causing the balance of Catledge's payroll account to fall below $7,371.43 on several occasions. Catledge says, however, there were undeposited checks totaling $18,436.36 in his office on October 18-19, 2000, and he was unaware that, without those deposits, the payroll account balance would fall below $7,371.43. Catledge deposited the $18,436.36 on October 20, and an additional $11,600.00 on Monday, October 23, 2000. Catledge argues that, because the undeposited funds were in his office, Shields's money was never at risk.

¶ 3. When Catledge realized he paid the bank with a check from the payroll account, he wrote a second check from his client trust account for $4,000 on October 30, 2000 to pay the bank. He requested that the second check be used to pay the note in place of the check delivered to the bank the previous Friday. However, the bank paid both checks, which resulted in a $4,000.00 reduction in both the payroll and trust accounts. This resulted in an overdraft of the client trust account by $3,974.35.

¶ 4. The remaining $7,371.43 due to Shields was paid as follows: $2,500 check to Mary Hadden on November 16, 2000; $500 in postal money order to Shields at MDOC on March 12, 2001; and $4,371.43 check to Shields at MDOC on March 27, 2001.

¶ 5. After Shields filed a complaint against him concerning his mishandling of client funds, Catledge hired Wayne Miles a certified public accountant on about March 28, 2001. Myles reorganized Catledge's system for handling the client trust account.

¶ 6. The charges against Catledge were investigated by a Complaint Tribunal which concluded that Catledge should be suspended from the practice of law for one year. Both Catledge and the Mississippi Bar filed appeals to this Court. Catledge says his only sanction should be a public reprimand while the Mississippi Bar advocates disbarment. The following issues are raised on appeal to this Court:

I. Whether Catledge received proper sanctions from the Tribunal.

II. Whether the Tribunal erred as a matter of law by making findings of fact which required a conclusion of law that Catledge had violated the provisions of M.R.P.C. 8.4(a) and (c), but failed to include such a conclusion of law in its Opinion and Judgment.

III. Whether the Complaint Tribunal abused its discretion by allowing Catledge to present testimony and proof at the February 14, 2003 hearing.

DISCUSSION

¶ 7. "The Supreme Court of Mississippi has exclusive and inherent jurisdiction in bar disciplinary matters." Miss. Bar v. Pels, 708 So.2d 1372, 1373 (Miss.1998). See also R. Discipline Miss. State Bar 1(a). In matters involving attorney discipline, this Court conducts a de novo review. Miss. Bar v. Shelton, 855 So.2d 444, 445 (Miss.2003) (citing Pels, 708 So.2d at 1373). See also R. Discipline Miss. State Bar 9.4. This Court must decide each disciplinary case on its own unique merits. Fougerousse v. Miss. State Bar Ass'n, 563 So.2d 1363, 1366 (Miss.1990). "On appeal, this Court, `shall review the entire record and the findings and conclusions of the Tribunal, and shall render such orders as the Court may find appropriate.'" Miss. Bar v. Sweeney, 849 So.2d 884, 887 (Miss.2003) (quoting Foote v. Miss. State Bar Ass'n, 517 So.2d 561, 564 (Miss.1987)). This Court may give deference to the findings of the Tribunal. Id. "This Court is free to evaluate the discipline imposed on an attorney and on review modify punishment as needed to best serve the interest of the Bar and the public." Parrish v. Miss. Bar, 691 So.2d 904, 907 (Miss.1996). "The burden is usually on the Mississippi Bar to show by clear and convincing evidence that an attorney's actions constitute professional misconduct." Shelton, 855 So.2d at 445 (quoting Pels, 708 So.2d at 1373).

I. Whether Catledge received proper sanctions from the Tribunal.

¶ 8. Catledge argues his sanction should be no greater than a public reprimand. He directs us to the following excerpt from the Tribunal's findings:

In the case of Mr. Catledge, there is no evidence that Mr. Catledge intentionally utilized the funds of Mary Shields. Mr. Catledge was not well versed in proper accounting procedures and bookkeeping and failed to implement the necessary controls to protect the viability of his accounts, which he acknowledged and took full responsibility for. Unlike many of the other cases involving this type of conduct, Mr. Catledge made no misrepresentations to his client or the Court and from all appearances forthrightly cooperated with the Bar in its investigation of this matter. There simply is no evidence to this Tribunal that Mr. Catledge intended to utilize Mary Shields' funds, but, rather, this was an offense of inadvertence.

¶ 9. Catledge admits that he allowed Shields's money to become commingled with his firm's money for a period of about two weeks, but he claims that his bank's mistakes caused the problem. He says he had no intention of converting client funds, and he points out that, because of the undeposited funds in his office, he had no need to convert client funds to his own use. He further informs us that he has addressed the problem by hiring a C.P.A. to implement controls for safeguarding client funds.

¶ 10. The Bar says Catledge should be disbarred because he intentionally commingled client funds. The Bar points out that Catledge's testimony is the only evidence that the bank made errors. Furthermore, the Bar disputes that Catledge could have paid Shields the money due her, had she requested it on October 18-19, 2000. Finally, the Bar, argues that Catledge's commingling of client funds, his use of client money for personal purposes, and his past disciplinary record, when considered together, require disbarment.

¶ 11. When considering the imposition of sanctions, this Court has stated:

The primary concern when imposing sanctions for attorney misconduct is that the punishment be sufficient "to vindicate in the eyes of the public the overall reputation of the Bar." The Court uses two sets of criteria when reviewing the sanctions for misconduct. Miss. Bar v. Alexander, 669 So.2d 40, 42 (Miss.1996). However, the Court is essentially "free to evaluate the discipline imposed on an attorney and on review modify punishment as needed to best serve the interest of the Bar and public."

Parrish, 691 So.2d at 907 (citing Miss. State Bar v. Blackmon, 600 So.2d 166, 173 (Miss.1992)).

¶ 12. The two sets of criteria mentioned in Parrish include nine areas of inquiry, four of which originate from the American Bar Association standards. These areas of inquiry include:

(1) the nature of the conduct involved;

(2) the need to deter similar misconduct;

(3) the preservation of the dignity and reputation of the profession;

(4) the protection of the public; and

(5) the sanctions imposed in similar cases.

(6) the duty violated;

(7) the lawyer's mental state;

(8) the actual or potential injury caused by the lawyer's misconduct; and

(9) the existence of aggravating or mitigating circumstances.

Miss. Bar v. Sweeney, 849 So.2d 884, 888 (Miss.2003). See also Parrish, 691 So.2d at 907; Miss. Bar v. Alexander, 669 So.2d 40, 42 (Miss.1996); Miss. Bar v. Attorney ST, 621 So.2d 229, 233 (Miss.1993); Blackmon, 600 So.2d at 173.

1. The nature of the conduct involved.

¶ 13. The Tribunal found that "[i]t is clear from the findings by this Tribunal that Mr. Catledge commingled and utilized the money of Mary Shields." However, unlike Miss. State Bar v. Odom, 566 So.2d 712, 716 (Miss.1990) and other similar cases, the Tribunal found that he did not use his client's money from "a temptation to appropriate for his own use." Catledge attempts to minimize his actions by claiming that the actions were "inadvertent" and at least partly due to bank errors. We find that Catledge's actions constitute per se violations of M.R.P.C. 1.15 and 8.4(a) and (c), even though the Tribunal found only a violation of Rule 1.15.

2. The need to deter similar misconduct.²

¶ 14. Miss. Bar v. Coleman, 849 So.2d 867, 874 (Miss.2002), states in part that "[c]ommingling of client funds is the `cardinal sin' of the legal profession, whether done intentionally or not." Catledge argues that his case is distinguishable from Pitts v. Miss. State Bar Ass'n, 462 So.2d 340, 343 (Miss.1985) and Coleman, Coleman is distinguishable, according to Catledge, because the attorney intentionally deposited the client funds into his personal account and the attorney had a negative balance in the account. Coleman, 849 So.2d at 869-70....