In re Delorenzo

214 A.D.3d 1253

185 N.Y.S.3d 423

In the MATTER OF Paul Edward DELORENZO, an Attorney.

(Attorney Registration No. 2528123)

PM-70-23

Supreme Court, Appellate Division, Third Department, New York.

Calendar Date: February 6, 2023

Decided and Entered: March 23, 2023

Monica A. Duffy, Attorney Grievance Committee for the Third Judicial Department, Albany (Alison M. Coan of counsel), for Attorney Grievance Committee for the Third Judicial Department.

O'Connell and Aronowitz, Albany (Stephen R. Coffey of counsel), for respondent.

Before: Aarons, J.P., Pritzker, Reynolds Fitzgerald, Ceresia and McShan, JJ.

MEMORANDUM AND ORDER ON MOTION

Per Curiam.

Respondent was admitted to practice by this Court in 1993 and has been most recently affiliated with the law firm of DeLorenzo, Grasso & Dalmata, LLP (hereinafter DGD) in Schenectady County. Respondent is the subject of a current investigation by the Attorney Grievance Committee for the Third Judicial Department (hereinafter AGC) centering around respondent's unauthorized use of funds maintained in the law firm's escrow accounts and his misappropriation of funds in the firm's operating account. Accordingly, by affidavit sworn to December 1, 2022, respondent has applied for leave to resign from the New York bar while AGC's investigation is pending. The application was previously marked returnable December 27, 2022 but, upon AGC's request, the return date was adjourned to February 6, 2023. AGC now opposes respondent's motion and cross-moves to suspend respondent during the pendency of its investigation and for an order directing respondent to make restitution to the Lawyers’ Fund for Client Protection based upon his misappropriation of funds.

An attorney may apply to resign while a disciplinary investigation is pending by application to this Court with "proof of service on [AGC], setting forth the specific nature of the charges or the allegations under investigation" and attesting that the resignation is consented to voluntarily and that he or she cannot successfully defend against the allegations of misconduct (Rules for Attorney Disciplinary Matters [ 22 NYCRR] § 1240.10 [a]). As relevant here, when allegations against an attorney include willful misappropriation of money in the practice of law, the attorney in question must also "(1) identify the person or persons whose money or property was willfully misappropriated or misapplied; (2) specify the value of such money or property; and (3) consent to the entry of an order requiring the respondent to make monetary restitution pursuant to Judiciary Law [§ ] 90(6–a)" (Rules for Attorney Disciplinary Matters [ 22 NYCRR] § 1240.10 [b]). Here, respondent has failed to provide this specific information in his affidavit. While respondent avers that he no longer has access to identify the ownership of any of the funds regarding DGD's operating account – i.e., the person or persons whose money he has willfully misappropriated – respondent's statements in his affidavit are "insufficient to meet this requirement and fail to convey the appropriate culpability for his actions" ( Matter of Meagher, 178 A.D.3d 1351, 1352, 115 N.Y.S.3d 553 [3d Dept. 2019] ; see Matter of Hessberg, 166 A.D.3d 1283, 1283, 86 N.Y.S.3d 793 [3d Dept. 2018] ). To this point, while respondent signed a settlement agreement with DGD that notes that DGD alleges respondent's intentional misappropriation of funds, this allegation is not addressed in the settlement agreement's list of provisions to which respondent is legally bound, except to the extent that it releases respondent from any potential legal action by DGD concerning said funds.

We further agree with AGC's concern that respondent's resignation application is an attempt to minimize his misconduct and to avoid any public determination of same. While respondent's statements do "readily admit" his wrongdoing regarding the firm's escrow account, they simultaneously minimize his culpability in the misappropriation of funds from the firm's operating account by noting only briefly that such issue was "resolved" by the mutual exchanges of releases between respondent and DGD. Accordingly, we deny respondent's motion for leave to resign (see Matter of Meagher, 178 A.D.3d at 1352, 115 N.Y.S.3d 553 ; Matter of Hessberg, 166 A.D.3d at 1283, 86 N.Y.S.3d 793 ).

As to AGC's cross-motion, "[a] respondent may be suspended from practice on an interim basis during the pendency of an investigation or proceeding ... upon a finding by the Court that the respondent has engaged in conduct immediately threatening the public interest" (Rules for Attorney Disciplinary Matters [ 22 NYCRR] § 1240.9 [a]). As relevant to AGC's cross-motion, a determination that the public interest is immediately threatened may be founded upon "uncontroverted evidence of professional misconduct" ...