State v. Gierhart

473 P.3d 30

STATE of Oklahoma EX REL., OKLAHOMA BAR ASSOCIATION, Complainant,

v.Douglas Mark GIERHART, Respondent.

SCBD-6848

Supreme Court of Oklahoma.

FILED SEPTEMBER 15, 2020

Peter Haddock, Assistant General Counsel, Oklahoma Bar Association, Oklahoma City, Oklahoma, for Complainant.

Timothy D. Beets, Midtown Attorneys, P.C., Oklahoma City, Oklahoma, for Respondent.

Rowe, J.:

¶1 Complainant, State of Oklahoma ex rel. Oklahoma Bar association began disciplinary proceedings pursuant to Rule 6, Rules Governing Disciplinary Proceedings ("RGDP"), 5 O.S.2011 ch. 1, app. 1-A, alleging three counts of professional misconduct against Respondent, Douglas Mark Gierhart. Respondent is an active member of the Oklahoma Bar Association and is currently in good standing. Complainant's allegations arise in part from Respondent's mishandling of funds belonging to two clients. Complainant alleges Respondent's actions are in violation of the Oklahoma Rules of Professional Conduct ("ORPC"), 5 O.S.2011, ch. 1, app. 3-A, and the RGDP and are cause for professional discipline.

Procedural History

¶2 In April 2018, two grievances were filed with the Complainant against Respondent, one by a former employee of Respondent and one by a contractor with whom Respondent dealt during the probate of a client's estate. On April 25, 2018, Complainant opened a formal investigation into the allegations made by Respondent's former employee. After receiving Respondent's responses to both grievances, Complainant filed its formal Complaint on October 3, 2019, which contained three counts of alleged misconduct. Respondent filed an answer to the Complaint on October 23, 2019.

¶3 On November 19, 2019, the Professional Responsibility Tribunal ("Tribunal") held a hearing on the allegations contained in the Complaint, pursuant to Rule 6, RGDP. On January 6, 2020, the Tribunal filed its report wherein it found that Complainant had established by clear and convincing evidence that Respondent violated Rules 1.1, 1.3, 1.4, 1.5, 1.15(a), 1.15(d), 8.4(a), and 8.4(c), ORPC, and Rule 1.3, RGDP. The Tribunal unanimously recommended that Respondent be suspended from the practice of law for two years and one day. On January 8, 2020, the Tribunal issued a corrected report; the Tribunal's findings and recommendation were unchanged.

Standard of Review

¶4 This Court possesses exclusive jurisdiction in Bar disciplinary proceedings. State ex rel. Oklahoma Bar Ass'n v. Holden , 1995 OK 25, ¶ 10, 895 P.2d 707, 711. We review the evidence de novo to determine whether the Bar has proven its allegations of misconduct by clear and convincing evidence. Rule 6.12(c), RGDP; State ex rel. Oklahoma Bar Ass'n v. Bolusky , 2001 OK 26, ¶ 7, 23 P.3d 268, 272. Clear and convincing evidence is "that measure or degree of proof which produces in the mind of the trier of fact a firm belief or conviction as to the truth of the allegations sought to be established." State ex rel. Oklahoma Bar Ass'n v. Green , 1997 OK 39, ¶ 5, 936 P.2d 947, 949.

¶5 Our goals in disciplinary proceedings are to protect the interests of the public and to preserve the integrity of the courts and the legal profession, not to punish attorneys. State ex rel. Oklahoma Bar Ass'n v. Kinsey , 2009 OK 31, ¶ 15, 212 P.3d 1186, 1192. We consider the discipline previously imposed for similar professional misconduct to ensure that discipline is administered uniformly. Id . ¶ 16, 212 P.3d at 1192 (citing State ex rel. Oklahoma Bar Ass'n v. Doris , 1999 OK 94, ¶ 37, 991 P.2d 1015, 1025 ). Discipline, however, is decided on a case-by-case basis to account for differences in the offending conduct and mitigating circumstances. Id .

Background

I. Count I: Estate of Miriam Felty

¶6 Miriam Felty died intestate while residing in Oklahoma. Her daughter and sole heir, Wendy Reed, retained Respondent to probate the Felty estate. On September 15, 2015, Respondent filed a Petition for Probate, Determination of Heirs, and Issuance of Letters of Administration in Oklahoma County. That same day, at the suggestion of Respondent, Leslie Withee, a paralegal in Respondent's office, was nominated by Reed to serve as administratrix of the Felty estate.¹ On October 21, 2015, the court entered an Order Admitting the Estate to Probate and Issuance of Letters of Administration appointing Withee as administratrix.

¶7 The primary assets of the Felty estate included two residences, referred to in the parties' briefs as "63rd Street" and "Federal Court;" Tinker Federal Credit Union ("TFCU") accounts totaling $12,584.52; and life insurance proceeds in the amount of $10,000.00. After some necessary clean-up and repairs, both of the properties were sold with the 63rd Street property returning net proceeds of $21,469.78, and the Federal Court property returning net proceeds of $41,539.89. These funds, as well as those from the TFCU accounts and the life insurance policy, were deposited in Respondent's trust account.

¶8 In September 2016, Respondent instructed Withee, in her capacity as administratrix, to issue a check from his trust account in the amount of $2,725.00 made payable to herself and drawn against the Felty estate funds. He further instructed her to endorse the check and give it back to him. Respondent then endorsed the check and deposited it in one of his personal accounts at TFCU. Withee claimed that these funds were used by Respondent for a personal vacation.

¶9 In July 2017, Withee left her position in Respondent's law office and took a job with another firm. Despite the change in her employment, Withee remained in her position as administratrix of the Felty estate. However, because the estate funds were held in Respondent's trust account, Withee no longer had access to them. She also lost access to files relevant to the administration of the Felty estate. On January 10, 2018, Withee contacted Respondent's office and requested access to the Felty case files and the estate funds held in Respondent's trust account. Neither were produced by Respondent.

¶10 On January 25, 2018, Respondent filed a Final Account and Petition for Order Allowing Final Account, Determination of Heirship, Distribution, and Discharge, wherein he requested attorney's fees totaling $19,147.50. Respondent filed the Final Account without providing proper notice to Reed or Withee. On March 6, 2018, the court held a hearing on Respondent's proposed Final Account. Reed testified that, prior to the hearing, she received a call from Respondent's office indicating that she did not need to attend because the hearing would be continued. Neither Reed nor Withee attended the hearing. On March 9, 2018, the court entered an Order Allowing Final Account, Determining Heirs, and Final Decree of Distribution, wherein the court approved all of Respondent's requested fees. The Order Allowing Final Account was filed on March 14, 2018.

¶11 Withee learned of the Order Allowing Final Account on the day it was filed, and that same day, proceeding pro se , filed a Motion to Vacate Order Allowing Final Account. Withee then obtained new counsel, Sally Ketchum Edwards, who entered her appearance before the court on March 16, 2018. The Order Allowing Final Account was vacated by agreement on April 10, 2018. Throughout April and May 2018, Edwards wrote to Respondent on four occasions advising Respondent that she considered his fee excessive and requesting that he turn over the funds in his trust account belonging to the estate as well as any files relevant to the estate. Respondent provided some of the requested materials but failed to turn over the estate funds.

¶12 Based on the materials provided by Respondent, Withee filed an Interim Accounting on May 2, 2018. The Interim Accounting estimated that Respondent had $40,664.94 in estate funds remaining in his trust account. The Interim Accounting reflected certain errors in the Final Account filed by Respondent on January 25, 2018. Among them, the January 2018 Final Account indicated that certain administrative expenses owing to Kathy Upton (dba K&M Real Estate Investments) for work done on the 63rd Street and Federal Court properties had been paid when, in fact, they had not.

¶13 On June 7, 2018, Withee filed an Amended Interim Accounting, which indicated that Respondent should have $39,164.94 in estate assets remaining in his trust account. That same day, Withee filed a Motion to Compel Respondent to deliver those funds. On August 10, 2018, Respondent filed an objection to the Motion to Compel. Respondent included with his objection a revised Final Account showing that he had $18,451.79 in estate funds remaining in his trust account.

In this revised Final Account, Respondent listed the $19,147.50 in fees he was previously awarded by the trial court as a disbursement. Taking the fees and remaining balance together, Respondent should have had $37,599.29 in estate funds remaining in his trust account.

¶14 The court held a hearing on the Motion to Compel on August 21, 2018. On the day of the hearing, Respondent filed an Application for Attorney Fees and Costs seeking $19,147.50, equal to the amount he had been awarded in the March 2018 Order Allowing Final Account. The court denied Respondent's requested fee and ordered him to turn over $37,000.00 belonging to the estate. Following the hearing, Respondent was only able to turn over $18,451.79. On September 24, 2018, Withee filed a Motion of Personal Representative for Contempt Citation to Issue to Douglas M. Gierhart because Respondent had still not paid the balance of the $37,000.00 he had been ordered to turn over by the court. Respondent eventually paid the remaining $18,548.21 on November 21, 2018. Respondent admitted during his testimony before the Tribunal that in order to pay the remaining balance, he borrowed money from family and used fees earned from unrelated cases.

II. Count II: Upton Grievance

¶15 Kathy Upton (dba K&M Real Estate Investments) was a contractor who was hired to prepare the two Felty estate...