Oregon State Bar Bulletin APRIL 2014
Effective Jan. 20, 2014, the disciplinary board approved a stipulation for discipline publicly reprimanding Pendleton lawyer, Timothy O’Rourke for violation of RPC 1.9(a) (former client conflict of interest).
In 1996, O’Rourke and another member of his firm represented two longtime clients, a wife and husband, in preparing and executing new wills and estate plans. In her executed will, the wife created the Wife’s Trust and named the husband as trustee and their granddaughter as successor trustee.
In relevant part, the will provided that if the husband survived his wife, he would receive from her estate a marital share and the income from Wife’s Trust assets. The husband could distribute the Wife’s Trust principal under certain limited circumstances, but upon his death, their granddaughter would distribute Wife’s Trust assets to the wife’s daughter and the wife’s granddaughters.
The wife died in 1998, after which the husband, as trustee, became vested in Wife’s Trust assets, including fractional interests in seven tracts of property in which the husband personally owned the remaining interests.
In June 2007, O’Rourke assisted the husband in transferring Wife’s Trust’s part interest in seven tracts of property to Husband individually and then subsequently transferring those tracts to Husband’s nephew or Husband’s Trust when O’Rourke should have known such actions were contrary to the terms of Wife’s Trust. O’Rourke anticipated at the time of the transfers that subsequent to Husband’s death, Wife’s Trust could seek to overturn them.
The stipulation recited that O’Rouke acted negligently, and that his conduct was aggravated by his substantial experience in the practice of law, having been admitted in 1987. However, O’Rourke had no prior discipline, did not act with a selfish motive, was cooperative in the disciplinary proceedings and expressed remorse.
IVAN S. ZACKHEIM
Pursuant to a stipulation for discipline approved by the disciplinary board on Jan. 23, 2014, Ivan Zackheim was publicly reprimanded for violating RPC 1.15-1(d) (failing to return client property upon request) and RPC 1.16(d) (duties upon termination of representation).
The complaint arose from Zackheim’s representation of a mother and her sons in two separate personal injury actions. In the first action, Zackheim withheld $2,000 of the mother’s settlement proceeds to cover a possible judgment for costs if she did not prevail at trial against a remaining defendant. After the mother lost at trial, the court ordered her to pay costs; however, Zackheim failed either to pay the judgment or deliver to the mother the $2,000 he had withheld from her settlement proceeds. Zackheim paid the withheld funds to the mother while this disciplinary matter was pending.
Soon thereafter, in the second action, the mother terminated Zackheim’s representation of her minor son and instructed Zackheim to forward his file to another attorney. On that same day, the mother’s other son (who had recently attained the age of majority) also terminated Zackheim’s representation and directed him to forward his file to a new attorney. Zackheim refused to send either of the files to new counsel, improperly asserting that he was entitled to retain them.
In mitigation, Zackheim had no prior disciplinary record and displayed a cooperative attitude toward the proceedings.
MARY E. LANDERS
30-day Suspension (stayed pending completion of two-year probation)
Effective Feb. 10, 2014, the disciplinary board approved a stipulation for discipline suspending Grants Pass lawyer Mary E. Landers for 30-days, stayed, pending completion of a two year probation, for violations of the following: RPC 1.3 (neglect of a legal matter); RPC 1.4(a) (failure to keep a client reasonably informed or respond to requests for information); RPC 1.4(b) (failure to adequately explain a matter to a client); and RPC 8.1(a)(2) (failure to respond to a lawful demand for information from a disciplinary authority).
In the first matter, Landers failed to respond to the lawful inquiries of a disciplinary authority regarding a complaint.
In the second matter, Landers represented a client in a dissolution of marriage. She neglected his legal matter and failed to communicate with him.
Landers’ two year discipline probation requires, among other things, that she submit to monitoring by the State Lawyer’s Assistance Committee (SLAC). Landers, who was admitted to practice in Oregon 2001, had no prior record of discipline.
Effective Feb. 11, 2014, in a split decision, a trial panel of the disciplinary board dismissed a formal complaint alleging that a lawyer violated the following: RPC 1.2(c)( assist or counsel a client to engage in illegal conduct); RPC 3.4(c)(knowingly disobey an obligation under the rules of a tribunal); RPC 8.4 (a) (4) (conduct involving dishonesty, fraud, deceit or misrepresentation); and RPC 8.4(a)(4)( engaging in conduct prejudicial to the administration of justice).
The lawyer, on behalf of a client, filed a dissolution proceeding. While the dissolution was pending, the opposing party had physical possession of and used the parties’ Ford F-10 truck for her sole mode of transportation. The lawyer became concerned that the opposing party may damage the truck. Sometime during the night, the lawyer directed his legal assistant to find the truck at the opposing party’s home and take it. The legal assistant took the truck and hid it on her property. When the truck was taken the opposing party had several personal items inside the truck including money and personal identification.
The next morning, the lawyer called the opposing party’s lawyer and told him, “We grabbed the truck,” and that the personal property was in it. Despite several inquiries, the lawyer would not tell the opposing party or counsel the location of the truck. The lawyer informed opposing counsel that the client had nothing to do with what he called “asset protection” activities, i.e., taking the truck.
The lawyer concealed the truck and its location from the opposing party and counsel for 6 weeks. As a result of the lawyer’s refusal to return the truck to the opposing party or disclose its location, the opposing counsel filed an order to show cause why they should not be held in contempt for violating ORS 107.093(c). Ultimately, the court granted the opposing party temporary possession of the truck.
The bar alleged that under ORS 107.093(c), once the dissolution petition was filed with the court and served on the respondent, both parties were subject to a restraining order prohibiting transferring, encumbering, concealing or disposing of marital property without the opposing party’s consent or a court order.
The bar also alleged: a) that by directing the taking of the truck without the opposing party’s permission or a court order pursuant to ORS 107.093(c) and refusing to disclose the location of the truck, the lawyer improperly assisted the husband in the violation of a state statute; b) that the lawyer knew of the restraining order provision of ORS 107.093(c) and he knowingly disobeyed it; and c) that by directing his office assistant to take and conceal the marital property while a petition for dissolution was pending before a county circuit court, the lawyer impeded the administration of justice.
The panel was troubled that the lawyer engaged in improper “self help” conduct. The facts turned on the statutory construction of ORS 107.093. The panel disagreed with the bar’s interpretation of the statute and found that the restraining order restrictions in ORS 107.093(2)(c) did not apply to the lawyer’s actions. The panel majority held that although the lawyer did not tell the opposing party or counsel where the truck was, they knew that the lawyer had the truck. Moreover the truck was included in the marital estate and was not concealed from the court. The trial panel found that the language of ORS 107.093 does not address the temporary possession or use of marital property.
STEVEN M. McCARTHY
Effective March 17, 2014, the Oregon Supreme Court suspended Independence lawyer Steven M. McCarthy for 90 days for knowing violation of: RPC 1.1 (failure to provide competent representation); RPC 1.4(a) (failure to comply with a client’s reasonable requests for information); RPC 1.4(b) (failure to explain matters to a client to the extent reasonably necessary to allow the client to make informed decisions); and RPC 1.15-1(c) (failure to deposit fees paid in advance into a lawyer trust account).
The court’s decision followed McCarthy’s appeal of the opinion rendered by a disciplinary board trial panel. In the course of representing a client facing nonjudicial foreclosure of one or more investment properties, McCarthy pursued a civil action against a lender and others for claims including alleged violations of the federal Truth in Lending Act and Real Estate Settlement Procedures Act. The panel found that McCarthy filed an error-suffused complaint and acted without adequate research into the applicable state or federal statutes or secondary materials explaining the law. The panel found that during much of the litigation, McCarthy failed to keep his client informed about the status of the case, frequently failed to respond to direct inquiries from the client and made tactical decisions without consulting the client. The panel also found that McCarthy failed to deposit a nonrefundable minimum retainer into a lawyer trust account when his fee agreement did not designate the retainer as earned upon receipt. The panel found McCarthy’s substantial experience in the practice of law was an aggravating factor. McCarthy has practiced law for more than 30 years, most of that in another state.