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In re Pennica

Decided: January 22, 1962.


On order to show cause why respondent should not be disciplined.

For disbarment -- Chief Justice Weintraub, and Justices Jacobs, Francis, Proctor, Hall, Schettino and Haneman. Opposed -- None. The opinion of the court was delivered by Francis, J.


[36 NJ Page 402] A number of charges of unethical conduct were filed against the respondent Joseph Pennica, Esq., who was admitted to the bar of this State in 1951. Hearings were held thereon by the Ethics Committee of Union County. They resulted in three presentments to this court recommending disciplinary action against him. We shall consider each

of them separately in the following order: (1) the Max Sacks Matter, (2) the Monmouth County Court complaint, and (3) the Bock Matter.



This accusation arose out of the forgery of the signature of Sophie Sacks, wife of Max Sacks, on an application for a bank loan, on a note for the amount of the loan, and on the bank check for the proceeds of the loan. The Ethics Committee found that Pennica participated in the loan transaction and aided in its consummation, knowing of the forgery. The conclusion was reached after several hearings and study of a welter of conflicting testimony. Since the issue of credibility is paramount, our review necessarily calls for a thorough examination and evaluation of the lengthy record.

Pennica maintains his law office in Elizabeth, New Jersey. In the forenoon of April 26, 1957, John Serido telephoned him from Plainfield, New Jersey, and told him that he needed money to make good some checks he had issued. He indicated also that he had a friend with him whose credit would support a loan. Pennica suggested that they come to his office. Serido and Max Sacks, the friend referred to, both of whom lived in Plainfield, came to Pennica's office by automobile, arriving around 11 A.M. One Clement Approvato, Jr. drove the car. Everyone agrees that Serido and Sacks entered the office. There is a dispute in the testimony as to whether Approvato came in with them. Serido, Sacks and Approvato say that he did; Pennica denies it and asserts that the allegation of Approvato's presence both in his office and at the bank on the visits to be detailed, was not made until the controversy arose as to Pennica's course of conduct on that day.

Serido and Approvato had substantial criminal records. Serido had been convicted of fornication, armed robbery, a

narcotics violation, and some worthless check charges. He seemed to have a particular penchant for issuing bad checks and had a number of them outstanding "in quite a few towns" at the time of this call to Pennica. Pennica was aware of earlier worthless check charges against Serido because he had represented him in connection with some of them. Whether he knew of the complete criminal record does not appear.

A discussion took place about raising money to meet Serido's obligations in order to keep him out of jail. Without reciting the details, when it developed that Sacks owned a substantial property in Plainfield which would provide collateral, Pennica advised that he could assist Serido and Sacks in obtaining a loan at the Elizabethport Banking Company, the office of which was nearby. After persuading Sacks to apply for the loan, they walked to the Bank (Pennica denying that Approvato accompanied them; the others asserting it).

Pennica introduced Sacks to Charles J. Walker, Vice-President of the Bank, who handled loan transactions, and explained to him the desire for a $2,000 loan. Serido remained at a distance, not joining in the talk; Approvato said he remained outside. After some discussion, Walker gave Sacks and Pennica a loan application form and a note for $2,280 to be completed. Walker, Sacks, Serido and Pennica agree that Pennica went to a nearby desk with Sacks and filled in the application in ink with information obtained from Sacks about the Plainfield property, his business, income, etc.; Pennica's writing appears on three sheets of the application. The circumstances strongly suggest that he used his own pen in doing so. Then Pennica had Sacks sign the papers in the three places marked by Walker. Our attention is attracted to the ink used by Pennica and Sacks. It has an odd, almost purple hue. Among other things, Pennica had noted that title to the real estate was in Max Sacks and his wife, Sophie. The forms were handed back to Mr. Walker who, after examination, advised them that Sophie's

signature on the application and note was necessary as well as Max's. Following this, Sacks, Pennica and Serido left the bank, ostensibly to obtain Mrs. Sacks' signature.

At this point the crucial conflict of credibility begins. Sacks testified he advised Pennica that his wife would never sign because she neither liked nor trusted Serido. According to Sacks, Serido and Approvato, they then returned to Pennica's office. Further talk about the problem ensued there during the course of which Sacks reiterated his certainty that his wife would not approve the transaction. It is difficult to pinpoint the exact circumstances preceding the signing of Mrs. Sacks' name. It appears that in the course of discussion, Serido volunteered to write her signature on the papers. There is testimony to the effect also that Pennica suggested that Serido sign her name because he was going to pay the monthly installments on the note and no harm would be done. Serido assured Sacks that he would "go straight" and do his best to make the payments. Sacks finally agreed and Serido added Mrs. Sacks' signature in two places on the application and two on the note. Max Sacks' signature was already on the papers, having been written at the bank. Here again, we note that Sophie Sacks' four forged signatures were written with the same purple hued ink Pennica used in filling out the application. After waiting a while to allow sufficient time to elapse for a trip to Plainfield, all four men went back to the bank.

Pennica denies returning to his office and the events alleged to have happened there. Before the Ethics Committee he said that he handed the papers to Sacks, and told him to go to Plainfield and get his wife's signature. He instructed Sacks also to telephone him from Plainfield when Mrs. Sacks had signed, and then return to his office. The request for the telephone call was made because he did not trust Serido. Pennica's description of this scene is unusual. He said that after Walker requested Mrs. Sacks' signature and the documents were handed back, Sacks took them and "out he went." Pennica could not "keep up with

him. He was beginning to take off and I had to go out after him and then when I caught him I told him, 'Now, you'll have to go to Plainfield and get your wife's signature.' * * * My recollection is that Mr. Sacks was going so fast that I wanted to tell him what Walker had said -- to remind him not to forget what Walker told him about getting his wife's signature and to make sure that he understood this." After this conversation, he returned to his office alone.

Some time later, Pennica continued, Sacks and Serido appeared at the office. "Serido came running up first, and Mr. Sacks hardly got into the office when they told me Mrs. Sacks had signed. They said, 'Come on, let's go to the bank.'" In the criminal trial against Pennica, arising out of the forgery, he testified that they gave him the papers and, on seeing Sophie's name thereon, he said to Sacks: "Is this your wife's signature?" Sacks "assured" him it was. He did this because he wanted to be sure in his own mind, but he made no inquiry as to why they had not telephoned him from Plainfield. He then proceeded to the bank with them and submitted the application and note to Walker. In his testimony before the Ethics Committee he said he did not question Sacks about the signature at his office but that when they arrived at the bank, he asked Sacks whether the signature on the papers was his wife's.

A bank check for $2,030.73 was prepared by Walker and given to Sacks who, according to Pennica, wanted to cash it immediately. But (Pennica testified) he said: "No, you have to repeat the same process now. You have to now get your wife's signature on the check. He looked at it and I showed him where it was, I indicated to him. He said, 'Like we did before?' I said, 'That's right. Go back to Plainfield and get your wife's signature.'" Sacks was then to return to Pennica's office. The reason Pennica gave for asking Sacks and Serido to come back to his office was that he was doing a favor for them by arranging

the loan; he was not acting as the attorney of either one of them; and, as he did not trust Serido, he wanted to do what he could to see that the proceeds were used to satisfy the bad checks. In any event, shortly thereafter the two men reappeared at his office. Sacks said, "Here's the signature, here's the check signed."

Sacks, Serido and Approvato dispute Pennica's statements about the endorsement of the check. Serido and Approvato testified that when Sacks and Pennica came out of the bank, Pennica told Sacks and Serido to sign it. They did so (Serido again writing Mrs. Sacks' name) leaning on a nearby parked car, according to Serido; leaning against the wall of the bank, according to Approvato. Sacks was confused as to where the signing took place. These signatures are not in the purplish-tinged ink. Serido and Approvato said Pennica made an unsuccessful effort to cash the check at a store; Pennica denied it. Then they waited for some time and again walked to the bank to obtain the money.

At this juncture it is necessary to return to Pennica's version of the affair at the point where he said Sacks and Serido reappeared at his office with the signed check. He said they set out for the bank to cash it, but they walked "so fast, they were so far ahead of me that they got there before I even turned the corner from my office and I wasn't going to run with them as rapidly as they were." So he waited outside and soon Sacks came out with the money in his hands.

Almost as soon as Pennica, Serido and Sacks came together outside the bank, they all agree that a squabble broke out about the division or possession of the money. Serido insisted that it be given to him because he had the bad checks to make good. Sacks indicated that he had made arrangements with the holders of the checks and felt that he should be permitted to make the payments. But both of them testified, Serido at Pennica's criminal trial, and Sacks on that occasion and before the Ethics Committee

also, that Pennica got possession of the money and gave Serido a maximum of $800 to satisfy the checks. Serido and Approvato said the reasons assigned by Pennica for retaining the balance were that he had worked all day on the loan and because of some previous indebtedness of Serido to him. Pennica denied that he received any part of the money. He said that Serido was grabbing for the money; Sacks was trying to avoid giving it to him. He suggested an even division so that Sacks could pay off the checks held by persons with whom he had made arrangements to do so, and Serido could take care of the remainder. At Pennica's criminal trial he asserted that his suggestion was agreeable and he "divided the money among them and it was my recollection that they got a thousand dollars apiece." More particularly he said:

"* * * Mr. Sacks had the money in his hand. Mr. Serido made a grab for all the money. Mr. Sacks wouldn't give him any of it. He was imploring upon me to make the division and to hold down Serido, not to give him all the money. I then divided it between them. I said, 'You claim you have personal people that have made representations to you that Serido owes them money. You take care of those,' and Serido claimed that he would take care of the balance."

Before the Ethics Committee, Pennica referred to the squabble between Sacks and Serido, and said that Sacks suggested that he (Pennica) be permitted to pay off the checks. But then "Serido grabbed the money and then I got my hands on some of it and I started to count it out and before you know it, it was grabbed out of my hands. Then Serido convinced Sacks to let him handle everything." In a statement given at a later time to the Prosecutor's representatives, Pennica described this incident as follows:

"* * * Sacks and Serido went into the bank and they came to the sidewalk and they began to squabble about the division of the $2,000., saying, 'I have to make certain checks good,' and they took off and I cautioned Mr. Sacks, 'Make sure you pay off the checks with that money, that's what you got it for.'"

After the sidewalk incident, Sacks and Serido set out together, ostensibly to make the checks good. Pennica returned to his office.

Early in 1958, Pennica encountered Serido at the Somerset County Court House. Serido, then represented by other counsel, had pleaded guilty to a charge of forgery and was awaiting sentence. (This offense was not the Sophie Sacks forgery.) Apparently he had learned or suspected that he was going to suffer a jail term. On seeing Pennica, he asked him to take over the case for the purpose of obtaining leave from the court to withdraw the plea and go to trial. Pennica did so and the indictment was tried in February 1958. A conviction resulted, whereupon, according to Pennica, both Serido and Sacks threatened him before and after the sentence. Serido said he would get even because Pennica had lost the case. Sacks complained that Serido owed him a large sum of money and now he would not be able to collect it. The following is the kind of threat Sacks is alleged to have made:

"* * * Now you lost the case. You made Serido go to jail for 12 to 18 years and I can't get any of the money he owes me, and I am going to hold you responsible for it. And the loan I got at the bank, my wife's signature was forged, and I am going to say that you were the one who told us to do it and that you arranged everything for us to forge that signature, and I am going to get Mr. Approvato to also swear to the same thing that I am going to swear to."

Pennica said that particular threat took place early in 1958, around the time of the trial. The court record, of which we take judicial notice, shows that Serido's sentence of 12 to 18 years was imposed on May 2, 1958. Serido and Sacks deny the threats.

In this chronicle of pertinent events, reference must be made to Pennica's fee arrangement for the defense of Serido. Before the Committee, he said the charge was $4,500, most of which he received. After the conviction it was decided to appeal. But he was not a counsellor and could not handle

the appeal, and told Serido he would recommend a good lawyer to do so. He testified variously that he made the necessary arrangements with Bernard Folkenflik, Esq., that he recommended various attorneys, that Folkenflik was actually engaged by a friend of Serido's when the appeal was already pending. In any event, prior to the taking of the appeal, Pennica said that Serido complained to him about being left "high and dry" after a substantial fee had been paid for legal services. Pennica then suggested that if Mrs. Serido would call at his office he would give her $2,000 to help defray the appeal expenses. And he testified that this sum was paid to her. The date this was done cannot be fixed with any certainty from the record. In one place in the record he asserted the money passed long before Mr. Folkenflik's death in February 1959; at another, on questioning by the Committee, he said that on October 20, 1958, he withdrew $3,000 from his savings account and gave Mrs. Serido the $2,000 in cash.

At the criminal trial of Pennica, the account of the fee transaction was quite different. Prior to Pennica's indictment for conspiracy to defraud the Elizabethport Banking Company by means of Serido's forgery of Mrs. Sacks' signature, he had testified before the Grand Jury. On cross-examination at the trial of the indictment, it developed that in the Grand Jury appearance he testified he had obtained a signed retainer agreement on February 10, 1958, from Serido for "$2,100" (sic), $200 for work already done, and the balance to be paid in two installments of $1,000 each, the last one due prior to February 14, the date fixed for trial of Serido. The agreement specified that if the fee was not paid, Pennica would not appear in court on February 14. When the time came, Serido did not have the money. Then a friend gave Pennica a check for $1,800. It was returned for insufficient funds. Suit was started on the check and a settlement made. As the result of these difficulties, Pennica said to the Grand Jury, he received but $800 for his services at Serido's trial. The Assistant Prosecutor questioned

his payment of $2,000 to Mrs. Serido, allegedly for appeal purposes, when he had received a total fee of $800, and intimated that the payment was made to influence Serido not to involve him in the Sacks forgery. Pennica rejected the suggestion and gave an explanation, which had not been given to the Grand Jury. He said he had been handed $2,000 to prosecute an appeal on the day the jury convicted Serido in Somerville. Specifically he testified:

"Q. Tell us when you received the $2,000 to prosecute the appeal.

A. The day the jury came out with a verdict against my client. He then got me in a corner and with me was one of my associates, and he explained to me, 'Now I have to take an appeal. Here is $2,000. Take care of the appeal.' And that is how he gave me the money for the appeal. * * *."

Although reference has already been made to some of the many conflicts and bizarre statements in Pennica's testimony which reflect upon his credibility, this obviously ad hoc assertion strains credulity beyond the breaking point.

After Serido went to prison, Pennica visited him many times and discussed the appeal with him. The Appellate Division file shows that on June 9, 1958, Serido made a pro se application for leave to appeal as an indigent. Such an order was granted. Serido then filed a notice of appeal pro se on July 10, 1958. Subsequently he applied for, and was given, a transcript of the testimony at the trial, also as an indigent. On April 17, 1959, again on a similar request, the Appellate Division assigned counsel to perfect and argue the appeal for him. The conviction was affirmed on September 22, 1959. The record reveals also that on February 2, 1959, Mr. Folkenflik presented an application for bail for Serido pending the review. It was denied. That was his only appearance on the appeal.

Serido testified that Folkenflik represented him on the conspiracy indictment referred to above, under which he was a codefendant with Pennica. He said also that Folkenflik, who died suddenly on February 21, 1959, was working on

the appeal from the Somerset County forgery conviction. However, the date when representation on the appeal began was not given. Among other things, Serido did say he gave Folkenflik the whole story of the Sacks forgery. This is not without significance in the present proceeding because Pennica told the Ethics Committee he first learned from Folkenflik that something was "stirring" in the way of investigation of the Sacks case, and that the information prompted him to obtain the statements from Sacks (which are to be discussed hereafter). It seems obvious that Folkenflik had detailed knowledge of the situation, at least as Serido described it, because Pennica said: "He went into this thing like he was with me when it happened." The inference is strong that the information came from Serido.

One of the odd circumstances to be appraised is Pennica's almost ambivalent discussion of Folkenflik. At one place in his testimony he said, "Bernie was a very dear friend of mine. He lived a block from my home." Later, when a member of the Committee suggested that Folkenflik was a good friend of his, he answered:

"No, he wasn't a good friend of mine. I didn't know Mr. Folkenflik very well. I knew him as I know you and as I know fellow members of the bar. I never was out with him socially. I only would know Mr. Folkenflik if I met him in a court room. * * *."

Again, in another part of his testimony, he said that after Folkenflik took over the prosecution of Serido's appeal, Serido "didn't like that I recommended Folkenflik and he didn't trust Folkenflik and he thought that Folkenflik was going to sell him down the river and he was always writing to me. I had to go down [to the prison] and assure him that he was all right, that he was a good lawyer and that he would do the right job for him."

Pennica made a number of assertions about hearing rumors from various sources concerning his alleged involvement in the criminal ...

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