For suspension for one year -- Chief Justice Weintraub and Justices Francis, Proctor, Hall, Schettino and Haneman. Opposed -- None.
The Burlington County Ethics Committee filed two presentments with this Court charging respondent, John S. Conroy, III, with unethical conduct.
The first presentment arises out of a personal injury negligence case which respondent was retained to handle. In April 1967, Mr. Conroy had a conference with his clients, husband and wife, in connection with an offer of a $2500 settlement which had been proposed by the insurance carrier covering the tortfeasor. After being advised that the attorney's fee would be $800, the clients authorized acceptance of the offer and shortly thereafter signed the necessary releases in respondent's office.
Thereafter many telephone calls and three personal visits were made by the husband to the Conroy office for the purpose of obtaining the proceeds of the settlement. Respondent was not available. On August 23, 1967, after inquiry of the insurance carrier, the husband learned that the settlement check drawn to him, his wife and the respondent had been issued on May 2 and cashed shortly thereafter. The names of all three payees had been endorsed by Mr. Conroy and on May 5 the check was marked "For deposit. Esc. Acct. No. 44-6025." On August 23, the husband was advised by respondent's secretary that he was in Florida, that their names had been endorsed on the settlement check pursuant to their power of attorney and that the check had been deposited. No money having been received by August 29, the clients filed the present complaint under oath with the Ethics Committee.
Before respondent knew of the complaint and before it was served on him, but after he had received a letter from a county judge concerning the matter, he arranged for another member of the bar to aid him in disbursing the settlement
proceeds to complainants. Within a few days thereafter respondent went to his clients' home and explained that since he had been their attorney for ten years he assumed that at the time of his retainer in the case he had taken a power of attorney from them to endorse and deposit any settlement check. He informed them also that the delay in making the disbursements was due to his illness, a vacation in Florida and his inability to get in touch with them. In any event, on this occasion he gave them the full proceeds of the settlement without deducting the $800 which he had told them earlier would be the amount of his fee for services. The clients apparently were satisfied and then sought unsuccessfully to withdraw their complaint to the Ethics Committee.
At the Committee hearing, Conroy said it was his practice in negligence cases to use a form of retainer which contained a power of attorney to endorse the client's name on the settlement check, deposit it and make the appropriate disbursements after it had cleared. The form of such retainer used by him was put in the record. It says in part:
He is to have full power * * * to execute any draft or check in behalf and to make disbursements of the proceeds covering all medical and hospital bills and to retain % of the total recovered if settled and % if trial is had.
In this case it was Conroy's recollection that he had given the retainer form to one of the clients, the other not being present at the time, and had requested him or her to take it home for signature and to return it to him. He believed it was returned to him thereafter duly signed, but he could not locate it in his file or office. On the basis of his belief that he held the power of attorney, he endorsed and deposited the settlement check. However, both clients denied they had ever signed such an authorization. The Committee found "as a fact that Mr. Conroy did not have a power of attorney." But it did not find one way or the
other as to whether he honestly believed such power of attorney had been signed ...