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In re Pauk

Decided: June 19, 1987.


On an order to show cause why respondent should not be disbarred or otherwise disciplined.

For suspension -- Chief Justice Wilentz, and Justices Clifford, Handler, Pollock, O'Hern, Garibaldi and Stein. Opposed -- None.

Per Curiam

This disciplinary proceeding arises out of five presentments filed by the District VIII Ethics Committee (the Ethics Committee), which concluded in each matter that respondent was guilty of unethical conduct. The Disciplinary Review Board (DRB) agreed with the Ethics Committee's finding of unethical conduct. Upon review of the first two presentments, involving the Schiffner and Paulus matters, the DRB recommended that respondent be temporarily suspended from the practice of law pending final disposition of all the ethics complaints against him. Decision and Recommendation issued December 15, 1982 (Decision No. 1). Accordingly, since January 18, 1983, respondent has been temporarily suspended from the practice of law.

Upon review of the last three presentments, involving the Cicciari, Gyorke, and Sabo matters, the DRB recommended that respondent be suspended for four years retroactive to the date of his temporary suspension. Decision and Recommendation issued December 4, 1986 (Decision No. 2). Three members of the DRB recommended that respondent be disbarred. One member of the DRB did not participate. Our independent review of the record leads us to accept the recommendation of the DRB, subject to the condition that respondent's practice be supervised by a preceptor approved by the DRB.


Respondent, a sole practitioner, was admitted to the bar in 1962. The presentments stem from five separate transactions.

We have independently examined the record and are satisfied that the DRB's determinations of the underlying facts in each

transaction are supported by clear and convincing evidence.*fn1 These facts are as follows:

A. Schiffner Matter

The respondent was retained by Walter G. Schiffner in July of 1976 to represent him in an action stemming from Schiffner's injury in an automobile accident on July 11th of that year. No retainer agreement was executed, and the client was not advised that he could retain respondent on an hourly basis. Mr. Schiffner in fact testified that there was no discussion of the fee to be charged.

A complaint was filed by respondent on behalf of Mr. Schiffner on November 21, 1976. The complaint was answered on July 27, 1977, after respondent agreed to an extension of time for defendants. Interrogatories were served on that same day.

On December 6, 1977, an order dismissing the complaint for failure to answer interrogatories was entered. Although respondent claimed that his client failed to return the interrogatories to him despite requests by letter and telephone over an 11 month period, the Committee found, based upon the client's testimony as well as references to certain dates within the interrogatories, that the client had cooperated and the interrogatories were completed in February of 1977.

The respondent further claimed that the first set of interrogatories were misplaced and complainant was therefore given another set in December, as well as that once the first set was again located, respondent was unable to obtain his client's signature on the document. He further stated that he advised his client of the dismissal. The client, on the other hand, stated that he was not advised at any time that his complaint had been dismissed, that he was never advised by respondent of the need for his signature on the interrogatories, that he and an attorney whose aid he enlisted had extensive difficulty in contacting respondent and, once contact was made, in November of 1978, the respondent lied to other counsel concerning the status of the case. Additionally, nearly one and one half years after the case was dismissed, Mr. Schiffner gave a $250 check to respondent, at respondent's request, allegedly to procure medical reports related to the case. The check bore the notation "Court costs and medical reports." Nonetheless, respondent claimed that the money was not for medical reports but was given as settlement on respondent's fee for handling the case. The check was thereafter cashed by respondent's secretary at respondent's request.

Mr. Schiffner further testified that in the Spring of 1980 he met with the respondent who advised that an offer to settle the case for $200 to $250 had been received, but respondent felt it could be doubled. The respondent did not recollect either the meeting or the offer.

In the Schiffner matter, the DRB concluded that respondent had harmed his client by failing to press his case; that he thereafter compounded his conduct by attempting to deceive his client, other counsel, and the Ethics Committee; and that he took money from his client under false pretenses, thereby violating DR 1-102(A)(1), (3), (4), (5) and (6); DR 6-101(A)(1); DR 7-101(A); DR 7-102(A)(3) and (8); and DR 9-102.*fn2

B. Paulus Matter

In August of 1978, John E. Paulus, Jr. retained the respondent to represent his wife and himself in an action to recover damages for injuries sustained by Mr. Paulus at a lumber company. Mr. Paulus understood that respondent would receive 1/3 of the net settlement after deduction of $1,000 to pay respondent's costs and expenses. Respondent did not advise his client that he could be retained on an hourly basis.

By October 11th of that year, Mr. Paulus had also retained respondent to represent him in his divorce action. No specific fee was agreed upon at that time. Rather than withdrawing as Mrs. Paulus' attorney in the negligence action, respondent contacted her attorney in the divorce case to have her withdraw her per quod claim.

Prior to resolution of the matrimonial matter in March of 1980, Mr. Paulus requested respondent's assistance in forestalling demands of the mortgagees of complainant's marital home. No fee was discussed or agreed upon, and Mr. Paulus regarded the problem as one aspect of the divorce proceeding. A divorce was granted to the Paulus' on March 27, 1980. As part of the settlement, Mrs. Paulus was to receive $1,800 from the proceeds of the negligence matter. While respondent claimed that Paulus had agreed to the fee of $6,500, billed at the conclusion of the matrimonial matter, Mr. Paulus contended that respondent was not to be paid until the marital home was sold. Additionally, he stated that he did not receive any bills on the matrimonial matter, and that the $6,500 fee was ridiculous since, in addition to numerous telephone conferences with his client, respondent spent only one day in court and had only two meetings with his wife and her counsel. The attorney who represented Mrs. Paulus testified that his fee was only $1,500 but that a fee of $3500 by respondent "would not be out of line." Respondent contended that although his fee was originally to be $3500, he raised that fee by $3,000 after successfully rebuffing Mrs. Paulus' alleged claim for a $10,000 payment as part of the property settlement.

The negligence action was settled in September of 1980. Respondent deposited a settlement check for $27,500 in his trust account on September 18, 1980. On the next day, he disbursed to himself $9,333 which represented his fee in the negligence matter. Mr. Paulus claimed that he authorized no further disbursements to respondent. Thereafter, Mr. Paulus received a check for $10,000 from respondent dated October 2, 1980. On October 14th, respondent disbursed to himself a fee of $1,571.25 which allegedly represented his fee of $1,245 for the "mortgage negotiation" and miscellaneous costs related to the divorce proceeding, and $6,500 which represented his fee in the divorce proceedings.

The respondent stated that he had spent four to five hours dealing with the problems related to the mortgages on the marital home. He indicated that his actions saved his client five or six mortgage payments, so he felt it was appropriate to take a fee equivalent to one month's mortgage ...

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