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.
[120 NJ Page 32] This is an attorney-disciplinary case in which the Disciplinary Review Board (DRB or Board) found that respondent, Norman J. Chidiac, had engaged in unethical conduct warranting public discipline. The ethics violations consisted of a breach of the standards of the Rules of Professional Conduct 1.4 and 1.15.
The discipline recommended was a suspension from the practice of law for three years.
The charges relate to respondent's representation of Cathedral Housing Corporation (Cathedral Housing), a charitable organization affiliated with the Diocese of Paterson. Cathedral Housing was incorporated in 1973 for the purpose of rehabilitating houses for low-income families. An initial trustee and director of the corporation, Father W., a Catholic Priest, actively engaged in all of the activities of the corporation on a daily basis for seven years. He personally bought, renovated, sold, and rented houses for Cathedral Housing.
Respondent began to represent Cathedral Housing in 1974. Between 1974 and 1980, respondent participated in several real-estate closings for Cathedral Housing. During that time, respondent also represented Cathedral Housing in several other matters, including a contractor's claim, a workers' compensation claim, the drafting of a state grant application, tenant evictions, preparation of rental leases, and preparation of a sub-division application. In addition, respondent conferred with Father W. on a regular basis.
During that time, respondent never received compensation for his legal services. He testified that because it was not generating sufficient income, Cathedral Housing could not afford his legal fees, but that he decided he wanted to continue to help Cathedral Housing. He therefore worked without reimbursement. That was consistent with evidence demonstrating that respondent did an enormous amount of pro-bono legal work for indigents.
In January 1980, when Father W. left Cathedral Housing for another position, he asked respondent to manage Cathedral Housing's properties. Father W. testified that he had instructed respondent to collect rents, pay taxes, arrange for repairs and, if possible, sell those properties. He also indicated to
respondent that "the Diocese doesn't seem to be interested in this thing at all," and that he should "[t]ry to manage the properties and manage them as you would your own." Father W. testified that respondent was to take whatever legal fees were appropriate, including fees for earlier legal services, and turn any surplus funds over to the Diocese. Respondent's testimony differed somewhat in that he recalled Father W. asking him to manage the properties only until Father W. came back to resume the work, which, it was anticipated, would be after several years. Respondent also understood that he was to keep all surplus funds after managing and selling Cathedral properties for his past legal fees and present management fees.
Respondent kept no records on either income received or expenses paid on behalf of Cathedral Housing. During that time respondent personally owned five buildings consisting of a total of thirty rental units. Respondent apparently managed Cathedral Housing property as though he were managing his own properties. He deposited all rent and mortgage payments into one checking account for both his own properties and the Cathedral Housing property, and he paid all expenses from the same checking account. The only records he maintained were checks, deposit slips, and bank statements, with no records of expenses or income for any of the rental units. During that period, respondent did not pay the taxes on either his own property or the property owned by Cathedral Housing.
No specific Cathedral Housing deposits could be identified in respondent's attorney trust account. It is clear that respondent did not deposit Cathedral Housing funds into his attorney trust account. Although respondent prepared the legal documents necessary for several tenant evictions and for a real estate closing on behalf of Cathedral Housing, he claimed that no moneys were placed in his attorney trust account "because I wasn't working as an attorney. In my mind I was working as a property manager. Never even occurred to me ...