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Attorneys — Discipline – Activated Suspension – Violation of Conditions – Trust Account

Attorneys — Discipline – Activated Suspension – Violation of Conditions – Trust Account

North Carolina State Bar v. Gilbert (Lawyers Weekly No. 15-16-0428, 17 pp.) (Richard Dietz, J.) Appealed from the Disciplinary Hearing Commission. N.C. App. Unpub.

Holding: Even though, during the stay of his suspension, the defendant-attorney did not maintain a trust account, since the conditions of the stay required him to submit semi-annual reports by a certified public accountant concerning his client trust account, he was still under an obligation to submit the reports.

We affirm the Disciplinary Hearing Commission’s (DHC’s) activation of defendant’s suspension for three years.

The 2010 DHC order staying suspension of defendant’s license to practice law did not say what reporting was required if defendant did not have a client trust account. However, defendant made no effort to explain to the State Bar that he did not maintain a client trust account or to clarify whether he was still required to submit CPA reports. Instead, defendant filed affidavits attesting to his proper management of entrusted funds without filing the required CPA reports. This is sufficient to support DHC’s finding that defendant failed to comply with a condition of the 2010 order.

Motion to Continue

Where defendant sought a continuance from December 2013 to March 2014 because of an upcoming jury trial, DHC did not abuse its discretion when it granted a continuance to January 2014 and – at the January hearing – denied any further continuance because the jury trial had already concluded.

Defense Response

Defendant argues that, because the rules governing hearings before the DHC do not provide a timeframe within which a defendant must submit arguments in response to the State Bar’s motion for order to show cause, DHC erred in determining that his written response was untimely. We disagree.

Defendant filed his written response to the State Bar’s allegations on the morning of the hearing, asserting for the first time arguments based on laches and due process. With no notice to the State Bar, he sought to introduce this document into evidence only after the State Bar had rested its case. It was well within DHC’s discretion to refuse to admit the document into evidence.

Moreover, defendant testified extensively and was allowed to use the document to refresh his memory. DHC did not abuse its discretion.

Rules of Professional Conduct

In 2010, Superior Court Judge Thomas Lock censured defendant for violating the Rules of Professional Conduct. DHC concluded that parts of this censure related to misrepresentations defendant made to the court during his stayed suspension.

The State Bar could use collateral estoppel offensively in this case. Defendant has not shown that the State Bar could easily have joined the earlier action.

Because the burden of proof in the State Bar disciplinary hearing was less exacting than the standard applied by Judge Lock, we reject defendant’s argument that the differences between the standards of review render application of collateral estoppel inequitable.

Bar Membership Terms

Even if, “like hundreds of other lawyers”, defendant paid his 2013 membership fees within 30 days of having been served with the notice to show cause, the terms of the stay required him to timely comply with the terms of bar membership. Defendant’s late payment of his bar dues was a violation of the terms of the stay.


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