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Paul Richard Lehto (WSBA No. 25103, admitted 1995), of Ishpeming, Michigan, formerly of Snohomish County, was disbarred, effective March 24, 2010, by order of the Washington State Supreme Court following a default hearing. This discipline is based on conduct involving failure to abide by a client’s decisions, lack of diligence, failure to communicate, trust account irregularities, failure to maintain records of client funds, improper withdrawal from representation, failure to respect rights of third party, commission of a criminal act, dishonest conduct, violation of attorney’s oath, non-cooperation in discipline investigations, and unfitness to practice law.
Matter No. 1: In August 2000, Clients A hired Attorney B to represent them in the lawsuit. Attorney B withdrew from the representation in March 2002 and Mr. Lehto appeared in July 2003. Mr. Lehto continued to represent Clients A through the dismissal of the lawsuit in February 2006. Attorney B claimed that, as of June 2004, Clients A owed him legal fees and costs of $24,369.04. He sent one or more letters to Mr. Lehto regarding their outstanding bill, but Mr. Lehto did not respond. Attorney B informed Mr. Lehto and Clients A that he was willing to accept $17,500 as full payment of the outstanding bill. In August 2005, Clients A issued a check to Mr. Lehto in the amount of $17,500 to pay Attorney B. Mr. Lehto told them he would take care of the matter. Mr. Lehto did not deposit the clients’ check into a trust account or disburse any funds to Attorney B. Instead, Mr. Lehto deposited the check into his business account and used the funds to pay his own personal and business expenses.
In February 2006, Attorney B filed a lawsuit against Clients A for the outstanding legal fees and costs. Without informing them, Mr. Lehto filed a Notice of Appearance on behalf of Clients A to appear as their counsel in Attorney B’s lawsuit. Mr. Lehto did not file an Answer to Attorney B’s lawsuit. Attorney B filed a Motion for Order of Default, which was noted for a July 12, 2006, hearing. Mr. Lehto failed to inform Clients A about the Motion for Order of Default, failed to respond to the Motion, and failed to appear at the July 2006 hearing. On July 12, 2006, the court entered an Order of Default against Clients A. In August 2006, Attorney B filed a Motion for Final Default Judgment, which was noted for a September 13, 2006, hearing. Mr. Lehto failed to inform Clients A about the Motion for Final Default Judgment, failed to respond to the Motion, and failed to appear at the September 2006 hearing. On September 13, 2006, the court entered a Default Judgment Order against Clients A in the amount of $27,180.36. Mr. Lehto did not inform Clients A about the Default Judgment Order.
In December 2006, after Clients A learned of the default judgment while trying to buy a house, they went to Mr. Lehto’s last known office address. Mr. Lehto was no longer there. Clients A contacted Mr. Lehto by telephone. Mr. Lehto promised to have Attorney B’s judgment vacated, but failed to take steps to do so. Clients A tried to contact Mr. Lehto again by telephone and by e-mail, but Mr. Lehto did not respond.
In September 2007, Clients A paid Attorney B $7,500, which he accepted in full satisfaction of his judgment. Mr. Lehto did not refund Clients A’s $17,500 or provide to them an accounting of the funds.
Matter No. 2: In 2002, Mr. Lehto contacted a nonprofit auto safety and consumer advocacy organization (CARS Foundation) on behalf of Client B. Mr. Lehto asked the CARS Foundation to loan Client B funds to obtain safe, reliable transportation pending resolution of Client B’s lawsuit against a car dealership. The CARS Foundation agreed to loan Client B $3,500, provided Client B repay the entire amount of the loan plus 10 percent simple interest out of any settlement received before Client B, his attorney, or others were paid, within one year after the case settled. Client B signed the loan agreement. The loan agreement also contained a statement, which was signed by Mr. Lehto, in which Mr. Lehto agreed that the CARS Foundation would be reimbursed from any settlement prior to the release of any other funds.
Client B’s case settled in December 2005. In February 2006, Mr. Lehto received a settlement check in the amount of $48,885, which he subsequently deposited into his trust account. In March 2006, Mr. Lehto transferred $20,000 from his trust account into his business account and disbursed $16,954.84 from his trust account to Client B. Mr. Lehto sent an e-mail to the CARS Foundation president stating, “I can cut a check as soon as I am provided a figure.” The Foundation president sent Mr. Lehto an e-mail stating the amount owed on Client B’s loan. Mr. Lehto did not send a check or any other payment to the CARS Foundation. In June 2006, Mr. Lehto sent an e-mail to the CARS Foundation stating that he would send a check within a day or so, but he failed to do so. For 17 months, Mr. Lehto did not respond to letters or telephone messages from the CARS Foundation demanding repayment of Client B’s loan. In February 2007, Mr. Lehto called the CARS Foundation and asked how much Client B owed. The Foundation president sent Mr. Lehto an e-mail stating that the amount owed was $4,966. Mr. Lehto did not send a check or any other payment to the CARS Foundation. In May 2007, the Foundation president sent Mr. Lehto an e-mail stating, “I haven’t heard back from you since then [February]. What is happening?” Mr. Lehto responded by e-mail, “Your money is there so I asked for checks to be fedexed here so I can cut a check.” A few minutes later that same day, Mr. Lehto sent another e-mail stating, “I don’t believe that there is [sic] any funds for interest from my client or from me . . . . So, what will likely happen is that I can send you a check for the original amount at end of loan without interest. The interest on the funds went to legal services for the indigent in Wash. State.” Mr. Lehto’s May 2007 e-mail was his last communication with the CARS Foundation. He did not send a check or any other payment to the CARS Foundation.
Failure to Cooperate: In May 2006, the Association received two Trust Account Overdraft Notices (TAONs) regarding Mr. Lehto’s trust account. Mr. Lehto failed to respond to the Association’s requests for information regarding the trust account, failed to produce records in response to the Association’s subpoena duces tecum, and failed to appear for a deposition that was originally scheduled for September 2006 and then continued to November 2006 at Mr. Lehto’s request.
On December 1, 2006, the president of the CARS Foundation filed a grievance against Mr. Lehto with the Association. Mr. Lehto failed to respond to the grievance, failed to produce records in response to the Association’s subpoena duces tecum, and failed to appear for a deposition scheduled for May 2007.
Mr. Lehto’s conduct violated former RPC 1.2(a), requiring a lawyer to abide by a client’s decisions about the objectives of representation and to consult with the client as to the means by which they are to be pursued; RPC 1.3, requiring a lawyer to act with reasonable diligence and promptness in representing a client; RPC 1.4, requiring that a lawyer keep a client reasonably informed about the status of a matter, promptly comply with reasonable requests for information, and explain a matter to the extent reasonably necessary to permit the client to make informed decisions regarding the representation; former RPC 1.14(a), requiring all funds of clients paid to a lawyer or law firm be deposited in one or more identifiable interest-bearing trust accounts and no funds belonging to the lawyer or law firm be deposited therein; former RPC 1.14(b)(3) and current RPC 1.15A(e), requiring a lawyer to maintain complete records of all funds, securities, and other properties of a client coming into the possession of the lawyer and render appropriate accounts to his or her client regarding them; former RPC 1.14(b)(4), requiring a lawyer to pay or promptly deliver to the client the funds, securities, or other properties in the possession of the lawyer which the client is entitled to receive; former RPC 1.15(d) and current RPC 1.15A(f) and 1.16(d), requiring a lawyer to take steps to the extent reasonably practicable to protect a client’s interests upon termination of representation, including giving reasonable notice to the client, allowing time for employment of other counsel, surrendering papers and property to which the client is entitled, and refunding any advance payment of fee that has not been earned; RPC 4.4(a), prohibiting a lawyer, in representing a client, from using a means that has no substantial purpose other than to embarrass, delay, or burden a third person; RPC 8.4(b), prohibiting a lawyer from committing a criminal act that reflects adversely on the lawyer’s honesty, trustworthiness, or fitness as a lawyer in other respects (here, theft); RPC 8.4(c), prohibiting a lawyer from engaging in conduct involving dishonesty, fraud, deceit, or misrepresentation; RPC 8.4(i), prohibiting a lawyer from committing any act which reflects disregard for the rule of law; RPC 8.4(k), prohibiting a lawyer from violating his or her oath as an attorney; RPC 8.4(l), prohibiting a lawyer from violating a duty or sanction imposed by or under the Rules for Enforcement of Lawyer Conduct in connection with a disciplinary matter; and RPC 8.4(n), prohibiting a lawyer from engaging in conduct demonstrating unfitness to practice law.
Marsha A. Matsumoto represented the Bar Association. Mr. Lehto did not appear either in person or through counsel. James M. Danielson was the hearing officer.
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