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Stanley D. Tate (WSBA No. 17943, admitted 1988), of Seattle, was disbarred, effective March 10, 2011, by order of the Washington State Supreme Court. This discipline is based on conduct involving failure to provide competent representation, charging unreasonable fees, incorrectly charging contingent fees, trust account irregularities, failure to maintain records of clients’ funds, failure to safeguard clients’ property or provide a written accounting upon distribution of property, offering false evidence, making false statements to the tribunal, the commission of crimes, and engaging in dishonest conduct that reflects disregard for the rule of the law and demonstrates unfitness to practice law.
Trust Account Irregularities: Mr. Tate was a solo practitioner whose practice, since 1997, consisted largely of personal injury cases. In the 1990s, Mr. Tate opened an IOLTA trust account, which he also used as a general business and personal account. Mr. Tate misappropriated client funds from his trust account on 15 separate occasions between August 2002 and September 2005. The total amount of misappropriated funds was $62,201.40. These funds were clients’ settlement proceeds earmarked to reimburse Personal Injury Protection (PIP) and medical costs. During this time period, Mr. Tate informed clients that all funds earmarked to pay PIP and other costs would be used only for those purposes. To conceal his misappropriation of client funds, Mr. Tate issued checks reflecting that he was paying “costs” or “fees” when he was actually using the funds for personal purposes. Mr. Tate also concealed the misappropriation of client funds through a series of transfers where he had certified checks issued to insurers with PIP subrogation claims, but ultimately cashed the check himself and used the funds for personal purposes. During the Bar Association investigation, Mr. Tate intentionally concealed the disbursement of funds by writing the word “void” on the front of certified checks, even though the checks had been cashed by him.
On five occasions between January 14, 2004, and February 21, 2007, Mr. Tate submitted trust account declarations to the Bar Association, under penalty of perjury, stating that all trust accounts, client funds, and records were being maintained in compliance with former RPC 1.14. At the time, Mr. Tate knew that he was misappropriating client funds, not placing advance fees into his trust account, and commingling personal funds with client funds. Prior to submitting a February 21, 2007, declaration, Mr. Tate knew that his accountant had not yet been able to create client ledgers or a check register for his trust account and that the Bar Association had filed a formal complaint alleging trust account violations in October 2006. Mr. Tate provided false, deceptive, and misleading testimony to the Bar Association.
Unreasonable Fees: Between 2004 and 2005, Mr. Tate used a handwritten log to keep track of tasks he performed for clients. However, he routinely did not record the amount of time that he spent on tasks contemporaneously. When Mr. Tate generated billing records for services provided on an hourly fee basis, a substantial amount of the time he billed and the dates on which he indicated services were rendered were based on speculation. Mr. Tate’s method for billing clients for services resulted in billing excessive hours that exceeded the time reflected in his handwritten logs.
Mahler Reduction: Mr. Tate was aware that insurers seeking reimbursement of PIP In personal injury cases are required to contribute a share of the legal expenses pursuant to a Supreme Court decision (Mahler reduction). Between 2003 and May 2005, Mr. Tate intentionally paid himself the Mahler reduction on six different occasions, totaling $12,573.90, without the knowledge or consent of his clients, and when the Mahler reduction didn’t apply to a matter. Mr. Tate’s settlement statements intentionally reflected that the entire PIP claim was deducted from the settlement and earmarked to pay the insurance carriers. One client sued Mr. Tate and, in September 2007, he issued a check returning her Mahler reduction. In May 2005, Mr. Tate temporarily ceased taking the Mahler reduction. He began charging a contingent fee on the Mahler reduction in 2006, even though his fee agreement did not provide for the additional fee and he knew the reduction did not apply in some cases. Mr. Tate did not return any of the fees he charged relating to the Mahler reduction until after the Bar Association deposed him on the subject.
Client Matters: Between 2004 and early 2006, in eight separate matters, Mr. Tate engaged in the following conduct:
• In one matter, Mr. Tate misappropriated $4,444.47 and concealed the misappropriation by providing false and misleading testimony during Bar Association proceedings and by omitting documentation regarding the check from the client’s file during discovery.
• In five matters, Mr. Tate deposited advance fees, totaling between $4,831.25 and $30,000, into his general business account and used the funds before they were fully earned. In a fifth matter, Mr. Tate converted $3,000 of advance fees from his IOLTA trust account and spent it for personal purposes.
• In several matters, Mr. Tate created billing statements containing inflated and fabricated charges, which he used to deceptively obtain attorney’s fees and interest from clients and others.
• Mr. Tate submitted declarations and exhibits containing false and deceptive statements to a county personnel board in one matter, and filed false and deceptive pleadings to Superior Court in a second matter.
• In a personal injury matter, where the client sustained a serious head injury that resulted from a hit-and-run driver, Mr. Tate failed to competently investigate potential liable parties.
• In two personal injury matters, including the previous matter, Mr. Tate charged unreasonable and excessive charges in connection with attorney’s liens he asserted in each matter.
• Mr. Tate failed to provide clients with an accounting in two matters notwithstanding requests and, in a third matter, failed to return unearned advance fees or provide the client with a copy of their file after withdrawing from representation.
• Mr. Tate engaged in conduct demonstrating unfitness to practice law in violation of the Rules of Professional Conduct.
Mr. Tate’s conduct violated RPC 1.1, requiring a lawyer to provide competent representation to a client; RPC 1.3, requiring a lawyer to act with reasonable diligence and promptness in senting a client; RPC 1.5(a), requiring a lawyer’s fee to be reasonable; former RPC 1.5(c)(2), requiring that a contingent fee consisting of a percentage of the monetary amount recovered for a claimant, in which all or part of the recovery is to be paid in the future, be paid only (i) by applying the percentage to the amounts recovered as they are received by the client or (ii) by applying the percentage to the actual cost of the settlement or award to the defendant; former RPC 1.14(a) and (c), requiring that all funds paid to a lawyer or law firm be deposited in one or more identifiable interest-bearing trust accounts; former RPC 1.14(b)(3), requiring a lawyer to maintain complete records of all funds coming into the possession of the lawyer and render appropriate accounts to his or her client regarding them; RPC 1.15A(a), (b), and (c), prohibiting a lawyer from using, converting, borrowing, or pledging client or third-person property for the lawyer’s own use and requiring that all property of clients or third persons in a lawyer’s possession in connection with a representation be held separate from the lawyer’s own property; RPC 1.15A(e), requiring a lawyer to promptly provide a written accounting to a client or third person after distribution of property or upon request; RPC 1.16(d), requiring that, upon termination of representation, a lawyer take steps to the extent reasonably practicable to protect a client’s interests, such as 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 or expense that has not been earned or incurred; RPC 3.3(a)(1), prohibiting a lawyer from knowingly making a false statement of fact or law to a tribunal or failing to correct a false statement of material fact or law previously made to the tribunal by the lawyer; former RPC 3.3(a)(4) and current RPC 3.4(b), prohibiting a lawyer from offering false evidence; former RPC 3.3(c), requiring a lawyer who has offered material evidence and comes to know of its falsity to promptly disclose this fact to the tribunal; RPC 8.4(b) prohibiting a lawyer from committing a criminal act (by violating RCW 9A.56.020) that reflects adversely on the lawyer’s honesty, trustworthiness, or fitness as a lawyer in other respect; RPC 8.4(c), prohibiting a lawyer from engaging in conduct involving dishonesty, fraud, deceit, or misrepresentation; RPC 8.4(d), prohibiting a lawyer from engaging in conduct that is prejudicial to the administration of justice; RPC 8.4(i), prohibiting a lawyer from committing any act involving moral turpitude, or corruption, or any other act which reflects disregard for the rule of law; and RPC 8.4(n), prohibiting a lawyer from engaging in conduct demonstrating unfitness to practice law.
Jonathan H. Burke and M. Craig Bray represented the Bar Association. Kurt M. Bulmer and Philip A. Talmadge represented Mr. Tate. Lish Whitson was the hearing officer. |