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Michael J. Scaringi (WSBA No. 18595, admitted 1989), of Mercer Island, was suspended for two years, effective June 13, 2003, by order of the Washington Supreme Court following a stipulation approved by the Disciplinary Board. This discipline was based on his conduct between 2000 and 2002 involving assisting in the unauthorized practice of law, failure to supervise nonlawyer assistants, and conflicts of interest in connection with his affiliation with a number of corporations selling estate planning, insurance, and pre-paid legal services.
In early 2000, Mr. Scaringi began working with a California corporation (Corporation A) that advertised itself as a “national estate planning corporation” and stated that it would provide “clients, systems and procedures, plus technical support” to a solo practitioner interested in expanding his or her practice. Mr. Scaringi signed an “Office Services Agreement” with Corporation A, which stated, inter alia, that Corporation A would provide him with personnel, office space, equipment and marketing services, while he would pay the corporation a flat fee for providing certain services relating to the preparation of living trusts and wills. Mr. Scaringi also signed a “Delivery Services Agreement” with a Washington corporation (Corporation B) affiliated with Corporation A, whose representatives would deliver completed documents to his clients. At the time of delivery, the representative would also be provided with the opportunity to sell insurance products to the clients.
While affiliated with these two corporations, Mr. Scaringi engaged in the following conduct that established grounds for discipline:
• Failing to properly supervise paralegals and other non-legal personnel affiliated with his office;
• Assisting in the unauthorized practice of law by affiliating himself with non-lawyers who marketed living trusts to the public and were delegated legal functions;
• Providing legal services to clients who purchased living trusts procured with the assistance of Corporation A without fully disclosing his own interest in maintaining a continuing business relationship with Corporation A and without obtaining informed consent from his clients;
• Failing to review necessary documents and consult with clients regarding their estate planning options;
• Failing to communicate with clients regarding their estate planning needs, and failing to determine whether a living trust was best suited to each client’s needs.
In April 2001, Corporation A filed for Chapter 7 bankruptcy protection in California. At that time, Mr. Scaringi’s association with Corporation A terminated.
Between 2000 and 2002, Mr. Scaringi affiliated himself with another California corporation (Corporation C) that provided “pre-paid legal services” to individuals with “memberships” in the corporation. Mr. Scaringi agreed to provide Washington members of Corporation C with estate planning services. Corporation C also contracted with two other California entities, jointly referred to as Corporation D, which sold trusts and insurance products to Washington consumers. Consumers purchasing trusts from Corporation D also received Corporation C’s pre-paid legal plan. During the period he was affiliated with Corporations C and D, Mr. Scaringi engaged in the following conduct that established grounds for discipline:
• Failing to properly supervise non-lawyers with whom he was affiliated in the provision of estate planning services;
• Assisting in the unauthorized practice of law by affiliating himself with non-lawyers who marketed living trusts and other estate planning products to the public and were permitted to perform legal functions;
• Providing legal services to clients procured with the assistance of Corporations C and D without fully disclosing to clients his own interest in maintaining a continuing business relationship with these entities and without obtaining informed consent from his clients.
Mr. Scaringi’s conduct violated RPC 1.3, requiring a lawyer to act with reasonable diligence and promptness in representing a client; RPC 1.4(b), requiring a lawyer to explain a matter to the extent reasonably necessary to permit the client to make informed decisions regarding the representation; RPC 1.7(b), prohibiting a lawyer from representing a client if the representation of that client may be materially limited by the lawyer's own interests unless the lawyer reasonably believes the representation will not be adversely affected and the client consents in writing after consultation and a full disclosure of the material facts; RPC 5.3(b), requiring a lawyer with direct supervisory authority over a nonlawyer to make reasonable efforts to ensure that the nonlawyer’s conduct is compatible with the professional obligations of the lawyer; and RPC 5.3(c), holding a lawyer responsible for the conduct of a nonlawyer assistant that would be a violation of the RPCs if engaged in by a lawyer in circumstances where the lawyer orders or ratifies the conduct or fails to take reasonable remedial action; and RPC 5.5(b), prohibiting a lawyer from assisting a person who is not a member of the Bar in the performance of activity that constitutes the unauthorized practice of law.
Kevin Bank represented the Bar Association. Kenneth S. Kagan represented Mr. Scaringi. Andrea A. Darvas was the hearing officer.
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