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Jeffrey L. Danzig (WSBA No. 13243, admitted 1983), of Bellingham, was disbarred effective November 25, 2003, by order of the Washington State Supreme Court following a default hearing. This discipline was based on his conduct between 1998 and 2001 involving theft of client funds and conflict of interest in a medical-malpractice matter.
In October 1998, Mr. Danzig agreed to represent clients in a medical-malpractice matter. The clients signed a written fee agreement for a $5,000 nonrefundable retainer and a contingency fee. Between October 1998 and November 2000, the clients paid Mr. Danzig $49,436.15 for costs, and an additional $2,700 in costs directly to third parties. Mr. Danzig deposited many of these payments into his personal checking account. By summer 2000, the clients could not afford to pay costs, so Mr. Danzig agreed to find a lawyer who could advance costs. He also prepared a new agreement stating that the clients agreed to pay fees in addition to those in the original fee agreement, and that they had no disagreement with "regard to money or preparation of our case." The clients initially refused to sign the new agreement, but did so after Mr. Danzig threatened to withdraw and make it difficult for the clients to find new counsel. Mr. Danzig did not tell the clients that they should obtain independent legal advice prior to signing the new fee agreement.
In November 2000, Mr. Danzig associated with another lawyer, who agreed to advance costs to the clients prospectively. The new agreement also provided that Mr. Danzig and the new lawyer would receive a 50 percent contingency fee. In January 2001, the clients' case settled for $600,000. After signing the settlement check, the clients asked Mr. Danzig to provide an accounting. He told them he did not have receipts, could not provide an accounting, and would not refund any money. The hearing officer found that the clients were entitled to a $35,603.76 refund of unused and unaccounted for advanced costs. Mr. Danzig did not refund any money to the clients.
Mr. Danzig's conduct violated RPCs 1.14(b)(3), 1.4, and 1.5(c), requiring lawyers to maintain complete records of client funds in their possession, and to render appropriate accountings to their clients; 1.4(b)(4) and 1.15(d), requiring lawyers to promptly refund unused advanced costs; 8.4(b), prohibiting lawyers from committing criminal acts [theft of client funds] that reflect adversely on the lawyers' honesty, trustworthiness, or fitness as lawyers in other respects; and 1.8(a) and 1.4, requiring lawyers entering business transactions with clients to provide full disclosure and a reasonable opportunity for the clients to seek independent legal advice.
Marsha Matsumoto represented the Bar Association. Mr. Danzig represented himself. Michael Lewis was the hearing officer.
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