Northwest Ohio Bar Assn. v. Archer

[Cite as Northwest Ohio Bar Assn. v. Archer, 129 Ohio St.3d 204, 2011-Ohio-3142.]

NORTHWEST OHIO BAR ASSOCIATION v. ARCHER.

[Cite as Northwest Ohio Bar Assn. v. Archer,

129 Ohio St.3d 204, 2011-Ohio-3142.]

Attorneys at law — Misconduct involving dishonesty — One-year license

suspension.

(No. 2010-2270 — Submitted February 16, 2011 — Decided July 5, 2011.)

ON CERTIFIED REPORT by the Board of Commissioners on Grievances and

Discipline of the Supreme Court, No. 10-015.

__________________

Per Curiam.

{¶ 1} Respondent, Stephen Robert Archer of Defiance, Ohio, Attorney

Registration No. 0031376, was admitted to the practice of law in Ohio in 1978.

On August 11, 1993, we publicly reprimanded him for neglecting a client’s

bankruptcy matter. Northwest Ohio Bar Assn. v. Archer (1993), 67 Ohio St.3d

97, 616 N.E.2d 210, 211.

{¶ 2} On February 8, 2010, relator, Northwest Ohio Bar Association,

filed a complaint alleging that respondent had committed several violations of the

Ohio Code of Professional Responsibility by failing to submit the requisite forms

or pay unemployment taxes and by failing to remit the federal-, state-, and local-

income-tax and Medicare and Social Security withholdings from his secretary’s

wages to the proper governmental authorities.

{¶ 3} A panel of the Board of Commissioners on Grievance and

Discipline heard the cause and considered the parties’ joint stipulations of fact,

law, and proposed penalties. The panel adopted the parties’ stipulated facts and

Disciplinary Rule violations, but rejected some of the stipulated aggravating and

mitigating factors and proposed sanction.

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{¶ 4} The board adopted the panel’s findings of fact and misconduct and

concluded that respondent had engaged in conduct involving dishonesty, fraud,

deceit, or misrepresentation and that his conduct adversely reflects on his fitness

to practice law.

{¶ 5} Citing respondent’s prior disciplinary record, his “mixed

appreciation” for the gravity of his misconduct, and the subsequent lapse of his

malpractice insurance and failure to inform his clients that he is not insured, the

board has rejected the parties’ stipulated sanction of a one-year partially stayed

suspension and recommends that we suspend respondent from the practice of law

for one full year. No objections have been filed.

{¶ 6} We adopt the board’s findings of fact and misconduct and

conclusions of law and suspend respondent from the practice of law in Ohio for

one year.

Misconduct

{¶ 7} Respondent’s misconduct came to light when his secretary

separated from her employment and applied for unemployment-compensation

benefits in February 2008. Because respondent had neither filed the appropriate

forms nor paid unemployment taxes from late 2004 until February 1, 2008, as

required by Ohio law, the secretary’s claim was denied. After receiving an

unfavorable judgment on appeal, the secretary filed a grievance with relator. By

April 8, 2008, the necessary paperwork had been filed, and all taxes and penalties

had been paid. As a result, the secretary’s application for unemployment benefits

was approved. Approximately seven weeks after she had applied, she received

unemployment benefits retroactive to the date of her original application.

{¶ 8} Relator’s investigation also revealed that during the secretary’s

employment, respondent withheld local, state, and federal taxes — including

income, Medicare, and Social Security taxes — from the secretary’s wages but

failed to remit the taxes and the requisite paperwork to the appropriate

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governmental authorities. Instead, he converted these funds to his own use. The

parties, however, have not stipulated the amount of the funds converted, relator

did not offer the secretary’s W-2’s into evidence, and the respondent testified that

the amounts he recalled paying included the payment of his delinquent personal-

income taxes and penalties. Nonetheless, the record clearly and convincingly

demonstrates that respondent violated DR 1-102(A)(4) and Prof.Cond.R. 8.4(c)

(both prohibiting a lawyer from engaging in conduct involving dishonesty, fraud,

deceit, or misrepresentation) and DR 1-102(A)(6) and Prof.Cond.R. 8.4(h) (both

prohibiting a lawyer from engaging in conduct that adversely reflects on the

lawyer’s fitness to practice law).1

Sanction

{¶ 9} When imposing sanctions for attorney misconduct, we consider

relevant factors, including the ethical duties that the lawyer violated and the

sanctions imposed in similar cases. Stark Cty. Bar Assn. v. Buttacavoli, 96 Ohio

St.3d 424, 2002-Ohio-4743, 775 N.E.2d 818, ¶ 16. In making a final

determination, we also weigh evidence of the aggravating and mitigating factors

listed in Section 10(B) of the Rules and Regulations Governing Procedure on

Complaints and Hearings Before the Board of Commissioners on Grievances and

Discipline (“BCGD Proc.Reg.”). Disciplinary Counsel v. Broeren, 115 Ohio

St.3d 473, 2007-Ohio-5251, 875 N.E.2d 935, ¶ 21.

{¶ 10} The parties have stipulated that respondent’s prior disciplinary

record is an aggravating factor. See BCGD Proc.Reg. 10(B)(1)(a). The board

also found that respondent’s failure to pay his unemployment taxes and to remit

multiple tax withholdings to the appropriate governmental authorities constitute

1. Respondent’s misconduct occurred both before and after February 1, 2007, the effective date of

the Rules of Professional Conduct, which supersede the Disciplinary Rules of the Code of

Professional Responsibility. Although both the former and current rules are cited for the same

acts, the allegations comprise a single continuing ethical violation. Disciplinary Counsel v.

Freeman, 119 Ohio St.3d 330, 2008-Ohio-3836, 894 N.E.2d 31, ¶ 1, fn. 1.

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multiple offenses and that his failures harmed a vulnerable employee. See BCGD

Proc.Reg. 10(B)(1)(d) and (h). In addition, the board recognized the lapse of

respondent’s malpractice insurance, coupled with his failure to inform his clients

of that lapse as required by Prof.Cond.R. 1.4(c), as an aggravating factor.

{¶ 11} As mitigating factors, the parties stipulated and the board found

that respondent paid monetary sanctions in the form of penalties for the late

payment of taxes and demonstrated a cooperative attitude toward these

disciplinary proceedings. See BCGD Proc.Reg. 10(B)(2)(c) and (d).

{¶ 12} The parties also stipulated that respondent submitted character

letters from two attorneys and a former client. See BCGD Proc.Reg. 10(B)(2)(e).

The first attorney, who has known respondent for almost 30 years, wrote that

respondent “is very conscientious, very thorough in his preparation, and very

caring in his dealing with clients,” that he has found [respondent’s] ethical

standards to be “above reproach,” and that respondent is “an honest and good man

and a fine lawyer.” The second attorney has known respondent for approximately

20 years and has dealt with him regularly, primarily in the context of domestic

relations. She states that she has known respondent “to be very honest and

forthright and [has] never even had an inkling or a concern as to the truth or

veracity of anything he has said.” She reports, “[H]e is perceived by the local bar

as being very honest” and that she considers him to be a “good man.” The final

letter, from a client who has known respondent for almost 30 years, having

retained him to handle both business and personal matters, states that respondent

has “always performed ethically, properly and efficiently for [him] and the

company.” He believes that respondent “is a good man and * * * an outstanding

attorney!”

{¶ 13} The board, however, rejected the parties’ stipulation that

respondent’s conduct was not driven by a dishonest or selfish motive, observing

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that he had offered several explanations for his misconduct and that his

expressions of remorse were inconsistent. See BCGD Proc.Reg. 10(B)(2)(b).

{¶ 14} Respondent stated that his financial situation was “[n]ot great”

when the secretary called him out of the blue seeking work, and he claimed that

various health problems, including diabetes and a minor stroke, had made it hard

for him to concentrate. He testified that his business had ebbed and flowed and

that he had had just barely the income to fund the secretary’s net paycheck. He

stated that once he had let the tax payments lapse, it was easy to continue that

pattern.

{¶ 15} Although respondent expected a large settlement to be “the pot of

gold that could make everything right,” he claimed that his plan derailed when he

suffered a heart attack and required quintuple-bypass surgery just one week after

the settlement was paid. Despite some expressions of remorse, he cast himself as

the victim of his circumstances and blamed his spiteful secretary for exploiting his

misconduct. But respondent offered no documentary evidence to substantiate any

of this testimony. Moreover, the board observed that respondent had stipulated to

engaging in conduct involving dishonesty, fraud, deceit, or misrepresentation.

{¶ 16} The parties have stipulated that a one-year suspension with six

months stayed is the appropriate sanction for respondent’s misconduct. In support

of that sanction, they cite Toledo Bar Assn. v. Abood, 104 Ohio St.3d 655, 2004-

Ohio-7015, 821 N.E.2d 560; Disciplinary Counsel v. Large, 122 Ohio St.3d 35,

2009-Ohio-2022, 907 N.E.2d 1162; and Geauga Cty. Bar Assn. v. Bruner, 98

Ohio St.3d 312, 2003-Ohio-736, 784 N.E.2d 687.

{¶ 17} While each of these cases involves misconduct comparable to that

of respondent’s, the board observed that the aggravating and mitigating factors

unique to each case resulted in a range of sanctions. For example, in Abood, the

attorney had failed to pay personal-income taxes for eight years and had deposited

proceeds from a personal real estate transaction into his client trust account to

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avoid IRS collection. Abood, 104 Ohio St.3d 655, 2004-Ohio-7015, 821 N.E.2d

560, ¶ 6. Abood’s default on his tax obligations lasted approximately twice as

long as respondent’s and involved significant IRS collection measures. Id. at ¶ 3-

4, 19. But like respondent, Abood fully cooperated in the disciplinary

investigation and submitted favorable character references. Id. at ¶ 9-10.

Additional mitigating factors present in Abood — including the attorney’s lack of

a prior disciplinary record, his efforts to self-report his conduct once he realized

that he was the subject of an IRS investigation, his sincere remorse, and the

imposition of criminal sanctions — justified the imposition of a one-year

suspension with six-months conditionally stayed. Id. at ¶ 9, 11, 19-20.

{¶ 18} At the opposite end of the spectrum, Bruner had failed to remit

$42,982.80 in taxes that he had withheld from his secretary’s wages over ten

years and had given her fraudulent W-2 forms each year in an effort to conceal his

theft. Bruner, 98 Ohio St.3d 312, 2003-Ohio-736, 784 N.E.2d 687, at ¶ 3-4.

Although Bruner had filed the documents necessary to assess his tax liability at

the time of his disciplinary hearing, he had not begun to make restitution, falsely

attributed his misconduct to a lack of business acumen before conceding that he

had defaulted on his tax obligations because his practice was not making enough

money, and failed to appreciate the gravity of his misconduct. Id. at ¶ 5-7.

Therefore, we indefinitely suspended Bruner from the practice of law. Id. at ¶ 8.

Respondent’s conduct, however, is less egregious than Bruner’s because it lasted

less than half as long, and respondent had made full restitution prior to the filing

of relator’s complaint.

{¶ 19} In Large, we imposed a one-year license suspension on an attorney

who, for five years, had failed to file personal-income tax returns, had failed to

withhold income taxes and Social Security contributions from his employees’

wages, and had failed to report his employees’ wages to the IRS. Large, 122

Ohio St.3d 35, 2009-Ohio-2022, 907 N.E.2d 1162, ¶ 4, 13, 15, 21. Like the

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respondent in this case, Large established that he was a person of good character

and reputation and fully cooperated in the disciplinary proceedings. Id. at ¶ 17.

He also had no prior disciplinary record and had served six months of probation in

a community confinement center and six months of electronically monitored

home confinement after pleading guilty to federal criminal charges arising from

this misconduct. Id. at ¶ 10, 17. See BCGD Proc.Reg. 10(B)(2)(a) and (f). Large

did not convert his employees’ withholdings, because he had not withheld taxes

from their wages, but he had failed to make restitution, even after he had received

a $72,000 fee, and he had acted with a selfish desire to delay the collection of his

personal-income taxes. Id. at ¶ 13, 17.

{¶ 20} Having independently considered respondent’s four-year pattern of

misconduct and balanced his good reputation in the legal community and payment

of restitution against his prior disciplinary action, his mixed appreciation for the

gravity of his misconduct, and his failure to inform his clients that he does not

carry malpractice insurance, we agree that a one-year suspension is the

appropriate sanction for respondent’s misconduct.

{¶ 21} Accordingly, Stephen Robert Archer is suspended from the

practice of law in Ohio for one year. Costs are taxed to respondent.

Judgment accordingly.

O’CONNOR, C.J., and PFEIFER, LUNDBERG STRATTON, O’DONNELL,

LANZINGER, CUPP, and MCGEE BROWN, JJ., concur.

__________________

John Donovan, for relator.

______________________

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