Opposition Brief — Merrill v. Arizona State Bar

| Supreme Court, U.S.

Se ae we

2) FEB 24 1098

No. 97-1245

CLERK

In The

Supreme Court of the United States

October Term, 1997

+

FREDRICK D. MERRILL,

Petitioner,

STATE BAR OF ARIZONA, an instrumentality

of the Arizona Supreme Court,

Respondent.

e

On Petition For A Writ Of Certiorari

To The Arizona Supreme Court

+

BRIEF IN OPPOSITION

*

YicaEL M. COHEN

Counsel of Record

State BAR OF ARIZONA

111 W. Monroe

Suite 1800

Phoenix, Arizona 85003-1742

(602) 340-7244

February 24, 1998

COCKLE LAW BRIEF PRINTING CO., (800) 225-6964

OR CALL COLLECT (402) 342-2831

QUESTION PRESENTED FOR REVIEW

The Supreme Court of Arizona suspended Petitioner

for violating Rule 63, Ariz. R.S.Ct. Therefore does the

matter before the Court even involve the unauthorized

practice of law?

li

PARTIES TO THE PROCEEDING

The petition accurately lists the parties to the pro-

ceeding.

Respondent, State Bar of Arizona, is a non-profit

corporation, incorporated in the State of Arizona.

TABLE OF CONTENTS

Page

ies oaks hase Cais 6 wa cc Cas chan ks 1

5 0 ib 4.16 oa A ew aah RoR We oS ]

A ih ao Sa hn wis 5 awalbin.é ad eos ott 3

REASONS FOR DENYING THE PETITION......... 4

NE og Ge Las UW a be kidach ha scsstae.pee ss 7

iv

TABLE OF AUTHORITIES

Page

CASsEs:

In re Neville, 147 Ariz. 106, 708 P.2d 1297 (1985)... 4

Middlesex County Ethics Committee v. Garden State

Bar Association, et al., 457 U.S. 423, 102 S.Ct.

2515, 73 L.Bd.2d 116 (1962).. ...cccccsecescerevses. 4

State Bar of Arizona v. Arizona Land Title & Trust

Co., 90 Ariz. 76, 366 P.2d 1 (1961), modified on

other grounds, 91 Ariz. 293, 371 P.2d 1020 (1962)..... 6

RULEs:

Arizona Supreme Court Rule 63 ................ ; & >

Arizona Supreme Court Rule 31(a)(3) ..........---- By

OPINION BELOW

The Petition for Writ of Certiorari accurately reflects

the opinions delivered in this case by other tribunals. The

report of the Disciplinary Commission is included in the

Appendix at 1a-15a.

RULES INVOLVED

Rule 63, Ariz. R.S.Ct. provides in part:

(a) Recipients of Notice; Contents. Within ten days

after the date of the commission or court order or judg-

ment imposing discipline or transfer to disability inactive

status, or the date of resignation, a respondent sus-

pended, disbarred, transferred to disability inactive sta-

tus, or who has resigned, shall notify or cause the

following persons to be notified by registered or certified

mail, return receipt requested, of the order or judgment,

and of the fact that the lawyer is disqualified to act as

lawyer after the effective date of same:

1. All clients being represented in pending

matters; and

'

2. Any co-counsel in pending matters,

3. Any opposing counsel in pending matters,

or in the absence of such counsel, the adverse

parties; and

4. Each court and division in which respondent

has any pending matter, whether active or inac-

tive.

The notice to be given to opposing counsel or parties

shall state the place of residence of the client of respon-

dent. In the event the client does not obtain substitute

counsel before the effective date of the disbarment, sus-

pension, transfer or resignation, it shall be the respon-

sibility of the disbarred, suspended, transferred or

resigned lawyer to move in the court or agency in which

the proceeding is pending for leave to withdraw.

(b) Return of Client Property. Respondent shall

deliver to all clients being represented in pending matters

any papers or other property to which they are entitled

and shall notify them, and any counsel representing

them, of a suitable time and place where the papers and

other property may be obtained, calling attention to any

urgency for obtaining the papers or other property.

Respondent shall deliver all files and records in pending

matters to the client, notwithstanding any claim of an

attorney lien.

(c) Effective Date of Order: Winding Up Affairs.

Judgments imposing suspension or disbarment shall be

effective thirty days after entry, unless the court specifies

an earlier date. Judgments and orders imposing other

sanctions or transfer to disability inactive status are effec-

tive immediately upon entry. Respondent, after entry of a

judgment of disbarment or suspension, shall not accept

any new retainer or engage as lawyer for another in any

new case or legal matter on any nature. During the period

between entry and the effective date respondent may

wind up and complete on behalf of any client all matters

that were pending on the entry date. Respondent shall

refund any part of any fees paid in advance, which have

not been earned.

STATEMENT

The State Bar hereby incorporates the facts recited in

the Report of the Disciplinary Commission as set forth in

the appendix at 2a-6a.

With regard to Petitioner’s Statement, the State Bar

disputes certain of the factual recitations as incomplete or

inaccurate. Specifically, while Petitioner may have com-

plied with the order suspending him (Petition at 3), he

did not comply with Rule 63, Ariz. R.S.Ct., which governs

the conduct of lawyers who have been suspended or

disbarred. During Petitioner’s period of suspension, there

were no substitutions of counsel in his cases and he did

not move to withdraw from those cases. Neither did

Petitioner return client files, records, or property to cli-

ents; he retained those files and records at his office and

retained unearned fees in his trust and general operating

accounts. In addition, he accepted new clients during this

same period. The Disciplinary Commission found that all

of the above referenced conduct violated Rule 63, Ariz.

R.S.Ct.

Petitioner also misstates the record in stating that

after he was reinstated from his prior suspension, he was

again charged by the “bar’s disciplinary committee” with

practicing law during his three-month suspension. Peti-

tion at 4. First, the Office of Bar Counsel, not a “disciplin-

ary committee”, filed the charging document or

complaint. Second, and more important, while the

unauthorized practice of law was an element of the com-

plaint it was not the only element. Petitioner was also

charged with violating Rule 63. Appendix at 16a-20a.

Petitioner also misstates the record by asserting that

the State Bar had to amend its complaint to allege a

violation of Rule 63, Ariz. R.S.Ct. Petition at 5. The com-

plaint consisted of four separate counts. Counts One and

Three alleged violations of Rule 63. Only Count Two had

to be amended during the hearing. Contrary to Peti-

tioner’s assertions, the disciplinary proceeding was not

initiated solely because of his “allegedly unauthorized

practice of law.”

Finally, Petitioner incorrectly states that rule 63 pro-

hibited a suspended lawyer from practicing law. Petition

at 6. In point of fact, the rule contains no language, which

specifically addresses the practice of law.

+

REASONS FOR DENYING THE PETITION

It has long been held in Arizona that the “purpose of

discipline is to protect the public, the profession and the

justice system.” In re Neville, 147 Ariz. 106, 708 P.2d 1297

(1985). The United States Supreme Court has also noted

that the states have a strong interest in “assuring and

maintaining high standards of conduct of attorneys

engaged in practice.” Middlesex County Ethics Committee v.

Garden State Bar Association et al., 457 U.S. 423, 435, 102

S.Ct. 2515, 2522, 73 L.Ed. 2d 116 (1982). Thus even accept-

ing Petitioner’s argument that he was denied equal pro-

tection, the state had a rational basis for doing so.

Petitioner asserts that he was denied equal protection

of the law because he was suspended for engaging in the

unauthorized practice of law. Petition at 8-9. Petitioner’s

entire premise is faulty because he was not suspended for

practicing law while under suspension. In fact the Disci-

plinary Commission specifically did not find a violation

of the rules relating to the unauthorized practice of law.

Appendix at 13a. Rather, the Disciplinary Commission

held that Petitioner repeatedly violated Rule 63, Ariz.

R.S.Ct.

Specifically, the Disciplinary Commission found that

Petitioner, during his suspension failed to file substitu-

tions of counsel and that he did not move to withdraw

from his cases. The Disciplinary Commission further

found that he did not return client files, records, or prop-

erty to clients and that he retained those files and records

at his office and retained unearned fees in his trust and

general operating accounts. While all of the aforemen-

tioned conduct violated Rule 63, none of it constituted the

unauthorized practice of law.

The only violative conduct engaged in by the Peti-

tioner that arguably could constitute the unauthorized

practice of law was his acceptance of new clients during

his period of suspension. This conduct expressly violated

Rule 63(c), Ariz. R.S.Ct. The Disciplinary Commission

however did not find a violation of the rules relating to

the unauthorized practice of law.

Even assuming arguendo that Petitioner was sanc-

tioned for engaging in the unauthorized practice of law,

his arguments are flawed. Petitioner presumes that sim-

ply because Arizona does not have an unauthorized prac-

tice of law statute, all citizens are allowed to engage in

the unauthorized practice of law. Petitioner however has

failed to cite to this Court, Rule 31(a)(3), Ariz. R.S.Ct. This

rule states that:

Except as hereinafter provided in subsection 4

of this section (a), no person shall practice law

in this state unless he is an active member of the

State Bar, and no member shall practice law in

this state or hold himself out as one who may

practice law in this state, while suspended, dis-

barred, or on disability inactive status.

In Arizona, the practice of law is defined by the

Supreme Court of Arizona’s holding in State Bar of Ari-

zona v. Arizona Land Title & Trust Co., 90 Ariz. 76, 366 P.2d

1 (1961), modified on other grounds, 91 Ariz. 293, 371 P.2d

1020 (1962). The court held that:

[T]hose acts, whether performed in court or in

the law office, which lawyers have carried on

from day to day through the centuries constitute

the practice of law. Such acts include, but are

not limited to, one person assisting or advising

another in the preparation of documents or

writings which affect alter or define legal rights;

the direct or indirect giving of advice relative to

legal rights or liabilities, the preparation for

another of matters for courts, administrative

agencies and other judicial or quasi-judicial

bodies and officials as well as the acts of repre-

sentation of another before such a body or offi-

cer. They also include rendering to another any

other advice or services which are and have

been customarily given and performed from day

to day in the ordinary practice of members of

the legal profession, either with or without com-

pensation.

Id. at 95.

It appears that Petitioner would have this Court

believe that Arizona is the land of the wild west, where

anybody can hold themselves out as a lawyer and engage

in the practice of law..As previously stated, just because

there is no state statute relating to the unauthorized

practice of law, does not mean that the common citizens

of Arizona can engage in the practice of law. Petitioner

has provided absolutely no support for his assertion that

he was sanctioned for something that non-lawyers can

do. In addition he has failed to take into account rule

31(a)(3), Ariz. R.S.Ct.

CONCLUSION

For all the foregoing reasons, the State Bar of Arizona

respectfully urges the Court to deny the petition for Writ

of Certiorari.

Respectfully submitted,

YiGAEL M. COHEN

Counsel of Record

STATE BAR OF ARIZONA

111 W. Monroe

Suite 1800

Phoenix, Arizona 85003-1742

(602) 340-7244

la

APPENDIX A

BEFORE THE DISCIPLINARY COMMISSION

OF THE

SUPREME COURT OF ARIZONA

Comm. Nos. 94-1394,

95-0235 & 95-0370

DISCIPLINARY

COMMISSION REPORT

In the Matter of

FREDERICK D.

MERRILL,

Attorney No. 005916

a Member of the

State Bar of Arizona,

RESPONDENT.

(Filed Feb. 13, 1997)

This matter came before the Disciplinary Commis-

sion of the Supreme Court of Arizona on December 14,

1996, for oral argument on the Hearing Committee’s rec-

ommendation of suspension and probationary terms,

pursuant to Rule 53(d), Ariz.R.S.Ct. The respondent,

Fredrick D. Merrill (“Merrill”), filed an objection to the

Hearing Committee’s recommendation.

Decision

With five members concurring and three members

dissenting,! the Commission adopts the findings of fact,

conclusions of law, and recommendation of the Hearing

Committee that:

1 Commissioner Ortega did not participate in these

proceedings. Commissioners Malm, Bonwell, and Potts dissent,

in the belief that a shorter suspension is warranted.

iia |

2a

1. Merrill shall be suspended for a period of one

year;

2. Not later than ten days prior to the effective date

of the suspension, the director of the Law Office Manage-

ment Assistance Program (“LOMAP”) or her designee

shall personally meet with Merrill to ensure that he has

complied, will comply, and has put in place procedures to

ensure his compliance with Supreme Court Rule 63 in all

respects. If he has not, the State Bar shall consider

appointment of a conservator under Supreme Court rule

65(a):

3. If Merrill applies for reinstatement, the same per-

son or another designated by the director of LOMAP

shall review Merrill's activities and actions during the

period of suspension to determine whether Merrill com-

plied with Rule 63, and shall file a report with the State

Bar to be considered along with the other matters

required by Supreme Court Rules 71 and 72; and

4. Any and all costs associated with these recom-

mendations shall be borne by Merrill.

Facts

Merrill was admitted to the State Bar of Arizona on

October 13, 1979. He was suspended from the practice of

law for a period of ninety days by court order dated May

24, 1994. That suspension became effective on June 24,

1994.

Prior to his suspension, Merrill was a sole practi-

tioner at “The Law Office of Fredrick D. Merrill.” While

suspended, Merrill continued to maintain his office, |

oo

3a

receive mail, and occasionally meet with clients. He

signed no pleadings and filled all of his time at paralegal

rates.

He contracted with two lawyers to perform services

for his clients during his suspension; Tara Brigham, a

newly-admitted lawyer, and David Kennedy, an experi-

enced practitioner. Merrill paid them by the hour to meet

with clients, sign pleadings, and make court appearances.

They did not work out of Merrill’s office, and had no

supervisory responsibilities over his staff, which consis-

ted of three non-lawyers. Pleadings were prepared by

Merrill’s employees and submitted to Ms. Brigham and

Mr. Kennedy for review and signature. The pleadings

were on the letterhead of “Fredrick D. Merrill, P.C.,” and

Ms. Brigham’s and Mr. Kennedy’s signature followed the

work “by.”

The complaint in this matter arises out of his office’s

involvement in three cases during his period of suspen-

sion. |

Count One involves Merrill continuing to act in a

limited role for a client following his suspension. Shortly

before Merrill’s suspension began, his client, Jack King,

confessed to him that he had been involved in a $400,000

check-kiting scheme involving First Interstate Bank of

Arizona. Mr. King wanted Merrill to contact First Inter-

state to arrange an agreement that would preclude crimi-

na! prosecution.

Merrill contacted Dan Durrant, a lawyer he knew at

the firm that served as outside counsel for First Interstate.

Mr. Durrant was aware that Merrill was suspended. Dur-

ing their meeting, held on June 24, 1996, Mr. Durrant

4a

called in James LeValley of First Interstate’s legal staff.

Mr. Durrant and Merrill differ in their recollection of

whether Merrill told Mr. LeValley at that time that he was

suspended; Merrill believes he did not mention that fact,

while Mr. Durrant strongly believes he did.

Mr. LeValley referred the matter to Dan Bergin,

another of the bank’s legal staff. Mr. Bergin has testified

that when he was brought into the case, he was given to

understand that Merrill was Mr. King’s attorney. Upon

learning the amount of money involved, however, Mr.

Bergin handed the matter over to First Interstate’s other

outside counsel, James Ball.

Mr. Ball testified that when he was initially contacted

about the situation he was unaware of Merrill’s suspen-

sion. When Mr. Ball became aware of Merrill’s suspension

a few days later, he expressed his discomfort with the

appearance that he was facilitating Merrill’s unauthorized

practice of law. Mr. Ball did concede that he dealt directly

with Mr. King, rather than Merrill, at their meeting, and

that, although he was present, Merrill did not actively

participate.

Mr. Ball eventually discovered he had a conflict of

interest in the matter, and the case was referred to new

counsel, who brought the matter to a satisfactory resolu-

tion.

Count Two of the complaint concerns the retention of

a new client by Merrill’s office while he was suspended.

In 1992, Merrill had hired Robert Silvert as a parale- -

gal. Mr. Silvert had three years of law school and work

experience in the legal field. When hired, Mr. Silvert was

5a

in the middle of seven years’ probation as a result of a

1990 conviction of one felony count of fraudulent

schemes. Merrill initially supervised Mr. Silvert closely,

but later relaxed that supervision. He testified that he

never gave him full case responsibility for any matter.

On June 4, 1994, Jerry Klock was arrested in Arizona

on a fugitive from justice warrant from the State of Nev-

ada on an underlying drug charge. He contacted Merrill’s

office to resolve the matter, upon a referral by a bail

bondsman friend of Mr. Silvert. Mr. Silvert handled the

initial meeting with Mr. Klock and accepted his retainer.

Mr. Klock never met Merrill.

Mr. Silvert telephones Scott Mitchell, an assistant

district attorney in Clark County, Nevada, and informed

him he was from the law office of Fred Merrill. He did

not identify himself as either a paralegal or a lawyer. Mr.

Mitchell assumed Mr. Silvert was a lawyer and described

the plea agreement he would accept.

Mr. Silvert then contacted Robert Pancoast, a Las

Vegas lawyer, to represent Mr. Klock at the Nevada hear-

ing. Again, Mr. Silvert identified himself only as “Robert

Silvert of the law office of Fred Merrill.” After discussing

his fee, Mr. Pancoast agreed to the representation, and the

matter was resolved as Mr. Mitchell had agreed.

Both Mr. Mitchell and Mr. Pancoast testified that they

assumed that Mr. Silvert was a lawyer, and that they

would not have said or done what they did had they

known he was not a licensed attorney.

Both Merrill and Mr. Kennedy testified that they had

admonished Mr. Silvert on numerous occasions about

6a

identifying himself as a paralegal, although neither did so

in connection with the Klock matter.

Count Three also concerns the retention of a new

client by Merrill’s office while he was suspended.

Prior to Merrill’s suspension, Peter Marella had con-

tacted Mr. Silvert for representation in a DUI matter. Mr.

Silvert met with Mr. Marella and his wife in July 1994 and

accepted a retainer of $1,000 to $1,500 on behalf of Mer-

rill’s firm. Both Mr. Kennedy and Ms. Brigham became

involved in representation of Mr. Marella, with Mr. Ken-

nedy filing a notice of appearance in the case on Merrill's

letterhead pleading paper. Although he does not speci-

fically recall the case, Mr. Kennedy assumes he met with

the client. After he was reinstated, Merrill became

involved in the representation.

The Marellas claim they were never informed of Mer-

rill’s suspension, and no other witness could specifically

recall whether the Marellas were sent a letter or other-

wise informed of the suspension.

The Hearing Committee found that the remaining

allegations in the Marella matter rest on the credibility of

various witnesses. As it was unable to reach any conclu-

sions concerning credibility, it made no further findings

in this Court.

Discussion of Decision

The Hearing Committee found that Merrill’s conduct

was in violation of Rule 63(a), (b), and (c), and the Com-

mission agrees. The following are the pertinent subsec-

tions of Rule 63:

as

7a

(a) Recipients of Notice; Contents. Within

ten days after the date of the commission or

court order or judgment imposing disci-

pline .. . , a respondent suspended .. . shall

notify or cause the following persons to be noti-

fied by registered or certified mail, return

receipt requested, of the order or judgment, and

of the fact that the lawyer is disqualified to act

as lawyer after the effective date of same:

1. All clients being represented in pending

matters; and

2. Any co-counsel in pending matters; and

3. Any opposing counsel in pending mat-

ters, or in the absence of such counsel, the

adverse parties; and

4. Each court and division in which

respondent has any pending matter, whether

active or inactive.

The notice to be given to opposing counsel

or parties shall state the place of residence of the

client of respondent. In the event the client does

not obtain substitute counsel before the effective

date of the . . . suspension .. ., it shall be the

responsibility of the... suspended .. . lawyer to

move in the court or agency in which the pro-

ceeding is pending for leave to withdraw.

(b) Return of Client Property. Respondent

shall deliver to all clients being represented in

pending matters any papers or other property to

which they are entitled and shall notify them,

and any counsel representing them, of a suitable

time and place where the papers and other

property may be obtained, calling attention to

any urgency for obtaining the papers or other

property. Respondent shall deliver all files and

8a

records in pending matters to the client, not-

withstanding any claim of an attorney lien.

(c) Effective Date of Order; Winding Up

Affairs. Judgments imposing suspension or dis-

barment shall be effective thirty days after entry,

unless the court specifies an earlier date... .

Respondent, after entry of a judgment of disbar-

ment or suspension, shall not accept any new

retainer or engage as lawyer for another in any

new case or legal matter of any nature. During

the period between entry and the effective date

respondent may wind up and complete on

behalf of any client all matters that were pend-

ing on the entry date. Respondent shall refund

any part of any fees paid in advance which have

not been earned.

(d) Affidavit Filed With Commission and

Court. Within ten days after the effective date of

the judgment of disbarment or suspension . . . ,

respondent shall file with the commission and

with the court an affidavit showing:

1. He has fully complied with the provi-

sions of the order and with these rules;

2. All other state, federal and administra-

tive jurisdictions in which he is admitted to

practice;

3. His residence and other addresses

where communications may thereafter be

directed to him; and that

4. He has served a copy of such affidavit

upon bar counsel.

Failure to comply with the provisions of this

Rule may be punishable by contempt.

9a

Merrill contends that the judgment and order impos-

ing the ninety-day suspension made reference only to

subsections (a) and (d) of Rule 63; therefore, he had no

knowledge that he was required to comply with the

entirety of Rule 63. The majority of the Commission

rejects this argument. Regardless of which subsections

were included in the Court’s order, Merrill had a clear

obligation to comply with all of Rule 63. In fact, Rule

63(d), which the Court did include in its order, provides

that a suspended attorney must file an affidavit showing

that he has fully complied with the provisions of the

order and with these rules. Merrill’s contention that he

believed he was only obligated to comply with certain

portions of the Rule is not reasonable.

Merrill has testified without dispute that he notified

all existing clients of his suspension by letter, and ‘hat all

of his clients expressed their wish that he continue his

representation upon reinstatement. The Committee

accepted this testimony, but found that there was no

substitution of counsel in Merrill’s cases during the

period of suspension and that he did not move to with-

draw from the cases. Neither did he return client files,

records, or property to clients; he retained those files and

records at his office and retained unearned fees in his

trust and general operating accounts.

The crux of this matter is whether Merrill’s actions

during his suspension were appropriate. Rule 31(a)(3)

provides, in part, that “no member shal! practice law in

this state or hold himself out as one who may practice

law in this state, while suspended.” However, exactly

what constitutes the practice of law, and just what a

suspended or disbarred lawyer can or cannot do, is not

eT

10a

provided in the Rules. Rule 63 provides some direction,

but certainly does not address the issue of what consti-

tutes the practice of law.

The Committee and the Commission struggled with

Merrill’s intent in the subject misconduct. Merrill asserts

he was merely trying to do the right thing - complying

with the portions of rule 63 referenced in the court's

order of suspension, hiring lawyers to handle his cases

while he was on suspension, etc. Despite such assertions

of good will, while suspended, Merrill kept in his employ

a paralegal who had a history of implying he was a

lawyer; he allowed his firm, even his paralegal, to con-

tinue to accept new clients and their retainers; he contin-

ued tc supervise his non-lawyer legal staff; and he

continued to be the sole signatory on his trust account

and general operating bank account and he signed and

issued checks on those accounts. In addition, there was

no outward indication that Merrill was on suspension

(for example, his office sent out pleadings and correspon-

dence on the letterhead of “The Law Office of Fredrick D.

Merrill” or “Fredrick D. Merrill, P.C.,” his business cards

continued to be displayed on the reception desk, tele-

phones were answered “Law Office of Fred Merrill,”? and

the sign on the building directory continued to read “The

Law Office of Fredrick D. Merrill”). While the Rules may

not specifically dictate what acts constitute the practice of

law, it seems clear that such actions and circumstances

are basic to the practice of law, and are inappropriate

during a period of suspension.

2 At oral argument, Merrill stated the phones were

answered only “Law Offices.”

lla

Merrill admits that he did not seek the guidance of

the State Bar and did not seek an ethics opinion from the

Committee on Rules of Professional Conduct in deciding

what conduct would be acceptable for a suspended attor-

ney.? The State Bar admits that it does not have specific

guidelines as to what a suspended lawyer can, or cannot,

do. As the Committee notes, the Rules Committee might

well have deciined such an inquiry as presenting a ques-

tion of law rather than ethics. Further, the Court has not

as yet had occasion to provide a clear definition of the

effects of a suspension from practice. Thus, had Merrill

sought guidance, it is possible he still would not have

received clear parameters within which to work.

The commission, like all the parties to this proceed-

ing, are troubled by the lack of clear direction in such

circumstances. The Commission finds Rule 63 to be

instructive on this issue as far as it currently goes; how-

ever, it would prefer to see the rule contain more all-

encompassing and specific guidelines as to the appropri-

ate conduct for a lawyer who is barred from practicing

law.

Despite the apparent lack of a definition of the “prac-

tice of law,” the Commission has concluded that, at the

very least, Merrill’s conduct clearly violated Rule 63(a),

(b), and (c). The Commission reviewed the American Bar

Association’s Standards for Imposing Lawyer Sanctions for

guidance on the appropriate sanction for such a violation.

Standard 3.0, providing general factors that should be

3 He did seek the advice of his counsel in the former

disciplinary proceedings, who advised him to retain other

attorneys to handle his cases. Merrill followed this advice.

TT

12a

considered in fashioning the sanction warranted, lists (a)

the duty violated, (b) the lawyer’s mental state, (c) the

potential or actual injury caused by the lawyer’s miscon-

duct, and (d) the existence of aggravating or mitigating

factors. The Commission finds that Merrill’s conduct vio-

lated his duty as a professional,* that his conduct was

intentional, and that the resulting injury could have been

serious — particularly had the other parties to the cases

handled by Mr. Silvert withdrawn their agreements after

learning he was not an attorney.

Standard 7.2, therefore, addressing Violations of

Duties Owed as a Professional, is the appropriate Stan-

dard to consider in relation to Merrill’s conduct. Speci-

fically, Standard 7.2 provides for suspension when a

lawyer knowingly engages in conduct that is a violation

of a duty owed as a professional and causes injury or

potential injury to a client, the public, or the legal system.

Merrill’s conduct violated his duty as a professional to

uphold the orders and rules that regulate the legal profes-

sion.

Finally, the Commission considered the applicable

aggravating and mitigating factors, which it finds to be of

equal weight. In aggravation are prior disciplinary

offenses (in addition to the prior suspension, Merrill was

* While it might appear that a violation of Rule 63 breaches

a lawyer’s duty to his clients, the Theoretical Framework to the

Standards indicates that the duties lawyers have to their clients

are loyalty, diligence, competence, and candor. These are not the

issues raised by a violation of Rule 63. Rather, the Standards

indicate that practicing law while suspended is a violation of

the lawyer’s duty as a professional, although it could obviously

result in harm to a “client.”

aaa claimant

13a

previously informally reprimanded in 1992 for unrelated

conduct), a selfish motive, and substantial experience in

the practice of law. In mitigation are full and free dis-

closure during the disciplinary proceedings, and remorse;

Merrill has admitted, in hindsight, that he should have

done things differently, although he could not articulate

what alternate actions he might have taken.

Continuing to practice law in any form while sus-

pended is, of course, serious conduct. Two prior cases

addressing this issue are In re Tarletz, 165 Ariz. 243, 798

P.2d 381 (1991), and In re Phelps, 154 Ariz. 516, 744 P.2d

428 (1987), both of which indicate that practicing law

while suspended after a previous finding of unprofessio-

nal conduct warrants disbarment. However, in both of

those cases the respondents were clearly involved in the

unauthorized practice of law, and each had sigr.ificant

prior discipline. Such is not the case here. As discussed

throughout these proceedings, there is at this point no

clear guideline in this state to indicate just what qualifies

as “practicing law.” Thus, there has been no finding that

Merrill was involved in the unauthorized practice of law.

The only conclusion that the Commission can reach in

this matter is that Merrill violated his obligations under

Rule 63. It found no prior cases addressing this particular

violation, however.

Thus, in seeking guidance for the appropriate sanc-

tion in this matter, the Commission turned to consider-

ation of the purpose of lawyer discipline, which is to

protect the public and the profession, rather than to pun-

ish the offender. In re Kersting, 151 Ariz. 171, 726 P.2d 587

(1986). The sanction imposed should, however, deter the

respondent and other attorneys from engaging in similar

i ei

l4a

unethical conduct. In re Kleindienst, 132 Ariz. 95, 644 P.2d

249 (1982). As discussed at length, there can be no conclu-

sive finding of the unauthorized practice of law in this

matter. Thus, disbarment would be inappropriate and

border on punitive. However, Merrill's clear violation of

a court order and court rule is, in itself, serious conduct

warranting a suspension.

Merrill’s explanations for his conduct during his sus-

pension are inadequate and unconvincing, and both the

Commission and Committee find that his conduct was

done knowingly. Based on these findings, the majority of

the Commission believes a one-year suspension is war-

ranted, as it believes it appropriate to require that Merrill

prove rehabilitation before being reinstated.° The major-

ity of the Commission also recommends, like the Com-

mittee, that Merrill’s compliance with Rule 63, in

connection with this suspension, be monitored by

LOMAP personnel, as detailed above.

RESPECTFULLY SUBMITTED this 13th day of Febru-

ary, 1997.

/s/ Richard N. Goldsmith

Richard N. Goldsmith, Chair

Disciplinary Commission

5 Rule 71(h), Ariz.R.S.Ct., requires lawyers who have been

suspended for more than six months to demonstrate proof of

rehabilitation in a reinstatement proceeding.

15a

Copies of the foregoing were mailed this 14th day of

February, 1997, to:

Fredrick D. Merrill, Respondent

100 West Clarendon, Suite 650

Phoenix, Arizona 85013-3527

F. Pendleton Gaines, Chair

Hearing Committee 6D

Two North Central, Suite 2200

Phoenix, Arizona 85004-2390

Stephen M. Kemp, Member

Hearing Committee 6D

8401 West Monroe, Room 340

Peoria, Arizona 85345-6560

Brian R. Warnock, Alternate Member

Hearing Committee 6D

2425 East Camelback, Suite 600

Phoenix, Arizona 85016-4214

Copies of the foregoing were hand-delivered this 14th

day of February, 1997, to:

Yigael M. Cohen, Bar Counsel

111 West Monroe, Suite 1800

Phoenix, Arizona 85003-1742

KENDRA A. DIEGAN

Disciplinary Clerk

By: /s/ E. F. Deering

l6a

APPENDIX B

STATE BAR OF ARIZONA

IN THE MATTER OF A

MEMBER OF THE STATE

BAR OF ARIZONA

FREDRICK D. MERRILL,

Attorney No. 005916

Nos. 94-1394, 95-0235,

and 95-0370

COMPLAINT

(Assigned to 6D)

Respondent.

tll tl i i de

(Filed Nov. 27, 1995)

Complaint is made against you as follows:

GENERAL ALLEGATIONS

1. Atall times relevant hereto, you were an attorney

licensed to practice law in the State of Arizona, having

been admitted to practice in Arizona on October 13, 1979.

By Supreme Court order, you were suspended from the

practice of law for ninety days commencing on June 24,

1994. You were thereafter reinstated on October 6, 1994.

COUNT ONE

2. Notwithstanding this order, on or about June 24,

1994, you met with attorney Dan Durrant to discuss a loss

that First Interstate Bank was likely to sustain as a result

of the conduct of one of your clients.

3. Thereafter, you met with Durrant and James

LeValley, Assistant General Counsel of First Interstate

i

17a

Bank to discuss your clients’ involvement in a check

kiting scheme.

4. At that meeting you would not identify your

client until you were-sure that the bank would agree to

negotiate a settlement of the potential loss. You also

proposed a potential payment program to Durrant and

LeValley.

5. At no time during the course of this meeting did

you advise Durrant or LeValley that your license to prac-

tice law was suspended.

6. Thereafter, the matter was turned over to Dan

Bergin, an Assistance [sic] Vice President and Counsel at

First Interstate Bank. You thereafter attempted to negoti-

ate a resolution to your clients’ case. At no time did you

advise Bergin that your license to practice law had been

suspended.

7. Your conduct in htis [sic] regard was in violation

of Rule 42, Ariz.R.S.Ct., particularly ER 5.5, and Rule

51(e), (k), and Rule 63.

COUNT TWO

8. On or about June 4, 1994, you were retained by

Jerry Klock for representation in a criminal matter.

9. Shortly thereafter you learned that Mr. Klock was

also a defendant in a felony from justice Originating in

Nevada.

10. On or about June 6, 1994, Robert Silvert con-

tacted Scott Mitchell, an Assistant District Attorney in the

Clark County District Attorney’s Office, and held himself

18a

out as Mr. Klock’s Arizona attorney. Mr. Silvert thereafter

negotiated a plea agreement on behalf of Mr. Klock.

11. On or about June 20, 1994, Mr. Silvert contacted

David Pancoast, a Nevada attorney, and requested that he

represent him at the plea agreement. During the course of

this conversation, Mr. Silvert again held himself out as an

Arizona attorney.

12. You failed to adequately supervise Mr. Silvert

and had knowledge that he was holding himself out as an

attorney.

13. By letter dated April 27, 1995, you advised the

State Bar that Mr. Silvert has never held himself out as an

attorney. You also provided an affidavit signed by Mr.

Silvert in which he advised that he has never held himself

out as an attorney.

14. Both the statements in your response and in Mr.

Silvert’s affidavit were false and misleading.

15. Your conduct in this regard was in violation of

Rule 42, Ariz.R.S.Ct., particularly ER 5.3, ER 5.5, ER

8.1(a), and ER 8.4.

COUNT THREE

16. On July 11, 1994, and during your period of

suspension, you were retained by Peter Marella for repre-

sentation in a DUI matter. You were paid a retainer of

$1,500.00 at that time.

17. At the time of your retention, you did not advise

Mr. Marella that you had been suspended from the prac-

tice of law.

19a

18. Thereafter, you failed to keep your client reason-

ably informed about the status of his matter, and failed to

promptly comply with his reasonable requests for infor-

mation. Although you did not appear in court with your

client during the period of your suspension, your client

was advised that you were busy handling other cases or

were making another appearance in a different court. In

addition, although your client requested that the trial in

his matter be continued, neither you nor anyone on your

behalf, made any application to continue your client’s

trial.

19. You engaged in the unauthorized practice of

law, engaged in conduct involving dishonesty, fraud,

deceit or misrepresentation, and engaged in conduct that

was prejudicial to the administration of justice. You will-

fully disobeyed the order of the Supreme Court placing

you on suspension, and never informed your client of

your suspension.

20. Your conduct as described above violated Rule

42, Ariz.R.S.Ct., particularly ER 1.2, ER 1.3, ER 1.4, ER 5.5,

ER 8.4, and Rules 51(e), (k), and Rule 63(c), Ariz.R.S.Ct.

COUNT FOUR

21. You have previously been sanctioned for viola-

tions of the Rules of Professional Conduct. Specifically, in

file No. 92-0485, you were suspended from the practice of

law for 90 days, placed on one year’s probation, and

assessed the State Bar’s costs on June 24, 1994, for viola-

tions of ER 1.8(a) and ER 1.15, Ariz.R.S.Ct. Additionally,

in file No. 92-1136, you were informally reprimanded by

order dated November 24, 1992, for violations of ER 1.15,

20a

Ariz.R.S.Ct. The entire record in these cases may be

reviewed by the hearing committee or hearing officer,

with or without your consent, following a decision on the

merits, pursuant to Rule 53(c) and Rule 54(k)(4),

Ariz.R.S.Ct.

DATED this 27th day of November, 1995.

/s/ Yigael M. Cohen

Yigael M. Cohen

Bar Counsel

Original filed with the

Disciplinary Clerk of the

State Bar of Arizona, this

27th day of November,

1995,

By: /s/ Cassi Taylor