grievances and the board of disciplinary appeals · pdf fileof his paper “the grievance...

GRIEVANCES AND THE

BOARD OF DISCIPLINARY APPEALS

Presenter

W. CLARK LEA

Cotton Bledsoe Tighe & Dawson PC

Midland, TX

Co-Author

CHRISTINE E. MCKEEMAN

Executive Director & General Counsel

Board of Disciplinary Appeals

State Bar of Texas

33rd

ANNUAL

ADVANCED CIVIL TRIAL COURSE

July 21-23, 2010—San Antonio

August 25-27, 2010—Dallas

October 20-22, 2010—Houston

CHAPTER 8

W. CLARK LEA

1608 Gulf Ave. Midland, Texas 79705 Home: (432) 570-7552 Office: (432) 685-8556

EDUCATION: Baylor University School of Law Waco, Texas Doctor of Jurisprudence awarded May, 1990 Southern Methodist University Dallas, Texas Master of Business Administration awarded August, 1980 Austin College Sherman, Texas Bachelor of Arts awarded May, 1979 Majors in Business and German EXPERIENCE: Cotton, Bledsoe, Tighe & Dawson. Midland, Texas Shareholder September, 1990 – present Emphasis in Employment and Commercial Litigation ClayDesta National Bank. Midland, Texas Vice President – Loan Officer Energy Lending November 1983 – May 1987 First National Bank of Midland. Midland, Texas Loan Officer – Energy Lending August 1980 – November 1983 BAR ACTIVITIES: Board of Disciplinary Appeals Appointed by the Supreme Court of Texas Member 2007 – present Chair 2009 – present Law Office Management Committee of the State Bar of Texas Vice-Chair 1998 – 2001 ADMISSIONS: Admitted to practice in all State and Federal Courts in Texas 5th Circuit Court of Appeals Federal Circuit Court of Appeals Supreme Court of the United States of America ACTIVITIES: Phi Delta Phi Legal Fraternity

Hospice of Midland, Inc. (non-profit) – Board Member 2002-2007 President 2005-2006

Hospice of Midland Endowment, Inc. Board Member; 2004 – present

CHRISTINE E. MCKEEMAN Executive Director & General Counsel

Board of Disciplinary Appeals Appointed by the Supreme Court of Texas

P.O. Box 12426, Austin, Texas 78711 (512) 427-1578; FAX (512) 427-4130

[email protected]

EDUCATION Doctor of Jurisprudence, University of Texas School of Law 1982 Bachelor of Arts in English, summa cum laude, University of Texas at Austin 1975 Phi Beta Kappa, Phi Kappa Phi PROFESSIONAL EXPERIENCE Executive Director & General Counsel 1992–Present Board of Disciplinary Appeals appointed by the Supreme Court of Texas

Private Practice, Austin, Texas 1983–1992 Board certified, Residential and Commercial Real Estate (inactive status) Texas Board of Legal Specialization Briefing Attorney, Chief Justice Joe R. Greenhill and Justice Ted Z. Robertson 1982–1983 Supreme Court of Texas

PROFESSIONAL HONORS AND ACTIVITIES President-Elect, National Council of Lawyer Disciplinary Boards 2010-2011

Member, Supreme Court of Texas Task Force, Texas Disciplinary Rules of Professional Conduct 2003-present

Member, State Bar of Texas Disciplinary Rules of Professional Conduct Committee 2002-2006 Member, Martha Dickie Task Force on Alternative Discipline Speaker and author, local, state and national professional ethics seminars Member State Bar of Texas (licensed 1982) Appellate Practice Section American Bar Association ABA Center for Professional Responsibility

The Grievance System & the Board of Disciplinary Appeals Chapter 8

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TABLE OF CONTENTS I. INTRODUCTION ...................................................................................................................................................... 1 II. OVERVIEW OF THE GRIEVANCE SYSTEM ....................................................................................................... 1

A. Self-Regulatory System. ........................................................................................................................................ 1 B. Entities in the Disciplinary System ........................................................................................................................ 1

1. Grievance Committees. ...................................................................................................................................... 1 2. Commission for Lawyer Discipline. ................................................................................................................... 2 3. Chief Disciplinary Counsel. ............................................................................................................................... 2 4. Board of Disciplinary Appeals. .......................................................................................................................... 2 5. Client Attorney Assistance Program. ................................................................................................................. 2 6. Grievance Oversight Committee. ....................................................................................................................... 3 7. Client Security Fund. .......................................................................................................................................... 3

III. STANDARD GRIEVANCE PROCEDURE ............................................................................................................ 3

A. Grievance Filing and Screening ............................................................................................................................. 3 B. Appeals from Grievance Dismissals to BODA ...................................................................................................... 3 C. Investigation and Summary Disposition ................................................................................................................ 4 D. Grievance Referral Program .................................................................................................................................. 4 E. Attorney’s Election of District Court or Evidentiary Hearing ............................................................................... 4

1. Trial in District Court. ........................................................................................................................................ 5 2. Evidentiary Hearing. .......................................................................................................................................... 5

F. Evidentiary Proceedings ......................................................................................................................................... 5 G. Revocation of Probated Suspension ...................................................................................................................... 6

IV. BOARD OF DISCIPLINARY APPEALS ............................................................................................................... 6

A. Caseload. ................................................................................................................................................................ 6 B. BODA Judgments and Opinions ............................................................................................................................ 6 C. Appellate Jurisdiction ............................................................................................................................................ 7 D. Evidentiary Appeals. .............................................................................................................................................. 7 D. Original Jurisdiction. ............................................................................................................................................. 7 E. Compulsory Cases .................................................................................................................................................. 7 F. Reciprocal Discipline ............................................................................................................................................. 8 G. Revocations of Probation ....................................................................................................................................... 8 H. Disabilities. ............................................................................................................................................................ 8

V. COMMON DISCIPLINE ISSUES ............................................................................................................................ 9

A. Neglecting the Client or the Matter ....................................................................................................................... 9 B. Fee Agreements ................................................................................................................................................... 10 C. Solicitation Letters ............................................................................................................................................... 11 D. Division of Fees and Retaining an Interest .......................................................................................................... 11 E. Supervising Non-lawyer Staff .............................................................................................................................. 11 F. Letters of Protection ............................................................................................................................................. 12 G. Terminating the Attorney-Client Relationship .................................................................................................... 13 H. Other Common Issues. ......................................................................................................................................... 13


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GRIEVANCES AND THE BOARD OF DISCIPLINARY APPEALS1

I. INTRODUCTION

This paper explains the roles of the various entities in the disciplinary system, provides a walkthrough of the standard grievance process from screening through an appeal from an evidentiary judgment to the Board of Disciplinary Appeals, outlines the jurisdiction and operations of the Board of Disciplinary Appeals, and discusses common discipline issues.

II. OVERVIEW OF THE GRIEVANCE SYSTEM

A. Self-Regulatory System.

TEX. GOV’T CODE §§ 81.001 et seq. (“State Bar Act”) subjects every attorney admitted or specially admitted to practice in Texas to the disciplinary jurisdiction of the Supreme Court of Texas. The Court has inherent power through the Texas Constitution to license attorneys, to maintain appropriate standards of professional conduct, and to dispose of individual cases of lawyer discipline and disability. To carry out its duties, the Texas Supreme Court has delegated responsibility for administering and supervising lawyer discipline and disability to the Board of Directors of the State Bar of Texas. The Court has also delegated to the Board of Disciplinary Appeals (BODA) authority to “exercise all the powers of either a trial court or appellate court, as the case may be, in hearing and determining disciplinary proceedings.” In re State Bar of Texas, 113 S.W.3d 730, 734 (Tex. 2003) (orig. proceeding).

The Texas Disciplinary Rules of Professional Conduct (“Rules of Professional Conduct” or “TDRPC”) define proper conduct for purposes of professional discipline. TEX. DISCIPLINARY R. PROF’L

CONDUCT preamble ¶ 10. The Rules of Professional Conduct are imperatives, cast in the terms of “shall” or “shall not.” However, the rules do not exhaust the moral and ethical considerations that govern lawyers, because legal rules can neither anticipate nor define proper conduct in all circumstances. TEX. DISCIPLINARY R. PROF’L CONDUCT preamble ¶ 10.

The Texas Supreme Court promulgated the Texas Rules of the Disciplinary Procedure (“Rules of Disciplinary Procedure” or “TRDP”) to establish the procedures used in the professional disciplinary and

1 Special thanks to Jack Balagia for permission to use parts of his paper “The Grievance System and the Board of Disciplinary Appeals” originally prepared for the 2003 Advanced Personal Injury Seminar and revised in 2006.

disability system for Texas attorneys. TEX. R. DISCIPLINARY P. 1.02. The Rules of Disciplinary Procedure do not amend or repeal, in any way, the Rules of Professional Conduct.

B. Entities in the Disciplinary System

The State Bar Act and the Rules of Disciplinary Procedure create several entities with direct involvement in the attorney disciplinary system: the Commission for Lawyer Discipline, BODA, the State Bar Chief Disciplinary Counsel, State Bar District Grievance Committees, and the State Bar Client Security Fund.

1. Grievance Committees.

The State Bar supports a number of additional important groups and programs which impact attorney discipline through grievance support, oversight, or advisory roles: the Supreme Court Grievance Oversight Committee, the Client Attorney Assistance Program (“CAAP”), the Attorney Ethics Hotline, the Discipline/CAAP Subcommittee of the State Bar Board of Directors, the Supreme Court Professional Ethics Committee, the Advertising Review Committee, the Law Practice Management Program, the Texas Lawyers’ Assistance Program, and the State Bar of Texas Disciplinary Rules of Professional Conduct Committee. The Texas Center for Legal Ethics and Professionalism is a nonprofit organization which provides courses in professionalism, lawyer ethics, and the basics of law practice to newly licensed attorneys as well as through other cooperative programs with the State Bar. Numerous local bars also support the disciplinary system indirectly by providing fee dispute resolution committees for attorneys and clients. Detailed information about the entities and programs involved in attorney discipline is available on the State Bar’s website at www.texasbar.com under “Client Assistance and Grievance,” the BODA website at www.txboda.org, the Grievance Oversight Committee’s website at www.txgoc.com, and the TCLEP website at www.txethics.org. Current information and statistics are also available in the annual reports published by the Commission, BODA, and Grievance Oversight Committee and available on their websites. The State Bar has established 49 district grievance committees that preside over both summary disposition dockets and evidentiary hearings. More than 430 individuals, a third of whom must be non-lawyers, serve pro bono on the district grievance committees.2 The State Bar President appoints

2 Commission for Lawyer Discipline Annual Report 2009, p.13.

http://www.TexasBarCLE.com/CLE/PMCasemaker.asp?table=TX_caselaw&volume=113&edition=S.W.3d&page=730&id=126586_01


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committee members who serve three-year terms and are eligible to be reappointed for a second consecutive term. Each committee is subdivided into geographic sub-districts. The State Bar Chief Disciplinary Counsel’s office provides training, both onsite and online, for the committee members.

2. Commission for Lawyer Discipline.

The Commission for Lawyer Discipline is a permanent committee of the State Bar of Texas, composed of six attorneys appointed by the President of the State Bar and six public members appointed by the Supreme Court of Texas. The Commission for Lawyer Discipline acts as the “client” for disciplinary matters not disposed of at summary disposition, monitoring formal proceedings, recommending discipline ranges for prosecutors to seek, deciding which cases to nonsuit, recommending a budget for the Chief Disciplinary Counsel’s office to the State Bar, hiring the Chief Disciplinary Counsel, and recommending changes to the disciplinary system. In accordance with the State Bar Act, the Commission drafts its own internal operating rules which are approved by the State Bar Board of Directors and the Supreme Court. The internal rules also provide eligibility criteria for the imposition by evidentiary panels of private reprimands for professional misconduct.3 The Commission meets monthly to review cases in formal proceedings, whether before evidentiary panels, in district court, or on appeal. The Commission may also take action by a three-person panel, with one member being a public member.

3. Chief Disciplinary Counsel.

The Commission is represented in disciplinary matters by the Chief Disciplinary Counsel and her/his staff. The Commission hired the current CDC, Linda Acevedo, in 2009 (references to “CDC” or “she” in this paper include CDC staff). Ms. Acevedo has extensive experience in many aspects of the disciplinary system. The CDC functions through four regional offices: Austin, Dallas, Houston, and San Antonio with a staff of 33 attorneys. The CDC is assisted by a Deputy Counsel for Litigation who oversees formal proceedings statewide and a Deputy Counsel for Administration who oversees grievance classification, referral, and compliance statewide.

The CDC staff handles the initial decision whether a grievance is dismissed or undergoes additional investigation, recommends to the Commission which complaints should become formal proceedings, prosecutes all formal proceedings before

3 Rule 13, Commission for Lawyer Discipline Internal Operating Rules.

either an evidentiary panel of a district grievance committee or in district court, and handles all appeals from disciplinary judgments. The CDC also recommends disability proceedings when her investigation indicates that an attorney may be suffering from a condition that, with or without misconduct, results in an attorney’s inability to practice law.

4. Board of Disciplinary Appeals.

Appointed by the Supreme Court of Texas, BODA serves as an independent statewide judicial body with original and appellate jurisdiction over six types of attorney discipline cases prosecuted by the State Bar’s CDC. All BODA members are attorneys, and many have experience serving on grievance committees. The BODA members’ backgrounds reflect the wide diversity of practice areas required to evaluate the many different kinds of complaints and cases before the Board. Members include litigators, transactional attorneys, appellate lawyers, in-house counsel, family law practitioners, and state and federal prosecutors and public defenders. BODA drafts its own Internal Procedural Rules which are approved and promulgated directly by the Supreme Court of Texas. The IPR are available in the West State Rules of Court Desk Reference and on the BODA website. BODA functions as a judicial body, interpreting and applying not only the disciplinary rules, but also civil procedural rules, evidentiary rules, and case law. BODA matters include complainant appeals from grievance screening decisions; transfers of grievances from one committee to another; appeals from disciplinary judgments signed by evidentiary panels of district grievance committees; petitions to revoke probated disciplinary suspensions; compulsory discipline cases; and reciprocal discipline cases. In addition, BODA appoints specially-constituted disability committees to determine whether an attorney is unable to practice law because of any physical or mental condition that prevents him or her from being able to carry out professional responsibilities to clients.

5. Client Attorney Assistance Program.

All dismissed grievances, whether dismissed at screening, the summary disposition docket, or after hearing, must be referred to a voluntary mediation and dispute resolution procedure. The State Bar Client-Attorney Assistance Program (“CAAP”), designed to assist persons in resolving minor disputes that do not rise to the level of professional misconduct, serves this function. Services that CAAP provides include suggesting ways for a client to deal with communication problems, answering questions about


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the disciplinary system, and referring callers to other State Bar programs.

6. Grievance Oversight Committee.

The Grievance Oversight Committee (“GOC”), a nine-member committee of attorneys and public members appointed by the Supreme Court of Texas, serves as an oversight body for the grievance and disciplinary process in Texas. The GOC reviews the grievance system and disciplinary procedures and provides annual reports to the Supreme Court. The GOC has also suggested changes that it believes will improve the efficiency and effectiveness of the grievance system, while serving the objective of public protection.

7. Client Security Fund.

The State Bar established the Client Security Fund in 1975 to provide relief to eligible clients who have lost money or property as a result of attorney theft or failure to refund an unearned fee and whose losses are not directly compensated by the attorney at fault. The Fund consists of interest on the original fund corpus plus annual appropriations from the State Bar. Applications to the fund are made to an attorney in the CDC office who administers the program for the Client Security Fund Subcommittee of the Bar. During FY 2008-2009, the Subcommittee reviewed 237 applications recommended for funding and paid out a total of $701,451 to 151 applicants.4

III. STANDARD GRIEVANCE PROCEDURE

A. Grievance Filing and Screening On average, the State Bar receives over 7,000 grievances each year. The Austin office of the CDC serves as the central intake for all grievances filed. Three attorneys assigned to review the grievances read and classify each submission within 30 days of filing. If, on its face, or upon screening or preliminary investigation, the written statement alleges conduct constituting professional misconduct or attorney disability cognizable under the Rules of Professional Conduct or the Rules of Disciplinary Procedure, the CDC classifies the grievance as a complaint and schedules it for further investigation to determine whether there is just cause to believe that misconduct has occurred. TEX. R. DISCIPLINARY P. 2.10. Grievances that do not allege misconduct on their face are dismissed. On average, the Chief Disciplinary Counsel’s office classifies 25 percent of the grievances filed as complaints.5 4 Commission for Lawyer Discipline Annual Report 2009, p. 12. 5 Commission for Lawyer Discipline Annual Report 2009, p. 15.

The CDC notifies each complainant of the classification decision. When the CDC dismisses a complaint, she/he also provides the complainant with a form to appeal the dismissal to the Board of Disciplinary Appeals. The attorney receives a copy of each grievance along with notice that the grievance was dismissed. If a complainant appeals the dismissal, the CDC so notifies the attorney.

B. Appeals from Grievance Dismissals to BODA

Complainants whose grievances are dismissed at screening may appeal the dismissal to BODA for independent review within 30 days of receiving the disposition from the Chief Disciplinary Counsel to BODA. Complainants appeal an average of over 40 percent of dismissed grievances to BODA.6 A randomly selected panel of three BODA members reviews each grievance appealed to determine whether they agree with the original screening decision that the writing does not allege a violation of the Rules of Professional Conduct. BODA makes its decision based on the face on the complaint, using the same information that the CDC reviewed when it dismissed the grievance. BODA does not consider any information submitted after the CDC reviewed the complaint nor does BODA contact the complainant or the attorney for any reason.

All the information that BODA reviews concerning classification appeals is strictly confidential, with respect to BODA and, CDC under the Rules of Disciplinary Procedure. BODA notifies both the complainant and the attorney in writing of its decision, usually within 4-6 weeks of receiving the appeal.

BODA grants the appeal and reverses the dismissal of the grievance with respect slightly less than 10 percent of the matters appealed. Many complaints appealed to BODA involve non-grievable situations such as fee disputes, rude behavior, and private conduct.

If BODA grants an appeal, it sends a disposition letter notifying the complainant and attorney that the appeal has been granted, BODA provides the specific rule(s) of professional conduct it believes the allegations of misconduct in the complaint violate. If BODA grants the appeal, the grievance goes back to the office of the Chief Disciplinary Counsel for investigation and a decision whether there is just cause to believe that professional misconduct occurred. The CDC is not limited to the rules articulated by BODA if its investigation results in just cause to believe that additional or different rules were violated. If BODA denies an appeal, it sends a disposition letter notifying the complainant and

6 BODA Annual Report 2009, p. 12.


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attorney that the appeal has been denied. There is no further appeal for the denial of a BODA determination on a classification appeal.

C. Investigation and Summary Disposition

Once the CDC or BODA upgrades a grievance to a complaint, the CDC sends the case to the regional office for the county of the attorney’s residence and assigns the case to an investigator. The investigator asks the attorney to respond to the complaint and provide any additional documentation explaining or refuting the allegations. The attorney has 30 days from the receipt of the request to respond. Failure to respond (or to respond timely) to a grievance is itself grievable, TDRPC 8.04(a)(8), and can turn a reprimand case into a suspension or even a disbarment. The CDC may ask the complainant or attorney for additional information, contact third persons, or obtain court records or other records to assist in determining whether there is just cause to believe that the attorney has committed professional misconduct.

The CDC has 60 days from the date the attorney’s response is due to determine whether there is just cause to believe that misconduct occurred. If the CDC determines after investigation that there is no basis to the allegations of misconduct, they docket the matter for summary disposition before a grievance committee panel composed for that purpose. This panel consists approximately of two-thirds attorney members and one-third public members.

Summary disposition (“SD”) hearings are held on as as-needed basis. In a metropolitan area, SD hearings are usually scheduled monthly. Cases pending summary disposition are assigned to panels on a rotating basis depending on current case load. The CDC presents its report concerning the extent and results of the investigation with its recommendation that the complaint be dismissed. Neither the complainant nor the attorney appears at this disposition. The SD panel may reject the recommendation and vote to proceed with the complaint; however, summary disposition panels accept the recommendation to dismiss in approximately 97 percent of cases.7

D. Grievance Referral Program

Implemented by the Commission in 2007, the Grievance Referral Program allows attorneys who have committed minor misconduct and who meet eligibility criteria to participate in a remedial or rehabilitative program specifically designed to address the issues that contributed to the misconduct in

7 Commission for Lawyer Discipline Annual Report 2009, p. 18.

exchange for a likely dismissal of the underlying complaint. Complaints referred to the program typically involve communication problems, poor law office management skills, or disability issues. If the lawyer fails to complete the terms of the agreement for referral, the underlying complaint returns and moves forward through the usual disciplinary process. The eligibility criteria and procedure for participating in the referral program, jointly developed by the Commission for Lawyer Discipline and the State Bar Board of Directors are set out in Board policy 6.09.01.8 Some of the criteria for referral include: • Respondent has not been disciplined within

prior three years • Respondent has not been disciplined for

similar conduct within prior five years • Misconduct did not result in substantial

harm or prejudice to the client or complainant

• Misconduct does not involve misappropriation of funds

• Misconduct does not involve dishonesty, fraud, or misrepresentation

• Misconduct does not constitute an Intentional Crime as defined in the Rules of Disciplinary Procedure

Special counsel in the Austin CDC office with training in social work or mental health administers the referral program. During 2008-2009, 36 cases were resolved through the program.

E. Attorney’s Election of District Court or Evidentiary Hearing

If the CDC concludes after investigation that there is just cause to believe that the attorney has committed professional misconduct, she/he notifies the attorney of the allegations and rule violations. CDC sends this notice to the attorney’s address as provided by the attorney to the State Bar and shown on the membership rolls maintained by the State Bar of behalf of the Supreme Court.9 The attorney has 20 days from receipt of the written notification that the CDC will pursue the complaint in formal proceedings to elect whether to proceed in district court, with or without a jury, or before an evidentiary panel of a

8 The policy manual of the State Bar Board of Directors is available on the State Bar website www.texasbar.com under “Leadership.” 9 Member attorneys are required by the State Bar Act to notify membership of any change to their address or other information within 30 days of such change. Tex. Gov’t Code tit. 2 Subtit.G, App. A, Art. III § 2 (2008). These changes can be made online on the State Bar website.


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district grievance committee. If the attorney fails to notify the CDC timely of his decision, he is deemed to have selected an evidentiary hearing.

1. Trial in District Court.

An attorney should consider several important differences between trial in district court and a hearing before an evidentiary panel when deciding how to proceed. Trial in district court will be in the county of the attorney’s principal place of practice before an active district judge appointed by the Supreme Court to hear the case. The judge must be from an Administrative Judicial District other than the one in which the attorney resides. The case is public as other civil cases, and private reprimands are not available. The matter proceeds with service, answer, discovery, pre-trial motions, and trial according to the Texas Rules of Civil Procedure generally unless specifically varied by the Rules of Disciplinary Procedure. TRDP 3.08B. Appeal is to the Courts of Civil Appeal as in civil cases generally with review for factual and legal sufficiency of the evidence. Appeal to the Texas Supreme Court is by petition for review.

2. Evidentiary Hearing.

An evidentiary hearing will typically be before a group of six grievance committee members appointed by the chair of the district committee to hear the case. The panel will consist of approximately (in the case that proceeds before a number of members other than 6) two-thirds attorneys and one-third public members. A quorum, or a minimum of four members, is required to actually hear the case.10 If the case is still pending at the end of a panel member’s term on the grievance committee, the panel composition will change when a new member is appointed.

Evidentiary hearings proceed according to Part II of the Rules of Disciplinary Procedure and are confidential unless and until a public sanction is imposed. Private reprimands are available. Failure to answer the petition timely constitutes a default, and the facts alleged in the petition are taken as true. Discovery is more limited than in civil proceedings. Appeal is to BODA with de novo review of legal issues, review by substantial evidence for factual issues, and review of sanctions imposed for abuse of discretion. Appeal to the Texas Supreme Court is by direct appeal.

10 Quorums consisting of two attorneys and two public members or three attorneys and one public member are properly constituted to hear the case. A panel of four attorneys and one public member, however, does not satisfy the statutory requirements of the State Bar Act and the TRDP. Cafiero v. Comm’n for Lawyer Discipline, (BODA 37811, May 10, 2007) www.txboda.org.

During the 2008-2009 bar year, 491 cases went to formal proceedings. Over 80 percent of the attorneys either affirmatively elected an evidentiary hearing (198) or failed to make any election and defaulted into evidentiary proceedings (211).11

F. Evidentiary Proceedings

When a disciplinary case proceeds before an evidentiary panel, the chair of the district grievance committee appoints a panel to hear the case. Each panel as appointed must be one public member for each two attorney members and satisfy statutory requirements concerning participation by public members.12 Most panels are either three (two attorneys and one public members) or six members (four attorneys and two public members). The attorney has an opportunity to move to recuse panel members. The evidentiary panel serves an adjudicatory or judicial function. The purpose of the evidentiary hearing is to receive the evidence, make findings of fact and conclusions of law, and either dismiss the complaint or impose sanctions. The CDC has the burden of proof in the hearing to prove material allegations by a preponderance of the evidence. TRDP 2.17. The chair of the evidentiary panel often rules on points of procedure and evidence, much in the same way as judges. It is challenging and significant work, often undertaken in an emotionally charged setting. The panel can order the parties to alternative dispute resolution to attempt to resolve the matter. TRDP 2.17K. The parties may also mutually agree to settle the case at any time before a judgment is signed. If the panel finds that the attorney has committed professional misconduct, it may hold a separate hearing to determine the appropriate discipline. The sanctions hearing may immediately follow the hearing on the merits of the complaint or occur on a different day. The full range of sanctions from private reprimand to disbarment is available, and the panel has broad discretion to impose the sanction. Their decision is reviewed for abuse of discretion. TRDP 2.18 sets out the factors the panel must consider to arrive at the appropriate discipline. Among these are: the attorney’s prior disciplinary record, if any, the loss or damage to the client, the seriousness of the circumstances surrounding the misconduct, and the attorney’s conduct during the course of the proceeding. The panel cannot consider whether an attorney may be suffering from a disability unless he

11 Commission for Lawyer Discipline Annual Report, p. 19. 12 For detailed discussion of these requirements, see In re Allison, 288 S.W.3d 413 (Texas 2009) and Cafiero v. Comm’n for Lawyer Discipline (BODA 37811, May 10, 2007) www.txboda.org.



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demonstrates that he is successfully pursuing in good faith a program of treatment and recovery. The panel then signs a judgment containing findings of fact and conclusions of law which goes to the respondent. Of 335 disciplinary sanctions imposed in 2008-2009, 114 were private or public reprimands.13 [What was dismissed?] Approximately another third of those judgments involved an active suspension of the attorney’s license for a certain period of time, a probated suspension, or combination of both active and probated suspension. The panel may also order the attorney to pay restitution to the client as well as reasonable attorney’s fees and the direct expenses associated with the proceedings as ancillary sanctions. TRDP 1.06Y. If the panel imposes a probated suspension, the judgment also contains the terms and conditions with which the attorney must comply for a certain period of time to retain his license. These may include prohibition against commiting any new misconduct, participation in substance abuse counseling programs, referrals to other support programs, and attendance at Minimum Continuing Legal Education seminars. The CDC employs a statewide compliance monitor in the Austin office who collects restitution on behalf of clients, collects attorney’s fees and costs payable to the State Bar, and monitors compliance with all other probationary terms for active cases.

An evidentiary panel order of disbarment cannot be superseded or stayed. The respondent may, within 30 days of the entry of judgment, petition the evidentiary panel to stay a judgment of suspension during an appeal. An order of suspension must be stayed during the pendency of any appeal if the evidentiary panel finds by a preponderance of the evidence that the attorney’s continued practice of law does not pose a continuing threat to the welfare of the attorney’s clients or to the public. TRDP 2.25. The respondent or CDC may appeal to BODA within 30 days of the date of judgment any findings, conclusions, or sanctions imposed by the evidentiary panel. These appeals are based on the record from the evidentiary hearing. TRDP 2.24. For more discussion of appeals from evidentiary judgments, see section III.C below.

G. Revocation of Probated Suspension

If the attorney materially violates a term or condition of probation, the CDC petitions BODA to revoke the probation. Revocation hearings are intended to be expedited, and the petition must be set for hearing within 30 days of the date the attorney is served with the petition to revoke. BODA conducts a hearing to receive evidence and, if it finds a violation,

13 Commission for Lawyer Discipline Annual Report, p. 15.

suspends the attorney for the full term of the original suspension period without credit for any probationary time served.

IV. BOARD OF DISCIPLINARY APPEALS

A. Caseload. The Supreme Court of Texas created BODA

through the Rules of Disciplinary Procedure in 1992. Since then, BODA has decided over 46,000 attorney discipline matters. On average, BODA decides approximately 2,200 matters per year. While most Texas attorneys may not even be aware that BODA exists, much less be familiar with its jurisdiction, BODA is regularly deciding 40 or more cases every week.

In addition to weekly panels deciding classification appeals, BODA meets en banc in Austin approximately four to five times a year to hear and decide compulsory and reciprocal cases, revocations of probation, appeals from evidentiary judgments, and disabilities and disability reinstatements. There is no filing fee for any BODA case. Hearings take place in the courtroom of the Supreme Court of Texas, typically at a Friday morning docket. The current hearing date and docket is available on the BODA website at www.txboda.org. For good cause, a party may request an expedited setting if waiting until the next regularly scheduled en banc date creates a problem. BODA may assign any matter to a panel of three members to meet hearing requirements or for any other reason. Detailed information about BODA members, jurisdiction, operations, current docket, and decisions is available on the website at www.txboda.org. BODA publishes an annual report with case statistics which is also available on the website. In addition to reviewing appeals from classification dismissals discussed above, BODA handles several other types of disciplinary cases discussed below.

B. BODA Judgments and Opinions

BODA may decide cases with or without opinion.14 To date, BODA has written 11 opinions in compulsory cases, evidentiary appeals, and a motion to set aside a revocation of probation. The opinions are available on the BODA website and in the official case reporting system. BODA typically issues judgments the week following hearings with written notice to the parties including instructions on how to appeal to the Supreme Court of Texas.

14 BODA does not issue opinions for classification decisions.


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C. Appellate Jurisdiction

BODA’s appellate jurisdiction encompasses two principal categories: (1) review of determinations by the Chief Disciplinary Counsel that a grievance fails to allege a violation of the Texas Disciplinary Rules of Professional Conduct and therefore does not state a complaint; and (2) appeals from evidentiary panel judgments (usually by the attorney who has been found to have committed misconduct and suffered a sanction). For a detailed discussion of BODA’s review of classification appeals, see section II.B above.

D. Evidentiary Appeals.

Either the CDC or the respondent attorney may appeal the judgment of an evidentiary panel within 30 days of the date of the judgment to BODA, including the findings of misconduct, conclusions of law, or the sanction imposed. If any party timely files a post-judgment motion for new trial or to modify the judgment, the appeal is due 90 days after the date of the judgment. These appeals are governed by Part 4 of BODA’s Internal Procedural Rules and proceed similar to civil appeals. Dispositions are based on the record, briefs, and oral argument (if requested). BODA reviews factual issues under a substantial evidence rule and legal issues de novo. BODA reviews the evidentiary panel’s choice of sanction for abuse of discretion in considering and applying the factors set out in TRDP 2.18.

The record is due 30 days after the date the notice of appeal is filed if no post-judgment motions are filed. The record is due 120 days from the date of the evidentiary judgment if a party files a motion for new trial or to modify the judgment. The person designated by the CDC as the clerk of the evidentiary panel prepares and files with BODA the clerk’s record from the evidentiary hearing. There is no fee for filing the clerk’s record. The party appealing is responsible for contacting the court reporter, requesting preparation of the reporter’s record, paying the court reporter, and ensuring that the transcription and exhibits are filed with BODA. Extensions of time for filing the record or briefs may be granted for good cause. If either party fails to file the record or brief timely, BODA first notifies the party. If the party files a brief but does not file the reporter’s record, BODA may proceed to decide the matter. If a party does not file a brief, BODA issues its order to show cause why the case should not be dismissed for want of prosecution.

Due to time allowed for filing the record and briefs, evidentiary appeals typically require at least four to six months to decide. BODA sets the case for disposition at the next BODA en banc meeting after

the appellee’s brief is filed.15 Either side may request oral argument which BODA typically grants.

If the parties have requested oral argument, BODA notifies both parties of the argument date. BODA schedules argument on regular en banc hearing dates in the courtroom of the Supreme Court of Texas in Austin. Upcoming arguments are available on the Current Docket page of the BODA website at www.txboda.org.

Appeal from BODA judgments in evidentiary cases is by direct appeal to the Supreme Court of Texas.

D. Original Jurisdiction.

The BODA hearings docket involves public matters, including compulsory cases, reciprocal matters, disability reinstatements, and revocations of probation. Typically, these cases require a hearing unless resolved by agreement or nonsuit. BODA considers these matters en banc in Austin approximately every three months. BODA hearings are conducted as in district court for civil matters following the Texas Rules of Disciplinary Procedures, BODA’s Internal Procedural Rules, Texas Rules of Civil Procedure, and the Texas Rules of Evidence. All pleadings and motions are filed with the BODA office. BODA staff act as the court clerk in these matters. BODA provides a court reporter at the hearings to make a record. Appeals from compulsory, reciprocal and revocation cases are by direct appeal to the Supreme Court.

E. Compulsory Cases

BODA has exclusive original jurisdiction to hear compulsory discipline cases under Part VIII of the Rules of Disciplinary Procedure. When the Chief Disciplinary Counsel learns that an attorney has been convicted of an Intentional Crime, she/he files a Petition for with BODA seeking either disbarment or suspension of the attorney’s license for the term of criminal probation or deferred adjudication. For purposes of compulsory discipline, deferred adjudication (or community supervision) is also considered a conviction. In compulsory discipline proceedings, the record of conviction or order of deferred adjudication is conclusive evidence of the attorney’s guilt. Not all criminal convictions are Intentional Crimes as defined by the Rules of Disciplinary Procedure for purposes of compulsory discipline. “Intentional Crime: includes barratry, misdemeanor theft, or any crime involving misapplication of money or other property held as a fiduciary. Additionally, any

15 This assumes there is enough time beforehand for staff to brief the case for the members.


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felony requiring proof of knowledge or intent and involving moral turpitude is an Intentional Crime. TRDP 1.06T & Z. The Supreme Court of Texas has defined crimes involving “moral turpitude” as those generally implicating dishonesty, fraud, deceit, misrepresentation, or deliberate violence, or that reflect adversely on a lawyer’s honesty or trustworthiness. State Bar of Texas v. Humphreys, 880 S.W.2d 402, 408 (Tex. 1994). Whether a crime involves moral turpitude is a question of law. If a convicted attorney’s criminal sentence is fully probated, he is eligible for and may ask to have his license suspended rather than being disbarred. Although an attorney may not retry the facts of the underlying criminal case, he may offer evidence at the sentencing portion of a compulsory hearing in mitigation of disbarment. BODA will consider, among other evidence, whether the criminal conduct involved the practice of law, whether the attorney has timely satisfied the terms and conditions of probation, the attorney’s prior disciplinary history, if any, and the attorney’s conduct during the course of the compulsory case. If BODA suspends an attorney’s license, the suspension runs concurrent with any remaining term of probation or deferred adjudication. BODA retains jurisdiction of the case during the term of suspension. If the attorney violates the probation or deferred adjudication and has the probation revoked, BODA has authority, on motion by the CDC, to disbar the attorney. Each BODA Annual Report contains a list of compulsory discipline cases decided that year. The BODA website has digests of prior compulsory discipline cases by attorney name.

F. Reciprocal Discipline

BODA has exclusive original jurisdiction to hear reciprocal cases where an attorney licensed in Texas and in another jurisdiction is disciplined in the second state. The CDC files a petition for discipline in Texas identical, to the extent practicable, to the discipline imposed in the second state. BODA issues an order to show cause to the attorney requiring that he answer within 30 days and show cause why the identical discipline should not be imposed. The show cause order also contains a hearing date. BODA usually hears reciprocal cases en banc. An attorney has several defenses available in a reciprocal case under Part IX of the Rules of Disciplinary Procedure which he must prove by clear and convincing evidence. These include: • That the procedure in the other jurisdiction

lacked due process

• That the imposition of identical discipline would result in a grave injustice

• That the misconduct in the other jurisdiction warrants substantially different discipline in Texas

• That the misconduct for which the attorney was disciplined in the other state does not constitute professional misconduct in Texas.

If the attorney establishes one of the defenses, BODA may enter “such orders as it deems necessary and appropriate.” TRDP 9.04. Any period of probation or suspension BODA imposes runs prospectively. Unlike probation in a compulsory discipline case, reciprocal discipline need not run concurrently with the disciplinary period in the other jurisdiction.

G. Revocations of Probation

BODA has exclusive jurisdiction during the term of any probation imposed by an evidentiary judgment to revoke the probation for a material violation of the terms and conditions of probation. TRDP 2.23. The CDC files a motion to revoke probation with BODA, which must be set for hearing within 30 days of service on the respondent attorney. Once set, however, the hearing may be continued for good cause on motion of either party. Motions to revoke are served on the respondent attorney in accordance with TRCP 21a. Typical probation violations include failure to pay timely restitution to the client or attorney’s fees as ordered in the evidentiary judgment. Some judgments also require a law practice monitor, attendance at MCLE courses, participation in rehabilitative treatment programs, or trust account audits. Typically, the CDC State Compliance Monitor has worked with (or attempted to work with) the attorney for a period of time to resolve the failure to comply with the requirements of the judgment or failure to report timely the attorney’s completion of the requirements. If BODA finds that the attorney has materially violated a requirement for probation, BODA suspends the attorney’s license for the full term of the suspension as originally imposed without credit for any period of probation served. A BODA order revoking probation cannot be superseded or stayed pending an appeal to the Supreme Court of Texas.

H. Disabilities.

BODA also is charged under Part XII of the Rules of Disciplinary Procedure with the duty of appointing a District Disability Committee to determine if an attorney is suffering from a disability which would result in an indefinite suspension from the practice of law. A disability is any “physical, mental, or emotional condition that, with or without a




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substantive rule violation, results in the attorney’s inability to practice law, provide client services, complete contracts of employment, or otherwise carry out his or her professional responsibilities to clients, courts, the profession or the public. TEX. R. DISCIPLINARY P. 1.06I. All disability proceedings are confidential and are sealed with the exception of the order of indefinite suspension.

If an evidentiary panel or the CDC believes that an attorney may be suffering from a disability, they must certify the finding and send it to BODA along with a statement of the basis for the belief that the attorney is disabled. BODA appoints a District Disability Committee (“DDC”) composed of an attorney, a doctor of medicine or a Ph.D. trained in the area of the disability, and a layperson.

The BODA clerk acts as the clerk of the DDC. All pleadings and motions are filed with the BODA office. The BODA clerk, at the direction of the DDC, provides all notices to the parties, sets the hearing date, and arranges the hearing location. Disability hearings are held as close to the county of the attorney’s residence as possible.

The respondent attorney may request appointment of counsel by BODA to represent him at the hearing before the DDC. BODA has recruited several attorneys with training and experience in disabilities who serve pro bono as appointed counsel.

The DDC conducts a de novo hearing to determine if the attorney is presently disabled. The party seeking the disability finding must prove that the attorney is disabled by a preponderance of the evidence which typically includes evidence by an expert in the field. Both sides may retain their own experts. If the DDC finds that the attorney is disabled, a finding is sent to BODA, and the attorney will be indefinitely suspended from the practice of law. If the committee finds that the attorney is not disabled, the discipline case returns to the grievance system for further proceedings.

On occasion, lawyers are unwilling to admit when disease, age, or other condition has impaired their ability to practice law. The DDC is a means to evaluate whether the grievance problems facing the lawyer are caused by physical and/or mental illness. If the cause of the problems is a disability, suspension allows the lawyer to take care of these problems.

When the attorney has recovered or controlled the condition, he can petition BODA or the district court in the county where he practiced for reinstatement. The attorney must demonstrate by a preponderance of the evidence that the reasons for the suspension no longer exist and that terminating the suspension will not harm the public or the profession. The attorney must provide an affidavit or report from a physician as to the petitioner’s competence or current condition.

Additionally, the attorney must also include a detailed description of the attorney’s activities since the suspension.

There is no minimum time before an attorney may petition to terminate the disability suspension; however, if the first petition is denied, he may not again petition for termination for one year. TDP 12.06D. Any attorney who has been on active disability suspension for more than two years may be required to pass the multistate Professional Responsibility section of the State Bar exam or complete continuing legal educations courses before being reinstated, or both. TRDP 12.06E.

V. COMMON DISCIPLINE ISSUES

The CDC’s office and BODA confront a wide variety of issues in reviewing and investigating complaints against lawyers. The overwhelming majority of grievances allege attorney neglect. Failure to advise clients that representation is declined and failure to properly terminate representation are sources of numerous complaints. Failure to safeguard client property and failure to communicate with clients also form the basis for a significant number of complaints.

The failure to respond (or to respond timely) to a grievance is itself grievable, TRDP 8.04(a)(8), and frequently will turn a reprimand case into a suspension or disbarment. Many attorneys simply do not appreciate the seriousness of failing to respond timely to a grievance.

Some of the more frequent issues are:

A. Neglecting the Client or the Matter

Perhaps no issue receives more attention in the grievance process than complaints regarding alleged neglect by the lawyer of the client or failing to properly communicate with the client. Not returning phone calls, missing hearings or court appearances, procrastinating, and ignoring requests for information are all grounds for upgrading a complaint to a grievance. Rules 1.01 and 1.03 of the Texas Disciplinary Rules of Professional Conduct govern such issues. Rule 1.01 provides: “In representing a client, a lawyer shall not (1) neglect a legal matter entrusted to the lawyer; or (2) frequently fail to carry out completely the obligations that the lawyer owes to a client or clients.” TDRCP 1.01(b). The Rule defines “neglect” as “inattentiveness involving a conscious disregard for the responsibilities owed to a client or clients.” TDRPC 1.01(C). Comment 7 to the Rule sums up the obligation well. “[A] lawyer is subject to professional discipline for neglecting a particular legal matter as well as for frequent failures to carry out fully the obligations


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owed to one or more clients. A lawyer who acts in good faith is not subject to discipline under those provisions for an isolated inadvertent or unskilled act or omission, tactical error, or error of judgment.” TDRPC 1.01 cmt. 7. Although failure to communicate may constitute neglect, there is a separate rule governing the obligation to communicate with the client. Under Rule 1.03, a lawyer must keep the client “reasonably informed” about the status of the matter and promptly comply with requests from the client for information. TDRPC 1.03(a). The communication also must be sufficient to permit the client “to make informed decisions regarding the representation.” TDRPC

1.03(b). The comments state that because “delay can cause a client needless anxiety and undermine confidence in the lawyer’s trustworthiness, there is a duty to communicate reasonably with clients.” TDRPC 1.01 cmt. 7.

B. Fee Agreements

Disputes often arise between the lawyer and the client regarding the fees charged by the lawyer. The most effective way to avoid such disputes is to have an engagement letter and/or fee agreement that sets out the scope of the representation and the fees to be charged. Even though only contingent fee agreements must be in writing, see TRPC1.04(d), the better practice is to put all fee agreements in writing, especially those with new clients. See TDRPC 1.04 cmt. 2. Many complaints reviewed by the BODA involve a complaint about the lawyer’s fee. Prevention of misunderstandings about the fee can frequently be accomplished with a written fee agreement. The fee must not be unconscionable. TDRPC

1.04(a). An unconscionable fee is one that no competent lawyer could find reasonable. Lucas v. Nesbitt, 653 S.W.2d 883 (Tex. App.–Corpus Christi 1983, writ ref’d n.r.e). Rule of Professional Conduct 1.04(b) outlines eight factors, among others, to be considered when determining if a fee is reasonable. Contingent fee agreements are required to be in writing and to clearly define the agreement. They must state the method by which the fee is to be determined. For example, are the litigation expenses to be deducted from the recovery first, or after the lawyer has taken his or her percentage? Are the percentages different if the matter is settled or goes to trial? These matters should be clearly stated. TDRPC

1.04(d). Contingent fees are never allowed when representing a defendant in a criminal matter, and “rarely justified” in domestic relations cases.

Once the fee is set and the relationship has formed, an increase in the fee is presumed to be unfair to the client. Archer v. Griffith, 390 S.W.2d 735 (Tex. 1964). A higher fee may be justified in some

circumstances. These reasons may include rising costs, unforeseen circumstances, unforeseen demands of the representation, or specific circumstances not initially contemplated by the parties. Anderson and Steele, Ethics and the Law of Contract Juxtaposed: A Jaundiced View of Professional Responsibility Considerations in the Attorney-Client Relationship, 4

GEO. J. LEGAL ETHICS 791, 809-12 (1991). The fee agreement should be clear and fully

inform the client of the terms of the engagement. If the engagement appears to be a lengthy one or may involve matters not yet contemplated by the parties, the agreement should state that the parties recognize that there may be fee increases as part of the initial contract consideration.

The use of non-refundable retainers, while not prohibited, is discouraged because they may be unconscionable or result in a claim of an unearned fee. A fee paid merely to retain the lawyer, with no services required and non-refundable under any circumstance, is probably not reasonable. Any attorney considering characterizing a fee as “non-refundable” should carefully read Cluck v. Comm’n for Lawyer Discipline, 214 S.W.3d 736 (Tex. App.—Austin 2007, no pet.) for a discussion of what constitutes a “true retainer.” “A fee is not earned simply because it is designated as non-refundable.” Id. at 740. The fee agreement should not contain provisions that would allow the lawyer to violate the Rules of Professional Conduct or any other law. See TDRPC

1.02 cmt. 5. For example, the file may not be held hostage for the payment of fees; that would constitute a violation of Rule 1.15(d) of the Rules of Professional Conduct. The agreement cannot limit the client’s right to accept or reject settlement offers, a violation of Rule 1.02(a)(2). The agreement cannot waive the client’s right to terminate the lawyer’s services, a violation of Rule 1.15(a)(3). See Tex. Comm. on Prof’l Ethics, Op. 395, 42 Tex. B.J. 436 (1979) (as corrected). The agreement cannot prospectively limit the attorney’s liability to a client for malpractice unless permitted by other law. TDRPC

1.08(g). Another matter is the determination of the fee after termination in a contingent fee contract. In Hoover Slovacek LLP v. Walton, 206 S.W.3 557 (Tex. 2006), the Texas Supreme Court held that a contingent attorney-client employment contract termination provision stating that the client owes attorney a fee based on value of client’s claim at time of termination of representation, with or without cause and regardless of amount for which claim is eventually settled, was not enforceable as against public policy. In Hoover, the law firm billed client $1.7 million after client fired firm and settled case for $900,000.





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The Firm based its claim for $1.7 million on client’s prior authorization to firm to accept $6 million from defendants. The defendant’s actual settlement offer of $6 million included additional terms requiring sale of some of client’s mineral interests that the client rejected. The Firm calculated its fee based on contract termination percentage of 28.66 percent of $1.7 million. The Court held that the “present value” termination provision is contrary to public policy, unconscionable, and therefore unenforceable. The Court affirmed the unconscionability but reversed the take-nothing against the firm and remanded in the “interest of justice” to allow the firm to seek recovery on the contingent contract as reformed. The dissent stated that even if the contract provision could potentially result in an unfair fee in some other case, the terms “seem fair enough in this case.” The fact that resulting fee was a “bad deal” for the client did not make it unconscionable.

C. Solicitation Letters

Advertising and solicitation of clients by Texas lawyers is regulated by Section VII of the Rules of Professional Conduct. All written solicitation letters are required to be filed with the State Bar of Texas Lawyer Advertising and Solicitation Review Committee, even if exempt. The fee associated with the filing is currently $75.

The solicitation letter must be filed at the same time the letter is disseminated. However, if the Advertising Review Committee finds a violation, it may either ask for a correction or forward the violation to the State Bar CDC as a violation of the Rules of Professional Conduct. Consequently, the better practice is to take advantage of the pre-approval process offered by the Advertising Review Committee and submit the proposed letter at least 30 days prior to dissemination. For more information about the submission and review process, follow the “Maintaining Your License” link on the State Bar Web site (www.texasbar.com) to the Advertising Review section. This area contains much helpful information, including an application form as well as interpretive comments to the advertising rules and examples. In addition to the requirements of Section VII of the Rules of Professional Conduct, attorneys sending solicitation materials must be familiar with the barratry statute. Texas Penal Code § 38.12(d)(2) prohibits a written solicitation for a personal injury or wrongful death claim sent before the 31st day after the accident or disaster that is the impetus for the solicitation. It also prohibits a written solicitation sent before the 31st day after an arrest and prohibits a letter sent to the defendant in any lawsuit, including a

divorce, until after the lawsuit has been on file 31 days.

D. Division of Fees and Retaining an Interest

If a client is represented by successive lawyers in a contingent fee matter, complaints about the sharing or allocation of fees will often arise. A division of fees is a sharing of a single billing to a client between two or more lawyers who are not in the same firm. TDRPC 1.04 cmt. 10. Rule 1.04(f) allows a lawyer to divide a fee if it is: (1) in proportion to the work performed by each, or, (2) made between lawyers who assume joint responsibility for the representation and the client consents to the representation in writing prior to the association or referral and the total fee is not illegal or unconscionable.

Texas lawyers may not split fees with non-lawyers, Rule of Professional Conduct 5.04(a). This does not include, however, fees paid to statutory lawyer referral services, Rule of Professional Conduct 7.03(b), fees paid to former partners or associates pursuant to a separation or retirement agreement, Rule of Professional Conduct 1.04(h), or fees paid to an attorney who has been disbarred or had his license suspended, so long as the attorney receiving the fee completed the legal work on the case prior to losing the license. Wright & Assoc. v. Weiss, 993 S.W.2d 466, 468 (Tex. App.—Houston [14th Dist.] 1999, pet. denied) citing Lee v. Cherry, 812 S.W.2d 361, 364 (Tex. App.—Houston [14th Dist.] 1991, writ denied). A related matter arises when a client discharges an attorney without good cause before he has completed the work. In that case, the attorney may recover on the fee contract for the agreed amount of his compensation. Mandell & Wright v. Thomas, 441 S.W.2d 841 (Tex. 1969). In order to be entitled to recover, however, there must be a valid contract. Tillery & Tillery v. Zurich Ins. Co., 54 S.W.3d 356 (Tex. App.–Dallas 2001, pet. denied). Contingent fee contracts for legal services must be in writing, be signed by the attorney and client, and state the method by which the fee is to be determined. TEX. GOV’T CODE § 82.065(a); TDRPC

1.04(d). A contingent fee agreement that does not meet the requirements of § 82.065 is voidable by the client. Tillery, 54 S.W.3d at 359.

E. Supervising Non-lawyer Staff

Many complaints filed against lawyers indicate some confusion on the part of the client as to the status of employees of the firm. Many times legal assistants and administrative assistants are mistaken for lawyers. Rule of Professional Conduct 5.03 requires that lawyers take reasonable measures to insure that the non-lawyer staff’s conduct is consistent with the lawyer’s own obligations under the disciplinary rules. The lawyer violates the rule if he








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orders, encourages, or permits the prohibited conduct or fails to take reasonable remedial efforts when he learns of the conduct. Occidental Chem. Corp. v. Brown, 877 S.W.2d 27, 30 (Tex. App.—Corpus Christi 1994, orig. proceeding), rev’d on other grounds, 888 S.W.2d 466 (Tex. 1994). This provision confirms that, while a lawyer may delegate certain duties to non-lawyer assistants, he has the ultimate responsibility for maintaining a direct relationship with the client and for compliance by the non-lawyer with the applicable ethical rules. Rule of Professional Conduct 5.03(a) requires supervising lawyers to establish procedures to ensure that non-lawyer subordinates understand how to perform their duties properly–including screening, instruction, and supervision–taking into consideration that they do not have legal training and are not subject to professional discipline. However, the mere fact of improper employee conduct, absent evidence that the lawyer encouraged or permitted the conduct, will not necessarily result in discipline. In a recent appeal to BODA, an attorney was not disciplined for the act of his legal assistant where the legal assistant signed an affidavit on behalf of a third party without the knowledge of the attorney, and the attorney withdrew the affidavit immediately upon learning of the misconduct. Examples of situations in which attorneys violate these rules include attorneys allowing assistants to sign documents for the lawyer, to explain the legal effects of the employment contract to the client, to disclose confidential client information and to provide other legal advice to the client generally. If the assistant has been giving the client legal advice, the lawyer may also be subject to discipline under TDRPC 5.05(b), which prohibits an attorney from assisting a non-lawyer with the unauthorized practice of law.

F. Letters of Protection

Another frequent issue arises when third parties seek to enforce “agreements” with lawyers regarding the provision of services under “letters of protection.” Resolution of the issue often turns on whether a letter of protection creates a third-party interest under TDRPC 1.14 so as to trigger the lawyer’s duties to segregate property, notify the third party, and retain disputed funds. Absent an enforceable contractual agreement between the client and third party (e.g., a letter signed by the client), a letter of protection, in which the attorney only promises to withhold funds, does not create a third party interest under Rule of Professional Conduct 1.14.

Rule of Professional Conduct 1.14 sets forth the lawyer’s fiduciary duties relating to the possession of funds or other property in which a client or third party

has an “interest.” The lawyer must identify that property, keep the funds segregated from personal or operating accounts, notify those persons entitled when funds are received, deliver funds to those entitled, retain disputed funds, and maintain certain records for five years. Rule of Professional Conduct 1.14 does not create the required interest; rather, the rule looks to applicable law to determine when the client or third person owns an interest in the funds. TDRPC 1.14(c) (providing for “persons entitled to receive them by virtue of the representation or by law”); TDRPC 1.14 cmt. 3 (stating that “a lawyer may have a duty under applicable law”); RESTATEMENT (THIRD) OF THE

LAW GOVERNING LAWYERS § 44 cmt. g (2000) (stating “this Section requires the lawyer to safeguard the contested property until the dispute has been resolved . . . but does not prescribe the rules for resolving it. Those rules are to be found in other law”).

The Texas cases on letters of protection, the law of assignments generally, and the bankruptcy cases that have addressed letters of protection are consistent in requiring the client’s signature for an enforceable assignment. If some other document is relied upon to create an assignment (e.g., the doctor’s letter or assignment), it must also be signed by the client, and the attorney must have actual knowledge of its existence.

Even with a signed letter or other enforceable assignment, if the client disputes the disbursement to the third party after the attorney receives settlement funds, the attorney should hold the disputed portion of the funds in trust or interplead them into the registry of the court until the dispute is resolved. Comment 3 to TDRPC 1.14 states that the “lawyer should not unilaterally assume to arbitrate a dispute between the client and the third party.” Any undisputed funds may be disbursed. Disputes frequently arise when, having issued letters of protection, the attorney negotiates a settlement amount insufficient to pay the providers in full, or when the client directs the attorney after receipt of funds to release them to the client directly. These situations result in a significant number of grievances filed by the provider/creditor urging that the attorney has violated Rule 1.14. For further discussion of letters of protection, see Chu v. Chew, 2002 Tex. App. LEXIS 376 (Tex. App.–Dallas 2002, no pet. h.), Brown v. Commission for Lawyer Discipline, 980 S.W.2d 675 (Tex. App.–San Antonio 1998, no pet.), and Butler v. Commission for Lawyer Discipline, 928 S.W.2d 659 (Tex. App.–Corpus Christi 1996, no writ).






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G. Terminating the Attorney-Client Relationship

Rule of Professional Conduct 1.15 generally governs the grounds for and obligations arising as a result of termination of the attorney-client relationship. The rules relating to the termination of the attorney-client relationship by withdrawal or otherwise may be summarized as follows: 1. If a matter is before a tribunal, the rules of the

tribunal will control withdrawal by the attorney. If the court orders the attorney to continue the representation, he or she must do so even though the attorney may have grounds for termination. If withdrawal is permitted, the attorney generally has a duty to mitigate adverse effects on the client.

2. The client may discharge the attorney at any time, with or without cause, and the attorney must withdraw, subject to any orders of the tribunal. The client may, however, be liable for all or part of the attorneys’ fees if the discharge is without cause. See supra Part III. D.

3. An attorney may withdraw at any time, with or without cause, if doing so will not adversely affect the client. TDRPC 1.15(b)(1) & cmt. 7.

4. Under certain circumstances set out in TDRPC 1.15(b), the attorney may terminate the representation even when withdrawal will adversely affect the client. These circumstances include when the attorney reasonably believes that the client is using the attorney’s services to commit a fraud or crime, when the client insists on pursuing an objective the attorney finds repugnant or imprudent or with which the attorney fundamentally disagrees, and where the client fails to fulfill an obligation to the attorney, including the payment of fees.

Regardless of the circumstances surrounding the termination of representation, the lawyer must always give reasonable notice of any withdrawal, see Vander Voot v. State Bar of Texas, 802 S.W.2d 332, 334 (Tex.App.–Houston [1st Dist.] 1990, writ denied), and take all “reasonably practicable” steps to protect the client’s interests and to mitigate any adverse consequences to the client even if the client unfairly discharges the attorney. One of the most frequent complaints in the termination situation is that the lawyer failed to return to the client any files or other materials provided to the lawyer by the client or otherwise belonging to the client. Rule of Professional Conduct 1.14 provides that “a lawyer shall promptly deliver to the client or third person any funds or other property that the client or third person is entitled to receive and, upon request by the client or third person, shall promptly render a

full accounting regarding such property.” TDRPC

1.14 (emphasis added).

H. Other Common Issues.

While not covered by this article, other matters that are often the subject of filed grievances or inquiries include the following:

Whether a lawyer can be disciplined for private or non-representation conduct. See Big Brother Bar, Jury is out on Disciplining Lawyers’ Private Conduct, A.B.A. J., Nov. 2000, p 14.

Using or threatening to use the grievance process “solely to gain an advantage in a civil matter.” TDRPC 4.04(b).

What obligations are owed by the lawyer to a non-client who pays the lawyer’s fee on behalf of the client’s friend or relative.


grievances and the board of disciplinary appeals · pdf fileof his paper “the grievance...

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