Synopsis of Hearing Board Report and Recommendation

NATURE OF CASE: Allegations of: 1) failure to keep a client reasonably informed about the status of a matter and promptly comply with reasonable requests for information; 2) failure to refund the unearned portion of a fee paid in advance; 3) conduct involving dishonesty, fraud, deceit or misrepresentation; 4) failure to respond to a lawful demand for information from a disciplinary authority; 5) conduct that is prejudicial to the administration of justice and 6) conduct which tends to defeat the administration of justice or to bring the courts or the legal profession into disrepute.

BEFORE THE HEARING BOARD
OF THE
ILLINOIS ATTORNEY REGISTRATION
AND
DISCIPLINARY COMMISSION

REPORT AND RECOMMENDATION OF THE HEARING BOARD

The hearing in this matter was held on May 20 and August 22, 2003 at the offices of the Attorney Registration and Disciplinary Commission, 130 East Randolph, Suite 1100, Chicago, Illinois. The hearing panel consisted of Allison L. Wood, Henry P. Wolff and Edward J. Miller. Gina M. Abbatemarco represented the Administrator of the Attorney Registration and Disciplinary Commission. Respondent appeared pro se.

PLEADINGS

The Administrator filed a fifteen-count complaint against Respondent Michael Edward Marsh on April 2, 2002. Counts 1 through XII and Count XIV alleged that Respondent received fees from clients but did not provide services to justify the full amount of those fees. Those counts further alleged that Respondent failed to refund the unearned portion and, in many of the instances, failed to keep his clients reasonably informed of their cases. As a result of the foregoing, Respondent was charged with the following misconduct:

a. failure to keep a client reasonably informed about the status of a matter and promptly comply with reasonable requests for information in violation of Rule 1.4(a) of the Illinois Rules of Professional Conduct (Counts I-VI, VIII, X, XII, XIV);

b. failure to refund the unearned portion of a fee paid in advance in violation of Rule 1.16(e) (Counts I-XII, XIV);

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c. conduct which is prejudicial to the administration of justice or which tends to defeat the administration of justice or to bring the courts or the legal profession into disrepute in violation of Supreme Court Rule 771 (Counts I-XII, XIV).

In his response to the complaint, Respondent admitted receiving fees from each of the referenced clients but denied engaging in any misconduct with respect to those clients.

Count XIII alleged that Respondent sent a billing statement to a client that included charges for services that were not actually performed by Respondent. Respondent was charged with the following misconduct:

a. engaging in conduct involving dishonesty, fraud, deceit or misrepresentation in violation of Rule 8.4(a)(4):

b. conduct that is prejudicial to the administration of justice, in violation of Rule 8.4(a)(5);

c. conduct which is prejudicial to the administration of justice or which tends to defeat the administration of justice or to bring the courts or the legal profession into disrepute in violation of Supreme Court Rule 771.

Respondent admitted that one billing error occurred but denied any other false statements and denied engaging in the charged misconduct.

The final count of the complaint, Count XV, alleged that Respondent failed to respond to requests for information from the Attorney Registration and Disciplinary Commission and failed to appear at the Commission's office and produce documents in response to a subpoena duces tecum. Respondent was charged with:

a. failure to respond to a lawful demand for information from a disciplinary authority, in violation of Rule 8.1(a)(2);

b. conduct that is prejudicial to the administration of justice, in violation of Rule 8.4(a)(5);

c. conduct which is prejudicial to the administration of justice or which tends to defeat the administration of justice or to bring the courts or the legal profession into disrepute in violation of Supreme Court Rule 771.

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Respondent admitted that he did not respond to requests for information and did not appear at the Commission's offices but stated that his failures were due to a scheduling conflict, problems with document retrieval and a change-over in his staff. He denied engaging in any professional misconduct.

EVIDENCE

At the hearing on May 20, 2003, the Administrator examined Respondent and presented eight additional witnesses. The hearing was then continued to July 19, 2003. Shortly before the hearing was set to commence on that date, the Administrator's office received, by facsimile transmission, a motion to continue the hearing asserting that Respondent was ill and unable to appear. The motion was accompanied by a note from Respondent's secretary stating that Respondent was on his way to an urgent care facility. The hearing was continued to August 22, 2003 and Respondent was directed to file medical documentation supporting his illness. Respondent filed no documentation and explained, when the hearing commenced on August 22, that although he had not felt well on July 19, he decided not to visit the hospital or seek medical attention on that date.

The hearing proceeded and the Administrator presented seven additional witnesses. Respondent then testified on his own behalf.

Background

Respondent was admitted to practice law in Illinois in 1980 and briefly worked in the Kane County State's Attorney's office before opening his own practice. He currently is a sole practitioner with an office in Naperville, Illinois. His practice consists primarily of domestic relations cases and he typically handles between 65 and 70 matters at any one time. Respondent has one employee, Jennifer Stevens, who performs clerical, paralegal and research duties. (Tr.

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49-52, 69).

Respondent testified that he experienced two problems in 2001 which affected his billing practices. In the first half of 2001 he lost two valued employees and in July, his computer system crashed. When one of the employees returned in late 2001, the billing procedures were rebuilt. In January 2002 status bills for the period of May through December 2001 were sent to clients. (Tr. 465-69).

Count I

Respondent represented Joseph Lorenz, now deceased, from approximately May 2000 to March 2001 in civil and criminal matters pending in Minnesota. Respondent, who is not licensed to practice in Minnesota, contacted a Minnesota attorney, Jean Hannig, to represent Lorenz in the civil matters. Hannig represented Lorenz in his domestic relations dispute and her partner, Jeffrey Hannig, agreed to represent Lorenz in a personal injury case. Hannig contacted a criminal defense attorney, Bruce Quick, to handle Lorenz' criminal matters. (Tr. 54, 59, 155-57, 472-75, 530).

Jean Hannig testified that after she was contacted by Respondent in May 2000, she faxed a retainer agreement to Respondent which Respondent signed on behalf of Lorenz. Respondent also signed the agreement as guarantor of the fees incurred by Lorenz. Hannig and Respondent agreed that Respondent would be responsible for collecting fees from Lorenz and transmitting them to Hannig. (Admin. Ex. 11; Tr. 141-46).

Hannig testified that her work on behalf of Lorenz included securing a mutual order for protection, filing a divorce petition, deposing Lorenz' ex-wife, conducting additional discovery and representing Lorenz in a contested trial. Hannig estimated that she performed between 90 and 95% of the work on the matter. Respondent's role, according to Hannig, was to assist Lorenz in the compilation of documents. Hannig stated that Respondent did travel with

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Lorenz to Minnesota and also interviewed Lorenz' doctor in Batavia, Illinois. She acknowledged that Lorenz was an alcoholic and that he became intoxicated prior to a hearing in February 2001. (Tr. 157-61, 171-76, 180).

Hannig stated that she received payments of $632 in May 2000 and $1,000 in July 2000. She believed that the funds came from Lorenz and denied receiving any money from Respondent for her services to Lorenz. On cross-examination, however, she stated that the $1,000 check was given to her by Respondent when Respondent and Lorenz were in Minnesota. Hannig estimated that she charged Lorenz somewhere between $10,000 and $12,000 for her representation. Her billing statements indicate that as of June 10, 2001, Lorenz owed her $8,974.77. (Admin. Ex. 4-8; Tr. 148-54, 157, 170).

Hannig recalled that in January 2001 she began to communicate directly with Lorenz and in March 2001, he showed her copies of checks he had given to Respondent for fees. At that time Hannig learned that Lorenz had not been able to reach Respondent, had not had any contact with Respondent, and wished to terminate Respondent's services. Thereafter, Hannig prepared a letter of termination, dated March 2, 2001, from Lorenz to Respondent in which Lorenz requested an itemized statement of services and an accounting of the funds paid to Respondent. In October or November 2001, Hannig received payment in full from Lorenz. Of the $20,000 received from Lorenz, she retained approximately $12,000 for her fees and paid the remainder to Jeffrey Hannig and Bruce Quick for their work on the personal injury case and the criminal matter. Hannig learned that Lorenz had to take out a loan to pay her fees. (Admin. Ex. 9; 155-56, 161-62, 169, 178-79).

Bruce Quick, a criminal defense attorney in Fargo, North Dakota, testified that he was contacted by Jean Hannig regarding representation of Joseph Lorenz in a criminal matter. He stated that as the attorney of record he performed legal research, prepared Lorenz' case for

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trial and, following settlement, handled Lorenz' sentencing. When asked to describe Respondent's role in the case, Quick stated that Respondent was the referring attorney who provided records and accompanied Lorenz to Minnesota on one occasion. He recalled that Lorenz became intoxicated during one visit when he was not accompanied by Respondent. Quick stated that he communicated with Lorenz by sending correspondence in care of Respondent. (Tr. 327-339).

Quick billed Lorenz $6,676.73 for work performed between June 2000 and March 2001 and received $5,500 in payments during the first months of his representation. Quick thought that those payments were made by Lorenz but stated that they may have gone through Respondent. The final payment of $1,176.63 was received from Jean Hannig in November 2001. (Admin. Ex. 12A; Tr. 334-35).

Respondent testified to the legal services he performed for Lorenz, who he described as suffering from bad health and having a problem with alcohol. Respondent stated that he took care of the work that had to be performed in Illinois, such as obtaining Lorenz' medical and financial records, producing documents, completing interrogatories on Lorenz' behalf, and providing a history of Lorenz' wife and marriage. Respondent traveled to Minnesota with Lorenz on one occasion because he was worried about Lorenz' continued sobriety and his ability to contribute information to Hannig and Quick. Respondent's services were terminated by Lorenz in 2000. (Tr. 54-60, 67-68, 475, 492-93).

Respondent introduced monthly billing statements, which he testified were mailed to Lorenz, for the period May 1, 2000 through March 31, 2001. The statements set forth a description of Respondent's legal services, the charges for those services and the payments received from Lorenz. The billing statements indicate that Respondent billed Lorenz $480.00 in connection with a personal injury case, $7,719.50 for work on a criminal case and $7,473.12 in

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connection with a divorce case, for a total of $15,672.62. The total amount received from Lorenz, according to the statements, was $15,300. Respondent pointed out that his charges exceeded the amount received from Lorenz, and therefore he had to write off $372.62. (Resp. Ex. 1; Tr. 482-87, 525-27).

In contrast to the payment amounts reflected in the billing statements, Respondent acknowledged during his testimony, as well as in his answer to the complaint, that Lorenz paid him $16,000 or "approximately" $16,000 for his services. When asked if he owed Lorenz a refund of $327.38, Respondent stated that the records speak for themselves and he did not know whether he owed a refund to Lorenz. He then stated that he has not made a refund to Lorenz because he does not owe anything to him. (Tr. 55, 486, 528-30).

Respondent stated that, from the money he received from Lorenz, he sent $632 to Hannig. The remainder of Hannig's fees and Quick's fees were paid by Lorenz from his own funds. (Resp. Ex. 1; Tr. 487-88).

Ralph Beck, an attorney in Batavia, Illinois, testified that Joseph Lorenz died on January 26, 2002. As executor of Lorenz' estate, Beck testified that Respondent has not made any claims against the estate nor has he returned any unearned fees to the estate. (Tr. 211-14).

Count II

Rosabla Reyes testified that she hired Respondent in July 2001 to collect child support from her ex-husband. She met with Respondent, signed an agreement and paid him $2500. Thereafter she talked to Respondent on two occasions and left messages with his secretary on other occasions. On August 17, 2001 Reyes terminated Respondent's services because her telephone calls were not returned and no work had been done on her case. She denied that Respondent sent anything to her ex-husband. (Admin. Ex. 13; Tr. 245-47).

Reyes stated that she never received a bill from Respondent or saw any

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paperwork. After discharging Respondent, she telephoned him several times and went to his office in an attempt to obtain a refund. Initially, she was told that a refund would be in the mail but she never received a refund and her subsequent calls to Respondent's office were not returned. Reyes hired a second attorney to pursue her case and paid the attorney with money she obtained from her parents. (Tr. 248-53).

Respondent acknowledged agreeing to represent Reyes and receiving $2500 from her. He stated that he prepared documents on her behalf but never filed them in court. He admitted that he received a letter from Reyes terminating his services and that he owes her a partial refund of $1,820. He stated that he did send a bill to Reyes but it was "substantially late." (Admin. Ex. 13, 14; Tr. 68-72, 497).

Count III

Stephen Williams, Sr. testified that he hired Respondent to represent his son, Stephen Williams, Jr., in a matter involving paternity and visitation issues. Williams paid Respondent $200 on March 24, 2001 and another $1,800 on April 10, 2001, with the understanding that the payment would cover DNA testing. When he received a separate bill for the DNA procedure, Williams contacted Respondent who denied any responsibility for payment of the test. Thereafter, Williams paid $410 for a DNA test. Williams stated that he terminated Respondent's services in July 2001 and at that time his son did not have visitation rights. (Admin. Ex. 17; 301-05, 307-08, 311-13).

Williams identified the last billing statement he received from Respondent which indicates that, as of the end of May 2001, a refund of $972.20 was due Williams. Williams stated that he attempted to contact Respondent numerous times over a period of several months but was never able to talk to him and never received the refund. Williams retained a second attorney to represent his son and after a long battle, his son was allowed visitation rights.

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(Admin. Ex. 17; Tr. 305-07, 312-13).

Stephen Williams, Jr. testified that he was a student at Indiana University at the time his father hired Respondent. Stephen Williams, Jr. denied receiving any billing statements from Respondent. He stated that during the time Respondent represented him, his visitation with his son was determined by the child's mother. (Tr. 343, 349).

Respondent agreed that he was paid $2,000 by Stephen Williams, Sr. to represent Williams' son in a paternity action. Respondent maintained that he procured an agreement whereby Stephen Williams, Jr. was allowed visitation with his child and visitation did, in fact, occur during the summer of 2001. Respondent withdrew from the matter after receiving a July 11, 2001 letter from Stephen Williams, Sr. terminating his services. Respondent acknowledged that his May 2001 billing statement indicates that he owes Williams $972.50. He has paid nothing to Williams, however, and maintained that Williams actually owes $332.50 to him. (Admin. Ex. 16, 17; Tr. 72-77, 497-98).

Respondent acknowledged that Williams paid for his own paternity test in addition to paying Respondent's fees. Respondent denied that he ever told Williams that he would pay for the paternity test and stated that it has never been his practice to pay for DNA testing. Respondent did pay the initial deposit of $100 to schedule an appointment for the test. (Tr. 77, 498-99).

Count IV

Christine Noel testified that on March 10, 2001 she paid Respondent $2500 to handle her husband's adoption of her son from a previous relationship. Respondent filed a paternity action because the biological father had not claimed paternity at the time of birth. (Tr. 260-61).

Noel received one billing statement from Respondent indicating a charge of $415

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for his legal services. Between March 10 and the following August, Noel tried to contact Respondent by phoning his office and leaving at least twelve messages with Respondent's secretary. After receiving no response from Respondent, she sent a letter, dated July 16, 2001, terminating Respondent's services. She received no response to that letter and, at the end of August, sent a second letter to Respondent. Thereafter she received a call from Respondent who told her that he would send a billing statement and refund the unearned portion of the retainer. When she did not receive any refund, Noel telephoned Respondent on two more occasions. She stated that her new attorney, to whom she paid $3500, also called and visited Respondent. (Admin. Ex. 18-20; Tr. 261-271).

Respondent agreed that Noel paid $2500 for his services in connection with an adoption and paternity action. He stated that he conducted an extensive search to locate the father, prepared two petitions and appeared in court on behalf of Noel. He was not able to obtain service of the paternity petition and withdrew from the case at Noel's request. Respondent acknowledged owing Noel $1,337 and stated that the amount has not been paid. (Tr. 77-84, 503-04).

Count V

Respondent was hired by Deborah Codute to handle a divorce proceeding and received $2,500 from her on August 8, 2001. Respondent filed a petition on her behalf. (Tr. 85-86).

Respondent acknowledged that Codute terminated his services by way of a letter dated August 23, 2001. The termination letter states that Respondent did not file the divorce petition on the date promised and, in fact, filed it after Codute's husband had already filed a petition. Codute complained in the letter that Respondent did not respond to her repeated requests for information and on the two occasions when she did speak to him, he was rude and

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unprofessional. The letter requested a return of the retainer fee less $500 for Respondent's services. Respondent admitted that he owes Codute $1,743. (Admin. Ex. 22; Tr. 85-87, 504).

Count VI

Sharon Peterson, currently residing in Florida, testified that she hired Respondent on April 10, 2001 because she had been served with an emergency order of protection. Peterson met with Respondent, signed a fee agreement and paid him $2500. Peterson stated that Respondent never filed an appearance in her case nor did he prepare any documents. According to Peterson the only action taken by Respondent was to agree to a continuance in her case and he took that action without consulting with her. She was opposed to any continuances because she wanted her case to proceed rapidly. (Tr. 181-83; 187-88, 198).

By letter of September 10, 2001, Peterson fired Respondent and requested a refund. After receiving no response to her request she sent a second letter to Respondent, dated October 16, 2001, stating that she had received no billing statements and again requesting a refund of her retainer money. Thereafter she attempted to reach Respondent on numerous occasions. On the one or two occasions when she was put through to Respondent, he laughed at her and hung up the telephone. Peterson stated that Respondent did not return any of her telephone calls, sent no bills and did not refund any of her money. After terminating Respondent, Peterson hired another attorney and paid that attorney a $2500 retainer. (Admin. Ex. 24, 25; Tr. 184-85; 188-93).

Respondent admitted that in August 2001, Peterson paid him $2,500 in connection with a divorce matter and order of protection. He stated that he prepared a response and counter petition but recalled that Peterson did not come in to sign the documents. Concerning the continued court date to which he agreed, Respondent stated that the continuance was in Peterson's best interests because if she went to court she could have had an order of

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protection entered against her. Respondent did not appear in court and instead agreed to a mutual restraining order whereby neither party could contact the other party. Respondent stated that when he told Peterson that she could not call her husband, she fired him. She has since moved to Florida to be with her husband. Respondent acknowledged that he has not paid Peterson the $960 that he owes her. (Tr. 87-98, 494-95).

Count VII

Kristi Ryan testified that she hired Respondent in May 2001 to handle her divorce and paid him between $2,500 and $3,000. She stated that Respondent filed a petition for dissolution of marriage but did not obtain service upon her husband, who was not represented by counsel. Ryan had some initial communication with Respondent and met with him three times. Thereafter, Respondent only returned one or two of Ryan's calls. In October 2001 Ryan terminated Respondent's services because her husband had not been served and the case was taking longer than she expected. (Tr. 225-29; 236).

Ryan stated that she received one bill from Respondent indicating that he owed her a refund of $1,932. Between November 2001 and the spring of 2002, Ryan called Respondent's office every two weeks to try to obtain the refund. She did not recall receiving any response from Respondent. In May 2002 Ryan confronted Respondent outside a courtroom and questioned him about the refund. Although Respondent asked for Ryan's cell phone number, he did not call her and has not refunded any money to her. Ryan stated that she had to pay $2,000 to another attorney who is now handling her case. (Admin. Ex. 27; Tr. 230-35).

Respondent testified that he sent a bill to Ryan and returned those calls of which he was aware. Respondent acknowledged that Ryan paid $3000 for his services and is due a refund of $1932. He has not made any payment to her. (Admin. Ex. 27; Tr. 99-100, 497).

Count VIII

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Charles Bedrosian hired Respondent in May 2001 and paid Respondent $5,000 to handle his divorce. Bedrosian testified that Respondent filed a divorce petition on his behalf and wrote a letter to his ex-wife. According to Bedrosian the petition was filed in the wrong county and later had to be transferred to the correct county. Further, the petition contained information that Bedrosian had not approved. Between May 30, 2001 and July 9, 2001, Bedrosian sent five facsimile transmissions to Respondent requesting information on his case and answers to questions. Bedrosian recalled that Respondent responded to some of his questions but not all of them. (Admin. Ex. 29; Tr. 380-383, 389-95, 400).

Bedrosian testified that he terminated Respondent's services in September 2001 because his wife had not been served with the divorce petition. He hired a second attorney and used a portion of his 401K savings to pay the attorney $5,000. Thereafter, he contacted Respondent to inquire about a refund and was told that as soon as a billing statement was completed, he would receive a check for the unused portion of the retainer. Bedrosian has never received a refund despite many inquiries. He feels that Respondent earned somewhere between ten and fifteen percent of the retainer. (Tr. 384-88, 400).

Respondent testified that Bedrosian hired him in May 2001 to handle a divorce. Respondent filed a divorce petition but did not have Bedrosian's wife served. He stated that he attempted to arrange meetings with Mrs. Bedrosian but she did not keep the appointments. He acknowledged that he was fired in July 2001 and owes Bedrosian $3,622. (Admin. Ex. 28; Tr. 101-104, 503).

Count IX

Respondent testified that he received $750 from Ralph Rodriguez to file a motion to terminate child support. Respondent filed the motion and a court date was set for September 19, 2001. Because Rodriguez' ex-wife had not been properly served, however, Respondent

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requested a two-week continuance. Respondent stated that Rodriguez ignored the continuance, appeared on his own behalf, obtained the desired order and then fired Respondent.

Respondent believed that, at the time his services were terminated, the balance left on Rodriguez' retainer was approximately $95. He stated that Rodriguez did not want to accept that amount and chose instead to file suit in small claims court. The action, which was filed in December 2001, was settled in January 2002 by Respondent's payment of $472 which, according to Respondent, was more than he owed Rodriguez and was more than Rodriguez could have recovered in court. He acknowledged that his payment to Rodriguez occurred after Rodriguez complained to the ARDC. (Admin. Ex. 31, 32, 33A; Tr. 104-07, 505-07).

Count X

Sang Lee testified that he retained Respondent in November 2000 to handle his divorce and paid Respondent $10,000. After the case was tried and a divorce decree was entered, Lee attempted to contact Respondent with questions concerning the decree but received no response. Lee terminated Respondent's services and contacted his ex-wife's lawyers to obtain answers to his questions and a copy of the official divorce decree. Lee stated that he was not happy with the final decree because it was one-sided and unreasonable. (Admin. Ex. 35-37; Tr. 403-06, 413, 419, 421-22).

Lee received a billing statement from Respondent in January 2002 and noticed that a $2,500 payment was not included. Further, Lee was not certain that Respondent had actually appeared for a court hearing as represented on the billing statement. He stated that he attempted to contact Respondent by calling and visiting Respondent's office but he was not able to speak to Respondent and Respondent did not return his calls. Lee believes that Respondent did virtually nothing on his case but, even if the charges on the billing statement are valid, Respondent owes him over $400. Lee has never received a refund. (Admin. Ex. 38; Tr. 409-16).

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Respondent agreed that he received $10,000 in installments to represent Lee in divorce proceedings. Respondent stated that he handled the trial and, when his client was not happy with the results, he asked the court to reconsider the division of property. Respondent also was able to secure a reduction in the attorney's fees requested by the opposing party so that Lee paid $2,500 rather than $6,500. Although Respondent's billing statement to Lee reflects that Lee owes a balance of $2,082 to Respondent, Respondent explained that the statement does not include Lee's last payment of $2,500. He admitted that he owes Lee $417.50 and that he has not paid that amount. He explained that, until recently, he believed that Lee owed money to him. (Admin. Ex. 34, 38; Tr. 109-113, 502).

Count XI

David Erdmann hired Respondent in August 2001 to represent him in custody proceedings and paid Respondent $5,000. Erdmann terminated Respondent's services in September 2001 after deciding not to pursue custody of his sons. Thereafter, Erdmann made numerous requests, both by letter and by telephone, for a final bill and a refund of the unused portion of his retainer. After receiving a final bill from Respondent indicating that a refund of $4,110 was owed to him, Erdmann again requested payment from Respondent. Erdmann stated that he received no response from Respondent and has not received a refund of the money owed to him. (Admin. Ex. 39, 40; Tr. 352-59).

Respondent confirmed that Erdmann hired him in August 2001 and paid him $5,000. Respondent acknowledged that Erdmann is due a refund of $4,110 which has not been paid. (Admin. Ex. 41; Tr. 114-118, 500).

Counts XII and XIII

Michael Kamrath testified that he hired Respondent in April or May 2001 to represent him in connection with a post-divorce proceeding. Kamrath paid Respondent $5,000 in

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two $2500 installments. In October 2001 Kamrath terminated Respondent's services because he felt that Respondent's lack of action was compromising his case. At that time, he had received from Respondent a billing statement for the month of May 2001 which indicated that Respondent owed him a balance of $1,537.50. Kamrath stated that, after terminating Respondent's services, he made numerous attempts to reach Respondent to request a bill but Respondent did not respond. (Admin. Ex. 42, 43; Tr. 362-63, 367-68, 375-77).

In January 2002 Kamrath received a billing statement for the period May 2001 through October 2001. The final page of the statement indicates a balance of $32.50 owed to Respondent. Kamrath testified that, upon reviewing the statements, he noticed that some charges were not accurate. Specifically, he pointed out that Respondent had added charges to the original May billing statement and had billed for court appearances on dates when no court proceedings took place. (Admin. Ex. 44; Tr. 363-65).

Respondent's billing statement reflects charges of $600 for court appearances on July 11 and August 1, 2001. Two court orders admitted into evidence show that no court hearings occurred on those dates. By order of June 8, 2001 the status date of July 11, 2001 was changed to August 1, 2001 and by order of July 25, 2001, the August 1, 2001 date was stricken. Kamrath stated that he attempted to contact Respondent to discuss the charges but was unable to contact him. (Admin. Ex. 44, 46, 47; Tr. 365, 368-69).

Respondent confirmed that he received $5,000 from Kamrath to handle a post-judgment custodial dispute. He testified that the case involved visitation issues, mediation and the appointment of a guardian ad litem. Respondent had no recollection of appearing in court on July 11 and did not know whether he appeared in court on August 1. He denied that the charges for both dates were a mistake, however, and pointed out that Kamrath never complained about the charges to him. He stated that his services were terminated by Kamrath and Kamrath owes

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him $32.50. (Admin. Ex. 42-47; Tr. 119-124, 500-01).

Count XIV

Michael Aigner testified that he first retained Respondent in 1997 to handle his divorce and was satisfied with Respondent's representation and billing practices at that time. In January 2001, Aigner paid Respondent $7,500 in connection with a post-decree matter. Aigner stated that he received bills from Respondent for the months of March, April and May, 2001. In September 2001 Aigner's ex-wife withdrew her request for additional post-decree maintenance. Aigner acknowledged that his ex-wife's decision was due to Respondent's investigation of her other sources of income. (Tr. 215-18; 221-22).

When his ex-wife dropped her request for maintenance, Aigner contacted Respondent concerning the unused portion of the retainer. According to Aigner, Respondent told him he would receive the unused portion of the retainer in 30 days. Aigner terminated Respondent's services by letter of December 26, 2001 and requested the balance owed to him. He received no response to the letter and subsequently contacted the ARDC. He stated that he has not received any refund from Respondent. (Admin. Ex. 48, 49; Tr. 217-19).

Aigner paid a second attorney approximately $2200 to bring an action against Respondent to recover the unused portion of the retainer. In May 2002 Respondent signed an order by which he agreed to pay Aigner $3673.44 on June 21, 2002. Aigner stated that Respondent has not paid any of the amount owed. (Admin. Ex. 52; Tr. 219-20).

Respondent acknowledged that his services to Aigner were terminated, that Aigner brought suit against him, and that he and Aigner reached a settlement whereby he agreed to refund the unearned fees and pay Aigner's costs of pursuing the claim. On the date payment was due, Respondent sent a letter to Aigner's attorney stating that the funds would be hand-delivered to the attorney's office the following week. Respondent acknowledged that he has not

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paid Aigner the amount he agreed to pay. (Admin. Ex. 51-53; Tr. 125-128, 496, 508).

Count XV

The admissions in Respondent's answer to the Complaint constitute the proof with respect to Count XV. No further evidence was presented at hearing.

Respondent admitted that between July 2001 and January 2002, he received letters from the Administrator requesting information in connection with allegations asserted by his clients Joseph Lorenz, Gary York, Rosabla Reyes, Mary Krebs, Stephen Williams, Christine Noel, Deborah Codute, Sharon Peterson, Kristi Ryan, Charles Bedrosian, Ralph Rodriguez, Sang Lee and David Erdmann. He did not respond to the requests in the Lorenz, Krebs, Williams, Noel, Codute, Peterson, Ryan, Bedrosian, Rodriguez, Lee or Erdmann matters and received letters from the Administrator notifying him of his obligation to respond pursuant to Commission Rule 53.

Respondent further admitted that he received a subpoena duces tecum commanding him to appear at the Commission's Chicago office on January 2, 2002 and to produce materials at that time relating to his representation of Lorenz, York, Reyes, Krebs, Williams and Noel. Respondent made several requests to continue his appearance. By letter of January 14, 2002, he was notified that he should also bring files relating to Codute, Peterson, Ryan, Bedrosian, Rodriguez, Lee and Erdmann.

Respondent's appearance was rescheduled for February 15, 2002. He did not appear on that date and admitted that, as of February 27, 2002, the date the members of the Inquiry Panel voted to file a complaint against him, he had not appeared or produced any of the documents requested in compliance with the Administrator's subpoena duces tecum or subsequent letter.

Additional Evidence

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Respondent admitted that he owes money to clients but explained that he has hesitated to take any action due to the ongoing ARDC investigation. He pointed out that, in the one instance where he did make repayment, the "ARDC investigators went over it with a fine-tooth comb" and determined that he may have done something improper. Respondent discovered that one of his secretaries was actually referring dissatisfied clients to the ARDC. (Tr. 138, 470, 532-33).

Respondent further stated that he has not repaid his clients because the bills were not done on a timely basis due to the computer problem and money was "a little tight." In a deposition before the ARDC he stated that he did not pay some bills because they got pushed out of the way and that after September 11, 2001, his business declined and his income was greatly reduced. (Tr. 135-37, 520-23, 531).

Respondent testified that he considers a retainer to be earned at the time it is received and to be his own money. He acknowledged that in July 2002 he won a grand prize at the Empress Casino in Joliet and used almost all of it to pay taxes. He further acknowledged that in late 2001 he sent "some limited funds" to a former employee who had moved to Florida so that the employee could return to Illinois and resume her position in his office. (Tr. 130-32, 529).

Respondent stated that he fully intends to repay his clients and he intends to do it quickly. (Tr. 521, 533).

FINDINGS AND CONCLUSIONS

In attorney disciplinary proceedings the Administrator has the burden of proving the charges of misconduct by clear and convincing evidence. In re Ingersoll, 186 Ill.2d 163, 710 N.E.2d 390, 393 (1999). Clear and convincing evidence constitutes a high level of certainty, which is greater than a preponderance of the evidence but less than proof beyond a reasonable doubt. People v. Williams, 143 Ill.2d 477, 577 N.E.2d 762 (1991).

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Of the fifteen counts of the complaint, thirteen involve Respondent's failure to promptly refund the unearned portion of clients' fees. In In re Smith, 168 Ill.2d 269, 659 N.E.2d 896 (1995) the Court discussed a lawyer's obligations upon being discharged by a client:

659 N.E.2d at 907.

We can easily dispose of many counts of the complaint through Respondent's own admissions. As to his clients Reyes, Noel, Codute, Peterson, Ryan, Bedrosian, Lee, Erdmann, and Aigner, Respondent acknowledged that he failed to refund fees that he had not earned. Therefore, as to Counts II, IV-VIII, X-XI, and XIV, we find that Respondent failed to refund the unearned portion of a fee paid in advance in violation of Rule 1.16(e) and engaged in conduct which tends to defeat the administration of justice or to bring the courts or the legal profession into disrepute in violation of Supreme Court Rule 771.

As to many of the aforementioned clients, we heard credible evidence that Respondent failed to respond to their repeated pleas for information concerning their cases and/or the amounts owed to them. Reyes, Noel, Peterson, Bedrosian, Lee, and Aigner testified to their frustrations at not being able to speak to Respondent. Codute did not appear at the hearing but we reviewed documentary evidence which indicated that she was not able to obtain information from Respondent. Other than stating that he returned those calls of which he was aware, Respondent offered no defense to his clients' claims that they were unable to communicate with him. We find, therefore, as to Counts II, IV, V, VI, VIII, X, and XIV that Respondent failed to

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keep a client reasonably informed about the status of a matter and promptly comply with reasonable requests for information in violation of Rule 1.4(a) of the Illinois Rules of Professional Conduct.

As to several counts, Respondent disputed the allegation that he owes money to his clients. Concerning the charge in Count I that Respondent failed to refund unearned fees to Joseph Lorenz, Respondent testified at hearing and admitted in his answer to the complaint that he received $16,000 or "approximately" $16,000 in fees from Lorenz. The testimony of Jean Hannig and Bruce Quick was presented to show that Respondent did not perform services to justify his receipt of that amount. Hannig estimated that Respondent did 5 to 10% of the work on the domestic relations matter and Quick testified that Respondent's substantive contribution to the criminal case was limited to providing medical and family records. Hannig's fees were $11,206.77 and Quick's fees were $6,676.73. Hannig also testified that her husband/partner billed approximately $5,000 for work on a personal injury case for Lorenz.

Respondent claimed that he owes nothing to Lorenz. In support of his position, he presented billing statements which show that he performed work on three separate matters for Lorenz and billed a total of $15,672.62. The statements also show that Lorenz' payments to Respondent totaled $15,300. Respondent maintained that, since his charges exceeded Lorenz' payments, he had to write off $372.62 and therefore owes nothing to Lorenz.

In reviewing Respondent's billing statements, we did not detect any charges that were blatantly inappropriate. A good percentage of Respondent's services - over $4,000 worth - were attributed to his July 2000 trip to Minnesota with Lorenz. Also, the charges for telephone calls and correspondence seem to match up with charges on Hannig's and Quick's bills.

In our minds, the billing statements have enough credibility to defeat the Administrator's charge of failure to return unearned fees. We are not deterred by Respondent's

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initial admission that he received $16,000 from Lorenz. That number is close enough to the amount reflected in the billing statements to allow us to conclude that Respondent's recollection was an approximation of the exact amount. We find therefore that the Administrator did not prove by clear and convincing evidence that Respondent failed to refund the unearned portion of a fee paid in advance in violation of Rule 1.1(16)(e) or that he engaged in conduct prejudicial to the administration of justice or which tends to defeat the administration of justice or to bring the courts or the legal profession into disrepute in violation of Supreme Court Rule 771.

Count III alleged that Respondent failed to return unearned fees to Stephen Williams, Sr. and failed to respond to requests for information. The evidence revealed a dispute as to the services provided by Respondent and whether Respondent owed money to Williams. Respondent claimed that he procured an agreement whereby Stephen Williams, Jr. was allowed to have visitation with his son in July 2001. That claim was disputed by both Stephen Williams, Sr. and Stephen Williams, Jr.. Stephen Williams, Jr. stated that during the period of Respondent's representation, visitation was determined by his son's mother. Stephen Williams, Sr. testified that a subsequent lawyer was responsible for procuring visitation.

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We find that the testimony of Stephen Williams, Sr. and Stephen Williams, Jr. was credible and, along with the billing statements, provided clear and convincing evidence of wrongdoing by Respondent. As to Count III, therefore, we determine that Respondent failed to keep a client reasonably informed about the status of a matter and promptly comply with reasonable requests for information in violation of Rule 1.4(a); failed to refund the unearned portion of a fee paid in advance in violation of Rule 1.16(e); and engaged in conduct which is prejudicial to the administration of justice or which tends to defeat the administration of justice

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or to bring the courts or the legal profession into disrepute in violation of Supreme Court Rule 771.

Count IX alleged that Respondent failed to return unearned fees to his client Ralph Rodriguez. The evidence showed that Respondent performed some work for Rodriguez before his services were terminated in September 2001. Respondent testified that the unused portion of Rodriguez' retainer was less than $100 but, because Rodriguez would not accept that amount, Respondent agreed to pay $472.00 to avoid a court battle. We received no evidence to contradict Respondent's statements.

We note that Respondent's payment to Rodriguez in January 2002 was made after Rodriguez complained to the ARDC and after an action was filed in small claims court. We further note, however, that the time frame between Rodriguez' termination of Respondent's services and his filing of a suit against Respondent was fairly short - approximately ten weeks. During that time period there appeared to be a dispute as to how much money was owed to Rodriguez.

The Supreme Court has commented, concerning Rule 1.16(e), that "there is scant guidance as to what time period is deemed ‘prompt' under the rules" but noted that "it is readily apparent that a delay measured in years will fail the promptness test." In re Howard, 188 Ill.2d 423, 721 N.E.2d 1126 (1999). Delays of a shorter period may also be subject to sanctions if a lawyer has displayed indifference to a client's repeated demands for a refund. Id.

We did not receive any evidence that Respondent displayed indifference to Rodriguez between September 2001 and January 2002. Further, upon reaching a settlement with Rodriguez, Respondent paid him the agreed-upon amount. Under the foregoing circumstances, we do not believe that the Administrator proved by clear and convincing evidence that Respondent failed to promptly refund the unearned portion of a fee paid in advance in violation

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of Rule 1.16(e) or that he engaged in conduct which tends to defeat the administration of justice or to bring the courts or the legal profession into disrepute in violation of Supreme Court Rule 771.

Counts XII and XIII pertain to Respondent's representation of Michael Kamrath. Count XII alleged that Respondent failed to refund the unearned portion of a fee to Michael Kamrath and failed to comply with Kamrath's requests for information. Count XIII alleged that Respondent engaged in dishonest behavior by billing Kamrath for court appearances on dates when no court proceedings took place.

Kamrath testified that when he terminated Respondent's services in October 2001, he had only received one billing statement for the month of May 2001. He then attempted to contact Respondent for a final billing statement and a refund but received no response. He acknowledged that he received a final statement in January 2002.

Respondent testified that he pursued various issues on behalf of Kamrath during his six months of representation but gave no explanation for his failure to return Kamrath's telephone calls. He denied owing a refund to Kamrath and claimed instead that Kamrath owed money to him. Respondent's final billing statement confirms that his charges for the six-month period of representation exceeded the amount he received from Kamrath by $32.50.

Respondent's billing statement does not defeat the Administrator's charges in this instance, however, because we received credible evidence that some of the charges in the statement were inaccurate. Specifically, the billing statement contains charges for court appearances and travel time to court for July 11 and August 1, 2001 even though the hearings scheduled for those dates were stricken pursuant to court order. Respondent acknowledged that he may have made a mistake with respect to one of the court dates. He also testified, however, that he could not recall whether he appeared in court on either date. The charges billed for the

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two non-existent court hearings totaled $600.

The foregoing evidence establishes that Respondent failed to respond to Kamrath's requests for information and improperly charged Kamrath for services that were not rendered. If the erroneous charges in connection with the July 11 and August 1 court hearings are credited back to Kamrath, the amount owed to him by Respondent for unearned fees is $567.50. We therefore find as to Counts XII and XIII that Respondent failed to refund the unearned portion of a fee in violation of Rule 1.16(e); failed to keep a client reasonably informed about the status of a matter and promptly comply with reasonable requests for information in violation of Rule 1.4(a); engaged in conduct involving dishonesty, fraud, deceit or misrepresentation in violation of Rule 8.4(a)(4), engaged in conduct that is prejudicial to the administration of justice, in violation of Rule 8.4(a)(5), and engaged in conduct which tends to defeat the administration of justice or to bring the courts or the legal profession into disrepute in violation of Supreme Court Rule 771.

that Respondent failed to respond to a lawful demand for information from a disciplinary authority, in violation of Rule 8.1(a)(2); engaged in conduct that is prejudicial to the administration of justice, in violation of Rule 8.4(a)(5); and engaged in conduct which is prejudicial to the administration of justice or which tends to defeat the administration of justice or to bring the courts or the legal profession into disrepute in violation of Supreme Court Rule 771.

RECOMMENDATION

Having concluded that Respondent engaged in wrongdoing, we must determine the appropriate discipline warranted by the misconduct. In determining the proper sanction, we consider the purposes of the disciplinary process. The goal of these proceedings is not to punish but rather to safeguard the public, maintain the integrity of the profession and protect the administration of justice from reproach. In re Timpone, 157 Ill.2d 178, 623 N.E.2d 300 (1993). Another factor for consideration is the deterrent value of attorney discipline and the need to impress upon others the repercussions of errors such as those committed by Respondent in the present case. In re Discipio, 163 Ill.2d 515, 645 N.E.2d 906, 912 (1994).

We also take into account those circumstances which may mitigate and/or aggravate the misconduct. In re Witt, 145 Ill.2d 380, 583 N.E.2d 526, 535 (1991). Respondent presented no mitigating circumstances for our consideration.

The aggravating circumstances, on the other hand, are numerous and consequential. We note first that Respondent's cooperation in these proceedings was less than satisfactory. See In re Brody, 65 Ill.2d 152, 357 N.E.2d 498, 500 (1976) (an attorney's failure to cooperate in his or her own disciplinary proceeding demonstrates a want of professional responsibility and is a factor to be considered in aggravation). Respondent filed his answer to the complaint several months after it was due, delayed his deposition and failed to produce requested

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documents on a timely basis. We also note that Respondent failed to appear for the second scheduled day of hearing and then failed to produce medical documentation to verify that an illness had prevented him from appearing. Given his other dilatory conduct, Respondent's failure to appear for the second day of hearing is highly suspect and contributes to our conclusion that he failed to fully cooperate in these proceedings.

Failure to make restitution is a factor to consider in aggravation. In re Uhler II, 126 Ill.2d 532, 535 N.E.2d 825 (1989). As to nine of his clients, Respondent has acknowledged owing a refund of unearned fees. Despite his admission of debt, he has not made any effort toward repayment. His explanations for his delay in restitution were unconvincing and he has not proposed any timetable for repayment.

We did not perceive any remorse on Respondent's part. See In re Smith, 75 Ill.2d 134, 387 N.E.2d 316 (1975). Although he has deprived his clients of a collective total of almost $20,000, Respondent did not appear contrite and offered no apologies either at hearing or to his clients when they requested a return of their monies. On the few occasions when his clients were able to speak with him, he responded with rudeness. We further note that several clients were forced to pay additional retainers to a second attorney. See In re Merriwether, 138 Ill. 2d, 561 N.E.2d 662, 666 (1990) (inconvenience to client and depriving clients of use of funds are considered in imposing attorney sanctions).

Finally, prior discipline is a significant factor in our consideration of discipline in this case. See In re Blank, 145 Ill.2d 534, 585 N.E.2d 105 (1991). Respondent has been disciplined on two prior occasions. In 1988 he was censured for failure to pay the fines associated with 339 parking tickets and 28 vehicle sticker citations. In re Marsh, 87 CH 55, M.R. 5030 (1988). That misconduct, being dissimilar to the present misconduct and temporally distant, would typically merit minimal weight in our consideration of discipline. It does,

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however, reinforce our perception that Respondent tends to put his own interests above his obligation to comply with rules and regulations.

Of far greater significance to this proceeding is Respondent's second disciplinary sanction. In 1999 he was censured for failing to refund unearned fees to two clients and failing to respond to their requests for information. In re Marsh, 96 CH 632, M.R. 15445 (1999). The decision to impose a mild sanction was based upon Respondent's ultimate restitution to his clients, his character evidence and his performance of pro bono services.

We give substantial weight to the 1999 sanction because the transgressions involved in that matter are identical to the misconduct at issue in the present case. Clearly, the discipline imposed a few short years ago did not cause Respondent to reform his behavior. On the contrary, his misconduct has become more severe and more blatant. Respondent failed to refund unearned fees in eleven cases, failed to respond to numerous requests for information, made misrepresentations in his billing to one client and failed to cooperate with the Administrator's investigation into his misconduct.

The Administrator has suggested that the misconduct warrants a two year suspension until further order of court. Respondent made no suggestion as to appropriate discipline.

Cases in which a suspension is imposed for failure to promptly refund unearned fees and communicate with clients often involve either a pattern of such misconduct or additional misconduct, such as neglect or failure to cooperate in the disciplinary proceedings. Likewise, the present case involves the additional misconduct of erroneous billings and failure to cooperate.

The failure to return unearned fees is a serious violation which may warrant a suspension. In re Simpson, 47 Ill.2d 562, 268 N.E.2d 20 (1971) the attorney failed to remit unearned fees to two clients and failed to respond to his clients' repeated requests for the return

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of their money. The Court found that the attorney's retention of money belonging to clients was tantamount to "a designed fraudulent conversion rather than lax business methods" and suspended him for one year. In In re Adelman, 93 CH 205, M.R. 11790 (1996) the attorney was suspended for six months for failing to return unearned fees to five clients and engaging in one instance of neglect. He presented evidence of a good reputation and did not engage in any dishonest conduct. In aggravation, he had failed to make restitution to his clients and had been previously disciplined for neglect.

The Administrator cited several cases in which disbarments or lengthy suspensions were imposed for multiple instances of neglect and failure to return unearned fees. An additional factor in each of those cases was the attorney's failure to appear at his own hearing - the ultimate act of lack of cooperation and a factor which strongly points to an unfitness to practice law. See In re Vesely, 97 CH 120, M.R. 15179 (1998) (disbarment for multiple acts of misconduct, including seven instances of neglect and three instances of failure to refund fees); In re Kuknyo, 01 SH 49, M.R. 17926 (2002) (attorney disbarred for neglecting three cases and failure to refund fees); In re Benskin, 97 CH 52, M.R. 14919 (1998)(attorney suspended for eighteen months until further order for neglecting three cases and failing to return fees); In re Porter, 98 CH 98, M.R. 15957 (1999) (two year suspension until further order for three instances of neglect, failure to refund fees and false statements to clients); In re Lee, 97 CH 107, M.R. 15436 (1999) (attorney suspended for three years until further order of court for neglecting two matters, failing to refund unearned fees and making false statements).

Unlike the foregoing cases, Respondent did appear and participate in his hearing. His cooperation, however, was flawed and that factor, along with the prior discipline and other aggravating factors, argues for a suspension of some length. We are mindful that our recommendation must also take into account the protection of the public and the maintenance of

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the integrity of the legal profession. In that regard, Respondent's failure to reform his practices after his prior discipline signifies a strong need to safeguard the public from further acts of misconduct. The reputation of the legal profession, which has been damaged by Respondent's disservice to many clients, will also be best served by removing him from the practice of law.

We conclude that a suspension of some duration is appropriate in this case. Moreover, Respondent's history of transgressions indicates to us the need for an assessment of his rehabilitation before he reenters the practice of law. Suspensions until further order of court are appropriate where the attorney has been previously disciplined or where the attorney has demonstrated an inability to adhere to the standards of the profession. See In re Levin, 101 Ill.2d 535, 463 N.E.2d 715 (1984) (in imposing three year suspension until further order of court on attorney who had been previously suspended for similar misconduct, the Court stated that the attorney "will not be reinstated until this court is satisfied that he will not engage in similar misconduct in the future"); In re Gomric, 94 SH 347, M.R. 129006 (1996) (two year suspension until further order of court for attorney who had been previously disciplined for similar misconduct).

Having considered Respondent's misconduct, the compelling aggravating factors, the lack of any mitigating circumstances and the relevant caselaw, we recommend that Respondent Michael Edward Marsh be suspended from the practice of law for two years until further order of court.

DATED: January 9, 2004 

Allison L. Wood, Chair, with Henry P. Wolff and Edward J. Miller, concurring