Filed April 6, 2017
In re William S. Bazianos
Commission No. 2015PR00127
Synopsis of Hearing Board Report and Recommendation
The Administrator filed a one-count Complaint alleging Respondent failed to safeguard escrow funds relating to a client's real estate matter and dishonestly used these funds, without authorization, for his own purposes. While Respondent admitted most of the factual allegations, he denied acting knowingly in using the escrow funds in question and that his conduct constituted conversion. He denied all allegations of misconduct.
Based on the evidence presented, the Hearing Board Panel found Respondent failed to properly handle escrow funds by not keeping the funds separate from his own funds and that his conduct in using these funds for his own purposes was dishonest. Significant evidence in mitigation was considered, which included the fact that Respondent's misconduct was an isolated instance in an otherwise unblemished legal career, his prompt payment of restitution, the absence of actual harm suffered, the steps taken by him to correct deficiencies in his law practice, his cooperation, remorse and acceptance of responsibility, his pro bono and volunteer work, and his good character. In consideration of the foregoing and ample legal precedent, the Hearing Board Panel recommended Respondent be suspended from the practice of law for sixty (60) days.
BEFORE THE HEARING BOARD
ILLINOIS ATTORNEY REGISTRATION
In the Matter of:
WILLIAM S. BAZIANOS,
Commission No. 2015PR00127
REPORT AND RECOMMENDATION OF THE HEARING BOARD
SUMMARY OF THE REPORT
The Hearing Panel found Respondent converted escrow funds related to a client matter when he transferred funds from his client trust account to his operating account and then used the majority of the funds transferred for his own purposes and without authority. Respondent conduct in using these funds was found to be knowing and dishonest. In mitigation, the Hearing Panel considered the fact that Respondent's misconduct was an isolated instance in an otherwise unblemished legal career, his prompt payment of restitution, the absence of actual harm suffered, the steps taken by him to correct deficiencies in his law practice, his cooperation, remorse and acceptance of responsibility, his pro bono and volunteer work, and his good character. The Hearing Panel recommended Respondent be suspended for sixty (60) days.
The hearing in this matter was held on November 4, 2016, at the Chicago offices of the Attorney Registration and Disciplinary Commission (ARDC) before a Panel of the Hearing Board consisting of Lon M. Richey, Chair, Tony J. Masciopinto, and Donald D. Torisky.
Melissa A. Smart represented the Administrator at hearing. Respondent appeared and was represented by Thomas P. McGarry.
On December 30, 2015, the Administrator filed a one-count complaint against Respondent alleging he had failed to hold escrow funds separate from his own property by knowingly converting these funds for his own purposes. Respondent filed an answer on January 28, 2016, in which he admitted most of the factual allegations, but denied that he acted knowingly in using the funds in question and that his conduct constituted a conversion. He denied all allegations of misconduct.
The Complaint alleges Respondent: 1) failed to hold property of a client or third person that was in the lawyer's possession in connection with a representation separate from the lawyer's own property and 2) engaged in conduct involving dishonesty, fraud, deceit or misrepresentation, in violation of Rules 1.15(a) and 8.4(c) of the Illinois Rules of Professional Conduct.
The Administrator presented the adverse testimony of Respondent, and the Administrator's Exhibits 1 through 8 were admitted into evidence. Respondent testified on his own behalf and presented the character witness testimony of Jeffrey Chrones, Darrell Graham, George Stotis, the Honorable Peggy Chiampas, and the Honorable Anthony Kyriakopoulos. Respondent's Exhibits 1 through 10 were admitted into evidence.
FINDINGS OF FACT AND CONCLUSIONS OF LAW
In attorney disciplinary proceedings, the Administrator has the burden of proving the charges of misconduct by clear and convincing evidence. Ill. Sup. Ct. R. 753(c)(6) (2010); In re Edmonds, 2014 IL 117696, par. 35. Clear and convincing evidence means a degree of proof which, considering all the evidence, produces a firm and abiding belief it is highly probable the proposition at issue is true. Cleary & Graham, Handbook of Illinois Evidence, sec. 301.6 (9th ed. 2009). It is the responsibility of the Hearing Panel to determine the credibility of witnesses, weigh conflicting testimony, draw reasonable inferences, and make factual findings based on the evidence. See Edmonds, 2014 IL 117696, par. 35; see also In re Timpone, 157 Ill. 2d 178, 196, 623 N.E.2d 300 (1993).
I. Admitted Facts and Evidence Considered
Respondent graduated from DePaul with an undergraduate degree in finance in 1988. In 1992, he graduated from Thomas Cooley School of Law and was admitted to practice law in Illinois. Since then, Respondent's practice has concentrated primarily on real estate and corporate transactional matters. In fall 2012, he opened his client trust account, which he admittedly did not use on a regular basis. He was responsible for reconciling this account and had online access to account information. Yet, according to Respondent, he failed to reconcile this account monthly because he was not a good bookkeeper. (Tr. 19-20, 31-32, 34, 59-60; Resp. Ex. 3).
Respondent testified that in addition to not regularly reconciling his client trust account, in June 2014, he did not pay attention to his operating account balance due to his busy practice and family and volunteer commitments. He stated he was overwhelmed with his law practice in
the summer of 2014, because he had taken over another attorney's practice and did not have the assistance of an associate. (Tr. 57-58).
Respondent's personal finances in 2014 were stable and his tax returns demonstrate that his annual salary increased in 2014 from 2013. He could have either refinanced his home or taken a loan on his 401(k) had he needed a short-term loan. He, however, recognized this would have taken some time. He also stated he could have borrowed money from his family. (Tr. 22, 61-64, 81; Resp. Exs. 4-7).
In May 2014, Respondent represented Jayme and Jason Olthoff in the sale of their home located in Evanston, Illinois to Kelli and Kenneth Harvey. The closing with respect to this transaction took place on May 30, 2014. (Ans. at par. 1; Tr. 35).
At the closing, the Olthoffs and the Harveys entered into a post-closing occupancy agreement. According to the agreement, the Harveys would allow the Olthoffs to remain living in the Evanston property from May 30, 2014, to June 30, 2014, in exchange for $2,500. There was also an option to extend the occupancy agreement beyond June 30, 2014 to until August 1, 2014, for a cost of $80.65 per day. (Ans. at pars. 2-3; Tr. 40-41, 74).
The agreement further provided that the Olthoffs would deposit $7,100 in escrow funds with Respondent, who would act as the escrow agent and hold the funds until the Olthoffs delivered possession of the Evanston property to the Harveys. After Respondent disbursed the appropriate funds to the Harveys, the funds remaining in escrow would be disbursed to the Olthoffs. During the closing it was verbally agreed that Respondent would retain $100 of the $7,100 in escrow funds as his fees for acting as the escrow agent in this matter. (Ans. at par. 3; Tr. 35-41, 74; Adm. Ex. 8).
At the closing on May 30, 2014, Respondent received a check in the amount $7,100 in accordance with the agreement referenced above. On June 6, 2014, he deposited the check into his client trust account. He stated he did so because he understood as an escrow agent he had an ethical obligation to hold escrow funds separate and apart from his own funds and that he had a fiduciary duty to both parties. Prior to this deposit, Respondent's client trust account had a balance of $133.52. (Ans. at pars. 4-5; Tr. 33, 39-40, 74; Adm. Ex. 2).
Then, between June 11, 2014, and June 13, 2014, before disbursing any funds with respect to the aforementioned occupancy agreement, Respondent made two electronic online transfers, one for $1,500 and one for $5,500, totaling $7,000 from his trust account to his operating account, which he used to pay both personal and business expenses. Respondent admitted that the terms of the occupancy agreement had not been met in June 2014, and as a result, the $7,000 should have remained in his client trust account. These transfers caused the balance in his trust account to fall to $233.52 in June 2014. (Ans. at par. 6; Tr. 28-30, 42-43, 54; Adm. Exs. 2-7).
According to Respondent, he had transferred the $1,500 and $5,500 from his trust account into his operating account to be able to disburse those amounts to the Harveys and Olthoffs, respectively, had the Olthoffs vacated the property in June 2014. He stated he believed this might have happened based on a conversation he had with Ms. Olthoff. He, however, did not know why he felt it necessary to put the funds in his operating account before disbursement or why he made two separate transfers from his trust account to his operating account. He recognized he engaged in commingling when he transferred funds belonging to the Harveys and Olthoffs into his operating account. (Tr. 67, 70-72).
On June 10, 2014, prior to the first electronic transfer from Respondent's trust account, Respondent's operating account had a daily ending balance of $791.14. On June 11, 2014, the same day of the $1,500 electronic transfer from Respondent's trust account, $620.63 was debited from his operating account for his monthly family health insurance premium. In addition, on June 11, 2014, Respondent drew a check made out to himself for $1,000 on his operating account. Respondent stated he had thought there were sufficient funds in his operating account to cover this check, but never confirmed this. The daily ending balance for June 11, 2014, was $-165.49. (Tr. 44-52; Adm. Ex. 4).
On July 12, 2014, the ending balance in Respondent's operating account was $-295.49. Between June 11, 2014, and June 12, 2014, Respondent's operating account was charged four times for insufficient funds. Then, on June 13, 2014, the same day of the $5,500 electronic transfer from Respondent's trust account, his operating account had an ending balance of $3,187.25. The electronic transfer of $5,500 was sufficient to cover the health insurance premium debit and other expenditures that month, which included a check for $2,000 that Respondent wrote to himself on June 13, 2014, and a check for $150 written to St. Andrews on June 13, 2014, for a charitable donation. Despite both transfers, Respondent's operating account had a daily balance as low as $64.59 on June 19, 2014. Then towards the end of June 2014 and at other times through August 2014, the balance in Respondent's operating account exceeded $7,000. On June 24, 2014, Respondent wrote a check to himself for $4,000, and used money in his operating account to fund a vacation to Cooperstown, New York. Respondent acknowledged these expenditures could not have been made without the transfer of $7,000 from his trust account, but also stated he was unaware at the time he wrote some of these checks that his account was overdrawn. (Tr. 44, 49-54, 73; Adm. Exs. 4-7).
With respect to the health insurance premium, even though $620.63 was debited from Respondent's operating account in the months surrounding June 2014, he stated he was unaware that the deduction would occur in June. He later testified that he believed it was not going to occur in June, because of changes to his policy. He stated he believed the new insurance premium was $670, and had written a check for this amount on June 24, 2014. However, the new insurance premium amount was $620.63, plus the $670. (Tr. 46-49; Adm. Exs. 4-7).
Neither the Olthoffs nor the Harveys authorized Respondent to use any portion of the $7,000 for his own purposes. Yet, they both received the amounts due to them in accordance with the terms of the occupancy agreement. On September 8, 2014, Respondent's check to the Harveys, dated July 17, 2014, for $2,500 cleared his operating account, and on September 9, 2014, his check to the Olthoffs, dated July 17, 2014, for $4,500 cleared his operating account. Respondent made these payments with funds in his operating account that he had earned as fees in other matters. (Ans. at par. 8; Tr. 55, 67, 71-72, 78-81; Adm. Exs. 7-8; Resp. Exs. 1, 2).
II. Analysis and Conclusions
Respondent converted escrow funds when he transferred the majority of these funds from his client trust account to his operating account and then shortly thereafter used most of the funds for his own purposes and without authority. After considering his role in transferring and spending the funds, the timing of his conduct, and his short-term need for funds, the Hearing Panel concluded his conversion was knowing and dishonest.
B. Respondent is charged with failing to hold property of a client or third person that is in the lawyer's possession in connection with a representation separate from the lawyer's own property in violation of Rule 1.15(a).
Rule 1.15(a) of the Rules of Professional Conduct requires an attorney who is entrusted with client and/or third person funds in connection with a representation to hold such funds
separate from his or her own funds and in a client trust account. Ill. Rs. Prof'l Conduct R. 1.15(a) (2010). When an attorney has used client and/or third person funds for his own purposes without authority, his conduct has been found to constitute conversion in accordance with disciplinary precedent even if the rightful owner has not made a demand for the funds. In re Karavidas, 2013 IL 115767, par. 62. A finding of conversion, while alone insufficient to justify the imposition of professional discipline, can support a finding that the attorney violated Rule 1.15(a) by failing to appropriately safeguard client funds and therefore, discipline is warranted. Karavidas, 2013 IL 115767, pars. 78-79.
Here, it is undisputed that Respondent commingled escrow funds related to the Olthoff/Harvey matter with his funds. Specifically, the evidence shows that on June 6, 2014, Respondent deposited $7,000 in escrow funds related to the Olthoff/Harvey matter into his client trust account. As he acknowledges, he was then obligated to hold these funds in his trust account on behalf of the Olthoffs and Harveys and in accordance with the terms of the May 31, 2014 occupancy agreement. Instead, between June 11, 2012, and June 13, 2012, prior to disbursing any funds with respect to the Olthoff/Harvey matter, Respondent transferred $7,000 from his trust account into his operating account without authorization. This transfer left a balance of $233.52 in his client trust account, which was $6,766.48 less than the $7,000 he should have been holding in his trust account on behalf of the Olthoffs and Harveys.
Respondent also admits that shortly after the $7,000 was transferred into his operating account, he spent the majority of the funds for his own purposes. In fact on June 19, 2014, after both transfers were made into his operating account but before disbursement occurred to the Olthoffs and Harveys, the balance in Respondent's operating account dropped to $64.59. Accordingly, based on the evidence presented and the admitted facts, we find Respondent's
conduct undoubtedly violated Rule 1.15(a) as he both commingled and converted client and third person funds.
C. Respondent is charged with engaging in conduct involving dishonesty, fraud, deceit or misrepresentation in violation of Rule 8.4(c).
The Administrator also alleges Respondent acted knowingly in converting the Olthoff/Harvey escrow funds and accordingly, violated Rule 8.4(c). Rule 8.4(c) prohibits an attorney from engaging in conduct involving dishonesty, fraud, deceit, or misrepresentation. Ill. R. Prof'l Conduct R. 8.4(c). The IllinoisSupreme Court has recognized that while the uniqueness of each case makes it impossible to define every act or form of conduct that constitutes a violation of Rule 8.4(c), this rule is "broadly construed to include anything calculated to deceive, including . . . the suggestion of falsity." Edmonds, 2014 IL 117696, pars. 53, 62. The Court, in making dishonesty findings, has recognized that "motive and intent are rarely proved by direct evidence, but rather must be inferred from conduct and the surrounding circumstances." Id. at par. 54. Therefore, the Court has widely accepted the reliance on circumstantial evidence, where appropriate, in finding a violation of this Rule. See Id. at par. 55; In re Discipio, 163 Ill. 2d 515, 523-24, 645 N.E.2d 906 (1994); In re Krasner, 32 Ill. 2d 121, 127, 204 N.E.2d 10 (1965).
Here, the circumstantial evidence supports the conclusion that Respondent acted knowingly when using the funds in question. It is undisputed that Respondent personally transferred the funds from his trust account into his operating account, and at the time he made these transfers, he had access to both his trust account and operating account information. Taking this into consideration, we find the timing of these transfers highly concerning.
Respondent transferred almost all of the Olthoff/Harvey escrow funds into his operating account within one week of depositing the funds into his client trust account. He then spent the
majority of these funds for his own purposes within a week. Moreover, on the days surrounding the transfers, his operating account had negative daily ending balances and insufficient funds to cover the expenses drawn on the account, which included his family health insurance premium and checks made payable to himself. Respondent's need for these funds, even if only for the short-term, demonstrates a clear motive for the transfers.
We find implausible Respondent's claim that at the time he made the transfers he was both unaware of the negative balance in his operating account and of the impending insurance premium deduction in large part due to poor bookkeeping practices. A simple review of his operating account information, which he had access to when he made the electronic transfers, would have shown the account's repeated negative balances. With respect to the insurance premium, that same amount was deducted monthly both before and after June 2014. And, while he asserts that he thought the insurance premium amount had changed in June 2014, he offered insufficient evidence to corroborate his claimed belief. Moreover, he admittedly knew the funds transferred into his operating account were escrow funds and also that he had an ethical obligation to segregate escrow funds from his own. We find it unlikely that an attorney with this understanding would act so carelessly when handling escrow funds. So although we recognize Respondent was overwhelmed with his law practice in 2014, and as a result, might have had some deficiencies in his bookkeeping practices that year, we are unconvinced that his use of escrow funds was the result of these deficiencies. The more probable explanation, which the evidence supports, is that in June 2014 Respondent had a short-term financial need and he knowingly satisfied that need by using the funds in question.
Moreover, we find incredible Respondent's assertion that he transferred the escrow funds into his operating account in mid-June because he had believed, based on a conversation with his
client, that the Olthoffs would be moving out of the property before June 30, 2014, and that disbursement in the amounts of $1,500 to the Harveys and $5,500 to the Olthoffs would be necessary around that time. First, Respondent failed to offer any evidence to corroborate this belief. If a conversation to this extent had taken place, testimony from Respondent's client regarding the conversation would have been of benefit. Also, the occupancy agreement does not contemplate the distribution of less than $2,500 to the Harveys and $5,500 to the Olthoffs if the Olthoffs moved out earlier than June 30, 2014. In addition, Respondent's claim belief that disbursement might have been necessary in mid-June, fails to explain why he transferred the funds into his operating account when he could have just disbursed the escrow funds directly from his trust account and why he made two separate transfers of funds, two days apart, rather than transferring the funds on the same day in a single transaction. Respondent admittedly has no explanation for this conduct.
Respondent's generally positive financial situation in 2014 and his ability to access additional funds if a need arose do not convince us that his conduct in using the escrow funds was unintentional. As discussed above, Respondent's short-term need for funds in June 2014 was undeniable. Although he might have been able to legitimately gain access to funds some other way, including possibly borrowing money from family, the process for doing so would have been likely more complicated than a quick transfer of funds between accounts.
Based on the foregoing, we find the Administrator proved by clear and convincing that Respondent acted knowingly when he used the Olthoff/Harvey escrow funds, and as a result, violated Rule 8.4(c).
EVIDENCE OFFERED IN AGGRAVATION AND MITIGATION
Respondent has cooperated with the Administrator throughout his disciplinary proceedings. He has acknowledged failing to properly segregate client and third person funds from his own and expressed remorse and regret for this misconduct. (Tr. 18, 67-68).
At the time of the misconduct, Respondent was of counsel at a law firm, but also maintained his own practice. He now practices as a non-equity partner at the same law firm where he was of counsel. As a result of the conduct in this matter, he no longer maintains a client trust account. He now either uses the firm's trust account or a third-party to hold escrowed funds. He has taken online ethical courses on how to properly maintain a trust account and handle trust funds. (Tr. 20-21, 23-24, 64-66, 75; Resp. Exs. 3, 8-10).
Respondent's client did not complain about him to the ARDC. Rather, the bank where his trust account was located, notified the ARDC when his trust account had insufficient funds to negotiate a check being presented for payment. (Tr. 26, 84-85; Adm. Ex. 1).
According to Respondent, he values his law license and believes he is respected in the community because of it. He has attempted to use his law license to help other. Over the past eight years, Respondent has served on the Board of Education for School District No. 37 and has dedicated approximately twelve hours a month to the School Board. He, however, has decided to not run for another term due to this incident. Additionally, Respondent occasionally will do a pro bono closing for a client who cannot afford an attorney. He also has done pro bono legal work and volunteer work for religious organizations that he is affiliated with. (Tr. 69, 72-73, 76).
Jeffrey Chrones, Darrell Graham, and Bill Stotis, Illinois attorneys, who know Respondent both professionally and socially, testified as to his character. Mr. Chrones and Mr. Stotis have known Respondent for many years and are members of the Greek community with him, and Mr. Graham lives in the Wilmette community with Respondent and their kids play sports together. Additionally, Mr. Graham works with Respondent, and Mr. Stotis previously employed him.
They all opined that Respondent is a very honest person. They also testified that he has a reputation for honesty and integrity in the legal community. Mr. Stotis specifically noted that he has good reputation among Greek lawyers. Mr. Chrones stated he has referred clients to Respondent and recalled an instance where the client was very pleased with Respondent's representation. Mr. Graham testified that he has known Respondent to make correct ethical decisions while representing clients over the years. He also stated that professionals in the Wilmette community have a high regard for Respondent and his quality of work. All three of them acknowledged being aware of the allegations in the Complaint, and stated their opinions of Respondent would not change if he was found to have intentionally used funds related to the Olthoff/Harvey matter (Tr. 97-114)
Judge Peggy Chiampas and Judge Anthony Kyriakopoulos, Cook County Judges, also testified on Respondent's behalf. They both have been friends with Respondent and his family for over thirty years and are all part of the Greek community. They testified that Respondent has a reputation for honesty and integrity in the Greek community. Specifically, Judge Chiampas commented that Respondent's reputation is beyond reproach, and Judge Kyriakopoulos stated his reputation for honesty was "stellar." Moreover, they both opined that Respondent is an
upstanding individual, who they would be comfortable referring people to for legal services if permitted to do so. In addition, both Judges were familiar with the allegations in the Complaint, but the allegations did not affect their opinions of Respondent nor would their opinions be affected if he was found to have intentionally used the funds at issue. (Tr. 115-29).
Respondent was admitted to practice law in Illinois in 1992 and has not been previously disciplined. (Tr. 18, 61).
The Hearing Panel recommends Respondent be suspended from the practice of law for sixty days. While considering the serious nature of Respondent's dishonest conversion, this recommendation gives significant weight to the evidence in mitigation, which includes the fact that his misconduct was an isolated instance in an otherwise unblemished legal career, his prompt restitution, the absence of actual harm suffered, the steps taken to correct deficiencies in his law practice, his cooperation, remorse and acceptance of responsibility, his pro bono and volunteer work, and his good character.
Having found Respondent engaged in misconduct, we now must determine the appropriate sanction recommendation. In doing so, we consider the purpose of the disciplinary process is not to punish the attorney for his misconduct, but to safeguard the public, maintain the integrity of the profession and protect the administration of justice from reproach. In re Edmonds, 2014 IL 117696, par. 90. We also consider the nature and seriousness of the attorney's misconduct, the circumstances that may mitigate and aggravate the misconduct, and the deterrent
value of attorney discipline. Edmonds, 2014 IL 117696, par. 90; In re Gorecki, 208 Ill. 2d 350, 361, 802 N.E.2d 1194 (2003).
While the dishonest conversion of client and third party funds is serious misconduct that cannot be countenanced, this case presents extensive and compelling evidence in mitigation that must be considered in determining the appropriate sanction. Initially, we believe it is important to consider that Respondent's conduct in misappropriating escrow funds, while unacceptable, was an isolated instance and not a pattern of misconduct. In addition, although we found his conversion to be dishonest, the evidence does not show he intended to permanently deprive any individuals of their funds. Respondent's operating account statements demonstrate he had a short-term need for funds in order to maintain his business and personal lifestyle. The evidence shows that shortly after misappropriating the escrow funds he had funds available to him that exceeded the amount misappropriated and that his financial condition in 2014 was generally positive. In re Lenz, 108 Ill. 2d 445, 454, 484 N.E.2d 1093 (1985) (considering it mitigating that the attorney's trust account only had insufficient funds in it for six weeks and that his misconduct was an isolated act in an otherwise unblemished career).
Respondent's prompt payment of restitution, long before the ARDC's involvement, is considered in mitigation, and supports our conclusion that Respondent did not intend to permanently deprive the Olthoffs and Harveys of their funds. In re Mulroe, 2011 IL 111378, pars. 28, 31. We also consider the lack of actual harm suffered by the Olthoffs and Harveys in mitigation. In re Yamaguchi, 118 Ill. 2d 417, 428, 515 N.E.2d 1235 (1987). Neither the Olthoffs nor Harveys testified on behalf of the Administrator nor complained to the ARDC regarding Respondent. Likewise, there was no evidence showing they were dissatisfied with him or suffered actual harm as a result of his conduct.
We also consider in mitigation Respondent's proactive behavior in both recognizing and remedying deficiencies in his practice. Although Respondent's misconduct was not found to be the result of poor bookkeeping practices, we acknowledge he was overwhelmed with his solo practice in 2014, and as a result, likely had some deficiencies in his bookkeeping procedures that year. Since then, Respondent has taken significant steps to remedy these shortcomings in his practice and in doing so, has made it extremely unlikely that he will engage in similar misconduct in the future. He has ceased practicing law as a sole practitioner and is a non-equity partner at a firm. Moreover, and perhaps most noteworthy, he has closed his client trust account, and now uses his firm's client trust account or a third party to hold escrow funds. We believe this will make it extremely difficult for him to ever again misappropriate funds, even if a short-term need arises. Respondent also has educated himself on proper trust account management and how to appropriately handle escrow funds by taking two ARDC trust accounting webinars. In re Mason, 122 Ill. 2d 163, 173-74, 522 N.E.2d 1233 (1988).
Respondent's cooperation in his disciplinary matter and his remorse and acceptance of responsibility are also mitigating. Respondent admitted the majority of the allegations in the Complaint including the factual allegations supporting a violation of Rule 1.15(a). He fully accepted responsibility and expressed sincere remorse for improperly handling the funds in question. Moreover, Respondent's cooperation in these proceedings was both evident from the record and acknowledged by the Administrator. These factors, as well as the other mitigating factors noted above, form the basis for our conclusion that Respondent's continued practice of law does not pose a threat to the public. See In re Twohey, 191 Ill. 2d 75, 90, 727 N.E.2d 1028 (2000) (considering cooperation in mitigation); Mason, 122 Ill. 2d at 172-74.
We also are encouraged by Respondent's years of dedication to the local school board and the pro bono legal work he has performed on behalf of those unable to afford an attorney. Respondent impressed us as an attorney who highly values his law license and seeks to use it to give back to the community, not just benefit financially. Lenz, 108 Ill. 2d at 454.
Finally, Respondent's twenty-four years of practicing law without incident and the compelling character testimony offered on his behalf are significantly mitigating. Each of Respondent's five character witnesses, two of which are judges, offered convincing testimony regarding their high opinion of him and the impeccable reputation he holds in different communities. We are impressed with the high regard others have for him and believe, in light of this mitigating evidence, that the misconduct found here is an aberration in his legal career. See In re Witt, 145 Ill. 2d 380, 403, 583 N.E.2d 526 (1991) (considering lack of prior discipline as a mitigating factor); In re Lunardi, 127 Ill. 2d 413, 423, 537 N.E.2d 767 (1989) (considering positive character testimony).
Respondent, recognizing his misconduct warrants the imposition of a sanction, asserts a censure is appropriate. In support of a censure, he cites cases where the attorneys misappropriated client and/or third party funds but, unlike him, did so unknowingly. See In re Zimmerman, 2014PR00036, M.R. 27099 (Jan. 16, 2015); In re Gutraj, 2012PR00095, M.R. 25962 (May 22, 2013); In re Pappas, 2014PR00088 (reprimanded Aug. 28, 2015); see also Lenz, 108 Ill. 2d at 445 (censuring an attorney who used funds in his client trust account that belonged to one client for the benefit of another client but was not charged with nor found to be dishonest); In re Sherman, 60 Ill. 2d 590, 328 N.E.2d 553 (1975) (making no clear finding that the attorney's misappropriation of client funds was dishonest, a censure was imposed). Given our finding that
Respondent acted knowingly in misappropriating the escrow funds at issue, we believe the foregoing cases are distinguishable from the present matter.
The Administrator asserts a suspension of six months is appropriate in light of Respondent's knowing use of the escrow funds in question. In support of a six month suspension, the Administrator cites the following cases: In re Henker, 08 CH 114, M.R. 23193 (Sept. 22, 2009); In re Defourneau, 08 CH 50, M.R. 23031 (May 18, 2009); In re Macchitelli, 02 CH 112, M.R. 19380 (May 17, 2004); In re Kanno, 97 CH 81, M.R. 14949 (Sept. 25, 1998); In re Davies, 96 CH 644, M.R. 13668 (May 30, 1997).
While we recognize the attorneys in the cases cited by the Administrator were found to have knowingly converted client and/or third person funds with respect to a single matter like Respondent, the similarities between the cases cited and the present matter end there. The cases cited by the Administrator contain more egregious misconduct, significant aggravation, or less mitigation than the case at hand. Unlike Respondent, the attorneys in Henker, Davies and Kanno failed to make restitution in a timely manner and only made restitution after the ARDC became involved. In fact, the attorney in Henker did not make restitution for over seven years and the client in Davies had to hire counsel, file a lawsuit, and obtain a judgment. Moreover, the conduct in Davies and Macchitelli was more egregious in that Davies failed to abide by the terms of the escrow agreement and deposit funds in an escrow account and Macchitelli failed to comply with terms of a court order resulting in sanctions being entered against him. In Defourneau, the attorney dishonestly misappropriated client funds for over a year, which is a much longer period of time than Respondent's misappropriation. Also, unlike the present case, the cases cited by the Administrator make no mention of the attorneys' positive character or proactive measures taken by the attorneys to not again engage in similar misconduct.1
After taking into account the seriousness of Respondent's misconduct and the significant mitigating factors, we conclude a suspension of sixty days is appropriate.The Court has imposed suspensions of sixty days in a number of cases where the attorneys engaged in dishonest conversion of client and/or third person funds and significant mitigating evidence was present.
In In re Boyle, 2014PR00118, M.R. 27316 (May 14, 2015), and In re Faber, 00 CH 1, M.R. 17050 (Nov. 27, 2000), the attorneys were suspended, pursuant to petitions to impose discipline on consent, for sixty days for intentionally converting $1,949.62 and $1,511.41, respectively, in settlement funds belonging to clients and/or third parties. In both these matters, numerous mitigating factors were present, such as no prior discipline, cooperation, and remorse. In Faber, the attorney's pro bono services and good character were also mitigating factors. While the funds at issue in these matters were less than the amount misappropriated here, both Boyle and Faber involved circumstances more serious. In Boyle, the funds were not released to the client until after the client complained to the ARDC, and in Faber, the attorney acted contrary to the terms of a fee agreement by underpaying his client and overpaying himself. Boyle, 2014PR00118; Faber, 00 CH 1.
The Court in In re Greenlee, 98 CH 83, M.R. 15670 (Sept. 15, 1999), and In re Ingles, 95 CH 520, M.R. 10402 (Sept. 23, 1994), suspended the attorneys, pursuant to petitions to impose discipline on consent, for sixty days for dishonestly converting approximately $3,300. While both these matters contain similar mitigation as the present matter, the attorney in Greenlee misappropriated funds with respect to three different client matters and the client in Ingles had to repeatedly request his funds before restitution was made. Greenlee, 98 CH 83; Ingles, 95 CH 520. See also In re Grimes, 01 CH 56, M.R. 17984 (Mar. 26, 2002) (suspending an attorney for
sixty days for dishonestly converting $1,666.66 from one client and technically converting $2,041.81 from another client due to poor bookkeeping records).
We also have considered and find instructive cases where the recommended sanction is just outside a sixty-day suspension. While these cases present similar misconduct as the present matter, there are a few key differences that are noted below and support our recommendation that Respondent be suspended for sixty days.
In In re Blanchard, 2015PR00025, M.R. 27795 (Jan. 21, 2016), and In re Romer, 08 CH 19, M.R. 23074 (May 18, 2009), the Court, pursuant to petitions to impose discipline on consent, imposed suspensions of approximatelythree months for the dishonest conversion of $3,500 and $5,015, respectively, in escrow funds. In Romer, the attorney, like Respondent, made the funds available for disbursement at the appropriate time and there was no actual harm suffered. In Blanchard, however, the attorney's trust account had insufficient funds to cover a check he issued to the title company for escrow funds and it was returned unpaid. Similar to the case at hand, the mitigation in both these matters included no prior discipline, cooperation, remorse, and pro bono and volunteer work. Also similar to Respondent, the attorney in Romer had positive character evidence and had taken proactive steps to remedy deficiencies in his trust accounting practices. Yet, unlike Respondent, both these attorneys were experiencing significant financial difficulties at the time of the dishonest conversion. Blanchard, 2015PR00025; Romer, 08 CH 19. Respondent's general financial stability during the year in question and the lack of delay in the disbursement of the escrow funds merits a suspension shorter than ninety days. See also In re Freiman, 118 Ill. 2d 341, 515 N.E.2d 78 (1987) (suspending Freiman for four months for intentionally converting $3,720 in client settlement fund and considering in aggravation delayed restitution and financial difficulties).
The Court in In re Peters, 2012PR00048, M.R. 26828 (Sept. 12, 2014), suspended the attorney for thirty days for dishonestly and intentionally converting $1,500 in client funds without authority. The mitigating evidence in Peters is comparable to this matter. In mitigation, the attorney in Peters, like Respondent, had no prior discipline, engaged in pro bono legal services, and was remorseful, cooperative and of good character. There was also no evidence that Peters, like Respondent, dishonestly delayed making restitution. Yet, unlike Respondent, the attorney in Peters did not use client funds for his own purposes, but rather used the funds to make a loan to his brother to help pay medical bills. Peters, 2012PR00048. Considering that Respondent personally benefited from the short-term misappropriation of escrow funds and the amount he misappropriated was more significant, we believe a slightly more significant sanction is warranted.
In considering the nature of Respondent's misconduct, the foregoing legal precedent, and the significant mitigating evidence, we conclude a suspension of sixty days is warranted. We are confident this sanction is appropriate in light of the purpose of the disciplinary system, namely to protect the public and maintain the integrity of the legal profession. The significant evidence in mitigation in this matter convinces us Respondent will not engage in similar misconduct in the future. Therefore, while Respondent's misconduct was serious and warrants an actual suspension, we believe a suspension exceeding sixty days will only seek to punish Respondent, rather than further the purpose of the disciplinary system. Accordingly, we recommend Respondent, Williams S. Bazianos, be suspended from the practice of law for sixty (60) days.
Lon M. Richey
I, Kenneth G. Jablonski, Clerk of the Attorney Registration and Disciplinary Commission of the Supreme Court of Illinois and keeper of the records, hereby certifies that the foregoing is a true copy of the Report and Recommendation of the Hearing Board, approved by each Panel member, entered in the above entitled cause of record filed in my office onApril 6, 2017.
Kenneth G. Jablonski, Clerk of the
1 An exception to this was that the attorney in Kanno was transferred to inactive status and no longer practiced law at the time discipline was imposed. In re Kanno, 97 CH 81, M.R. 14949 (Sept. 25, 1998).