Disciplinary Counsel v. Maley

Citation: 119 Ohio St. 3d 217Docket: No. 2008-0038

Court: Ohio Supreme Court; August 13, 2008; Ohio; State Supreme Court

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Lawrence M. Maley, an attorney from Lancaster, Ohio, was charged by the Disciplinary Counsel with violations of the Disciplinary Rules in a two-count complaint. Following a hearing, the Board of Commissioners on Grievances and Discipline recommended an 18-month suspension of his law license, with six months stayed, contingent upon his completion of office management and ethics classes. Maley did not contest the board's recommendations. 

The misconduct, detailed in Count I, involved Maley granting his secretary, Diane Bilinovich, extensive authority over office operations, including the use of office credit cards and managing client fee payments. Between July 2004 and August 2005, Bilinovich collected fees and filed at least 39 bankruptcy petitions without Maley's knowledge—five of which were never filed despite client payments. She misused Maley’s credit cards for personal expenses exceeding $8,300 and continued filing petitions under his name even after she was terminated in March 2005. Maley became aware of her ongoing fraudulent activities by June 2005, when his wife raised concerns, but he only reported the misconduct to law enforcement in September 2005 and later alerted the bankruptcy court and the local bar association. Overall, Maley was found to have violated the Code of Professional Responsibility due to the unauthorized actions taken by his secretary while using his name and resources.

Count I findings against the respondent include violations of several ethical rules, specifically: DR 1-102(A)(5) (conduct prejudicial to administration of justice), 1-102(A)(6) (conduct reflecting adversely on a lawyer's fitness), 3-101(A) (aiding unauthorized practice of law), 3-102(A) (sharing fees with a nonlawyer), 6-101(A)(3) (neglecting a legal matter), and 7-101(A)(3) (intentionally harming a client). In Count II, the respondent lacked a trust account during 2005 and part of 2004, commingling unearned retainers and settlement checks with business funds, violating DR 1-102(A)(5), 1-102(A)(6), 9-102(A) (commingling funds), and 9-102(B)(3) (maintaining complete records of client funds). 

The respondent was aware that his secretary misused his credit card for unauthorized expenses and accepted retainers without permission but failed to take appropriate action, such as changing locks or canceling cards. He only reported the issues to authorities in September 2005, despite having knowledge of unauthorized activities as early as April. The board noted the respondent's significant negligence in maintaining a trust account, attributing this to "sheer stupidity and laziness." Had he properly managed client funds, he could have discovered the secretary's misconduct earlier.

The board found clear and convincing evidence of violations in both counts. As a sanction, an 18-month suspension of the respondent's license was recommended, with six months stayed contingent upon completing office-management and ethics training. Aggravating factors included selfish motives, a pattern of misconduct, multiple offenses, refusal to acknowledge wrongdoing, and harm to victims. Mitigating factors included no prior disciplinary record, cooperation in proceedings, and positive character references. The board’s findings on these factors were adopted.

Numerous letters from a judge, elected officials, attorneys, and others support the respondent's claims of honesty, integrity, and good character. A key witness, the first assistant prosecuting attorney in Fairfield County, affirmed the respondent's integrity and high moral character. The respondent highlighted his role as a founding member of Habitat for Humanity of Fairfield County and his recognition as the 2003 “Person of the Year” by the Sertoma Club. However, the respondent's inadequate supervision of an employee permitted her to misuse his credit card, bankruptcy court credentials, and professional reputation, negatively impacting clients and the court. Proper oversight could have prevented this misconduct, and the respondent's failure to regularly review emails, bank statements, and files indicated negligence. The legal community emphasizes the importance of supervising delegated tasks to ensure compliance, as seen in multiple disciplinary cases involving inadequate supervision of nonlawyer assistants. Despite the absence of evidence that the respondent knowingly allowed his employee's unauthorized legal practice, his negligence contributed to it. Additionally, his failure to maintain a trust account reflected irresponsibility. Consequently, the respondent is suspended from practicing law for 18 months, with the last six months stayed, contingent on fulfilling specific conditions, including compliance with professional conduct rules and completion of continuing legal education (CLE) courses. Failure to comply will result in serving the full suspension. Costs are assigned to the respondent.