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Disciplinary Board of the Supreme Court v. Dooley9/22/1999
Filed 9/22/99 by Clerk of Supreme Court
Application for disciplinary action.
REPRIMAND ORDERED.
[ ] The Disciplinary Board petitions for disciplinary action against Fintan L. Dooley and recommends Dooley be reprimanded and ordered to make $16,666.65 in restitution to a former client for violating N.D.R. Prof. Conduct 1.5(a), and be reprimanded for violating N.D.R. Prof. Conduct 1.7(a) and 1.16(e). We conclude Dooley did not charge an unreasonable fee within the meaning of N.D.R. Prof. Conduct 1.5(a), and need not make restitution to the client, and he did not have an impermissible conflict of interest in violation of N.D.R. Prof. Conduct 1.7(a). We further conclude Dooley failed to return funds to a client upon termination of representation in violation of N.D.R. Prof. Conduct 1.16(e). We order Dooley be reprimanded for that violation.
I.
[ ] Fintan L. Dooley was admitted to practice law in North Dakota on January 2, 1976. On September 23, 1987, Dooley entered into a one-third contingent fee agreement with Teddy Lee Cahill to represent him on his claim for personal injuries suffered in a railroad accident. Cahill had received workers compensation benefits for his injuries, and Dooley, on May 18, 1989, executed an agreement to represent the Workers Compensation Bureau under N.D.C.C. § 65-01-09 for its subrogation interest in connection with any action involving Cahill's claims. Dooley informed Cahill by memo, "I ask you, after careful review of our fee agreement, to recognize that our fee agreement entitles me to receive one-third of all recoveries made from the Bureau or from the hospitals or from the railroads." Cahill testified he understood and agreed the gross recovery included the subrogation interest of the Bureau, and he would pay one-third of the gross recovery as an attorney fee to Dooley.
[ ] Dooley brought an action on Cahill's behalf against Burlington Northern Railroad Company for damages resulting from his personal injuries. With Cahill's consent, Dooley retained other lawyers to assist him with the action against Burlington Northern. Dooley was responsible for paying associate counsel fees, specifically agreeing with Cahill their fees "will be paid out of my share of the recovery."
[ ] On January 26, 1994, Burlington Northern entered into a $400,000 settlement agreement with Cahill, Dooley, the Bureau, and Diane Schwandt. Schwandt and Cahill live together with their children as a family unit. Cahill and Schwandt "released and discharged" Burlington Northern "from any and all known and unknown . . . causes of actions" resulting from the accident. Although Schwandt was not a party to the action and was not married to Cahill, she executed the release and settlement because, in the words of the release, "at the time of his injury Teddy Lee Cahill was living with Diane Schwandt and she may have a consortium claim arising out of this accident." Before signing the settlement, a Bureau representative had the following language added: "The Bureau by signing this release does not waive its right to assert its subrogation interest to any claims for consortium."
[ ] Burlington Northern's settlement with Cahill and the Bureau was shared equally by them in accordance with the provisions of N.D.C.C. § 65-01-09. First, the lawyers received one-third of the gross amount of recovery, less the retainer paid by Cahill, for a total of $127,333.33. The Bureau received its one-half share, less 25 percent for attorney fees and its share of the costs, for a total of $118,595.57. Cahill's lawyers received their advanced costs, totaling $67,419.07. Cahill received the remaining amount of $86,652.04. The amount of attorne
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