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In re Bailey9/15/2005
ard "could not find [that] the transaction unfair or unreasonable to Ms. Haile. . . ." After determining that there was no misappropriation and in light of In re Hutchinson, 534 A.2d 919, 924 (D.C. 1987) (en banc), the Board recommended that Mr. Bailey "be suspended from the practice of law for nine months, without requirement to show fitness, but with a requirement to complete a course in ethics and a course in trust accounting (at least three hours each) as a condition of reinstatement." Bar Counsel took exception to the Board's finding of no misappropriation and both Bar Counsel and Mr. Bailey took exception to the Board's recommended sanction.
ANALYSIS
Bar Counsel challenges the findings and conclusion of the Board majority that the authorization did not constitute a lien on Ms. Haile's settlement funds. In particular, Bar Counsel contends that in finding that Mr. Bailey did not misappropriate funds " he Board majority hinge its erroneous legal conclusion on its equally erroneous finding that Dr. Garmon had not rendered services as an expert," thereby concluding that "the authorization did not establish a lien on the Funds." In Bar Counsel's view, "Dr. Garmon's uthorization created legal rights in his favor, including interests, property, an assignment, and a lien, obligating [Mr. Bailey] to safeguard and promptly pay funds belonging to the doctor." Bar Counsel insists that " ot only did Dr. Garmon's uthorization give him an interest as a matter of law - irrespective of his services as an expert - but Dr. Garmon, in fact served as an expert in [Ms. Haile's] case." Therefore, Bar Counsel argues that Mr. Bailey violated Rule 1.15 (a) when he spent $2,420.30 of the settlement owed to Dr. Garmon for his services characterized as a misappropriation, despite the fact that Ms. Haile authorized Mr. Bailey to borrow the full settlement amount of $25,000. Bar Counsel also asserts that Mr. Bailey violated Rule 1.15 (b) when he failed to notify Dr. Garmon of the settlement or promptly pay him. Finally, Bar Counsel maintains that because Mr. Bailey's misappropriation went beyond mere negligence, disbarment is the appropriate sanction in light of In re Addams, supra, 579 A.2d at 194.
In defending its report and recommendation, the Board insists that the authorization is neither an assignment nor a lien, and thus, did not convey an interest to Dr. Garmon. Specifically, the Board maintains that the word "property" as used in Rule 1.15 (a) requires that there be a "just claim" or "perfected interest that runs to the specific piece of property." The Board asserts that after interpreting the plain language of the authorization it is apparent that Dr. Garmon simply retained the right to be paid by Ms. Haile as a "general debt obligation" because the authorization did not specifically state that the settlement funds were to be the source of the payment. The plain language in the authorization, referred to Dr. Garmon's services as an expert witness, not to his treatment of Ms. Haile. The Board argues that Dr. Garmon only provided Ms. Haile with medical services, i.e., "the diagnosis and treatment of Ms. Haile's injuries." Therefore, Dr. Garmon "did not have a lien against the settlement under the uthorization."
Essentially, the Board contends that there was no misappropriation because the settlement funds belonged to Ms. Haile and she gave Mr. Bailey permission to borrow the funds. That is, Mr. Bailey "did not commit misappropriation," because Dr. Garmon did not have a property interest in the settlement funds under Rule 1.15 (a). Furthermore, the Board maintains that Mr. Bailey failed to promptly notify Dr. Garmon of the settlement, but he did not violate the requirement that he pro
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