Disciplinary Counsel v. Parnoff
Disciplinary Counsel v. Parnoff
Opinion of the Court
**507In this appeal, we are asked to decide whether an attorney who knowingly appropriated client funds, but did not intend to do so wrongly, "knowingly misappropriated" those funds and is therefore subject to mandatory disbarment pursuant to Practice Book § 2-47A.
This disciplinary action originates from a twelve year old fee dispute that resulted in several actions and various appeals. The facts and procedural history underlying these actions are set forth in substantial detail in Disciplinary Counsel v. Parnoff , supra,
Darcy Yuille had been employed by Bridgeport Hospital (hospital) until a work-related injury led to her termination. Disciplinary Counsel v. Parnoff , supra,
In 1998, after Mooney brought the bad faith action, Yuille also retained the defendant to represent her in a bad faith and wrongful discharge action against the hospital. Id., at 515,
In 2002, the defendant entered into an agreement with the hospital on Yuille's behalf to submit her claim to binding arbitration. Disciplinary Counsel v. Parnoff , supra,
In August, 2004, shortly after the arbitration award, Yuille questioned the defendant's fee agreement, claiming that the 40 percent contingency fee was excessive because it violated General Statutes § 52-251c (b),
The defendant and Yuille were unable to resolve the fee dispute, and, in January, 2005, the defendant filed an action against Yuille for breach of contract, unjust enrichment, and bad faith.
**511The cases against Mooney and Yuille were consolidated and tried to a jury. Id., at 461,
The defendant notified Chase Bank not to renew the CD holding the disputed funds, causing it to mature. The defendant then transferred the funds into his personal savings account. Id., at 462,
During the appeal from the judgment of the trial court, Yuille discovered that the defendant was no longer holding the funds in escrow, and filed a grievance against him, alleging that he had violated the Rules of Professional Conduct by transferring and commingling the funds. Id., at 456, 468,
**512During the presentment before the trial court, the defendant testified that he believed he was entitled to the funds because Yuille had no interest in them other than to pay Mooney's legal fee. Id., at 475,
The trial court found by clear and convincing evidence that the defendant violated rule 1.15 (f) of the Rules of Professional Conduct by failing to maintain **513the disputed fee in escrow and that his "belief that Yuille would be satisfied once Mooney was paid was erroneous and unreasonable given the totality of the circumstances." Despite this violation, the trial court also found that the defendant did not knowingly misappropriate those funds. Specifically, the trial court found that the defendant's "failure to escrow the funds ... was not a reflection of any lack of integrity on his part and that he did not act wilfully or with intent to deceive Yuille." Essentially, while the defendant appropriated the funds knowingly, he had "engaged in this conduct negligently," without deceptive intent. The trial court "set forth the protracted, lengthy, very confusing, and tortured history of the fee dispute," and found that the defendant's mistaken belief that Yuille had no personal interest in the funds other than to pay Mooney, meant "the defendant acted unreasonably but not dishonestly, and without an intent to deceive." Disciplinary Counsel v. Parnoff , supra,
The plaintiff appealed to the Appellate Court, which affirmed the judgment of the trial court. Id., at 482,
The plaintiff claims that Practice Book § 2-47A mandates disbarment when an *1228attorney: (1) appropriates **514client funds; (2) does so knowingly; and (3) does so knowing no agreement or court order existed regarding the appropriation of the funds. In the plaintiff's view, a finding regarding the defendant's intent is unnecessary. We disagree.
Whether the Appellate Court correctly interpreted a rule of practice is a question of law over which our review is plenary. Wiseman v. Armstrong ,
As required by § 1-2z we begin with the text of the rule of practice. Practice Book § 2-47A provides: "In any disciplinary proceeding where there has been a finding by a judge of the superior court that a lawyer has knowingly misappropriated a client's funds or other property held in trust, the discipline for such conduct shall be disbarment for a minimum of twelve years." (Emphasis added.)
The phrase "knowingly misappropriated" is not defined in Practice Book § 2-47A or elsewhere in the rules of practice. Because the rules of practice do not provide guidance, we look to related provisions. Rule 1.0 (g) of the Rules of Professional Conduct define " '[k]nowingly' " as "denot [ing] actual knowledge of the fact in question." We observe that General Statutes § 53a-3 of the Penal Code also offers guidance. Section 53a-3 (12) provides: "A person acts 'knowingly' with **515respect to conduct or to a circumstance described by a statute defining an offense when he is aware that his conduct is of such nature or that such circumstance exists ...." A person, therefore, acts knowingly when he or she has actual knowledge or awareness of the nature of the act.
The term "misappropriated" is not defined in the rules of practice or in any related provisions, thus, in accordance with General Statutes § 1-1 (a), we look to its common usage.
The definition of misappropriate is uncannily similar to the definition of larceny in General Statutes § 53a-119, which provides in relevant part that "[a] person *1229commits larceny when, with intent to deprive another of property or to appropriate the same to himself or a third person, he wrongfully takes , obtains or withholds such property from an owner. Larceny includes, but is not limited to ... Embezzlement .... Obtaining **516property by false pretenses .... Theft of services.... Receiving stolen property .... Library theft .... Conversion of leased property.... Theft of utility service.... Theft of motor fuel...." (Emphasis added.) The commission's comment to § 53a-119 provides in relevant part that "[t]his definition ... is meant to encompass the myriad ways in which property may be stolen." Commission to Revise the Criminal Statutes, Penal Code Comments, Conn. Gen. Stat. Ann. § 53a-119 (West 2012), commission comment, p. 108. With respect to the intent element of larceny, the Appellate Court has observed that "[a] specific intent to deprive or to misappropriate is an essential element of larceny." State v. Pulley ,
By contrast, the term "appropriate" is defined as "[t]o take possession of or make use of exclusively for oneself, often without permission." American Heritage College Dictionary, supra, at p. 70. The definition of the term "appropriate," unlike that of "misappropriate," does not include an inherently wrongful or dishonest intent, and certainly is not consistent with the concept of theft. If the drafters of the rules of practice intended to require merely a "knowing" mental state, without an element of intent as the plaintiff contends, they would have used the word "appropriate" instead of the word "misappropriate." Their decision not to do so is telling. An attorney, therefore, can be said to knowingly misappropriate funds when the attorney: (1) appropriates funds; (2) does so knowing that a client claims to have an interest in them; and (3) does so with the intent to steal the funds or otherwise take them wrongfully, dishonestly, or illegally.
On the basis of the trial court's factual findings, as set forth in this opinion, the defendant's transfer of funds constituted an appropriation that he undertook knowingly. The trial court found, however, that the **517long and tortuous procedural history of the parties' fee dispute contributed to the defendant's unreasonable but subjective belief that he was entitled to the disputed funds and no longer was required to maintain them in escrow.
The plaintiff contends that New Jersey case law should inform our decision in the present case because the 2007 commentary to Practice Book § 2-47A states that § 2-47A is "a codification of the 'Wilson rule'," as set out in In re Wilson ,
In holding that in order to be subject to mandatory disbarment pursuant to Practice Book § 2-47A, an attorney must knowingly and intentionally steal client funds, we reject the definition of "knowing misappropriation" from Wilson , which resembles strict liability, and the New Jersey case law that flows from it. In re Wilson , supra,
The judgment of the Appellate Court is affirmed.
In this opinion the other justices concurred.
Practice Book § 2-47A provides: "In any disciplinary proceeding where there has been a finding by a judge of the superior court that a lawyer has knowingly misappropriated a client's funds or other property held in trust, the discipline for such conduct shall be disbarment for a minimum of twelve years."
Although Practice Book § 2-47A has been amended since the events underlying this appeal by the addition of the phrase "for a minimum of twelve years" after the word "disbarment," that amendment has no bearing on the merits of this appeal. In the interest of simplicity, all references to Practice Book § 2-47A in this opinion are to the version appearing in the 2016 Practice Book. See Disciplinary Counsel v. Parnoff,
General Statutes § 52-251c (b) provides in relevant part: "In [a] contingency fee agreement such fee ... shall not exceed an amount equal to a percentage of the damages awarded and received by the claimant or of the settlement amount received by the claimant as follows: (1) Thirty-three and one-third per cent of the first three hundred thousand dollars; (2) twenty-five per cent of the next three hundred thousand dollars; (3) twenty per cent of the next three hundred thousand dollars; (4) fifteen per cent of the next three hundred thousand dollars; and (5) ten per cent of any amount which exceeds one million two hundred thousand dollars."
Although § 52-251c has been amended since the events underlying this appeal; see, e.g., Public Acts 2005, No. 05-275, § 1; those amendments have no bearing on the merits of this appeal. In the interest of simplicity, we refer to the current revision of the statute.
Rule 1.15 (f) of the Rules of Professional Conduct (2015) provides: "When in the course of representation a lawyer is in possession of property in which two or more persons (one of whom may be the lawyer) claim interests, the property shall be kept separate by the lawyer until the dispute is resolved. The lawyer shall promptly distribute all portions of the property as to which the interests are not in dispute."
All references herein to rule 1.15 (f) are to the version set forth in the 2015 Practice Book.
During trial, Yuille testified, as part of her special defense, that "[the defendant] would need to resolve matters with Mooney and that she would then be willing to give [the defendant] his fee; she also testified, when asked if she was at the trial to help Mooney, that she was also trying to get her own fee dispute resolved." (Internal quotation marks omitted.) Disciplinary Counsel v. Parnoff, supra,
General Statutes § 1-1 (a) provides: "In the construction of the statutes, words and phrases shall be construed according to the commonly approved usage of the language; and technical words and phrases, and such as have acquired a peculiar and appropriate meaning in the law, shall be construed and understood accordingly."
The plaintiff also appears to contend that the trial court erred in finding that the defendant did not demonstrate any lack of integrity, and did not act with any intent to deceive Yuille. To the extent that the plaintiff may be understood to claim the trial court's findings were clearly erroneous, we disagree.
The 2007 commentary to Practice Book § 2-47A provides in relevant part: "The above rule is a codification of the 'Wilson ' rule. In In re Wilson, [supra,
Reference
- Full Case Name
- DISCIPLINARY COUNSEL v. Laurence PARNOFF
- Cited By
- 6 cases
- Status
- Published