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Attorney Grievance Commission of Maryland v. Levin

Court of Appeals of Maryland

July 2, 2013


Circuit Court for Montgomery County County Case No. 27349M

Bell, C.J., Harrell, Battaglia, Greene, Adkins, Barbera, McDonald, JJ.


Battaglia, J.

Robert Norman Levin, Respondent, was admitted to the Bar of this Court on December 17, 1965. On April 2, 2012, the Attorney Grievance Commission ("Bar Counsel"), acting pursuant to Maryland Rule 16-751(a), [1] filed a "Petition for Disciplinary or Remedial Action" against Levin.

The complaint arose from Levin's representation of Sean Shahparast and Royal Investment Group, LLC, as plaintiffs in a legal malpractice action filed in the Circuit Court for Montgomery County.[2] Years earlier, in an unrelated case in the Circuit Court for Montgomery County, Creative Concrete Corporation, represented by Michael T . Nalls, Esq., sued Shahparast and Royal for the balance of a debt they owed to Creative for a driveway installed by Creative. Creative obtained judgment in November of 2005, in the amount of $24, 355, plus $5, 000 in attorneys' fees, against Shahparast for the balance of the amount owed for the driveway.

In October of 2010, prior to reaching a settlement in the legal malpractice litigation, Levin was served with a Charging Order in Aid of Enforcement and a Writ of Garnishment by Creative. The Writ named Shahparast as the judgment debtor, Creative as the judgment creditor, and Levin as the garnishee.

In November of 2010, Levin filed an Answer to the Writ of Garnishment in which he denied holding any property of the judgment debtor. Upon receiving the Answer, Nalls wrote to Levin and expressed his belief that the Writ applied to the unmatured debt arising from Shahparast's ongoing legal malpractice claim. Levin responded in writing that he was not in possession of any of the judgment debtor's property, but that he would honor the court's order should he come into possession of any such property. Nalls then filed a Reply to Levin's Answer, stating that the debt owed by Levin to Shahparast was unmatured and, therefore, garnishable. At this point, pursuant to Rule 2-645(g), [3] the garnishment proceedings became contested. Thereafter, Levin filed a Response to Nalls' Reply. At no point in the garnishment proceedings did Levin argue that the Writ of Garnishment was invalid.

In February of 2011, a settlement in the legal malpractice litigation was reached with Levin receiving two settlement checks with a total value of $107, 500. The checks named Levin, Shahparast, and an attorney from a D.C. firm as payees. Levin did not contact Creative or Nalls to inform them of his receipt of the checks. Instead, Levin endorsed the checks and handed them over to his client to be endorsed by the client and the attorney from the D.C. firm.

In March of 2011, upon learning of the legal malpractice settlement, Nalls contacted Levin to inquire about the proceeds, to request an accounting, and to notify Levin that he intended to seek legal relief. Levin responded that he was never in receipt of any funds in connection with the settlement and that tho se funds had be en deposited into the D .C.'s firm's trust account. In March of 2011, Nalls filed a Motion for Appropriate Relief and served a Request for Production of Documents on Levin seeking documents related to his representation of Shahparast in the legal malpractice action. After a hearing on the Motion for Appropriate Relief, the Court ordered Levin to produce documents relevant to the garnishment action. Levin failed to produce all of the requested documents by the court-imposed deadline, but produced them at a later date.

In April of 2011, Nalls filed a Motion for Summary Judgment and Petition for Contempt on behalf of Creative against Levin for failing to comply with the court's orders relating to the production of documents and for disobeying the Writ of Garnishment. After a hearing, the Motion for Summary Judgment was granted, the Petition for Contempt regarding the willful violation of the Writ of Garnishment was taken under advisement, and the Petition for Contempt for failing to comply with the Court's Order regarding the production of documents was denied. Thereafter, Levin and Nalls negotiated a settlement. Pursuant to that settlement, Levin agreed to pay $40, 000 of his own money to Creative in exchange for the assignment of Shahparast's debt to Creative. The grant of summary judgment was then stricken and the Petition for Contempt was withdrawn.

Prior to the hearing on Creative's Motion for Summary Judgment, Nalls filed a complaint with Bar Counsel regarding Levin's handling of the legal malpractice proceeds. Bar Counsel charged Levin with violations of the Maryland Lawyers' Rules of Professional Conduct 1.15(a), (d), and (e) (Safekeeping Property), [4] 3.4(c) and (d) (Fairness to Opposing Party and Counsel), [5] 4.1(a) (Truthfulness in Statements to Others), [6] and 8.4(c) and (d) (Misconduct).[7]

In an Order dated April 9, 2012, we referred the Petition to the Honorable Sharon V. Burrell of the Circuit Court for Montgomery County. A hearing was held on September 14, 2012. Nalls and Levin testified and various documents were introduced into evidence including the Charging Order, the Writ of Garnishment, correspondence between Nalls and Levin, and transcripts of the relevant proceedings. Judge Burrell issued the following Findings of Fact and Conclusions of Law in which she determined that Levin violated Rules 1.15(d) and (e) and 3.4(c), but did not violate Rules 1.15(a), 4.1(a), and 8.4(c) and (d):

Findings of Facts

Robert Norman Levin (hereinafter "Respondent") graduated from Harvard Law School in 1965. He was admitted to the Bar of the Court of Appeals of Maryland in December 1965 and admitted to the Bar of the District of Columbia in January 1966. Respondent is also admitted to the U.S. District Court for the District of Columbia, the U.S. District Court for the District of Maryland, the U.S. Court of Appeals for the Fourth Circuit, the U.S. Court of Appeals for the Federal Circuit, the U.S. Court of Appeals for the District of Columbia Circuit, the U.S. Tax Court, the U.S. Supreme Court, and has been admitted pro hac vice to numerous other state and federal courts. He has never been the subject of any disciplinary actions by any court.
Respondent is 72 years of age and has practiced law continuously in Maryland for 47 years. During all times relevant to this matter, Respondent maintained an office for the practice of law in Montgomery County, Maryland.
As of October 2010, Respondent represented Sean Shahparast ("Shahparast") and Royal Investment Group, LLC ("Royal"), who were Plaintiffs in a legal malpractice action filed in this Court against John C. Moffett and his law firm. Mr. Moffett had represented Shahparast and Royal in a real estate matter that led to the malpractice action. The case was styled Sean Shahparast and Royal Investment Group, LLC vs. John C. Moffett and John C. Moffett Chartered, Case No. 320660V, and the amount claimed was $700, 000. (The Defendants in that action will be referred to as "Moffett.") Leo Roth, Esq. represented Moffett. Mr. Moffett then filed in this Court a separate suit against Shahparast, Royal, and Shahparast's wife (Homa Ravanbakhsh) for unpaid legal fees. Respondent represented the three defendants. The case was styled John Moffett Chartered v. Sean Shahparast, Homa Ravanbakhsh and Royal Investment Group, LLC, Case No. 335738V. The legal malpractice case and the collection case were consolidated by this Court.
Shahparast filed a second and unrelated legal malpractice case in the Superior Court of the District of Columbia against Moffett. Respondent was not counsel in the D.C. litigation. Plaintiffs were represented in D.C. by the firm of Gordon & Simmons.
In a prior and unrelated construction case in this Court, Creative Concrete Corporation ("Creative") had sued Shahparast and Royal, formerly known as Foreclosure Real Estate Services, LLC, to collect payment for a driveway (the "Creative litigation"). Creative was represented by Michael T. Nalls, Esq. ("Mr. Nalls"), an attorney with an office in Montgomery County, Maryland whose practice includes representing construction companies, including debt collection on their behalf. These collection matters included the issuance of Writs of Garnishment and Charging Orders. Respondent was not counsel of record, or otherwise involved in the Creative litigation. In the Creative litigation, a judgment was entered on November 7, 2005, against Shahparast. No judgment was entered against Royal. The principal amount of the judgment claimed by Mr. Nalls to be owed by Shahparast was $24, 355, plus a $5, 0 00 attorney's fee, and interest.
Mr. Nalls engaged in extensive post-judgment efforts to collect the judgment, including the issuance of Writs of Garnishment and efforts to attach real property. As of October 2010, Nalls' collection efforts had not been successful. At some point Nalls became aware of the legal malpractice action brought by Shahparast and Royal. On October 4, 2010, Nalls filed a Request for Writ of Garnishment on behalf of Creative against Shahparast as the Judgment Debtor and Respondent as the Garnishee, because Respondent was counsel for Shahparast in the Moffett case. At the same time Nalls requested the issuance of a Charging Order "against any interest [Shahparast] may have in [Royal] and Foreclosure Real Estate Services, LLC, for the amount of the judgment and interest . . . and that said Order be served on Robert N. Levin, Esquire, as Counsel of record in Civil 320660." By this time Creative was owed over $43, 000. The Court granted both requests. The Writ of Garnishment was issued on October 8, 2010. The Order for Charging Order in Aid of Enforcement of Judgment was entered on October 15, 2010. The Court directed in the Charging Order that it be served on Respondent as counsel for Shahparast. The Court authorized service in this manner because service on Shahparast in previous matters w as difficult an d he had f ailed to abide by previous charging orders.
Respondent was served with both the Writ of Garnishment and the Order For Charging Order in Aid of Enforcement of Judgment. On November 1, 2010, Respondent filed a Garnishee's Answer to Garnishment. In the Answer, Respondent denied being indebted to Shahparast and denied that he was holding any property belonging to Shahparast except: "to the extent that [Shahparast] might be said to have a property interest in the related files and papers" Respondent was holding in connection with his representation of Shahparast in several cases. Upon receipt of the Answer, Nalls sent Respondent a letter dated November 1, 2010, expressing his disagreement with the contents of the Answer. Nalls pointed out in the letter that the "Garnishment would apply to an un-matured debt and the Chose in Action, or claim of Mr. Shahparast and Foreclosure Real Estate Services, Inc./Royal Investment Group, LLC versus John Moffett."
On November 19, 2010, Respondent wrote to Nalls. Of relevance to this case is Respondent's representation that:
At the moment I do not hold any funds or other property of the judgment debtors. . . . Should any funds come into my possession that are subject to the garnishment I will, of course, honor the Court's Order. I am handling the Moffett case on a contingent basis and will assume that all an attaching creditor is entitled to are those funds that I would be distributing to my clients.

On November 22, 2010, Nalls filed a Plaintiff's Reply to Garnishee's Answer. At that point the proceedings became contested pursuant to Maryland Rule 2-645. On November 24, 2010, Respondent filed a Garnishee's Response to Plaintiff's Reply to Garnishee's Answer. Due to the representation in Respondent's letter of November 19, 2010, Nalls did not request a trial date since he believed the matter to be uncontested if Respondent received funds in Civil 320660. It was his understanding that the Writ of Garnishment and Charging Order remained in effect.

On February 23, 2011, a written "Settlement Agreement and Release" was entered into between the Shahparast parties and Mr. Moffett, which resulted in dismissal of: (a) the Maryland legal malpractice case against Mr. Moffett, (b) the legal fee claim brought by Mr. Moffett against Shahparast, his wife, and Royal, (c) the D.C. legal malpractice case against M r. Moffett, and "all currently known or unknown claims, causes of action, and/or grievances. . ." and all claims "of any kind known to law, whether or not they are in the contemplation of the parties at the present time and whether or not they may arise following the execution of this release. . ." for the sum of $107, 500.

The written "Settlement Agreement and Release" identified as "Releasors" Shahparast and Royal. Although Homa Ravanbakhsh was mentioned in the document as agreeing to certain conditions, she was not identified as a Releasor, nor was there a signature line for her to sign. There is only one signature on the Settlement Agreement — that of Shahparast. Above the signature line is the following: "Releasors Sean Shahparast and Royal Investment Group, L.L.C." The Settlement Agreement was drafted by Mr. Roth. Respondent described the document as a "mess, " but, for reasons covered by privilege, the document was not corrected.

On February 24, 2011, Respondent received from counsel for the malpractice insurance carrier for Moffett two checks totaling $107, 500 in payment of the settlement addressed in the Settlement Agreement and Release. One check, in the amount of $95, 000, was made payable to "Sean Shahparast and Robert N. Levin, Esq. & Roger Simmons, Esq., his attorneys, " and included an attachment that stated: "Full and complete release and settlement of the Shahparast Maryland matter relative to John Moffett." The other check, in the amount of $12, 500, was made payable to "Sean Shahparast and Robert N . Levin, Esq. & Roger C. Simmons, Esq." and included an attachment that stated: "In full and final release of John Moffett in DC matter."

There had never been any discussion amongst the parties regarding two checks. Respondent proposed returning the checks, and having the Settlement Agreement redrafted to correct errors in the document, but was unable to do so, for reasons protected by attorney/client privilege. Instead, Respondent endorsed both checks and gave the checks to Shahparast, who delivered them to the Simmons law firm for the necessary further endorsements and deposit of the checks in the Simmons' firm trust account. Shortly thereafter, Respondent received a check written on the Simmons firm's trust account in the amount of $25, 000, which represented Respondent's fee and an amount owed to an expert witness. Respondent did not inform Nalls that he received the checks and did not contact the Court or take any legal action. Nalls continued to monitor the docket entries for the case and contacted defense counsel. N alls was relatively sure that settlement would be reached in February 2011 or the matter would go to trial on March 7, 2011. Nalls was also assured that the settlement proceeds would bear Respondent's name as well as Shahparast's name. In early March 2011, Nalls observed that lines of dismissal had been entered in Civil 320660 and the other ca se in which Respondent represented Shahparast and his wife. He then wrote to Respondent on March 2, 3 and 4, 2011. As of March 4, 2011, Nalls knew that the case was settled and he wanted Respondent to provide information concerning the settlement. Nalls notified Respondent that he intended to seek legal relief. When he received no response from Respondent, Nalls wrote on March 7, 2011, once again requesting a full accounting, and informed Respondent that he planned to take legal action to obtain information related to the settlement from Respondent and Roth.

On March 7, 2011, Respondent wrote back to Nalls. In this letter Respondent stated:

All of the funds from the settlement of all of the cases were paid into the escrow account of the firm handling the action in the Superior Court, Gordon & Simmons, and so I never was the recipient of those funds. Thus, your assumption that I was or would be the recipient of the settlement proceeds is in correct.

On March 9, 2011, Nalls filed a Motion for Appropriate Relief (Disclosure of Confidential Documents) and a Motion to Shorten Time for the production of documents pursuant to a Notice of Records Deposition served on Leo Roth and a Request for Production of Documents served on Respondent. After a hearing attended by Respondent, Roth and Nalls, on March 9, 2011, the Court ordered the production of the documents relating to the settlement of the Shahparast litigation by 3:00 p.m. on March 16, 2011. The documents were to be disclosed only to Nalls and Bar Counsel. Respondent was served with the Request for Production and Orders in the Courthouse on March 9, 2011. During the hearing before the Honorable Robert Greenberg, Respondent acknowledged that the case had settled and that he and Shahparast had received the checks.

On March 10, 2011, Nalls sent a letter to Respondent demanding payment of the judgment. On March 16, 2011, Nalls sent Respondent another letter requesting that Respondent comply with the Court order prior to 3 p.m. that day. Respondent wrote back on March 16, 2011, and questioned Nalls' basis for requesting the documents be produced in less than 30 days and indicated that Shahparast had the right to review what he intended to produce and assert his privilege. Respondent further indicated that he was "gathering the requested documents and will provide them once they are all assembled and approved by Mr. Shahparast which I hope will be in the next week or so."

On March 17, 2011, Nalls sent Respondent a letter confirming that Respondent would provide the requested documents by March 21, 2011. Respondent provided some of the requested documentation on March 21, 2011. He did not, however, provide a copy of the Retainer Agreement for the representation of Shahparast. On March 23, 2011, Nalls sent Respondent another letter, requesting this document be provided.

On April 8, 2011, Nalls filed a Motion for Summary Judgment and Petition for Contempt on behalf of Creative. In the Petition for Contempt, Nalls asserted that Respondent had failed to obey the Garnishment and Charging Order and had failed to respond to discovery. On April 18, 2011, a Show Cause Order was issued and, on May 5, 2011, Respondent filed Garnishee's Verified Opposition to Motion for Summary Judgment. On May 19, 2011, a hearing was held before the Honorable Joseph M. Quirk. Judge Quirk found that the funds came into the hands of Respondent on a temporary basis and that Respondent "had an obligation to, at least, make [Creative] aware that he had come into this chose, which is in the form of a check, and that he was certainly not free to then make simply a transfer with an endorsement to a third party . . ." Judge Quirk entered judgment against Respondent in the amount owed by the judgment debtor. Although the Court found that Respondent had violated the Orders to produce the documents requested by Nalls, noting that Respondent had not filed for a Protective Order, Judge Quirk did not find Respondent in contempt for failing to produce the documents in compliance with the Orders. Judge Quirk took the issue of contempt for not honoring the garnishment under advisement.

Subsequently Respondent and Nalls discussed settling the matter. Respondent asked N alls if there was something he could do to resolve the Attorney Grievance com plaint. Nalls indicated that there was nothing he could do about the complaint.

Respondent and Nalls entered into a settlement, under which Respondent paid (out of his own funds) $40, 000 to satisfy the obligation to Creative. The debt owed by Shahparast was then assigned to Respondent by Creative. Creative withdrew the motions for contempt and summary judgment and, on June 3, 2011, the Court struck the ...

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