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Attorney Grievance Com'n of Maryland v. Berry

Court of Appeals of Maryland

February 26, 2014

ATTORNEY GRIEVANCE COMMISSION OF MARYLAND
v.
Steven Gene BERRY.

Page 208

Marianne J. Lee, Assistant Bar Counsel (Glenn M. Grossman, Bar Counsel, Attorney Grievance Commission of Maryland), for petitioner.

Booth M. Ripke, Esquire (Nathans & Biddle, LLP, Baltimore, MD), for respondent.

Argued before BARBERA, C.J., HARRELL, BATTAGLIA, GREENE, ADKINS, McDONALD and WATTS, JJ.

BATTAGLIA, J.

[437 Md. 154] Steven Gene Berry, Respondent, was admitted to the Bar of this Court on December 15, 1988. On November 26, 2012, the Attorney Grievance Commission, acting through Bar Counsel (" Bar Counsel" ), pursuant to Maryland Rule 16-751(a),[1] filed a [437 Md. 155] " Petition For Disciplinary or Remedial Action" against Berry, charging violations of the Maryland Lawyers' Rules of Professional Conduct, including Rules 3.3(a)(1) (Candor Toward the Tribunal),[2] 8.4(b), (c) and (d) (Misconduct),[3] and

Page 209

Rule 1.15(a) (Safekeeping Property),[4] concomitant with violations of Section 10-306 of the Business Occupations and Professions Article, Maryland Code (2000, 2010 Repl. Vol.) (Misuse of Trust Money),[5] [437 Md. 156]Section 10-606(b) of the Business Occupations and Professions Article, Maryland Code (2000, 2010 Repl. Vol.) (Penalties),[6]Maryland Rule 16-607 (Commingling of Funds),[7] and Maryland Rule 16-609 (Prohibited Transactions).[8]

Bar Counsel alleged in its Petition for Disciplinary or Remedial Action that after Berry's assumption of the duties of successor personal representative for the Estate of Patricia Mae Bowles (" Bowles Estate" ), Berry withdrew more than $50,000 without court authority, deposited his own funds

Page 210

into the Bowles Estate account to cover deficiencies, and submitted multiple accounts to the Orphans' Court containing false statements and misrepresentations to conceal unauthorized withdrawals from the Bowles Estate account. Additionally, Bar Counsel alleged that Berry failed to hold and maintain the [437 Md. 157] funds of clients in trust, while depositing his own funds in his attorney trust account to cover overdrafts, as well as using client funds to reimburse other clients. In an Order dated December 4, 2012, this Court referred the matter to Judge Steven G. Salant of the Circuit Court for Montgomery County for a hearing, pursuant to Rule 16-757.[9] Judge Salant issued Findings of Fact and Conclusions of Law, after which this Court held oral argument.

Immediately following argument, a Per Curiam Order disbarring Berry was entered on January 14, 2014, which stated:

ORDERED, by the Court of Appeals of Maryland, that the respondent, Steven Gene Berry, be, and he is hereby, [437 Md. 158] disbarred, effective immediately, from the further practice of law in the State of Maryland; and it is further
ORDERED that the Clerk of this Court shall strike the name of Steven Gene Berry from the register of attorneys, and pursuant to Maryland Rule 16-760(e), shall certify that fact to the Trustees of the Client Protection Fund and the clerks of all judicial tribunals in the State; and it is further
ORDERED that respondent shall pay all costs as taxed by the Clerk of this Court, including the costs of all transcripts, pursuant to Maryland Rule 16-761(b), for which sum judgment is entered in favor of the Attorney Grievance Commission of Maryland against Steven Gene Berry.

Judge Salant's written Findings of Fact and Conclusions of Law stated:

Findings of Fact and Conclusions of Law [[10]]

Page 211

Pursuant to an Order of the Court of Appeals dated December 4, 2012, the above-captioned disciplinary matter was transmitted to the Circuit Court for Montgomery County, Maryland, for trial relating to Respondent's alleged professional misconduct in misappropriating funds in an estate escrow account as successor personal representative and attorney for the estate and for overdrafting funds in his attorney trust account. The matter came before this Court for a two-day trial on April 15, 2013. Upon consideration of the evidence presented at trial and the arguments of counsel and the parties, this Court finds the following facts to have been established by clear and convincing evidence:
Findings of Fact
Background
Respondent, Steven Gene Berry (" Respondent" or " Berry" ) was admitted to the Maryland Bar on December 15, 1988. Berry has also been previously admitted to the Oregon Bar (1978) and the Indiana Bar (1982). Respondent operates a general solo practice in Bethesda, Maryland that [437 Md. 159] consists primarily of representing individuals with small traffic or criminal matters in the District Courts of Maryland, occasional trust and estate work, occasional domestic relations cases, relatively simple wills and powers of attorney, and some court-appointed federal misdemeanor and appellate cases. Respondent has no associates, secretary, receptionist, law clerk, or paralegal. Respondent has no previous history of bar complaints or disciplinary actions.
The Bowles Estate
On February 15, 2005, Respondent was appointed as successor personal representative in the Estate of Patricia Mae Bowles (" Bowles Estate" ), Estate No. W43773, in the Orphans' Court for Montgomery County. Respondent was appointed to this position after the original personal representative, Michelle B. Allen, misappropriated more than $300,000 from the Bowles Estate. On May 12, 2005, Respondent opened an escrow account for the Bowles Estate at Mercantile Potomac Bank (now PNC Bank) titled " Estate of Patricia Mae Bowles, Steven G. Berry (Personal Representative)" (" Bowles escrow account" ). Respondent opened the account with a check in the amount of $14,997.66 from Wachovia Bank, where the Bowles escrow account was originally held by Michelle Allen.
John DeBone, a paralegal with the Attorney Grievance Commission, reviewed, summarized, and analyzed Respondent's bank records and accounts submitted to the court. As DeBone testified, Respondent's accountings contained three types of errors: (1) a check went through the bank but the check listed on the accounting was listed as a different amount; (2) a check went through the bank but was never listed on an accounting; and (3) a check listed on the accounting never went through the bank during the time period reviewed.
Throughout his appointment as successor personal representative and attorney to the Bowles Estate, Respondent made numerous unauthorized disbursements to himself for commission and attorney's fees and failed to accurately reflect these disbursements on his accounts to the court. [437 Md. 160] On November 4, 2005, Respondent wrote Check Number 1003 payable to " Steven G. Berry" as " Successor Personal Representative" in the amount of

Page 212

$9,500 from the Bowles escrow account, and cashed the same on November 7, 2005. On November 18, 2005, Respondent wrote Check Number 1004, again payable to himself, in the amount of $4,500, and cashed the same on November 21, 2005. On December 2, 2005, Respondent wrote Check Number 1005, payable to himself in the amount of $500, and cashed the same on December 5, 2005. At the time Respondent withdrew funds for himself in the total amount of $14,500 from the Bowles escrow account, he had not received approval from the Orphans' Court to disburse monies to himself as successor personal representative, nor did he petition the court for approval to disburse despite being aware that he was required to do so. Respondent also had not received consent from the interested persons of the Bowles Estate to disburse monies to himself for personal representative commission or counsel's fees.
On December 6, 2005, after having already disbursed a total of $14,500 to himself, Respondent filed a Petition for Allowance of Interim Personal Representative Commission and Interim Attorney's Fees (" First Petition" ) requesting an interim personal representative's commission and counsel's fee of $15,834.37 for services he rendered on behalf of the estate and stating that he applied a 25% professional courtesy discount to the actual time expended on the case. In the Petition, Respondent falsely represented that the Bowles escrow account had a " sum total of $22,671.44." In fact, as of December 5, 2005, when Respondent served the Petition upon interested parties, there was a balance of $8,171.44. The balance was $8,171.44 as a result of disbursements Respondent made to himself totaling $14,500, which Respondent failed to disclose to the Court in the First Petition. On January 17, 2006, the Court approved Respondent's request for $15,834.37 as and for commission and fees.
[437 Md. 161] Seven months later, on July 17, 2006, Respondent filed his First Account of Successor Personal Representative for the period of January 11, 2004 through July 17, 2006. Berry signed the First Account under oath and under the penalties of perjury. However, Respondent knowingly and deliberately presented inaccurate information in his First Account to give the false impression that his accounting and disbursements of monies held in the Bowles escrow account were proper and lawful. In his First Account, Respondent represented that Check Number 1003 was dated 5/24/2005, was in the amount of $21.18, and was issued to " U.S. Postal Service" for " payment for certified mail postage." However, Check Number 1003 was actually dated 11/4/2005, was in the amount of $9,500, and was issued to " Steven G. Berry" for " Patricia M. Bowles." Also, Respondent excluded a copy of Check Number 1003 from his First Account, although he included copies of most of the other checks he disbursed from the Bowles escrow account.
In addition to misrepresenting Check Number 1003 in his First Account, Respondent failed to disclose numerous checks that he issued to himself from January 11, 2004 to July 17, 2006 without authorization or approval from the Orphans' Court, as follows:

Date (issued and posted) Check Number Amount Payee

11/18/05 and 11/21/05 1004 $4,500 Steven G. Berry

12/2/05 and 12/5/05 1005 $500 Steven G. Berry

12/6/05 and 12/7/05 1006 $750 Steven G. Berry

1/19/06 and 1/19/06 1007 $4,000 Steven G. Berry

3/11/06 and 3/13/06 1008 $6,000 Steven G. Berry

4/28/06 and 4/28/06 1009 $2,000 Steven G. Berry

5/5/06 and 5/8/06 1010 $2,000 Steven G. Berry

6/30/06 and 7/3/06 126 $2,500 Steven G. Berry

Page 213

In sum, by July 2006, Respondent had taken for himself a total of $31,750 from the Bowles escrow account without authorization from the court and without disclosing same to either the Orphans' Court or to the interested persons.
In his First Account, Respondent additionally misrepresented that he disbursed Check Number 115, dated 1/21/2006, for the amount of $15,834.37 to Steven Gene Berry as " personal representative's commission and counsel [437 Md. 162] fee." However, Respondent never presented that check for payment. Respondent admitted during trial that he never intended to cash the check, but only wrote it and presented a copy to the court to give the false impression that he did. Respondent knew that such information was false and inaccurate, yet included the same to purposefully conceal the multiple unauthorized payments to himself.
Respondent subsequently filed eight additional accounts, all signed under oath and penalties of perjury, and all of which contained misrepresentations and omissions. On July 31, 2006, Respondent filed an Amended First Account of Successor Personal Representative of the Bowles Estate in which he continued to make the same misrepresentations as he did in his First Account. On July 10, 2007, Respondent filed his Second Account of Successor Personal Representative. Not only did the Second Account contain the same misrepresentations from his previous account but also contained additional misrepresentations to conceal the unauthorized disbursements to himself from the Bowles escrow account. Respondent fabricated the dates, amounts, and payees on checks, as well as the purpose of the disbursements of the checks. Respondent provided, in part, the following in his Second Account:

Date Check No. Amount Payee/Purpose

7/17/2006 126 $25.00 U.S, Postal Service— postage for mailing the First Account to the interested persons.

7/31/2006 128 $21.00 U.S. Postal Service— postage for mailing to Motion for Summary Judgment Regarding the prior Personal Representative's Motion to Approve Sale of 1053 Grady Avenue, Charlottesville, Virginia with attached Exhibits to the interested persons.

10/17/2006 131 $4.88 U.S. Postal Service— fee for certified mail Service on Attorney Richard Paugh.

10/30/2006 132 $10.08 Nelson County, Virginia, Treasurer— property tax.

4/5/2007 134 $11.16 U.S. Postal Service— postage for mailing of the spreadsheet of Michelle B. Allen's provided financial information to the Interested Persons.

Page 214

Date Check Number Amount Payee

6/30/2006 126 $2,500 Steven G. Berry

7/26/2006 128 $3,200 Steven G. Berry

8/8/2006 131 $1,500 Steven G. Berry

8/21/2006 132 $2,000 Steven G. Berry

10/5/2006 134 $2,000 Steven G. Berry

[437 Md. 163] Respondent never disclosed the actual disbursements to the Court or to the interested persons of the Bowles Estate. In addition, as Respondent had done in the First Account, Respondent failed to disclose in the Second Account the following checks that he issued to himself from the Bowles escrow account:

Date (issued and posted) Check Number Amount Payee

10/25/06 and 10/26/06 137 $3,200 Steven G. Berry

11/2/06 and 11/3/06 140 $1,000 Steven G. Berry

11/10/06 and 11/10/06 141 $2,000 Steven G. Berry

11/30/06 and 11/30/06 142 $1,000 Steven G. Berry

12/14/06 and 12/15/06 143 $1,400 Steven G. Berry

1/30/07 and 1/31/07 144 $1,500 Steven G. Berry

 

By July 2007, Respondent had taken a total of $50,550 from the Bowles escrow account without authority or approval from the court.

From April 30, 2008 through May 20, 2010, Respondent filed his Third, Fourth, Fifth and Amended Fifth Accounts of Successor Personal Representative, which, again, were prepared and filed under oath and under penalties of perjury. These accounts not only contained the same misrepresentations and omissions from Respondent's previous accounts, but also contained additional misrepresentations concerning disbursements he made to himself from the Bowles escrow account. Respondent again fabricated the dates, amounts, payees, and purposes of the disbursements. For example, Respondent provided, in part, the following in his Third, Fourth, Fifth, and Amended Fifth Accounts:

Date Check No. Amount Payee/Purpose

8/9/2007 137 $23.00 U.S. Postal Service— Postage Fee for mailing the Second Account of Successor Personal Representative and Petition to Show Cause.

9/9/2008 1008 $5.20 U.S. Postal Service— mailing to Attorney James W. Cox of Michie, Hamlett, Rasmussen & Tweel, PLLC

11/17/2009 1012 $30.25 Nelson County, Virginia, Treasurer— property tax.

5/11/2010 1013 $30.25 Nelson County, Virginia, Treasurer— property tax.

5/12/2010 1014 $8,461.78 Register of Wills for Montgomery County

 

[437 Md. 164] The actual disbursements Respondent made for these check numbers, as revealed by the bank records of the Bowles escrow account, were as follows:

Date Check No. Amount Payee

10/25/2006 137 $3,200 Steven G. Berry

8/22/2008 1008 $60.00 Steven G. Berry

9/24/2008 1012 $100.00 Steven G. Berry

11/21/2008 1013 $10.06 U.S. Postal Service

12/5/2008 1014 $30.25 Treasurer— Nelson County

Page 215

Respondent never disclosed the actual disbursements of these checks to the Court or to the interested persons of the Bowles Estate. Further, Respondent never corrected any of his accounts with the Orphans' Court as to either his omissions or misrepresentations.
As of May 1, 2010, the balance of the Bowles escrow account had been reduced to $834.95 after Respondent had made multiple unauthorized payments to himself. On May 12, 2010, despite this reduced account balance, Respondent issued Check Number 1022 in the amount of $8,461.78 to " Register of Wills for Montgomery County," when the Bowles escrow account did not contain sufficient funds to cover the check. In order to cover the shortfall, on May 11, 2010 and May 13, 2010, Respondent's father, Donald Berry, wired $5,000 and $3,000, respectively, into Respondent's Attorney Trust Account. On May 12, 2010 and May 14, 2010, Respondent deposited nearly all of the monies he received from his father, specifically $4,900 and $2,900, respectively, into the Bowles escrow account. But for the monies from his father's loan, Respondent would not have had sufficient funds in the Bowles escrow account to cover the entire amount of Check Number 1022. Respondent purposefully deposited his own personal funds into the Bowles escrow account to cover the deficiency caused by his unauthorized payments to himself from the escrow account.
On August 3, 2010, Respondent filed his Amended Petition for Second Interim Personal Representative Commission and Attorney Fees (" Second Petition" ), which was signed under oath, requesting an additional $23,828.06 in [437 Md. 165] commission and attorney's fees. Respondent attached his invoice for work allegedly performed on behalf of the Bowles Estate from December 9, 2005 through May 20, 2010 and indicated that had he charged his normal fee rate, he would have generated a fee of $69,919.50. However, when Respondent filed the Second Petition, only $80.76 remained in the Bowles escrow account because Respondent has already taken for himself a total of $50,760 without any authority or approval from the court. Respondent failed to disclose the disbursements he made to himself from the Bowles escrow account. Respondent falsely represented that the Bowles estate had a " balance forward of $24,534.56" and that it was " SOLVENT " .
On January 14, 2011, the Orphans' Court granted Respondent's Second Petition and authorized Respondent to pay himself $23,828.06 from the assets of the Bowles Estate. Based upon the two Orders granting Respondent's requests for interim commission and fees, Respondent was authorized by the Court to pay himself a total of $39,662.43 from the assets of the Bowles Estate. Significantly, as of February 10, 2009, Respondent had already paid himself, without any notice to or authority from the court, a total of $50,760 from the Bowles escrow account as follows:

Date (posted) Check No. Amount

11/7/05 1003 $9,500.00

11/21/05 1004 4,500.00

12/5/05 1005 500.00

12/6/05 1006 750.00

1/19/06 1007 4,000.00

3/13/06 1008 6,000.00

4/28/06 1009 2,000.00

5/8/06 1010 2,000.00

7/3/06 126 2,500.00

7/26/06 128 3,200.00

8/8/06 131 1,500.00

8/21/06 132 2,000.00

10/5/06 134 2,000.00

10/26/06 137 3,200.00

11/3/06 140 1,000.00

11/10/06 141 2,000.00

11/30/06 142 1,000.00

12/15/06 143 1,400.00

1/31/07 144 1,500.00

8/25/08 1008 60.00

9/24/08 1012 100.00

2/10/09 1017 50.00

Total ...


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