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Attorney Grievance Commission of Maryland v. Powell

Court of Appeals of Maryland

August 28, 2018

ATTORNEY GRIEVANCE COMMISSION OF MARYLAND
v.
ROGER N. POWELL

          Argued: June 1, 2018

          Circuit Court for Baltimore City Case No.: 24-C-17-003207/AG

          Barbera, C.J. Greene, Adkins, McDonald, Watts, Hotten, Getty, JJ.

          OPINION

          GETTY, J.

         This attorney discipline case involves an attorney who represented the personal representative of an estate. While representing his client, the attorney failed to submit a timely, complete, and accurate inventory of estate assets and an administrative account of the estate. The attorney also failed to submit a petition for personal representative's commissions and attorney's fees before disbursing fees and commissions to himself and the personal representative. Even after the Orphans' Court ordered him to return the estate funds, the attorney did not. Additionally, the attorney filed a lawsuit against a previous personal representative of the estate which the circuit court and the Court of Special Appeals determined was without substantial justification. Lastly, the attorney failed to properly manage his trust accounts, using the accounts for personal matters, and failed to retain complete records.

         On May 5, 2017, the Attorney Grievance Commission of Maryland ("Bar Counsel") filed a Petition for Disciplinary or Remedial Action ("Petition") alleging that Roger N. Powell ("Powell") had violated the Maryland Lawyers' Rules of Professional Conduct ("Rules").[1] The Petition alleged that Powell, during representation of Charles Wingler in the administration of Charlene Wingler's estate ("the Estate" or "decedent's Estate") and otherwise, violated the following Rules: 1.1 (Competence); 1.3 (Diligence); 1.4 (Communication); 1.5 (Fees); 1.7 (Conflict of Interest); 1.8 (Conflict of Interest); 1.15 (Safekeeping Property); 3.1 (Meritorious Claims and Contentions); 3.3 (Candor Toward the Tribunal); 3.4 (Fairness to Opposing Party and Attorney); 4.4 (Respect for Rights of Third Persons); 8.1 (Bar Admission and Disciplinary Matter); and 8.4 (Misconduct).[2] The Petition also alleged that Powell violated Maryland Rules 16-603 (Duty to Maintain Account), 16-606.1 (Attorney Trust Account Record-Keeping), 16-607 (Commingling of Funds), and 16-609 (Prohibited Transactions).[3]

         By Order dated June 6, 2017, we designated Judge Philip S. Jackson ("the hearing judge") of the Circuit Court for Baltimore City to conduct a hearing concerning the alleged violations and to provide findings of fact and recommended conclusions of law. See Maryland Rule 19-722(a). The hearing took place over the course of September 27-29, 2017 ("evidentiary hearing"). At the evidentiary hearing, Bar Counsel introduced into evidence various exhibits, including documents relating to the Estate and to Powell's attorney trust accounts. Several witnesses, including E. Suzan Miller, Charles Miller, Charles Wingler, Jean Wingler, and Powell, testified.

         After the evidentiary hearing concluded, the hearing judge requested that the parties submit proposed findings of facts and conclusions of law. Bar Counsel submitted a memorandum within the period specified by the hearing judge. The hearing judge then submitted his findings of facts and conclusions of law opinion to this Court on January 10, 2018. On January 17, 2018, Powell filed a motion to remand with this Court that alleged that he submitted a legal memorandum to the hearing judge at the close of evidence that was not considered by the hearing judge. We granted Powell's motion and referred the matter back to the hearing judge to consider Powell's memorandum. The hearing judge then issued an updated opinion on March 30, 2018. In his recommended conclusions of law, the hearing judge found that Powell violated Rules 1.1, 1.3, 1.5(a), 1.7, 1.15(a), 3.1(a), 3.3(a), 3.4(c), 4.4, 8.1(b) and 8.4(a) and (c). The hearing judge also concluded that Powell violated Maryland Rules 16-606.1, 16-707, and 16-609.

         Both parties filed exceptions to the hearing judge's findings of fact and recommended conclusions of law. On June 1, 2018, we heard oral argument in this matter. The same day, we issued a per curiam order disbarring Powell. We now explain our reasons for imposing the sanction of disbarment.

         BACKGROUND

         Powell was admitted to the Bar of Maryland in June 1971 and has maintained a law office in either Baltimore City or Baltimore County since his admission.

         This matter involves two instances of alleged misconduct stemming from: (a) a complaint filed by E. Suzan Miller, Esq. ("Attorney Miller"), pertaining to Powell's conduct during the administration of the Estate; and, (b) Powell's management of his attorney trust accounts generally. We summarize the hearing judge's factual findings below.

         The Will and the Administration of the Estate

         In 2004, Charlene Wingler ("the decedent") handwrote a document titled "Charlene Denise Wingler's final wishes" (the "will"). In this will, the decedent appointed her longtime friend, Stephanie Wilking ("Wilking"), as the personal representative of the Estate and as beneficiary to care for her pets and house with the proceeds of the Estate. Additionally, the will gifted personal property and $20, 000 to her brother, Charles Wingler, and $5, 000 to his wife. Although the will was required to be signed by the decedent and witnessed by two individuals, only one witness signed the document. The will included a list of the decedent's assets, including her bank, retirement, and investment accounts and life insurance policies.

         On January 8, 2011, Charlene Wingler died. Attorney Miller began representation of Wilking in matters related to the Estate following Charlene Wingler's death. Although she had concerns about the validity of the handwritten will due to the lack of two witness signatures, Attorney Miller filed the will along with other necessary documents based upon a conversation she had with an assistant Register of Wills. Included in these documents were proofs of execution of the will completed by two witnesses although only one signed the will. The will was admitted for administrative probate on April 1, 2011, and Wilking was appointed personal representative of the Estate.

         During June 2011, Charles Wingler contacted Attorney Miller and told her that he had received the Estate documents she had sent and that he had moved from Hampstead to Ocean City, Maryland. Attorney Miller apprised the Orphans' Court for Carroll County ("Orphans' Court") of this information. Charles Wingler also stated he was not interested in becoming the personal representative of the Estate and that he had personal property stored in an outbuilding located on the decedent's property that he needed to collect. Since there was also property in the outbuilding that belonged to one of the decedent's friends, Wilking wanted to be present when Charles Wingler came to claim his property. Charles Wingler agreed to coordinate a time with Wilking to retrieve his property but never did. Instead, he went to the decedent's real property when Wilking was not present and was unable to collect his personal belongings. In September 2011, Attorney Miller sent Charles Wingler a letter informing him that if he did not make arrangements during September, the property would be considered abandoned. Charles Wingler did not make arrangements to claim his property during September.

         No interested parties, including Charles Wingler, challenged the will and therefore, the Estate was administered for approximately one year consistent with the terms of the will. As personal representative, Wilking opened a bank account for the Estate and made expenditures, including care for the decedent's pets, payment of the decedent's debts, and repairs to the residential real property in preparation for its listing for sale.

         The decedent's retirement accounts were deposited with Fidelity Investments ("Fidelity"). The decedent's Fidelity accounts totaled $127, 517.41. Around April 2011, Fidelity notified Wilking that there had been no beneficiary designated in the accounts and the retirement funds were paid to the Estate. However, on September 19, 2011, Fidelity sent a letter to Wilking alerting her that a recordkeeping mistake had been made by Fidelity and that Wilking was the beneficiary of the retirement accounts. Wilking, as personal representative, returned the funds from the Estate to Fidelity and the funds were then sent to Wilking in her individual capacity as the rightful beneficiary.

         In the inventory filed on June 6, 2011, Attorney Miller and Wilking recorded the full value of the Fidelity funds and the decedent's value of real property at $320, 700. This value was based upon the State Department of Assessments and Taxation's tax assessment value as of July 1, 2011, which Attorney Miller testified was customary to use for estate purposes.

         On January 3, 2012, Attorney Miller and Wilking filed an amended inventory and an administration account. It reported the decreased value of the Estate assets due to Wilking being named the beneficiary on the Fidelity retirement accounts. Wilking also reported a decrease in the real property value based upon an appraisal by Bitzel & Associates, Inc. that concluded that the value of the dilapidated property was $130, 000 and that extensive repairs were required to bring it into suitable condition for sale. A copy of the October 31, 2011 appraisal, which noted that the real estate needed a "gut remodel," and photographs of the squalid condition of the interior of the property were included in the amended inventory.

         As such, Wilking used Estate assets to pay the mortgage on the real property and to prepare the property for sale. However, the transfer of $127, 517.41 in retirement funds from the Estate to Fidelity, and then to Wilking, had depleted the Estate account, leaving it with insufficient funds to make the necessary repairs. After informing the Orphans' Court, Wilking offered to purchase the property from the Estate at the reduced inventory value. On January 30, 2012, the Orphans' Court sent Charles Wingler an order approving the account subject to exceptions being filed within 20 days. No exceptions were filed.

         Also in January 2012, Attorney Miller received a call from the same assistant Register of Wills whom she spoke with a year earlier, alerting her that the earlier information imparted about the validity of the will was mistaken. With the will's validity now in question, Attorney Miller filed a petition to accept the will for administrative probate. After conducting a hearing on March 26, 2012, the Orphans' Court ordered that the will be withdrawn due to the lack of two witness signatures, that the Estate proceed intestate, and that Wilking continue as personal representative. Attorney Miller had sent Charles Wingler a copy of the petition, and the Orphans' Court had sent him a copy of the hearing notice. Although he received both mailings, Charles Wingler did not attend the hearing. Since the will was declared invalid, and the Estate was to proceed intestate, Charles Wingler became the sole heir of the decedent's Estate.

         Powell's Representation of Charles Wingler Begins

         After the Orphans' Court declared the will invalid, Charles Wingler met with Powell about his sister's Estate on April 17, 2012. Powell testified that, at this meeting, Charles Wingler told him that he had been rebuffed in his attempts to retrieve his personal property from the decedent's house. According to Powell, Charles Wingler was concerned that much of his sister's Estate "could not be accounted for." Powell entered his appearance on behalf of Charles Wingler in the Estate matter the following day.

         Around the same date, Powell contacted Attorney Miller via phone, introduced himself, and requested Estate documents. On approximately April 26, 2012, Powell mailed Attorney Miller two letters. In a May 5, 2012 response letter, Attorney Miller sent Powell a copy of the agreement of sale for the decedent's home, stated that the mortgage company involved was Wells Fargo, and suggested that Powell contact Fidelity regarding information concerning the beneficiary designation. Attorney Miller also indicated that if Charles Wingler wanted to become personal representative or list the house for sale that Wilking would be willing to resign as personal representative and terminate the agreement of sale for the decedent's house. Attorney Miller testified that Wilking was not in good health and that the stress of administering the Estate was an emotional burden.

         Instead of agreeing to Wilking's offers, and thus avoiding adversarial proceedings, Powell filed a petition with the Orphans' Court to remove Wilking as personal representative, for an accounting, to attach bond, set aside sale of real estate, and other appropriate relief on May 10, 2012. In the petition, Powell alleged that Wilking first declared the value of the decedent's real estate to be $320, 700 and then later changed its value to $130, 000. On May 17, 2012, Wilking resigned as personal representative of the Estate and filed a petition for allowance of personal representative's commission. Charles Wingler opposed Wilking's petition for allowance of personal representative's commission.

         Charles Wingler Becomes Personal Representative of the Estate

         At an August 28, 2012 hearing, the Orphans' Court officially removed Wilking as personal representative of the Estate, appointed Charles Wingler as the successor personal representative, and directed Wilking to file a final accounting within thirty days.[4] Also at this hearing, Powell offered evidence of Wilking's alleged wrongdoing in her handling of the decedent's Estate. Powell presented the testimony of a real estate broker who believed that the property value of the decedent's residence was between $200, 000 and $250, 000 as of May 2012. The real estate broker also admitted that, in estimating the property's value, he did not go inside the property and that the valuation was based on a projection that the house would be improved.

         On October 9, 2012, Powell took control and possession of the decedent's Estate and approved the sale of the real property for $180, 000 to a different buyer. By the time the property had been sold, a new roof and new windows had been installed.

         Powell then submitted an amended inventory to the Orphans' Court on January 29, 2013. The Orphans' Court found this filing deficient in many ways. The inventory submission provided no documentation supporting the values of the listed Estate property. Instead of listing $180, 000 as the sales price of the decedent's real property, Powell wrote "contract for sale of estate . . . Appraiser testified to a higher value before gaining access and finding that kitchen and both bathrooms had been removed." Powell failed to acknowledge that the real property was encumbered by a $110, 000 mortgage. Additionally, Powell neglected to list jewelry in the inventory even though Powell later admitted that Wilking turned over a box of jewelry and Powell had it appraised on August 29, 2012. Additionally, a copy of the appraisal was not submitted with the inventory either. According to the inventory submitted by Powell, the net value of the Estate after the sale of real estate was approximately $68, 700.

         Powell also took control over the Estate's funds on approximately October 9, 2012. Instead of depositing the approximately $70, 000 in Estate funds into an account in the name of the Estate, Powell deposited the funds into his attorney trust fund account at BB&T Bank ("BB&T"). In October and December 2012, Powell disbursed $29, 000 to Charles Wingler through checks titled "Advancement on Estate Distribution" and "Advance on Bequest." Prior to filing an inventory, accounting, or petition for attorney's fees, Powell began issuing checks to himself which included references to the decedent's Estate. Other than a $121 check issued for court costs, the remainder of the Estate assets, approximately $40, 000, was disbursed to Powell in checks that specifically referenced work he performed on behalf of the Estate.

         Powell's Lawsuit against Wilking

         Although Charles Wingler had not filed any exceptions to the various Orphans' Court orders throughout the estate administration process, Powell filed a separate civil action in the Circuit Court for Carroll County on February 1, 2013. In this action, Powell, on behalf of Charles Wingler as an individual and as personal representative of the Estate, named Wilking and NGM Insurance Company ("NGM")[5] as defendants. The lawsuit alleged that Wilking engaged in acts of self-serving misconduct and breach of fiduciary duty which caused the Estate to lose $350, 000. Attorney Miller, on behalf of Wilking, filed a motion for summary judgment on October 1, 2013. Following a hearing, the circuit court granted summary judgment in favor of Wilking on November 21, 2013.

         Attorney Miller then filed a motion for sanctions against Powell and Charles Wingler on April 4, 2013, alleging that the civil action was brought in bad faith and without substantial justification. The circuit court granted the motion for sanctions, awarding Wilking and NGM approximately $50, 000, jointly and severally. Charles Wingler then moved to alter or amend the judgment. In an unreported opinion, the Court of Special Appeals held that the circuit court "was not clearly erroneous in finding that Mr. Wingler lacked substantial justification to bring and maintain this case" and that the circuit court "did not err in awarding costs and fees under Rule 1-341 to Mrs. Wilking and NGM." Wingler v. Wilking, No. 1845, Sept. Term, 2015, 2016 WL 6988477, at *7 (Md. Ct. Spec. App. Nov. 29, 2016).

         Powell Fails to Comply with Deadlines

         Following the initiation of the lawsuit against Wilking, Powell filed a notice and request in the Orphans' Court on March 15, 2013 to request additional time before filing an interim account. Specifically, Powell argued that Charles Wingler was obligated to pursue the lawsuit in order to recover estate assets. The Orphans' Court agreed to extend the deadline until September 13, 2013. Notably, Powell's March 15, 2013 filing did not include a request to authorize the payment of attorney's fees.

         However, Powell failed to file the administrative account by the September 13, 2013 deadline and the Orphans' Court issued another show cause order on October 15, 2013. Powell responded to this order and requested an extension which was granted, and the deadline was extended until May 6, 2014. Despite the second extension, Powell did not file an administrative account by the May 6, 2014 deadline and on May 20, 2014, the Orphans' Court issued another show cause order.

         The Orphans' Court held a hearing on October 7, 2014 to address the missed deadlines. At the hearing, Charles Wingler and Powell consented to Wilking receiving $5, 000 as commission for her tenure as personal representative contingent on $5, 000 remaining in Estate funds after payment of expenses. That same day, the Orphans' Court issued an order directing Charles Wingler and Powell to file an administrative account by November 7, 2014. In its order, the Orphans' Court explicitly requested that the administrative account detail the necessity of a trip to Florida[6] and that a petition for attorney's fees be filed with the administrative account detailing the amount of Estate money paid to Powell thus far. The Orphans' Court also requested that Powell and Attorney Miller prepare a joint proposed order detailing the payment of fees and commissions associated with the removal of Wilking as personal representative.

         Powell filed a petition for attorney's fees and a consent to payment of attorney's fees, signed by Charles Wingler, on approximately October 22, 2014. The petition for attorney's fees listed "Legal fees (see Petition filed October 22, 2014-161 hours $60, 375.00 (pending) Fees advances….$40, 000.00" and "Litigation expenses see itemization filed October 22, 2014….. $1, 378.06." The filing fee for the circuit court lawsuit and the costs for the Florida trip were included in this amount.

         In a November 4, 2014 letter, Attorney Miller informed the Orphans' Court that Powell was not cooperating in preparing or submitting the joint proposed order detailing the payment of fees for the removal of Wilking as personal representative. Powell neither signed the order prepared by Attorney Miller nor cooperated in the preparation of the proposed joint order, which the Orphans' Court adopted.

         By November 25, 2014, Powell had still not complied with the Orphans' Court's October 7, 2014 order to file an administrative account. As such, the Orphans' Court issued a new show cause order on that day directing Powell to comply with the previous order by December 1, 2014. The Orphans' Court also alerted Powell that any petition for attorney's fees would not be considered until Powell complied with the October 7, 2014 order. Powell failed to comply with the extended deadline of December 1, 2014.

         Powell filed a first administration account on December 9, 2014, which showed that: the Estate was valued at $71, 539.88; Powell had billed the Estate for one hundred and sixty-one hours totaling $60, 375; Powell had already collected $40, 000 of those legal fees; and Charles Wingler had been advanced approximately $29, 000 from the Estate. The Orphans' Court, on December 22, 2014, denied attorney's fees and ordered Powell and Charles Wingler to return the $40, 000 and $29, 000, respectively, back to the Estate.

         Powell then noted an appeal to the Circuit Court for Carroll County. An attorney for the Orphans' Court filed a motion for summary ...


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