Board of Overseers of the Bar v. Mark Kierstead, Esq.
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Docket No.: GCF-99-37
Issued by: Grievance Commission
Date: July 28, 2000
Respondent: Mark Kierstead, Esq.
Bar Number: 001895
Disposition/Conduct: Neglect of a Client's Matter; Failure to have a Written Contingent Fee Agreement
This matter was heard by Panel E of the Grievance Commission on the petition of the Board of Overseers against Mark Kierstead, Esq., of Waterville, Maine. On June 6, 2000, a public hearing was conducted in accordance with Maine Bar Rule 7.1(e)(2) to determine whether there were grounds for the issuance of a reprimand or whether probable cause existed for the filing of an information against Mr. Kierstead arising out of his representation of Laura Pelletier, including his failure to account timely and turnover to Ms. Pelletier the proceeds of litigation held by him on her behalf, and his subsequent conduct in the course of litigation in which he and Ms. Pelletier were parties. The petition alleges numerous violations of the Maine Bar Rules including Maine Bar Rule 3.1(a) (conduct unworthy of an attorney); 3.2 (conduct involving dishonesty and which is prejudicial to the administration of justice); 3.3(a) (excessive fees); 3.5 (withdrawal from employment); 3.6 (failure to employ reasonable care and skill); 3.6(e) (failure to maintain complete records of all funds and prompt delivery to the client ); 3.6(f) (communicating with adverse party); and 3.7 (employment of legal process for delay harassment or malicious injury).
At the hearing, no objection was made to the composition of the panel. The Board of Overseers was represented by Assistant Bar Counsel, Geoffrey Welsh. Mr. Kierstead appeared pro se. Mr. Welsh examined Mr. Kierstead and Laura Pelletier. Mr. Kierstead also testified on his own behalf. Both parties offered written evidence in the form of exhibits. All exhibits were admitted into evidence without objection.
Based upon the evidence, the Panel finds that Mr. Kierstead violated the Rules of Professional Responsibility in several aspects of his representation of Ms. Pelletier. Mr. Kierstead filed no answer to the petition. Pursuant to Maine Bar Rule 7.1(e)(1), the facts set forth in the petition and the misconduct alleged in that petition are taken as admitted. At the hearing, Mr. Kierstead urged the Panel to hear his evidence. He argued that his failure to answer the petition was an oversight and that he had intended to dispute certain aspects of the petition. Mr. Kierstead identified those portions of the petition he wished to dispute. Mr. Kierstead was permitted to present evidence with respect to whether his communications with his client were deceitful, whether he exercised reasonable care and skill in his representation of Ms. Pelletier, and whether his conduct in subsequent litigation violated the rules because these allegations were considered by the Panel to bear upon the question of sanctions. Mr. Kierstead was, thus, permitted to proceed on a limited basis in defense of the foregoing allegations.
The undisputed facts are these. Laura Pelletier engaged Mark Kierstead in March of 1997 to prosecute a personal injury claim, initially commenced on her behalf by the Bangor firm of Leen & Emery. Ms. Pelletier discharged Leen & Emery in hopes that Kierstead could obtain a more valuable settlement of her claims. Leen & Emery had contracted with Ms. Pelletier for a contingent fee, consistent with Maine Bar Rule 8(d), which contained a provision for payment of one-third (⅓) of the highest settlement offer obtained by the firm from the proceeds of the ultimate recovery in the event Ms. Pelletier discharged Leen & Emery prior to recovery. On March 24, 1997, David Leen wrote to Kierstead and advised him of the firm's claim to a portion of any recovery of Ms. Pelletier's claim and its willingness to accept a compromise sum of $3,000.00. On April 30, 1997, Leen wrote again requesting payment of $3,000.00 from any recovery obtained by Kierstead on Pelletier's behalf. On June 17, 1997, Kierstead made that commitment.
Kierstead settled Ms. Pelletier's claim for a total sum of $32,500.00, significantly higher than the highest offer obtained by Leen & Emery. Kierstead disbursed to Pelletier the sum of $13,333.33 on November 25, 1997 and another $5,000.00 on or about December 5, 1997. Mr. Kierstead calculated his fee as one-third (⅓) of the net recovery, after deduction of the fee due to Leen & Emery. Respondent produced no written contingent fee agreement in compliance with Maine Bar Rule 8. The panel finds that there was none.1
David Leen, having been informed of the settlement, requested payment to Leen & Emery on December 5, 1997. Mr. Kierstead's response (or lack thereof) is the basis of the petition.
The Respondent did not remit to Leen & Emery until April 6, 1998, more than four months following his receipt of settlement funds. In the interim, Leen & Emery commenced a civil action against both the Respondent and Ms. Pelletier for all sums due under their contingent fee agreement. Respondent, thus, failed in his undertaking to hold his client harmless from liability to Leen & Emery. Respondent offered no excuse other than the press of other business interests and a brief, albeit arduous, separation from his law office on account of the ice storm of January 1998.
Once Leen & Emery commenced suit, Mr. Kierstead faced two dilemmas. He clearly had authority to settle the claim for the compromise sum. However, Leen & Emery pressed for a larger sum. In addition, Ms. Pelletier cross-claimed and refused to dismiss without satisfaction of the Leen & Emery claim, plus her damages arising out of the litigation. As a consequence, further delay and expense ensued all of which could have been avoided had Mr. Kierstead simply paid Leen & Emery as he had agreed. These dilemmas were of Respondent's own making and avail him of nothing in terms of mitigation.
The Board characterizes this case as egregious. Indeed, Respondent's conduct should not be excused. Respondent ignored too many warnings from his fellow attorneys and neglected too many demands from his client. In fashioning an appropriate sanction we look, first to the underlying misconduct. We note that the essence of the complaint against Respondent is that he delayed payment to Leen & Emery for approximately four months. The reasons for that delay remain unclear. The Panel heard no evidence that Ms. Pelletier's money was misappropriated by Respondent. Respondent testified that the money never left his trust account. Moreover, the Panel cannot conclude on the evidence, that Respondent misled either his client or Leen & Emery. He simply ignored them for an unconscionable period of time. The Respondent violated the rules due to delay, as opposed to deceit. He has made his client whole. We believe that the absence of deceit and the fact that restitution has been made is what distinguishes this case from a case which might otherwise warrant a finding of probable cause for suspension or disbarment.
On the other hand, a dismissal, even with a warning would require the Panel to overlook the sum of numerous other violations of the rules including Mr. Kierstead's failure to comply with Rule 8 and his lack of attention in his obligations to account. The harm done to Ms. Pelletier was not minor. She put too much expense and considerable anxiety before Mr. Kierstead was coerced into meeting his obligations to her. Mark Kierstead was the agent of Ms. Pelletier, owing to her the fiduciary duties of due care, loyalty and obedience. He failed in the performance of each of those duties. He failed to attend to the simplest of undertakings. He neglected the bill of Leen & Emery. He failed to timely respond to his client's requests for assistance in resolving the matter and her subsequent demands for performance. He testified that his personal business interests diverted his attention from client matters and, in so doing, concedes his violation of the Rules of Professional Responsibility.
Accordingly, Mark Kierstead, Esq. is hereby reprimanded for his inattention to matters entrusted to him in violation of the Rules of Professional Responsibility in connection with his representation of Laura Pelletier.
For the Grievance Commission
Stephen G. Morrell, Esq.
Charles W. Smith, Jr., Esq. .
1Prior to this hearing, a panel of the Fee Arbitration Commission decided the amount of a reasonable fee for Mr. Kierstead's services on Ms. Pelletier's behalf. The parties acknowledged that Mr. Kierstead had since remitted to Ms. Pelletier in compliance with that decision.