Case Number(s): 04-O-15061 (Inv. Case 05-O-04876)
In the Matter of: Michael D. Anderson, Bar # 194493, A Member of the State Bar of California, (Respondent).
Counsel For The State Bar: Anthony J. Garcia, Bar # 171419
Counsel for Respondent: Ellen A. Pansky, Bar # 77688
Submitted to: settlement judge State Bar Court Clerk’s Office Los Angeles
Filed: September 13, 2006
<<not>> checked. PREVIOUS STIPULATION REJECTED
Note: All information required by this form and any additional information which cannot be provided in the space provided, must be set forth in an attachment to this stipulation under specific headings, e.g., "Facts," "Dismissals," "Conclusions of Law," "Supporting Authority," etc.
1. Respondent is a member of the State Bar of California, admitted February 17, 1998.
2. The parties agree to be bound by the factual stipulations contained herein even if conclusions of law or disposition are rejected or changed by the Supreme Court.
3. All investigations or proceedings listed by case number in the caption of this stipulation are entirely resolved by this stipulation and are deemed consolidated. Dismissed charge(s)/count(s) are listed under "Dismissals." The stipulation consists of 15 pages, not including the order.
4. A statement of acts or omissions acknowledged by Respondent as cause or causes for discipline is included under "Facts."
5. Conclusions of law, drawn from and specifically referring to the facts are also included under "Conclusions of Law".
6. The parties must include supporting authority for the recommended level of discipline under the heading "Supporting Authority."
7. No more than 30 days prior to the filing of this stipulation, Respondent has been advised in writing of any pending investigation/proceeding not resolved by this stipulation, except for criminal investigations.
8. Payment of Disciplinary Costs-Respondent acknowledges the provisions of Bus. & Prof. Code §§6086.10 & 6140.7. (Check one option only):
<<not>> checked. costs added to membership fee for calendar year following effective date of discipline (public reproval).
<<not>> checked. case ineligible for costs (private reproval).
checked. costs to be paid in equal amounts for the following membership years: In the two billing cycles following the effective date of the Supreme Court Order. (hardship, special circumstances or other good cause per rule 284, Rules of Procedure.)
<<not>> checked. costs waived in part as set forth in a separate attachment entitled "Partial Waiver of Costs".
<<not>> checked. costs entirely waived.
9. The parties understand that:
<<not>> checked. (a) A private reproval imposed on a respondent as a result of a stipulation approved by the Court prior to initiation of a State Bar Court proceeding is part of the respondent’s official State Bar membership records, but is not disclosed in response to public inquiries and is not reported on the State Bar’s web page. The record of the proceeding in which such a private reproval was imposed is not available to the public except as part of the record of any subsequent proceeding in which it is introduced as evidence of a prior record of discipline under the Rules of Procedure of the State Bar.
<<not>> checked. (b) A private reproval imposed on a respondent after initiation of a State Bar Court proceeding is part of the respondent’s official State Bar Membership records, is disclosed in response to public inquiries and is reported as a record of public discipline on the State Bar’s web page.
<<not>> checked. (c) A public reproval imposed on a respondent is publicly available as part of the respondent’s official State Bar membership records, is disclosed in response to public inquiries and is reported as a record of public discipline on the State Bar’s web page.
Case Number(s): 04-O-15061 (05-O-04876)
In the Matter of: Michael D. Anderson
Nolo Contendere Plea Stipulations to Facts, Conclusions of Law, and Disposition
Business and Professions Code § 6085.5 Disciplinary Charges; Pleas to Allegations
There are three kinds of pleas to the allegations of a Notice of Disciplinary Charges or other pleading which initiates a disciplinary proceeding against a member:
(a) Admission of culpability.
(b) Denial of culpability.
(c) Nolo contendere, subject to the approval of the State Bar Court. The court shall ascertain whether the member completely understands that a plea of nolo contendere shall be considered the same as an admission of culpability and that, upon a plea of nolo contendere, the court shall find the member culpable. The legal effect of such a plea will be the same as that of an admission of culpability for all purposes, except that the plea and any admissions required by the court during any inquiry it makes as to the voluntariness of, or the factual basis for, the pleas, may not be used against the member as an admission in any civil suit based upon or growing out of the act upon which the disciplinary proceeding is based. (Added by Stats. 1996, ch. 1104.) (emphasis supplied)
Rule 133, Rules of Procedure of the State Bar of California STIPULATION AS TO FACTS, CONCLUSIONS OF LAW AND DISPOSITION
(a) A proposed stipulation to facts, conclusions of law, and disposition must set forth each of the following:
(5) a statement that Respondent either
(i) admits the facts set forth in the stipulation are true that he or she is culpable of violations of the specified statutes and/or Rules of Professional Conduct or
(ii) pleads nolo contendere to those facts and violations. If the Respondent pleas nolo contendere, the stipulation shall include each of the following:
(a) an acknowledgement that the Respondent completely understands that the plea of nolo contendere shall be considered the same as an admission of the stipulated facts and of his or her culpability of the statutes and/or Rules of Professional Conduct specified in the stipulation; and
(b) if requested by the Court, a statement by the Deputy trial counsel that the factual stipulations are supported by evidence obtained in the State Bar Investigation of the matter (emphasis supplied)
I, the Respondent in this matter, have read the applicable provisions of Business and Professions Code section 6085.5 and rule 133(a)(5) of the Rules of Procedure of the State Bar. I plead nolo contendere to the charges set forth in this stipulation and I completely understand that my plea will be considered the same as an admission of culpability except as stated in Business and Professions Code section 6085.5(c).
Signed by:
Respondent: Michael D. Anderson
Date:
Case Number(s): 04-O-15061 (05-O-04876)
In the Matter of: Michael D. Anderson
a. Restitution
<<not>> checked. Respondent must pay restitution (including the principal amount, plus interest of 10% per annum) to the payee(s) listed below. If the Client Security Fund (“CSF”) has reimbursed one or more of the payee(s) for all or any portion of the principal amount(s) listed below, Respondent must also pay restitution to CSF in the amount(s) paid, plus applicable interest and costs.
1. Payee:
Principal Amount:
Interest Accrues From:
2. Payee:
Principal Amount:
Interest Accrues From:
3. Payee:
Principal Amount:
Interest Accrues From:
4. Payee:
Principal Amount:
Interest Accrues From:
<<not>> checked. Respondent must pay above-referenced restitution and provide satisfactory proof of payment to the Office of Probation not later than
<<not>> checked. Respondent must pay the above-referenced restitution on the payment schedule set forth below. Respondent must provide satisfactory proof of payment to the Office of Probation with each quarterly probation report, or as otherwise directed by the Office of Probation. No later than 30 days prior to the expiration of the period of probation (or period of reproval), Respondent must make any necessary final payment(s) in order to complete the payment of restitution, including interest, in full.
1. Payee/CSF (as applicable)
Minimum Payment Amount
Payment Frequency
2. Payee/CSF (as applicable)
Minimum Payment Amount
Payment Frequency
3. Payee/CSF (as applicable)
Minimum Payment Amount
Payment Frequency
4. Payee/CSF (as applicable)
Minimum Payment Amount
Payment Frequency
.
<<not>> checked.
1. If Respondent possesses client funds at any time during the period covered by a required quarterly report, Respondent must file with each required report a certificate from Respondent and/or a certified public accountant or other financial professional approved by the Office of Probation, certifying that:
a. Respondent has maintained a bank account in a bank authorized to do business in the State of California, at a branch located within the State of California, and that such account is designated as a “Trust Account” or “Clients’ Funds Account”;
b. Respondent has kept and maintained the following:
i. A written ledger for each client on whose behalf funds are held that sets forth:
1. the name of such client;
2. the date, amount and source of all funds received on behalf of such client;
3. the date, amount, payee and purpose of each disbursement made on behalf of such client; and,
4. the current balance for such client.
ii. a written journal for each client trust fund account that sets forth:
1. the name of such account;
2. the date, amount and client affected by each debit and credit; and,
3. the current balance in such account.
iii. all bank statements and cancelled checks for each client trust account; and,
iv. each monthly reconciliation (balancing) of (i), (ii), and (iii), above, and if there are any differences between the monthly total balances reflected in (i), (ii), and (iii), above, the reasons for the differences.
c. Respondent has maintained a written journal of securities or other properties held for clients that specifies:
i. each item of security and property held;
ii. the person on whose behalf the security or property is held;
iii. the date of receipt of the security or property;
iv. the date of distribution of the security or property; and,
v. the person to whom the security or property was distributed.
2. If Respondent does not possess any client funds, property or securities during the entire period covered by a report, Respondent must so state under penalty of perjury in the report filed with the Office of Probation for that reporting period. In this circumstance, Respondent need not file the accountant’s certificate described above.
3. The requirements of this condition are
in addition to those set forth in rule 4-100, Rules of Professional Conduct.
checked. Within one (1) year of the effective date of the discipline herein, Respondent must supply to the Office of Probation satisfactory proof of attendance at a session of the Ethics School Client Trust Accounting School, within the same period of time, and passage of the test given at the end of that session.
IN THE MATTER OF: MICHAEL DALE ANDERSON
CASE NUMBERS: 04-O-15061 (investigative case no. 05-0-4876)
A. FACTS AND CONCLUSIONS OF LAW
1. Respondent pleads nolo contendere to the following facts and violations of the specified statutes and Rules of Professional conduct. The Respondent completely understands that the plea of nolo contendere shall be considered the same as an admission of the stipulated facts and of her culpability of the statutes and Rules of Professional Conduct specified in the Stipulation.
2. The deputy trial counsel is prepared to inform the court, if requested, that the factual stipulations are supported by evidence obtained during the State Bar investigation of this matter.
FACTS
Case no. 04-0-15061, The Hill matter
The Tax work
3. On March 22, 2002, Heather and Randall Hill (the Hills) employed Michael Dale Anderson (Respondent) to represent them in legal matters that included an IRS matter. The Hills paid Respondent a total of $3,260 shortly thereafter.
4. Respondent requested and received, from INS, an extension of time for the Hills to file their 2001 taxes. The IRS extended the time to file the Hill’s taxes until October 15, 2002.
5. On October 15, 2002, the Hills filed their 2001 income taxes. They paid $50,000 with their return and owed a balance of approximately $64,000 to the IRS, but did not have adequate funds to pay.
6. In March 2003, the Hills, through their LLC created and formed by Respondent, sold a condominium that they owned. The Hills netted $140,413.75 from the sale of the property.
7. On August 22, 2003, the Hills instructed the escrow company to wire the $140,413.75 check to Respondent’s client trust account (CTA) located at Bank of America.
8. The Hills requested that Respondent disburse three checks to the Hills from his CTA between August 22, 2003 and December 30, 2003. The total of these disbursements was $105,000, plus additional cost disbursements.
9. In the first quarter of 2003, Respondent retained the services of Robert Heinrich, C.P.A. to assist the Hills with their tax liability. The Hills continue to use the services of Robert Heinrich to the present.
10. In March 2004, the IRS began to take steps to collect the Hill’s tax bill. On about March 31, 2004, the IRS filed a Notice of Federal Tax Lien against the Hills.
11. As of the date of this Stipulation, Mr. Heinrich has prepared an amended Return and continues to negotiate the Hills’ tax bill with the IRS and the issue has not been resolved.
Other Legal Work that Respondent performed for the Hills
12. In addition, the Hills hired Respondent to prepare their estate plan, to sue the moving company that damaged their furniture while it was being moved from California to Nevada, to review and advise them regarding an adverse decision in an employment matter, and to assist and work with the Hills in the formation of a new start-up company. Respondent reserved and registered for a trademark and trade name for the start up company.
13. As early as August 2003, the Hills instructed Respondent, several times, in front of multiple witnesses, that he should pay himself for the legal work he was performing from their funds that he was holding in his CTA.
14. Respondent failed to regularly update the Hills regarding how much he was charging them for the legal services that he performed.
The money in Respondent’s CTA
15. Beginning about August 13, 2004, through about October 25, 2004, Respondent’s wrote several checks to himself to compensate him for the legal services he provided to the Hills with regard to their estate plan, the moving company litigation, the review of the decision in the employment matter, and for legal work on the Hills’ start-up company and several other small matters. By October 25, 2004, Respondent had depleted his CTA of the LLCs’ funds.
16. Respondent did not provide the Hills an accounting of the funds that he held in trust until after all funds were removed from his CTA.
17. Immediately upon learning that the Hills disputed his right to the funds, Respondent returned the disputed funds back into his CTA. Currently, the money is held in Respondent’s CTA.
CONCLUSIONS OF LAW
18. By failing to regularly provide written detail regarding the legal work that he was performing for them and the cost of that work, Respondent wilfully violated Rules Professional Conduct, rule 3-110(a)
19. By failing to render appropriate accountings to the Hills for client monies in his possession, Respondent wilfully violated Rules Professional Conduct, rule 4-100(B)(3).
Case No. 05-0-4876, the Holt Matter
20. Beginning January 2003, Bennie Holt retained Respondent to defend a Temporary Restraining Order and to file a petition for conservatorship to obtain custody of his wife, whom had been relocated and housed by her children (the step-children) when she became ill. The step-children were very antagonistic towards Holt and were trying to take his wife’s (their mother’s) property, both personal and real, without using the proper legal processes. One of the issues in the matter was that a Quit Claim deed to a piece of real property that had been owned by Holt and his wife was recorded against Holt’s wishes and without his knowledge. In April 2003, after his wife’s death, the stepchildren physically attacked Holt and took some of his wife’s personal property including his wife’s Lexus.
21. Holt retained Respondent to obtain restraining orders against his step children and to file a civil action for damages. Soon after the Quit Claim deed was recorded, Holt hired Respondent to file a quiet title action in April 2003, and then represented Holt through discovery phases of the litigation, and eventually preparing for and appearing ready at trial scheduled to begin in August 2004. Then, the day before trial, it was discovered that Holt had met with the step-children and initiated settlement of both
matters on his own without advice of counsel. Holt and the step-children had prepared their own agreement. The agreement was not an advantageous settlement for Holt.
22. In February of 2004, Holt had sought the advice of separate legal counsel, Patricia Rush, who met with Holt and Respondent to discuss and strategize for trial. Attorney Rush continued to advise Holt throughout the completion of litigation. As of about July 31, 2004, Holt owed Respondent about $130,000 in earned, but unpaid legal fees. On about August 4, 2004, Holt who had previously agreed to pay Respondent from the sale of his home, agreed to execute a note in the sum of $95,000 and Deed of Trust to Respondent to secure $95,000 of unpaid legal fees. At the time that Holt agreed to execute a note and Deed of Trust to Respondent, or soon after that date, Respondent suggested that Holt meet with his separate counsel to review the terms of the agreement.
23. On September 29, 2004, Respondent met with Holt and Holt’s independent attorney Rush, to review the agreement and to review a proposed settlement involving a civil matter as well as the Quiet Title action. At that meeting, Holt, Rush, and Respondent signed a settlement agreement, settling Holt’s quiet title and civil damages lawsuits and incorporating the agreement wherein Holt granted Respondent a trust deed on his home to secure $95,000 in fees. As of that date Holt owed a total of $162,000 in legal fees and costs to Respondent. Respondent, out of concern, unilaterally agreed to write off $67,000 dollars in fees and costs that Holt owed to Respondent.
Conclusion of Law
24. By obtaining Holt’s agreement to grant Respondent a trust deed to his home to secure $95,000 in fees that he owed to Respondent without first advising Holt in writing meet with independent counsel, Respondent violated Rules Professional Conduct, rule 3-300.
25. Because Holt owed Respondent more than $95,000 on August 4, 2004, the assignment of a trust deed in Respondent’s favor was, at least colorably, fair, and Respondent suggested that Holt seek advice of his independent attorney at the time or soon after the day that Holt assigned the trust deed to Respondent. Finally, after the agreement was reviewed by Holt’s independent counsel, it was incorporated, without any changes, into a larger settlement agreement indicating that its terms were fair
to Holt.
B. PENDING PROCEEDINGS
The disclosure date referred to on page one, paragraph A.(7), was May 9,2006.
C. SUPPORTING AUTHORITIES
In the Matter of Hanson (Review Dept. 1994) 2 Cal. State Bar Ct. Rptr. 703. Hanson received a public reproval for failure to return promptly unearned fees and for failing to avoid prejudice to his client after discharge. Hanson refunded the unearned advanced fees about 15 months after he was discharged. There were no mitigating circumstances
Dudugian 1. State Bar, (1991) 52 Cal.3d 1092, at 1 100
Notwithstanding Standard 2.2(b), Court imposed public reproval for attorneys’ improper retention of client funds based on honest but mistaken belief that clients had authorized application of funds to attorneys’ fees.
Connor v. State Bar (1990) 50 Cal.3d 1047
The Supreme Court imposed the discipline of a public reproval on a Respondent for a violation of the predecessor to Rule 3-300. Connor had acquired title to the client’s property in Lake Arrowhead and then obtained a home equity loan on the property, falsely stating on the loan application that his address was that of the Lake Arrowhead property, that he was then renting and buying the property from the client, and, by a check mark, that he intended to occupy the property as his primary residence. He then
provided the proceeds of the loan to the client to avoid foreclosure. The issue of Connor’s intent to deceive the lender was raised and dismissed by the Supreme Court.
In the Holt case there are no allegations that Respondent attempted to mislead anyone, and there are no facts that would otherwise support an allegation or finding of Business and Professions Code §6106.
D. DISMISSALS
The State Bar moves the court to dismiss the following counts in the interest of justice:
Count Two;
Count Three;
Count Four; and
Count Five.
SIGNATURE OF THE PARTIES
Case Number(s): 04-O-15061 (05-O-04876)
In the Matter of: Michael Dale Anderson
By their signatures below, the parties and their counsel, as applicable, signify their agreement with each of the recitation and each of the terms and conditions of this Stipulation Re Facts, Conclusions of Law and Disposition.
Signed by:
Respondent: Michael Dale Anderson
Date: 9/1/06
Respondent’s Counsel: Ellen A. Pansky
Date: 9/7/06
Deputy Trial Counsel: Anthony J. Garcia
Date: 9/8/6
Case Number(s): 04-O-15061 (05-O-04876)
In the Matter of: Michael Dale Anderson
Finding the stipulation to be fair to the parties and that it adequately protects the public, IT IS ORDERED that the requested dismissal of counts/charges, if any, is GRANTED without prejudice, and:
checked. The stipulated facts and disposition are APPROVED AND THE REPROVAL IMPOSED.
<<not>> checked. The stipulated facts and disposition are APPROVED AS MODIFIED as set forth below, and the REPROVAL IMPOSED.
<<not>> checked. All court dates in the Hearing Department are vacated.
The parties are bound by the stipulation as approved unless: 1) a motion to withdraw or modify the stipulation, filed within 15 days after service of this order, is granted; or 2) this court modifies or further modifies the approved stipulation. (See rule 125(b), Rules of Procedure.) Otherwise the stipulation shall be effective 15 days after service of this order.
Failure to comply with any conditions attached to this reproval man constitute cause for a separate proceeding for willful breach of rule 1-110, Rules of Professional Conduct.
Signed by:
Judge of the State Bar Court: Robert M. Talcott
Date: 9-8-06
[Rule 62(b), Rules Proc.; Code Civ. Proc., § 1013a(4)]
I am a Case Administrator of the State Bar Court of California. I am over the age of eighteen and not a party to the within proceeding. Pursuant to standard court practice, in the City and County of Los Angeles, on September 13, 2006, I deposited a true copy of the following document(s):
STIPULATION RE FACTS, CONCLUSIONS OF LAW AND DISPOSITION AND ORDER APPROVING
in a sealed envelope for collection and mailing on that date as follows:
checked. by first-class mail, with postage thereon fully prepaid, through the United States Postal Service at Los Angeles, California, addressed as follows:
ELLEN A PANSKY ATTORNEY AT LAW
PANSKY & MARKLE
500 S GRAND AVE FL 14
LOS ANGELES, CA 90071
checked. by interoffice mail through a facility regularly maintained by the State Bar of California addressed as follows:
Anthony J. Garcia, Enforcement, Los Angeles
I hereby certify that the foregoing is true and correct. Executed in Los Angeles, California, on September 13, 2006.
Signed by:
Julieta E. Gonzales
Case Administrator
State Bar Court