Case Number(s): 08-O-12673; 08-O-14850
In the Matter of: William Stephen Bonnheim Bar #68693 , A Member of the State Bar of California, (Respondent).
Counsel For The State Bar: Michael J. Glass, Deputy Trial Counsel
1149 South Hill Street
Los Angeles, CA 90015-2299
(213) 765-1254
Bar #102700
Counsel for Respondent: Stephen J. Strauss, Karpman & Associates
301 North Canon Drive, Suite 303
Beverly Hills, CA 90210
(310) 887-3900
Bar #129648
Submitted to: Settlement Judge
<<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 June 24, 1976.
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 14 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. Until costs are paid in full, Respondent will remain actually suspended from the practice of law unless relief is obtained per rule 5.130, Rules of Procedure.
checked. Costs are to be paid in equal amounts prior to February 1 for the following membership years: February in three billing cycles following the effective date of discipline. (Hardship, special circumstances or other good cause per rule 5.132, Rules of Procedure.) If Respondent fails to pay any installment as described above, or as may be modified by the State Bar Court, the remaining balance is due and payable immediately.
(Hardship, special circumstances or other good cause per rule 5.132, Rules of Procedure.) If Respondent fails to pay any installment as described above, or as may be modified by the State Bar Court, the remaining balance is due and payable immediately.
<<not>> checked. Costs are waived in part as set forth in a separate attachment entitled "Partial Waiver of Costs".
<<not>> checked. Costs are entirely waived.
Respondent has no prior record of discipline over 32 years of practice.
Respondent was also cooperative with the State Bar during the State Bar’s investigation of this matter by providing copies of Respondent’s trust account records and all information requested of him.
Respondent also made complete restitution to the Blumes prior to Respondent being contacted by the State Bar.
At the time that the balance in Respondent’s client trust account dipped below the amount that should have been maintained for the client’s portion of the settlement and disputed attorneys’ fees, Respondent was a newly sober alcoholic which expert testimony would establish was directly responsible for Respondent’s failure to personally supervise the administration of his client trust account, lingering denial and anxiety over confronting one’s neglectful actions being the operative factor. Expert testimony would further establish that there is an excellent prognosis for Respondent’s full recovery and in fact Respondent has suffered no relapse in the three and one-half years since the misconduct complained of.
IN THE MATTER OF: WILLIAM STEPHEN BONNHEIM
CASE NUMBER(S): 08-012673;08-O-14850
FACTS AND CONCLUSIONS OF LAW.
Respondent admits that the following facts are true and that he is culpable of violations of the specified statutes and/or Rules of Professional Conduct.
Case No. 08-O- 12673 (Complainant: Paul and Alice Blume)
FACTS:
1. In January 2006, Paul and Alice Blume (the "Blumes") employed Respondent to represent them in a securities claim against Prudential. Respondent’s written contingency fee agreement provided that Respondent’s fee would be 33 and one third percent of any gross recovery if the case was settled more than 45 days prior to arbitration, and 40 percent of any gross recovery if received within 44 days of
the scheduled arbitration or as a result of the arbitration itself. Respondent’s written fee agreement was never signed by the Blumes.
2. On January 7, 2008, Respondent hired Ms. Sandy Pechous ("Pechous") as his new
bookkeeper. Ms. Pechous’ duties included, but were not limited to, overseeing all internal accounting and bookkeeping in Respondent’s office, and advising Respondent of the balance in Respondent bank accounts, including Respondent’s client trust account ("cta") number xxx09841 at Palm Desert National Bank. Ms. Pechous spent a few days training under the old bookkeeper prior to taking over on February
1, 2008.
3. On January 16, 2008, mediation was held between the Blumes and Prudential. Prudential offered the Blumes $90,000 to settle their claim. The Blumes accepted Prudential’s settlement offer of $90,000 in writing.
4. On January 17, 2008, the Blumes faxed a letter to Respondent in which they complained that the settlement was too low and requested that Respondent reduce his fees to 20% of the $90,000 ($18,000).
5. On or about January 24, 2008, Respondent’s office informed the Blumes that they would not reduce their fees and that Respondent’s office was requesting 40% of the $90,000 ($36,000) because Respondent’s written fee agreement provided that Respondent would receive a 40% contingency fee if
The complete account number has been omitted for privacy purposes.
the matter settled after the mediation. Respondent also informed the Blumes of their right to arbitrate the attorney fees.
6. On February 1, 2008, Ms. Pechous took over as Respondent’s bookkeeper.
7. On February 15, 2008, Respondent received the $90,000 settlement check from Prudential. On February 21, 2008, Respondent deposited the $90,000 settlement check from Prudential in Respondent’s cta.
8. In February 2008, the Blumes requested that Respondent send them their settlement proceeds minus attorney fees of 20%. Respondent did not send the Blumes their settlement proceeds at that time.
9. In February 2008, the Blumes filed their request to resolve their fee dispute with the Desert Bar. Association.
10. On April 25, 2008, the balance in the cta dropped to $8,695.90. On April 28, 2008, a deposit of $62,000 was made to the cta bringing the balance to $70,695.90.
11. On April 30, 2008, Respondent paid the Blumes $54,000 with a check from the cta.
12. On May 15, 2008, the fee arbitration award from the Desert Bar Association was rendered. The, Arbitrator awarded made a finding that Respondent was entitled to $30,000 in attorneys fees, and owed the Blumes $6,000.
13. On May 23, 2008, Respondent paid the Blumes the $6,000 with a check from the cta.
14. In or about May 2008, Respondent became aware that Ms. Pechous had and continued to have problems keeping up with the workload as bookkeeper, including, but not limited to, overseeing all internal accounting and bookkeeping in Respondent’s office, and advising Respondent of the balance in Respondent bank accounts, including Respondent’s client trust account. Respondent had not supervised Ms. Pechous or personally reconciled his cta on a monthly basis.
15. On June 1, 2008, Respondent terminated Ms. Pechous’ services. In or about mid June 2008, Respondent hired Ms. Danette Melton, as his bookkeeper. Ms. Melton has organized the bookkeeping records at Respondent’s office. Respondent also now reconciles his client trust account on a monthly
basis.
CONCLUSIONS OF LAW:
16. By failing to supervise Ms. Pechous with regard to the balance in Respondent’s cta,
reconciling the cta, and reviewing bank statements with regard to the cta, Respondent was grossly negligent and misappropriated at least $63,304.10 in settlement funds, and Respondent committed an act of moral turpitude in violation of Business and Professions Code section 6106.
17. By failing to supervise Ms. Pechous with regard to the balance in Respondent’s cta,
reconciling the cta, and reviewing bank statements with regard to the cta, Respondent was grossly negligent and Respondent failed to maintain at least $63,304.10 received on behalf of the Blumes between February 21, 2008, and April 30, 2008, and Respondent failed to maintain the balance of funds received for the benefit of a client and deposited in a bank account labeled "Trust Account," "Client Funds Account," or words of similar import.
PENDING PROCEEDINGS.
The disclosure date referred to, on page 2, paragraph A(7), was April 22, 2011.
AUTHORITIES SUPPORTING DISCIPLINE.
Standard 2.2(a) provides that, "Culpability of a member of wilful misappropriation of entrusted funds or property shall result in disbarment. Only if the amount of funds or property misappropriated is insignificantly small or if the most compelling mitigating circumstances clearly predominate, shall disbarment not be imposed. In those latter cases, the discipline shall not be less than a one-year actual suspension, irrespective of mitigating circumstances."
Standard 2.3 provides that, "Culpability of a member of an act of moral turpitude, fraud, or intentional dishonesty toward a court, client or another person or of concealment of a material fact to a court, client or another person shall result in actual suspension or disbarment depending upon the extent to which the victim of the misconduct is harmed or misled and depending upon the magnitude of the act of the misconduct and the degree to which it relates to the member’s acts within the practice of law."
Although the standards are not binding, they are entitled to great weight. In Re Silverton 36 Cal. 4th 81, 92. The court is "not bound to follow the standards in talismanic fashion. As the final and independent arbiter of attorney discipline, we are permitted to temper the letter of the law with considerations peculiar to the offense and the offender." Howard v. State Bar (1990) 51 Cal. 3d 215,221-222.
Further, in regard to application of standard 2.2(a), the court has noted that "The standard’s requirement of disbarment in the absence of compelling mitigating circumstances should be viewed as a guideline rather than an inflexible rule." Edwards v. State Bar (1990) 52 Cal. 3d 28, 38. Additionally, "The court has noted that even where the most compelling mitigating circumstances do not clearly predominate, we
have recognized extenuating circumstances relating to facts of the misappropriation that render disbarment inappropriate...As the term in used in attorney discipline cases, ’willful misappropriation’ covers a broad range of conduct varying significantly in the degree of culpability. An attorney who deliberately takes a clients funds, intending to keep them permanently, and answers client’s inquiries with lies and evasions, is deserving of more severe discipline than an attorney who has acted negligently, without intent to deprive and without acts of deception...Disbarment would rarely, if ever, e an appropriate discipline for an attorney whose only misconduct was a single act of misappropriation, unaccompanied by acts of deceit or other aggravating factors. Edwards, id. at 38.
In Lipson v. State Bar (1991) 53 Cal. 3d 1010, in two client matters, Respondent was found culpable of misappropriation of $8,400 from one, and entering into an improper business transaction with both clients. The court did not impose discipline consisting of disbarment under standard 2.2(a) as the
misappropriation by Respondent was found to be negligent due to "serious and inexcusable lapses in office procedure. The court did impose discipline consisting of a 5 year stayed suspension, 5 years probation with conditions, including a 2 year actual suspension and until Respondent complied with standard 1.4(c)(ii), and until restitution was paid. In mitigation, the court noted that Respondent had no prior record of discipline over 42 years of practice, Respondent was cooperative and candid with the State Bar, and that the misconduct was aberrational. In aggravation, Respondent had engaged in multiple acts of misconduct.
In the Matter of Lily (Review Dept. 1992) 2 Cal. State Bar Ct. Rptr. 185, while acting a fiduciary of trust funds which were to be used for the partnership venture of his clients, the Respondent commingled $20,000 of trust funds with his own, misappropriated those funds and misrepresented to a third party that the funds were in a trust account when the Respondent knew they were not. The court recommended discipline consisting of a 5 year stayed suspension, 5 years probation with conditions, including a 3 year actual suspension and until Respondent complies with standard 1.4(c)(ii). The court noted that the misconduct was serious. However, without diminishing the gravity of that misconduct, the court gave great weight to the unblemished 21 year prior record of the Respondent, and the narrow period of time over which the misconduct occurred.
In In the Matter of Tindall (Review Dept. 1991) 1 Cal. State Bar Ct. Rptr. 652, Respondent misappropriated approximately $25,000 from a client trust account in nineteen separate withdrawals over an eight month period of time. Respondent failed to complete work on the case, failed to communicate with the client, and failed to cooperate with the client’s subsequent counsel. The court rec6mmended discipline consisting of a 5 year stayed suspension, 5 years probation with conditions,
including a 3 year actual suspension and until Respondent complied with standard 1.4(c)(ii), and until restitution is paid. In regard to mitigation, little weight was given to Respondent’s 7 years of discipline free practice prior to the misconduct. Respondent did receive mitigation for his work on behalf of poor and disadvantaged clients.
In the instant case, the misappropriation by Respondent Bonnheim was due to Respondent’s gross negligence in failing to supervise Ms. Pechous. As Respondent has no prior record of discipline over 32 years of practice, and made complete restitution to the Blumes prior to Respondent being contacted by the State Bar, discipline consisting of a 3 year stayed suspension, 4 years probation with conditions, including a 2 year actual suspension and until Respondent complies with standard 1.4(ii) is appropriate.
DISMISSALS.
The parties respectfully request that the Court dismiss the following matter in the interest of justice.
Case No. 08-0-14850
The parties also respectfully request that the Court dismiss the following alleged violation in the interest of justice:
Case No. 08-0-12673, Count Two, Alleged Violation rule 4-100(B)(4)
COSTS OF DISCIPLINARY PROCEEDINGS.
Respondent acknowledges that the Office of the Chief Trial Counsel has informed respondent that as of April 22, 2011, the estimated prosecution costs in this matter are $4, 273.00. Respondent further acknowledges that should this stipulation be rejected or should relief from the stipulation be granted, the costs in this matter may increase due to the cost of further proceedings.
Case Number(s): 08-O-12673; 08-O-14850
In the Matter of: William Stephen Bonnheim
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: William Stephen Bonnheim and Stephen J. Strauss and Michael J. Glass
Respondent: William Stephen Bonnheim
Date: April 25, 2011
Respondent’s Counsel: Stephen J. Strauss
Date: May 2, 2011
Deputy Trial Counsel: Michael J. Glass
Date: May 2, 2011
Case Number(s): 08-O-12673; 08-O-14850
In the Matter of: William Stephen Bonnheim
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:
<<not>> checked. The stipulated facts and disposition are APPROVED and the DISCIPLINE RECOMMENDED to the Supreme Court.
checked. The stipulated facts and disposition are APPROVED AS MODIFIED as set forth below, and the DISCIPLINE IS RECOMMENDED to the Supreme Court.
<<not>> checked. All Hearing dates are vacated.
Page 11 at end of 1st paragraph, add “in violation of rule 4-100(a), Rules of Professional Conduct
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 5.58 (E) & (F), Rules of Procedure.) The effective date of this disposition is the effective date of the Supreme Court order herein, normally 30 days after the file date. (See rule 9.18(a), California Rules of Court.)
Signed by:
Richard A. Platel
Judge of the State Bar Court
Date: May 16, 2011
[Rules Proc. of State Bar; Rule 5.27(B); 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 San Francisco , on May 5, 2011, 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:
STEPHEN J STRAUSS ESQ
KARPMAN & ASSOCIATES
301 N CANON DR STE 303
BEVERLY HILLS, CA 90210
checked. by interoffice mail through a facility regularly maintained by the State Bar of California addressed as follows:
Michael J. Glass, Enforcement, Los Angeles
I hereby certify that the foregoing is true and correct. Executed in Los Angeles
, California, on May 17, 2011.
Signed by:
Julieta E. Gonzales
Case Administrator
State Bar Court