Case Number(s): 09-O-11763 [09-O-12254; 09-O-12976; 09-O-13654; 09-O-14685; 09-O-18009; 10-O-03756; 10-O-8919; 11-O-11505]
In the Matter of: Warren W. Quan , Bar # 140032 , A Member of the State Bar of California, (Respondent).
Counsel For The State Bar: Donald R. Steedman, 180 Howard St.
San Francisco, CA 94105
Bar # 104927
Counsel for Respondent: In Pro Per Respondent
Warren W. Quann
54 Springbrook Circle
Sacramento, CA 95831
Bar # 140032
Submitted to: Assigned Judge State Bar Court Clerk’s Office San Francisco
<<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 6, 1989.
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 ** 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):
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.
<<not>> checked. Costs are to be paid in equal amounts prior to February 1 for the following membership years: **. (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.
PENDING INVESTIGATIONS;
The disclosure mentioned in paragraph A7 of the stipulation was made on November 22, 2011.
STATEMENT OF FACTS AND CONCLUSIONS OF LAW COUNT ONE
Case Nos. 09-O-11763; 09-O-12254; 09-O-12976; 09-O-13654; 09-O-14685; 09-18009; 10-O-18009; 10-O-03756; 10-O-08919; 11-O-11505
Rules of Professional Conduct, Rule 1-300(A)
[Aiding in the Unauthorized Practice of Law]
1. Respondent willfully violated Rules of Professional Conduct, rule 1-300(A), by aiding a person or entity in the unauthorized practice of law, as follows:
2. At all relevant times, Second Chance Negotiations, Inc., also known as Second Chance Legal Services ("Second Chance"), was a business enterprise providing mortgage loan modification and restructuring services constituting the practice of law.
3. At all relevant times, Second Chance was incorporated and controlled entirely by individuals who were not lawyers as defined by rule l- 10003)(3), Rules of Professional Conduct, including Christopher James Mesunas C’Mesunas") and Michael Garcia ("Garcia").
4. By on or about December 15, 2008, respondent entered into an agreement with Mesunas and Garcia to provide services to the clients of Second Chance. Specifically, respondent agreed to "handle client in take [sic], review client file[s], make ass~sment of client file[s] to determine if the client is a candidate for loss mitigation services from [Second Chance]; if necessary, refer client[s] to the negotiations division Of
[Second Chance] for loan modification negotiations and services; and handle client complaints." The, so services constituted the practice of law.
5. At all relevant times, respondent reasonably should have known that Second Chance held itself out as providing the services of a law firm.
6. At all relevant times, respondent reasonably should have known that Second Chance employed a number of individuals, referred to herein collectively as "negotiators," who were not entitled to practice law. Respondent provided processes and procedures for the negotiators to follow and established criteria for the types of cases to be accepted by Second Chance, but did not otherwise supervise or control the work of the negotiators. Second Chance negotiators were responsible for securing the loan modifications and respondent did not participate in attempting to secure the loan modifications.
7. Respondent received $125.00 from Second Chance for each Second Chance client file respondent reviewed, including another client named Carolyn Raimondi (whose small claims action against respondent was dismissed on the grounds that respondent did not receive any fees from Raimondi and Raimondi did not engage the services of respondent). The respondent received the following payments from Second Chance:
December 2008 $5,000.00
January 2009 $18,200.00
February 2009 $29,000.00
March, 2009 $20,000.00
8. At all relevant times, the negotiators engaged in the practice of law in relation to the Second Chance legal clients.
9. By allowing and assisting the negotiators to engage in the practice of law, respondent aided a person or entity in the unauthorized practice of law in violation of rule 1-300.
COUNT TWO
Case No. 09-0-12976
Rules of Professional Conduct, rule 3-700(D)(2)
[Failure to Refund Unearned Fees]
10. Respondent willfully violated Rules of Professional Conduct, rule 3-700(D)(2), by failing to refund promptly any part of a fee paid in advance that has not been earned, as follows:
11. The allegations of Count One are incorporated by this reference.
12. On or about February 18, 2009, Jeffrey and Karl Tumey ("the Turneys") hired Second Chance to perform mortgage loan modification and restructuring services and paid Second Chance $2,500. The Turneys did not pay the respondent; however, the Turneys signed a Second Chance agreement with respondent’s name as the attorney responsible for performing legal services in relation to the Turneys’ matter.
13. Respondent acknowledges that the Turneys reasonably believed that they had hired and paid respondent to provide legal services on their behalf.
14. On or about May 12, 2009 the Turneys sought a refund from Second Chance and Second Chance. refused to refund the Turneys their funds. Subsequently, Second Chance filed bankruptcy.
15. As sole attorney responsible for performing legal services for the Turneys respondent was obligated to refund any unearned attorney’s fees paid by them to Second Chance.
16. No portion of the $2,500 in fees paid by the Turneys was earned by respondent and respondent agrees to refund the $2,500 fee paid by the Turneys.
17. By failing to refund the $2,500 in fees paid by the Turneys, all of which were unearned by respondent, respondent failed to refund promptly any part of a fee paid that has not been earned.
COUNT THREE
Case No. 09-0-13654
Rules of Professional Conduct, role 3-70003)(2)
[Failure to Refund Unearned Fees]
18. Respondent willfully violated Rules of Professional Conduct, rule 3-700(D)(2), by failing to refund promptly any part of a fee paid in advance that has not been earned, as follows:
19. The allegations of Count One are incorporated by this reference.
20. On or about January 20, 2009, Vada T. Lee ("Lee") and Starshima Placide ("Placide") were solicited by Garret Reese and hired Second Chance to perform mortgage loan modification and restructuring services and paid Second Chance $1,100. Lee and Placide did not pay the respondent, however, Lee and Placide signed a Second Chance agreement with respondent’s name as the attorney responsible for performing legal services in relation to the Lee and Placide matter.
21. Respondent acknowledges that Lee and Placide reasonably believed that they had hired and paid respondent to provide legal services on their behalf.
22. Lee and Placide sought a refund from Second Chance and Second Chance refused to refund Lee and Placide their funds. Subsequently, Second Chance filed bankruptcy.
23. As sole attorney responsible for performing legal services for Lee and Placide, respondent was obligated to refund any unearned attorney’s fees paid by them to Second Chance.
24. No portion of the $1,100 in fees paid by Lee and Placide was earned by respondent and respondent agrees to refund the $1,100 fee paid by Lee and Placide.
25. By falling to retired the $1,100 in fees paid by Lee and Placide, all of which were unearned by respondent, respondent failed to refund promptly any part of a fee paid that has not been earned.
COUNT FOUR
Case No. 09-0-14685
Rules of Professional Conduct, rule 3-700(D)(2)
[Failure to Refund Unearned Fees]
26. Respondent willfully violated Rules of Professional Conduct, rule 3-700(D)(2), by failing to refund promptly any part of a fee paid in advance that has not been earned, as follows:
27. The allegations of Count One are incorporated by this reference.
28. On or about January 14, 2009, David and Cynthia Blackburn ("the Blackburns") were solicited by Tim Gibson and hired Second Chance to perform mortgage loan modification and restructuring services and paid Second Chance $2,500. The Blackburns did not pay the respondent; however, the Blackburns signed a Second Chance agreement with respondent’s name as the attorney responsible for performing legal services in relation to the Blackburns matter.
29. Respondent acknowledges that the Blackburns reasonably believed that they had hired and paid respondent to provide legal services on their behalf.
30. Blackburns sought a refund from Second Chance and Second Chance refused to refund Lee and Placide their funds. On May I5, 2009 the Blackburns filed a small claims suit against including Christopher James Mesunas ("Mesunas") and Michael (Garcia ("(Garcia") for refund of their money and received a judgment. Mesunas paid the Blackbums $200 on December 10, 2009 and $200 on January 14, 2010 and subsequently filed bankruptcy. The BIackburns are owed $2,100.
31. As sole attorney responsible for performing legal services for the Blackbums, respondent was obligated to refund any unearned attorney’s fees paid by them to Second Chance.
32. No portion of the $2,500 in fees paid by the Blackburns was earned by respondent and respondent agrees to refund the $2,100 fee paid by the Blackburns.
33. By failing to refund the $2,100 in fees paid by the Blackburns, all of which were unearned by respondent, respondent failed to refund promptly any part of a fee paid that has not been earned.
COUNT FIVE
Case No. 09-0-18009
Rules of Professional Conduct, rule 3-700(D)(2)
[Failure to Refund Unearned Fees]
34. Respondent willfully violated Rules of Professional Conduct, rule 3-700(D)(2), by failing to refund promptly any part of a fee paid in advance that has not been earned, as follows:
35. The allegations of Count One are incorporated by this reference.
36. On or about January 24, 2009, Jeanne and Michael Coleman ("the Colemans") were solicited by Nancy Bandettini and hired Second Chance to perform mortgage loan modification and restructuring services and paid Second Chance $4,000. Bandettini°s contact at Second Chance was Peter G. Galvez. The Colemans did not pay the respondent; however, the Colemans signed a Second Chance agreement with respondent’s name as the attorney responsible for performing legal services in relation to the Colemans matter.
37. Respondent acknowledges that the Colemans reasonably believed that they had hired and paid respondent to provide legal services on their behalf.
38. The Colemans sought a refund from Second Chance and Second Chance refused to refund the Colemans their funds.
39. As sole attorney responsible for performing legal services for the Colemans, respondent was obligated to refund any unearned attorney’s fees paid by them to Second Chance.
40. No portion of the $4,000 in fees paid by the Colemans was e~rned by respondent and respondent agrees to refund the $4,000 fee paid by the Colomans.
41. By failing to refund the $4,000 in fees paid by the Colemans, all of which were unearned by respondent, respondent failed to refund promptly any part of a fee paid that has not been earned.
COUNT SIX
Case No. 10-0-08919
Rules of Professional Conduct, rule 3-700(D)(2)
[Failure to Refund Unearned Fees]
42. Respondent willfully violated Rules of Professional Conduct, rule 3-700(D)(2), by failing to refund promptly any part era fee paid in advance that has not been earned, as follows:
43. The allegations of Count One are incorporated by this reference
44. On or about February 3, 2009, Gloria J. Peppers ("Peppers") was solicited by "Edward G." and hired Second Chance to perform mortgage loan modification and restructuring services and paid Second Chance $2,500. Peppers did not pay the respondent; however, Peppers signed a Second Chance agreement with respondent’s name as the attorney responsible for performing legal services in relation to the Peppers matter.
45. Respondent acknowledges that Peppers reasonably believed that she had hired and paid respondent to provide legal services on her behalf.
46. Peppers sought a refund from Second Chance and Second Chance refused to refund Peppers her funds.
47. As sole attorney responsible for performing legal services for Peppers, respondent was obligated to refund any unearned attorney’s fees paid by her to Second Chance.
48. No portion of the $2,500 in fees paid by Peppers was earned by respondent and respondent agrees to refund the $2,500 fee paid by Peppers.
49. By failing to refund the $2,500 in fees paid by Peppers, all of which were unearned by respondent, respondent failed to refund promptly any part of a fee paid that has not been earned.
COUNT SEVEN
Case No. 10-0-03756
Rules of Professional Conduct, rule 3-700(D)(2)
[Failure to Refund Unearned Fees]
50. Respondent willfully violated Rules of Professional Conduct, rule 3-700(D)(2), by failing to refund promptly any part of a fee paid in advance that has not been earned, as follows:
51. The allegations of Count One are incorporated by this reference.
52. On or about December 3, 2009, Christina Huckaby was solicited by an unknown third party and hired Second Chance to perform mortgage loan modification and restructuring services and paid Second Chance $2,885. Huckaby did not pay the respondent and did not sign an Second Chance agreement with respondent’s name as the attorney responsible for performing legal serivces in relation to the Huckaby matter. Huckaby signed a Second Chance agreement with another attorney’s name, Marc A. Caraska, as the attorney responsible for performing legal services in relation to the Huckaby matter. Huckaby paid Second Chance $2,885 on December 28, 2008 and by the date the funds were received, respondent was the responsible attorney with Second Chance.
53. Respondent acknowledges that, by the time the $2,885 was removed from her account, Huckaby could have reasonably believed that she had hired and paid respondent to provide legal services on her behalf.
54. Huckaby sought a refund from Second Chance and Second Chance refused to refund Huckaby her funds.
55. As sole attorney responsible for performing legal services for Huckaby, respondent was obligated to refund any unearned attorney’s fees paid by her to Second Chance.
56. No portion of the $2,885 in fees paid by Hnckaby was earned by respondent and respondent agrees to refund the $2,885 fee paid by Huckaby.
57. By failing to refund the $2,885 in fees paid by Huckaby, all of which was unearned by respondent, respondent failed to refund promptly any part of a fee paid that has not been earned.
COUNT SEVEN
Case No. 11-0-11505
Rules of Professional Conduct, rule 3-700(D)(2)
[Failure to Refund Unearned Fees]
58. Respondent willfully violated Rules of Professional Conduct, rule 3-700(D)(2), by failing to refund promptly any part of a fee paid in advance that has not been earned, as follows:
59. The allegations of Count One are incorporated by this reference.
60. On or about February 13, 2009, Diana Krkljus ("Krkljus") responded to a flyer listing Gerard and Marylou Ladairdo as agents for Second Chance. She received this flier from friends. Marylou Ladalardo solicited her, and she hired Second Chance to perform mortgage loan modification and restructuring services and paid Second Chance $5,995. Krkljus did not pay the respondent; however, Krkljus signed a Second Chance agreement with respondent’s name as the attorney responsible for performing legal services in relation to the Krkljus matter.
61. Respondent acknowledges that Krkljus reasonably believed that she had hired and paid respondent to provide legal services on her behalf.
62. Krkljus sought a refund from Second Chance and Second Chance refused to refund Krkljus her funds.
63. As sole attorney responsible for performing legal services for Krldjus, respondent was obligated to refund any unearned attorney’s fees paid by her to Second Chance.
64. No portion of the $5,995 in fees paid by Krkljus was earned by respondent and respondent agrees to refund the $5,995 fee paid by Krkljus.
65. By failing to refund the $5,995 in fees paid by Krkljus, all of which were unearned by respondent, respondent failed to refund promptly any part of a fee paid that has not been earned
SUPPORTING AUTHORITY
Respondent’s conduct in assisting in the unauthorized practice of law and failing to return unearned fees is cause for significant discipline (compare In the Matter of Jones (Review Dept. 1993) 2 Cal. State Bar Ct. Rptr. 411 (2-year suspension for partnership with non attorney), especially in light of respondent’s prior record of discipline (Std. 1.7, Standards for Attorney Sanctions).
(Effective January 1, 2011)
Case Number(s): 09-O-12976 et al.
In the Matter of: Warren W. Quann
a. Restitution
checked. Respondent must pay restitution (including the principal amount 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 costs.
1. Payee: Jeffrey and Kari Turney
Principal Amount: $2,500
Interest Accrues From: Not required
2. Payee: Vada T. Lee and Starshim Placide
Principal Amount: $1,100
Interest Accrues From: Not required
3. Payee: David and Cynthia Blackburn
Principal Amount: $2,100
Interest Accrues From: Not Required
4. Payee: Joanne and Michael Coleman
Principal Amount: $4,000
Interest Accrues From: Not Required
5. Payee: Gloria J. Peppers
Principal Amount: $2,500
Interest Accrues From: Not Required
6. Payee: Christina Huckaby
Principal Amount: $2,885
Interest Accrues From: Not Required
7. Payee: Diana Krkljus
Principal Amount: $5,995
Interest Accrues From: Not Required
<<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. 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.
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”;
Case Number(s): 09-O-12976 et al.
In the Matter of: Warren W. Quann
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: Warren W. Quann
Date: 12/19/2011
Respondent’s Counsel:
Date:
Deputy Trial Counsel: Donald R. Steedman
Date: 12/22/2011
Case Number(s): 09-O-12976
In the Matter of: Warren W. Quann
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.
checked. All Hearing dates 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 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:
Judge of the State Bar Court: Lucy Armendariz
Date: January 11, 2012
[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 Los Angeles, on January 24, 2012, 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:
WARREN W. QUANN
LAW OFFICE OF WARREN W QUANN
54 SPRINGBROOK CIR
SACRAMENTO, CA 95831
checked. by interoffice mail through a facility regularly maintained by the State Bar of California addressed as follows:
DONALD STEEDMAN, Enforcement, San Francisco
I hereby certify that the foregoing is true and correct. Executed in San Francisco, California, on January 11, 2012.
Signed by:
Bernadette C.O. Molina
Case Administrator
State Bar Court