Case Number(s): 09-O-13110, 09-O-13232,09-O-13341,09-O-16497, 09-O-17608, 09-O-17860, 10-O-05893;
In the Matter of: Nicholas Chavarela, Bar # 251632, A Member of the State Bar of California, (Respondent).
Counsel For The State Bar: Timothy G. Byer, DTC,
1149 So. Hill St.
Los Angeles, CA 90015
Bar # 172472,
Counsel for Respondent: Richard C. Gilbert,
950 W. 17th Street, Stes. D & E
Santa Ana, CA 92706
Bar # 85912,
Submitted to: Settlement Judge – State Bar Court Clerk’s Office Los Angeles .
<<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 December 3, 2007.
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: 2012, 2013. (Hardship, special circumstances or other good cause per rule 284, Rules of Procedure
<<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 was unable to provide refunds to any of the individuals who employed him, after the federal court ordered a Receiver to assert control over Respondent’s bank accounts.
ATTACHMENT TO STIPULATION RE FACTS, CONCLUSIONS OF LAW AND DISPOSITION
IN THE MATTER OF: NICHOLAS CHAVARELA
FACTS AND CONCLUSIONS OF LAW:
Respondent admits that the following facts are true and that he is culpable of violation of the
specified Rule of Professional Conduct.
WAIVER OF RIGHT TO FILING OF NOTICE OF DISCIPLINARY CHARGES:
The parties waive the right to the filing of a Notice of Disciplinary Charges and to a formal hearing
on any charge not included in the pending Notice of Disciplinary Charges.
Facts:
Case No.: 09-O-13110
1. New York Judiciary Law Section 478, entitled "Practicing or appearing as attorney-at-law without being admitted and registered," provides, in pertinent part, that "it shall be unlawful for any natural person to practice or appear as an attorney-at-law or as an attorney and counselor-at-law for a person other than himself in a court of record in this state, or to furnish attorneys or counsel or an attorney and counsel to render legal services, or to hold himself out to the public as being entitled to practice law ... without having first been duly and regularly licensed and admitted to practice law in the courts of record of this state[.]"
2. Respondent is not presently, and never has been, admitted to practice law in the state of New York.
3. On May 12, 2009, Respondent held himself out as licensed to practice law in New York, and accepted the representation of New York resident Netty Velez to negotiate and obtain for her a home mortgage loan modification for Velez’s New York residence. Velez paid Respondent an advanced fee of $2,000.
Case No.: 09-O-13232
4. Rule 5.5 of the Rules of Professional Conduct for the Commonwealth of Virginia states, in pertinent part, that "a Foreign Lawyer shall not ... hold out to the public or otherwise represent that the Foreign Lawyer is admitted to practice law in Virginia." Rule 5.5 defines a "Foreign Lawyer" as "a person authorized to practice law by the duly constituted and authorized governmental body of any State or Territory of the United States or the District of Columbia, or a foreign nation, but is neither licensed by the Supreme Court of Virginia or authorized under its rules to practice law generally in the Commonwealth of Virginia, nor disbarred or suspended from practice in any jurisdiction."
5. Respondent is not presently, and never has been, admitted to practice law in Virginia, and has not been licensed by the Supreme Court of Virginia or authorized under its rules to practice law generally in the Commonwealth of Virginia.
6. On May 22, 2009, Respondent held himself out as licensed to practice law in Virginia, and accepted the representation of Virginia residents Alex and Ana Galeano to negotiate and obtain for them a home mortgage loan modification for their Virginia residence. The Galeanos paid Respondent an advanced fee of $1,166.67.
Case No.: 09-O-13341
7. Hawaii Revised Statutes §605-14 (HRS §605-14) ("Unauthorized Practice of Law Prohibited") provides, in pertinent part, that "it shall be unlawful for any person, firm, association, or corporation to engage in or attempt to engage in or to offer to engage in the practice of law, or to do or attempt to do or offer to do any act constituting the practice of law, except and to the extent that the person, firm, or association is licensed or authorized so to do by an appropriate court, agency, or office or by a statute of the State or of the United States."
8. Respondent is not presently, and never has been, admitted to practice law in Hawaii, and has not been licensed or authorized to do so by any court, agency, office, or statue of the state of Hawaii or of the United States.
9. On May 15, 2009, Respondent held himself out as licensed to practice law in Hawaii, and accepted the representation of Kenny Flinn to negotiate and obtain for him a home mortgage loan modification for his Hawaii residence. Flinn paid Respondent an advanced fee of $3,500.
Case No.: 09-O-16497
10. Washington Rules of Professional Conduct, rule 5.5(b)(2) states, in pertinent part, that: "A lawyer who is not admitted to practice in this jurisdiction shall not: ... [r]epresent or hold out to the public that the lawyer is admitted to practice law in this jurisdiction."
11. Respondent is not presently, and never has been, admitted to practice law in Washington.
12. On May 4, 2009, Respondent held himself out as licensed to practice law in Washington, and accepted the representation of Diana Goratuyk to negotiate and obtain for her a home mortgage loan modification for her Washington residence. Goratuyk paid Respondent an advanced fee of $3,250.
Case No.: 09-O-17608
13. On May 28, 2009, Respondent held himself out as licensed to practice law in Virginia, and accepted the representation of Jeff Jaeger to negotiate and obtain for him a home mortgage loan modification for his Virginia residence. Jaeger paid Respondent an advanced fee of $1,750.
Case No.: 09-O-17860
14. Maryland Rules of Professional Conduct, rule 5.5(b) states, in relevant part, that "a lawyer who is not admitted to practice law in this jurisdiction shall not ... hold out to the public or otherwise represent that the lawyer is admitted to practice law in this jurisdiction."
15. Respondent is not presently, and never has been, admitted to practice law in the state of Maryland.
16. On April 22, 2009, Respondent held himself out as licensed to practice law in Maryland, and accepted the representation of Jana Perez to negotiate and obtain for her a home mortgage loan modification for her Maryland residence. Perez paid Respondent an advanced fee of $1,500.
Case No.: 10-O-05893
17. Missouri Rules of Professional Conduct, Rule 5.5(b), states, in pertinent part, that "a lawyer who is not admitted to practice in this jurisdiction shall not ... hold out to the public or otherwise represent that the lawyer is admitted to practice law in this jurisdiction."
18. Respondent is not presently, and never has been, admitted to practice law in Missouri.
19. On May 12, 2009, Respondent held himself out as licensed to practice law in Missouri, and accepted the representation of Paul Ashton to negotiate and obtain for him a home mortgage loan modification for his Missouri residence. Ashton paid Respondent an advanced fee of $1,836.
Legal Conclusions
20. By holding himself out as licensed to practice law in New York when he was not so licensed, and accepting Velez as a client, Respondent willfully violated the regulations of the profession in New York, in willful violation of Rules of Professional Conduct, rule 1-300(B).
21. By entering into an agreement for, charging, and collecting fees from Velez, when he was not licensed to practice law in New York, Respondent willfully entered into an agreement for, charged, and collected an illegal fee from Velez, in willful violation of Rules of Professional Conduct, rule 4-200(A).
22. By holding himself out as licensed to practice law in Virginia when he was not so licensed, and accepting the Galeanos as clients, and accepting Jaeger as a client, Respondent willfully violated the regulations of the profession in Virginia, in willful violation of Rules of Professional Conduct, rule 1300(B).
23. By entering into an agreement for, charging, and collecting fees from the Galeanos, when he was not licensed to practice law in Virginia, Respondent willfully entered into an agreement for, charged, and collected an illegal fee from the Galeanos, in willful violation of Rules of Professional Conduct, rule 4200(A).
24. By holding himself out as licensed to practice law in Hawaii when he was not so licensed, and accepting Flinn as a client, Respondent willfully violated the regulations of the profession in Hawaii, in willful violation of Rules of Professional Conduct, rule 1-300(B).
25. By entering into an agreement for, charging, and collecting fees from Flinn, when he was not licensed to practice law in Hawaii, Respondent willfully entered into an agreement for, charged, and collected an illegal fee from Flinn, in willful violation of Rules of Professional Conduct, rule 4200(A).
26. By holding himself out as licensed to practice law in Washington when he was not so licensed, and accepting Goratuyk as a client, Respondent willfully violated the regulations of the profession in Washington, in willful violation of Rules of Professional Conduct, rule 1-300(B).
27. By entering into an agreement for, charging, and collecting fees from Goratuyk, when he was not licensed to practice law in Washington, Respondent willfully entered into an agreement for, charged, and collected an illegal fee from Goratuyk, in willful violation of Rules of Professional Conduct, rule 4-200(A).
28. By entering into an agreement for, charging, and collecting fees from Jaeger, when he was not licensed to practice law in Virginia, Respondent willfully entered into an agreement for, charged, and collected an illegal fee from Jaeger, in willful violation of Rules of Professional Conduct, rule 4-200(A).
29. By holding himself out as licensed to practice law in Maryland when he was not so licensed, and accepting Perez as a client, Respondent willfully violated the regulations of the profession in Maryland, in willful violation of Rules of Professional Conduct, rule 1-300(B).
30. By entering into an agreement for, charging, and collecting fees from Perez, when he was not licensed to practice law in Maryland, Respondent willfully entered into an agreement for, charged, and collected an illegal fee from Perez, in willful violation of Rules of Professional Conduct, rule 4-200(A).
31. By holding himself out as licensed to practice law in Missouri when he was not so licensed, and accepting Ashton as a client, Respondent willfully violated the regulations of the profession in Missouri, in willful violation of Rules of Professional Conduct, rule 1-300(B).
32. By entering into an agreement for, charging, and collecting fees from Ashton, when he was not licensed to practice law in Missouri, Respondent willfully entered into an agreement for, charged, and collected an illegal fee from Ashton, in willful violation of Rules of Professional Conduct, rule 4-200(A).
AGGRAVATING CIRCUMSTANCES
Respondent’s current misconduct evidences multiple acts of wrongdoing and demonstrates a pattern of misconduct.
MITIGATING CIRCUMSTANCES
Respondent paid a refund to one of his clients out of his own personal funds (in the sum of $1,800), after the seizure of his law firm’s bank accounts prevented him from accessing those funds.
LEGAL AUTHORITY
Standard 2.10 provides that "culpability of a member of a violation of any provision of the Business and Professions Code not specified in these standards or of a wilful violation of any Rule of Professional
Conduct not specified in these standards shall result in reproval or suspension or disbarment according to the gravity of the offense or harm, if any, to the victim, with due regard to the purposes of imposing discipline set forth in standard 1.3 ."
Standard 1.3 provides that those purposes are "the protection of the public, the courts and the legal profession; the maintenance of high professional standards by attorneys and the preservation of public confidence in the legal profession."
COSTS:
Respondent acknowledges that the Office of the Chief Trial Counsel has informed Respondent that, as of December 27, 2010, the costs in this matter are $5,697. 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.
Costs are to be paid in equal amounts prior to February 1 for the following two billing cycles
following the effective date of the Supreme Court order.
Case Number(s): 09-O-13110,09-O-13232,09-O-13341,09-O-16497, 09-O-17608, 09-O-17860, 10-O-05893
In the Matter of: Nicholas Chavarela
a. Restitution
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: Netty Velez
Principal Amount: $2,000
Interest Accrues From: 5/12/2009
2. Payee: Alex and Anna Galeano
Principal Amount: $1,666.67
Interest Accrues From: 5/22/2009
3. Payee: Kenny Flinn
Principal Amount: $3,500
Interest Accrues From: 5/15/2009
4. Payee: Diana Goratuyk
Principal Amount: $3,250
Interest Accrues From: 5/4/2009
5. Payee: Jeff Jaeger
Principal Amount: $1,750
Interest Accrues From: 5/28/2009
6. Payee: Jana Perez
Principal Amount: $1,500
Interest Accrues From: 4/22/2009
7. Payee: Paul Ashton
Principal Amount: $1,836
Interest Accrues From: 5/12/2009
checked. Respondent must pay above-referenced restitution and provide satisfactory proof of payment to the Office of Probation not later than February 1 of the second billing cycle following the effective date of the Supreme Court order..
<<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.
<<not>> 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.
SIGNATURE OF THE PARTIES
Case Number(s): 09-O-13110,09-O-13232,09-O-13341,09-O-16497, 09-O-17608, 09-O-17860, 10-O-05893
In the Matter of: Nicholas Chavarela
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: Nicholas Chavarela
Date: January 21, 2011
Respondent’s Counsel: Richard C. Gibert
Date: January 21, 2011
Deputy Trial Counsel: Timothy G. Byer
Date: January 25, 2011
Case Number(s): 09-O-13110,09-O-13232,09-O-13341,09-O-16497, 09-O-17608, 09-O-17860, 10-O-05893
In the Matter of: Nicholas Chavarela
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 DISCIPLINE RECOMMENDED to the Supreme Court.
<<not>> 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.
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: Richard A. Platel
Date: February 11, 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 Los Angeles, on February 14, 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:
RICHARD C. GILBERT
RICHARD GILBERT & ASSOCIATES
950 W. 17th ST STE C D & E
SANTA ANA CA 92706
<<not>> checked. by certified mail, No. with return receipt requested, through the United States Postal Service at , California, addressed as follows:
<<not>> checked. by overnight mail at , California, addressed as follows:
<<not>> checked. by fax transmission, at fax number . No error was reported by the fax machine that I used.
<<not>> checked. By personal service by leaving the documents in a sealed envelope or package clearly labeled to identify the attorney being served with a receptionist or a person having charge of the attorney’s office, addressed as follows:
checked. by interoffice mail through a facility regularly maintained by the State Bar of California addressed as follows:
SUZAN ANDERSON, Enforcement, Los Angeles
I hereby certify that the foregoing is true and correct. Executed in Los Angeles, California, on February 14, 2001.
Signed by:
Angela Carpenter
Case Administrator
State Bar Court