State Bar Court of California
Hearing Department
STIPULATION RE FACTS, CONCLUSIONS OF LAW AND
DISPOSITION AND ORDER APPROVING DISBARMENT; ORDER OF INVOLUNTARY INACTIVE
ENROLLMENT
DISBARMENT
Case Number(s): 12-O-12839
In the Matter of: JOHN EDWARD ENGEL, Bar # 153043, A Member
of the State Bar of California, (Respondent).
Counsel For The State Bar: Erin McKeown Joyce, Bar #149946,
Counsel for Respondent: John Edward Engel, Bar #153043,
Submitted to: Settlement Judge.
Filed: August 21, 2013.
<<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.
A. Parties' Acknowledgments:
1.
Respondent is a member of the State Bar of California, admitted June 7,
1991.
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 10 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. Costs are awarded to the
State Bar.
<<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.
9.
ORDER OF INACTIVE ENROLLMENT:
The parties are aware that if this stipulation is approved, the judge will
issue an order of inactive enrollment under Business and Professions Code
section 6007, subdivision (c)(4), and Rules of Procedure of the State Bar, rule
5.111(D)(1).
B. Aggravating Circumstances [for definition, see Standards for Attorney
Sanctions for Professional Misconduct, standard 1.2(b)]. Facts supporting
aggravating circumstances are required.
<<not>> checked. (1) Prior
record of discipline
<<not>> checked. (a) State Bar Court case # of prior case .
<<not>> checked. (b) Date prior discipline effective .
<<not>> checked. (c) Rules of Professional Conduct/ State
Bar Act violations:
<<not>> checked. (d) Degree of prior discipline
<<not>> checked. (e) If Respondent has two or more incidents
of prior discipline, use space provided below. .
<<not>> checked. (2) Dishonesty:
Respondent's misconduct was surrounded by or followed by bad faith, dishonesty,
concealment, overreaching or other violations of the State Bar Act or Rules of
Professional Conduct.
<<not>> checked. (3) Trust
Violation: Trust funds or property were involved and Respondent refused or was
unable to account to the client or person who was the object of the misconduct
for improper conduct toward said funds or property.
checked. (4) Harm: Respondent's
misconduct harmed significantly a client, the public or the administration of
justice. See attachment to stipulation re facts, conclusions of law and
disposition at page 7.
<<not>> checked. (5) Indifference:
Respondent demonstrated indifference toward rectification of or atonement for
the consequences of his or her misconduct.
<<not>> checked. (6) Lack of
Cooperation: Respondent displayed a lack of candor and cooperation to victims
of his/her misconduct or to the State Bar during disciplinary investigation or
proceedings.
<<not>> checked. (7) Multiple/Pattern
of Misconduct: Respondent's current misconduct evidences multiple acts of
wrongdoing or demonstrates a pattern of misconduct.
<<not>> checked. (8) No
aggravating circumstances are involved.
Additional aggravating circumstances: .
C. Mitigating Circumstances [see standard 1.2(e)]. Facts supporting
mitigating circumstances are required.
<<not>> checked. (1) No Prior Discipline: Respondent has no prior record
of discipline over many years of practice coupled with present misconduct which
is not deemed serious.
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checked. (2) No Harm: Respondent did not harm the client or person who was
the object of the misconduct.
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checked. (3) Candor/Cooperation: Respondent displayed spontaneous candor and
cooperation with the victims of his/her misconduct and to the State Bar during
disciplinary investigation and proceedings.
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checked. (4) Remorse: Respondent promptly took objective steps spontaneously
demonstrating remorse and recognition of the wrongdoing, which steps were
designed to timely atone for any consequences of his/her misconduct.
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checked. (5) Restitution: Respondent paid $ on in restitution to without
the threat or force of disciplinary, civil or criminal proceedings.
<<not>>
checked. (6) Delay: These disciplinary proceedings were excessively
delayed. The delay is not attributable to Respondent and the delay prejudiced
him/her.
<<not>>
checked. (7) Good Faith: Respondent acted in good faith.
<<not>>
checked. (8) Emotional/Physical Difficulties: At the time of the stipulated
act or acts of professional misconduct Respondent suffered extreme emotional
difficulties or physical disabilities which expert testimony would establish
was directly responsible for the misconduct. The difficulties or disabilities
were not the product of any illegal conduct by the member, such as illegal drug
or substance abuse, and Respondent no longer suffers from such difficulties or
disabilities.
<<not>>
checked. (9) Severe Financial Stress: At the time of the misconduct,
Respondent suffered from severe financial stress which resulted from
circumstances not reasonably foreseeable or which were beyond his/her control
and which were directly responsible for the misconduct.
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checked. (10) Family Problems: At the time of the misconduct, Respondent
suffered extreme difficulties in his/her personal life which were other than
emotional or physical in nature.
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checked. (11) Good Character: Respondent's good character is attested to by a
wide range of references in the legal and general communities who are aware of
the full extent of his/her misconduct.
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checked. (12) Rehabilitation: Considerable time has passed since the acts of
professional misconduct occurred followed by convincing proof of subsequent
rehabilitation.
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checked. (13) No mitigating circumstances are involved.
Additional
mitigating circumstances: See attachment to stipulation re facts, conclusions
of law and disposition at pages 7 and 8.
D. Discipline: Disbarment.
E. Additional Requirements:
(1) Rule 9.20,
California Rules of Court: Respondent must comply with the requirements of
rule 9.20, California Rules of Court, and perform the acts specified in
subdivisions (a) and (c) of that rule within 30 and 40 calendar days,
respectively, after the effective date of the Supreme Court's Order in this
matter.
<<not>> checked. (2) Restitution:
Respondent must make restitution to in the amount of $ plus 10 percent
interest per year from . If the Client Security Fund has reimbursed for all
or any portion of the principal amount, respondent must pay restitution to CSF
of the amount paid plus applicable interest and costs in accordance with Business
and Professions Code section 6140.5. Respondent must pay the above restitution
and furnish satisfactory proof of payment to the State Bar's Office of
Probation in Los Angeles no later than days from the effective date of the
Supreme Court order in this case..
<<not>> checked. (3) Other: .
Attachment language (if any):.
ATTACHMENT TO
STIPULATION RE FACTS, CONCLUSIONS OF LAW AND DISPOSITION
IN THE MATTER OF: JOHN EDWARD ENGEL, State Bar No. 153043
STATE BAR COURT CASE NUMBER: 12-O-12839
FACTS AND CONCLUSIONS OF LAW.
Respondent admits that the following facts are true and that he is culpable
of violations of the specified statute and Rule of Professional Conduct.
Case No. 12-0-12839 (Complainant: Joanne Harms)
FACTS:
1. On February 7, 2008, Joanne Harms employed Respondent to represent her
in a personal injury matter (the "Harms legal matter"). Respondent
and Harms executed a written attorney client agreement pursuant to which
Respondent was entitled to a 40% contingency fee of the gross settlement amount.
2. Under the attorney client agreement, Harms was responsible for all costs
incurred during litigation of the Harms legal matter.
3. On February 11, 2011, the Harms legal matter settled for $185,000,
$50,000 to be paid by Crusader Insurance and $135,000 to be paid by Farmers
Insurance. On January 19, 2011, Respondent deposited a $50,000 check from
Crusader Insurance into his client trust account. On February 14, 2011,
Respondent deposited a $135,000 check from Farmers Insurance into his client
trust account.
4. Respondent’s attorney fees pursuant to the attorney client agreement
totaled $74,000. After paying the attorney fees, Respondent was required to
maintain $111,000 in his client trust account on behalf of Harms.
5. The total costs incurred during the Harms legal matter were $11,081.95,
of which Harms had paid $8,000 prior to the settlement, leaving $3,081.95 to be
paid from the settlement.
6. After payment of costs, Respondent was required to maintain $107,918.05
in his client trust account on behalf of Harms.
7. On March 10, 2011, the balance of Respondent’s client trust account
dropped to $105,099.34. At that time Respondent had not disbursed any funds to,
or on behalf of, Harms from the settlement proceeds of the Harms legal matter.
8. On April 14, 2011, Respondent disbursed $20,000 to Harms from the client
trust account. After that disbursement, Respondent was required to maintain
$87,918.05 in his client trust account for the benefit of Harms. On that date,
the balance in Respondent’s client trust account dropped to $78,059.35.
9. On June 21, 2011, Respondent wrote check number 3061 to Harms from his
client trust account for $45,000. On that date, the balance in his client trust
account was $30,134.35.
10. On June 28, 2011, the bank dishonored check number 3061 since it was
written against insufficient funds. At the time Respondent wrote check number
3061, he knew, or in the absence of gross negligence would have known, that
there were insufficient funds in his client trust account to cover the check.
11. On or about June 29, 2011, Respondent disbursed $30,000 to Harms from
his client trust account. After that disbursement, Respondent was required to
maintain $57,918.05 in his client trust account for the benefit of Harms. On
that date, the balance of Respondent’s client trust account dropped to $109.35.
12. Respondent intentionally misappropriated $57,808.70 of Harms’
settlement funds and used the funds for his own use. Respondent’s
misappropriation of Harms’ settlement funds caused her significant financial
hardship.
13. In late 2012, after Respondent was contacted by the State Bar as the
result of a complaint lodged by Harms, Respondent paid to Harms the remainder
of the settlement proceeds to which she was entitled.
CONCLUSIONS OF LAW:
14. By failing to maintain in his client trust account the funds Respondent
was required to hold on behalf of Harms, Respondent failed to preserve client
funds in a client trust account for the benefit of his client in wilful
violation of Rule of Professional Conduct 4-100(A).
15. By writing check number 3061 against insufficient funds and
misappropriating $57,808.70 of Harms’ settlement proceeds, Respondent committed
acts involving moral turpitude, dishonesty or corruption in violation of
Business and Professions Code section 6106.
ADDITIONAL FACTS RE AGGRAVATING CIRCUMSTANCES
Harm (Standard 1.2(b)(iv)): Harms did not receive her full portion of the
settlement proceeds from Respondent which should have been paid in 2011, until
late 2012, over a year later, which caused the client significant financial
hardship. While the failure to promptly disburse client funds alone does not
establish significant client harm as required under the Standard, in this case
Harms did suffer significant financial injury due to the delay in payout out
the misappropriated funds. (Kelly v. State Bar (1991) 53 Cal.3d 509, 519-520
[in absence of additional facts, attorney’s failure to promptly pay client
funds constitutes genuine monetary injury].)
ADDITIONAL FACTS RE MITIGATING CIRCUMSTANCES.
Prefiling Stipulation: Respondent met with the State Bar, admitted his
misconduct, and entered this stipulation fully resolving this matter.
Respondent’s cooperation at this early stage has saved the State Bar
significant resources and time. Respondent’s stipulation to the facts, his
culpability, and discipline is a mitigating circumstance. (Silva-Vidor v. State
Bar (1989) 49 Cal.3d 1071, 1079 [where mitigating credit was given for entering
into a stipulation as to facts and culpability].)
Additional Mitigating Circumstances: Although Respondent’s misconduct was
serious, Respondent has no prior record of discipline. Respondent was admitted
in June 1991, twenty years before the onset of the misconduct. Even where the
underlying conduct is deemed serious, Respondent’s lengthy period of discipline
free practice should be afforded mitigating weight. (In re Brown (1995) 12
Cal.4th 205, citing Kelly v. State Bar, (1991) 53 Cal.3d 509, 520 and Standard
1.2(e)(i) [where Supreme Court gave substantial mitigating weight to over 20
years of discipline free practice].)
AUTHORITIES SUPPORTING DISCIPLINE
The Standards for Attorney Sanctions for Professional Misconduct provide a
"process of fixing discipline" pursuant to a set of written
principles to "better discharge the purposes of attorney discipline as
announced by the Supreme Court." (Rules Proc. of State Bar, tit. IV,
Standards for Attorney Sanctions for Professional Misconduct, Introduction (all
further references to standards are to this source).) The primary purposes of
disciplinary proceedings and of the sanctions imposed 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." (ln re Morse (1995) 11 Cal.4th 184, 205;
standard 1.3.)
Although not binding, the standards are entitled to "great
weight" and should be followed "whenever possible" in
determining level of discipline. (In re Silverton (2005) 36 Cal.4th 81, 92,
quoting In re Brown (1995) 12 Cal.4th 205,220 and In re Young (1989) 49 Cal.3d
257, 267, fn. 11 .) Adherence to the standards in the great majority of cases
serves the valuable purpose of eliminating disparity and assuring consistency,
that is, the imposition of similar attorney discipline for instances of similar
attorney misconduct. (In re Naney (1990) 51 Cal.3d 186, 190.)
Respondent admits to committing two serious acts of professional
misconduct. Standard 1.6 (a) requires that where a Respondent acknowledges two
or more acts of misconduct, and different sanctions are prescribed by the
standards that apply to those acts, the sanction imposed shall be the more
severe prescribed in the applicable standards.
The more severe sanction applicable to Respondent’s misconduct is found in
Standard 2.2(a) of the Standards for Attorney Sanctions for Professional
Misconduct, for offenses involving entrusted funds. Under Standard 2.2(a),
"[c]ulpability 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 hot be imposed. In those
latter cases, the discipline shall not be less than a one-year actual
suspension, irrespective of mitigating circumstances."
Here, Respondent misappropriated over $57,000 of Harms’ settlement funds,
and did not pay Harms her portion of the settlement funds until Harms contacted
the State Bar, more than a year after Respondent misappropriated her funds.
Although Respondent is entitled to some mitigation for his nearly two decades
of discipline-free practice, this fact is not sufficiently compelling to
warrant a deviation from Standard 2.2(a). Respondent also deserves some
mitigation for entering into this Stipulation. But, again, this fact is not
sufficiently compelling to warrant a deviation from Standard 2.2(a).
The case law also supports the recommended discipline. The California
Supreme Court has written that "[m]isappropriation generally warrants
disbarment unless ’clearly extenuating circumstances’ are present."
(McKnight v. State Bar (1991) 53 Cal.3d 1025, 1035.) The California Supreme
Court has also stated that, "In all but the most exceptional cases, we
must impose the harshest discipline for such a breach in order to safeguard the
citizenry from unethical practitioners." (Chang v. State Bar (1989) 49
Cal.3d 114, 128; In Re Naney (1990) 51 Cal.3d 186; In Re Kaplan (1991) 52
Cal.3d 1067; and Kelly v. State Bar (1988) 45 Cal.3d 649 [misappropriation
warrants disbarment in absence of clearly mitigating circumstances].)
SIGNATURE OF THE PARTIES
Case Number(s): 12-O-12839
In the Matter of: JOHN EDWARD ENGEL
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: JOHN EDWARD ENGEL
Date: 8/14/13
Respondent’s Counsel:
Date:
Deputy Trial Counsel: Erin McKeown Joyce
Date: 8/19/13
DISBARMENT ORDER
Case Number(s): 12-O-12839
In the Matter of: JOHN EDWARD ENGEL
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.)
Respondent is ordered transferred to involuntary inactive status pursuant
to Business and Professions Code section 6007, subdivision (c)(4). Respondent’s
inactive enrollment will be effective three (3) calendar days after this order
is served by mail and will terminate upon the effective date of the Supreme
Court’s order imposing discipline herin, or as provided for by rule 5.111(D)(2)
or the Rules of Procedure of the State Bar of California, or as otherwise
ordered by the Supreme Court pursuant to its plenary jurisdiction.
Signed by:
Judge of the State Bar Court: Richard A. Platel
Date: 8/21/13
CERTIFICATE OF SERVICE
[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 August 21,
2013, I deposited a true copy of the following document(s):
STIPULATION RE FACTS, CONCLUSIONS OF LAW AND DISPOSITION AND
ORDER APPROVING; ORDER OF INVOLUNTARY INACTIVE ENROLLMENT
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:
JOHN E. ENGEL
LAW OFFICES OF JOHN E ENGEL
2173 SALK AVE STE. 250
CARLSBAD, CA 92008
<<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:
ERIN JOYCE, Enforcement, Los Angeles
I hereby certify that the foregoing is true and correct. Executed in Los
Angeles, California, on August 21, 2013.
Signed by:
Angela Carpenter
Case Administrator
State Bar Court