Discipline Summaries

Summaries from the California Bar Journal are based on discipline orders but are not the official records. Not all discipline actions have associated CBJ summaries. Copies of official licensee discipline records are available upon request.

February 12, 1999

GARY W. VERBOON [#102015], 42, of Los Angeles was suspended for five years, stayed, placed on five years of probation with a two-year actual suspension and until he proves rehabilitation, and was ordered to pass the MPRE and comply with rule 955. The order took effect Feb. 12, 1999.

Verboon stipulated that he failed to promptly notify his clients of the receipt of funds or pay out those funds, failed to maintain the funds in a client trust account, and misappropriated client money.

He was employed by a homeowners association to represent it in a defective construction claim against multiple defendants. The case settled for about $362,250, but when Verboon began receiving the funds, he did not have a client trust account and put the money in his general account. He did not notify the association of his receipt of funds.

Verboon had practiced abroad and served as an officer in a real estate company, and this case marked the first time he represented any client on a contingency basis. The settlement funds were the first he held for a client. He was building a new practice, had a credit line with a bank, and initially used the settlement proceeds as working capital for his fast-growing firm.

Nonetheless, the balance of his general account had fallen below what should have been maintained for the homeowners association.

When advised that he needed a client trust account, he promptly opened one. He also told the homeowners association to retain counsel to advise it concerning its rights to the settlement funds. Verboon has subsequently rectified the problem with handling client funds.

Both the bar and Verboon sought review of a hearing judge's recommendation about the level of discipline, and the review department attached additional conditions to his probation. It agreed with some of the mitigating factors found by the hearing judge (Verboon's efforts to correct the situation and his regular pro bono work), but rejected others. It noted Verboon committed multiple acts of misconduct, and found the misappropriation intentional and constituting moral turpitude.

"We find an attorney engaged in a new and growing practice with no prior trust account experience and no prior experience in handling client funds," the review judges wrote. "Within a day of his misconduct being called to his attention, he made a full disclosure of that misconduct to his client and made arrangements to pay the sums due the client as soon as the amount was agreed on with the aid of the client's independent counsel."

The misconduct does not require disbarment, the judges said, but did warrant significant discipline.