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Rogers v. Mississippi Bar

January 21, 1999


The opinion of the court was delivered by: Banks, Justice






¶1. This case involves the suspension of an attorney for converting funds from his law firm by performing legal services after hours. The attorney was charged with violating Miss. R. Prof. Conduct 8.4 (a), (c) and (d). We conclude that these Rules are not unconstitutional and that the facts presented below support the Complaint Tribunal's findings that Rogers violated Miss. R. Prof. Conduct 8.4 (a) and (c), but did not support a finding that Rogers violated Miss. R. Prof. Conduct 8.4(d). In light of the mitigating and aggravating circumstances Rogers will be suspended from the practice of law for a period of 180-days, from the date of this judgment.


¶2. In September of 1980, H. Russell Rogers ("Rogers") went to work as an associate for William Ward ("Ward"), who maintained a law office in Starkville. In July of 1981 Rogers and Ward formed the law partnership of Ward & Rogers. The terms of the Ward & Rogers ("W&R") Partnership Agreement provided that the partners were to "devote full time to the partnership profession." In addition to the Partnership Agreement, there was an informal agreement between the partners that Rogers, if he so desired, could handle any work not handled by the firm on his own time and keep the income.

¶3. Sometime in the mid to late 80's, while a partner of W&R, Rogers began 'moonlighting' by performing real estate work, such as title searches. Rogers' moonlighting activities also included handling a few subrogation cases for regular clients. Requests for the real estate work primarily came from the National Bank of Commerce (NBC) or Deposit Guaranty National Bank (DGNB), both of which were regular clients of W&R. Rogers testified that he had a key to the courthouse and the combination to the vault, which allowed him to do the majority of his extra-firm work during the evenings or on weekends.

¶4. Rogers admitted, however, that some of the work was done during 'regular' business hours. For example, he would receive the requests for the real estate work and disburse checks during regular business hours. Rogers testified that because he could not avoid doing some of the extra-firm work during regular business hours, he would reimburse the firm by remitting the title insurance commissions earned on the transactions to the firm, while keeping the attorney's fees for himself. Rogers did not report the income generated by his moonlighting on his annual income tax returns, until sometime after Bar proceedings had commenced.

¶5. In the fall of 1991 the Columbus based law firm of Gholson, Hicks & Nichols (GH&N) began looking at the feasibility of a merger with W&R. After negotiations, the firms drew up a Letter of Intent. As the only document which set out the intent of the parties regarding the merger, the Letter of Intent also came to serve as the merger agreement. Under the terms of the Letter of Intent Ward and Rogers received equal interests in 188 shares of GH&N stock. Each of the firms reserved to itself those matters which were close to completion. Also, exempted from the merger were the remunerations paid to several of the attorneys as a result of their serving on the Boards of various organizations. However, not all of these exemptions were listed in the Letter of Intent.

¶6. The Letter of Intent further provided that all shareholders were to serve on the Board of Directors for the firm. Additionally, compensations were to be determined by the firm's Board of Directors upon the recommendation of the compensation committee, both of which Rogers served on. Rogers' initial salary, as set out in the Letter of Intent, was calculated by taking his ultimate compensation and backing out of it the value of various fringe benefits and the salary he was expected to receive as the attorney for the Oktibbeha County Board. These calculations were designed to bring Rogers' salary in line with the other employees of GH&N. The Letter of Intent did not address the issue of whether the firm's employees would be allowed to moonlight. Nor did Rogers disclose to GH&N that he had been earning extra income by performing legal services after hours. On January 1, 1992, the law firms merged to form the Professional Association of Gholson, Hicks, Nichols & Ward ("GHN&W"). Rogers continued his 'moonlighting' activities after the merger.

¶7. The American Title Insurance Company conducted a routine audit of the Starkville office in April of 1995. During the audit it was determined that a number of checks were missing from various banking statements. The payee on a majority of the checks was NBC (National Bank of Commerce); a few of the checks were made payable to H. Russell Rogers. The stubs for the checks indicated that the payees were either NBC or GHN&W. None of the stubs listed Rogers as the payee. The bank verified that the checks had either been deposited into Rogers personal account, used to pay on his personal loan, or cashed. When Rogers was confronted with the results of the audit he stated that "Old habits are hard to break" and "I know I've done wrong. I will pay the money back," and "I just made a mistake."

¶8. After Rogers' extra-firm activities came to light the firms decided to rescind the agreement and reverse the merger. Under the terms of the withdrawal and Termination Agreement, in addition to the disassociation of the firms, Rogers agreed to pay to GH&N the sum of $38,500.00, along with 8% interest, for the transactions in question. Rogers also agreed to indemnify GH&N for any loss which resulted from his employment with the firm.

¶9. GH&N also reported Rogers' activities to the Mississippi Bar (the Bar) under Miss. R. of Professional Conduct 8.3, as evidence of an attorney's unfitness to practice law. After an investigation, the Bar filed a Formal Complaint against Rogers on January 21, 1997. The Complaint alleged that Rogers "engaged in conduct that constitutes the improper conversion of firm funds and that such conduct is in violation of Rules 8.4 (a, c and d) of Mississippi's Rules of Professional Conduct."

¶10. The matter came on for hearing on August 18, 1997, before a Complaint Tribunal. During the hearing Rogers testified that his activities were consistent with the practices of other attorneys in the firm, before and after the merger. He argues that on several occasions other attorneys in the firm had called on him to provide legal services to third persons, some of which resulted in pecuniary gain to that attorney, but not to the firm. On one occasion Rogers closed a 2.7 million loan for a hotel in which several of the other attorneys in the firm held an interest as partners in a separate partnership. The firm was not paid a fee for the loan closing. On another occasion Rogers was called upon to represent, without charge, another attorney's partner in a subdivision development venture. That same attorney testified to having used firm resources and personnel in preparing deeds to be given to purchasers of lots in his subdivision. The attorney stated that it was his obligation as seller to provide the deeds to the purchasers. He did not charge his partnership a fee for the preparation of the deeds nor did he get prior approval from a majority of the members of the firm.

¶11. Various firm members agreed that it was permissible for the firm to provide "reciprocal" legal services to the individual attorneys of the firm without charge. These legal services were also provided to the attorneys in their pursuit of extra-firm activities such as subdivision closings and ownership interest in hotels. However, members of the firm testified that, although not an express policy, extra-firm activities which involved the practice of law, with the fees going to the attorney performing the work and not the firm, should have been approved by at least a majority of the members. Rogers was never informed of this policy.

¶12. Rogers further contends that his moonlighting activities were comprised of handling real estate transactions which the firm would not have handled, as they were regarded as unprofitable. Rogers testified that GHN&W had a fee schedule and generally charged between $350.00 and $400.00 for a real estate closing. He also testified that the profits generated by fees under $350.00 did not justify handling the work during office hours.

¶13. Although, Rogers never disclosed his moonlighting activities to anyone in the firm of GHN&W, he did create firm files for each of the transactions. He would also send title insurance checks to the Columbus office, some of which included attorneys fees and some of which did not, all of which denoted a file number. Those transactions which were sent absent attorneys fees were the product of Rogers' moonlighting activities.

¶14. After the hearing the Complaint Tribunal found that in the absence of disclosure by Rogers and approval by the other attorneys in the firm, Rogers' actions constituted a violation of the parties' written contract. The Tribunal also found that Rogers' withdrawal from the firm and his readiness to pay the money to the firm was tantamount to an admission. The Tribunal also placed great weight on the fact that Rogers failed to report the additional income to the Internal Revenue Service until later. The Tribunal issued a Judgment suspending Rogers indefinitely. Rogers filed a timely appeal from both the Tribunal's Findings of Facts and Conclusions of Law and the Final Judgment.



¶15. A Complaint Tribunal is convened for the purpose of hearing and disposing of Bar disciplinary matters. Miss. R. Discipline 8. However, the Mississippi Supreme Court retains "exclusive jurisdiction of matters pertaining to attorney discipline and reinstatement, and this Court is the ultimate Judge of matters arising under the Rules of Discipline for the Mississippi Bar." Broome v. Mississippi Bar, 603 So. 2d 349, 354 (Miss. 1992). As such, the appropriate standard of review in Bar discipline matters is as follows:

"On appeal, this Court `shall review the entire record and the findings and Conclusions of the Tribunal, and shall render such orders as the Court may find appropriate.' When reviewing disciplinary matters this Court, `reviews the evidence de novo, on a case-by-case basis, sitting as triers of fact, and no substantial evidence or manifest error rule shields the Tribunal from scrutiny.'" Asher v. Mississippi Bar, 661 So. 2d 722, 727 (Miss. 1995) (quoting Underwood v. Mississippi Bar, 618 So. 2d 64, 66-67 (Miss. 1993) (quoting Foote v. Mississippi State Bar Ass'n, 517 So. 2d 561, 564 (Miss. 1987))).

While the review of evidence is de novo, deference is given to the Tribunal's findings 'due to its exclusive opportunity to observe the demeanor and attitude of the witnesses, including the attorney, which is vital in weighing the evidence.' Asher, 661 So. 2d at 727 (quoting Underwood, 618 So. 2d at 67 (quoting Broome, 603 So. 2d at 353)).


¶16. Rogers claims that Rules 8.4 (a), (b) & (c), standing alone, "boarder on being void for vagueness." A rule is vague where it fails to fairly warn those of ordinary intelligence as to what constitutes offending conduct such that those persons may pattern their actions in accordance with the rule. Vance v. Lincoln County Dept. of Pub. Welfare, 582 So. 2d 414, 419 (Miss. 1991). This Court has held that a rule "which either forbids or requires the doing of an act in terms so vague that men of common intelligence must necessarily guess at its meaning and differ as to its application violates the first essential of due process." Vance, 582 So. 2d at 418-19 (quoting Connally v. General Const. Co., 269 U.S. 385, 391 (1926)).

¶17. A "rule or standard is not objectionable[, however,] merely because it is stated in general terms and is not susceptible of precise application." Id. (quoting Transcontinental Gas Pipeline Corp. v. State Oil & Gas Bd., 457 So. 2d 1298, 1323 (Miss. 1984)). Rules should only be as specific as is permitted by the subject matter. Vance, 582 So. 2d at 419. This is especially true in the context of rules governing the conduct of attorneys, because "[t]he regulation at issue herein applies only to lawyers, who are professionals and have the benefit of guidance provided by case law, court rules and the 'lore of the profession.'" Howell v. ...

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