1. TOP TWELVE THINGS THAT GET LAWYERS (AND THE PEOPLE WHO WORK FOR THEM) INTO TROUBLE
Houston Association Legal Administrators August 16, 2016 Houston, Texas
Richard A. Schwartz Vorys, Sater, Seymour and Pease, LLP 700 Louisiana, Suite 4100 Houston, Texas Phone: (713) Fax: (713)

2. OVERVIEW
WHAT ARE THE PENALTIES FOR VIOLATING THE ETHICS RULES WHAT ARE THE AREAS OF LAW IN WHICH THE MOST GRIEVANCES ARE FILED WHAT ARE THE TYPES OF CONDUCT (RULE VIOLATIONS) WHICH ARE MOST FREQUENTLY ALLEGED HELPFUL HINTS ON STAYING OUT OF TROUBLE

3. POSSIBLE PENALTIES FOR VIOLATIONS
DISBARMENT
SUSPENSION
PUBLIC REPRIMANDS
PRIVATE REPRIMANDS
RESIGNATION
ORDERS FOR REHABILITATION
RESTITUTI0N

4. Information Tracked By the SBOT STATISTICS
Total Number of Grievances filed
Grievance Results or Penalties Imposed
Areas of Law
Rule Violations

5. Grievances Filed vs. Penalties
13-14
12-13
11-12
10-11
09-10
08-09
07-08
06-07
05-06
04-05
03-04
02-03
01-02
Active Attorneys
98,804
92,210
89,987
87,881
86,500
84,183
82,414
80,094
77,934
77,056
74,675
73,084
71,170
Grievances Filed
7,394
7,882
8,135
7,328
7,233
7,108
7,307
6,572
7,118
6,987
6,891
7,501
7,784
Dismissed as inquiries
5,827
5,495
5,351
4,778
5,000
5,168
5,160
4,370
4,584
4,318
4,423
4,833
4,895
Classified as complaints
1567
1,628
2,296
2,047
1,970
1,761
1,966
2,027
2,357
2,438
2,209
2,479
2,624
Complaints resolved
403
444
516
584
417
499
Total Number of disciplines
322
367
402
370
315
335
299
320
344
427
459
437
482
% of Disciplines out of complaints
20.5%
22.5%
17.5%
18%
15.9%
19%
15.2%
15.7%
14.5%
20.7%
17.6%
18.3%

6. GRIEVANCE RESULTS

7. Actual Penalties for Violations 2012-13
Disbarments 39
10.6%
Resignations 24
6.5%
Suspensions
122
33.24%
Public Reprimands 37
10.1%
Private Reprimands 89
24.25%
Grievance Referral Program (rehabilitation) 56
15.25%

8. Actual Penalties for Violations 2013-14
Disbarments 21
6.5%
Resignations 17
5.2%
Suspensions
131
40.5%
Public Reprimands 31
9.5%
Private Reprimands 65
20.12%
Grievance Referral Program (rehabilitation) 58
17.95%

9. Client Attorney Assistance Program* Top 5 Concerns of Clients 2013-14
Not scheduling/keeping appointments
672
Not Returning Phone Calls
6,560
Fee Problems
6713
Not providing/Returning Copies of File and Documents
8,375
Inattention and Preparation on the Case
11,653
*Confidential dispute resolution service of the SBOT for minor concerns, disputes and misunderstandings

10. Client Attorney Assistance Program Type of Legal Matter 2013-14
Criminal
36%
Family
20%
Civil
19%
Personal Injury
11%
Immigration 3%
Probate
Real Estate 2%
Collection 1%
Bankruptcy
Business
WCC
EEOC
Consumer Protection

11. AREAS OF LAW FOR THE MOST GRIEVANCES

12. Area of Law by Most Grievances 2012-2013
Criminal
2,441
2366
Non-Client Relationships
1,506
2074
Family
948
989
Civil
821
744
Personal Injury
349
297
Immigration
281 -
Other
263
194
Probate/Wills
153
152
Real Estate
117 88
Bankruptcy 66 75
Workman’s Comp 25 34
Traffic 24 42

13. 2012-2013 Grievances By Area of Law

14. Criminal Grievances

15. Non Client Relationship Grievances 2001 - 2013

16. Family Grievances

17. Civil Law Grievances 2003 – 2013

18. Personal Injury Grievances 2001 - 2013

19. Probate/Will Grievances 2001 -2013

20. Real Estate Grievances 2003 - 2013

21. Bankruptcy Grievances 2001 - 2013

22. Workmen’s Comp Grievances 2003 - 2013

23. Traffic Grievances

24. Other Grievances

25. MOST FREQUENT RULE VIOLATIONS ALLEGED

26. ALLEGED RULE VIOLATIONS 12-13 11-12 10-11 09-10 08-09 07-08 06-07
05-06
04-05
03-04
02-03
01-02
Communication
832
975
1006
871
713
928
974
1183
1488
1760
1180
303
Neglect
812
888
981
932
811
937
1009
1201
1437
1611
1203
1788
Integrity
607
346
403
427
448
509
563
710
736
469
344
Declining or terminating representation
506
681
638
553
405
479
436
533
502
598
421
450
Safeguard Property
260
241
192
224
380
329
321
304
320
375
251
413
Conflicts
136 77 73 95 88 96 75
102
116
100
126
Tribunals
117
119 86 74 99 97 65 61 58 94
Fees
109
152
137
105
128
132
157
169
203
236
Non-clients 52 80 87 92 76 50 60
110
Confidentiality 27 36 47 51 30 40 57 39
Advertising & Solicitation 21 43 48 41 20 35
Law firms 17 34 15 18 22 25 26 44 32

27. Alleged Violations

28. Lessons Learned from the Grievance Committee

29. Lessons Learned from the Grievance Committee
Most frequent issues:
Communication
Terminating representation
Safeguarding Property
Fees

30. Communication

31. COMMUNICATION – 24.5% of Complaints Number 1

32. Rule 1.03 Communication
(a) A lawyer shall keep a client reasonably informed about the status of a matter and promptly comply with reasonable requests for information. (b) A lawyer shall explain a matter to the extent reasonably necessary to permit the client to make informed decisions regarding the representation.

33. Communication
Comments to 1.03 The client should have sufficient information to participate intelligently in decisions concerning the objectives of the representation and the means by which they are to be pursued, to the extent the client is willing and able to do so. For example, a lawyer who receives from opposing counsel either an offer of settlement in a civil controversy or a proffered plea bargain in a criminal case should promptly inform the client of its substance unless prior discussions with the client have left it clear that the proposal will be unacceptable.

34. Comments to 1.03
In litigation, a lawyer should explain the general strategy and prospects of success and ordinarily should consult the client on tactics that might injure or coerce others. On the other hand, a lawyer ordinarily cannot be expected to describe trial or negotiation strategy in detail. Moreover, in certain situations practical exigency may require a lawyer to act for a client without prior consultation. The guiding principle is that the lawyer should reasonably fulfill client expectations for information consistent with the duty to act in the client’s best interests, and the client’s overall requirements as to the character of representation.
Examples:
Extensions of time
Continuances
Settlement demands and offers
Experts

35. Communication Problems Being out of communication
I called my lawyer over and over and never got a call back
I never received any update on my case
I wrote my lawyer letters and got no response
Responses:
I didn’t have anything to report
I responded (but no log, letter or proof)
My secretary was supposed to do that

36. Communication Key Points: Don’t be out of communication
Send your clients the papers you file and receive and be able to prove it (keep copies)
Return your clients phone calls even if you have not done what you said you would do or you have nothing to report
Answer your client’s letters and keep copies
Keep some record of your communications with clients.
Put yourself in your client’s shoes.
Give the client sufficient information to make the important decisions

37. Terminating Representation

38. DECLINING OR TERMINATING REPRESENTATION – 14.5% Of Grievances No. 4
Rule 1.15 Declining or Terminating Representation

39. Rule 1.15 Declining/Terminating
(d) Upon termination of representation, a lawyer shall take steps to the extent reasonably practicable to protect a client’s interests, such as giving reasonable notice to the client, allowing time for employment of other counsel, surrendering papers and property to which the client is entitled and refunding any advance payments of fee that has not been earned. The lawyer may retain papers relating to the client to the extent permitted by other law only if such retention will not prejudice the client in the subject matter of the representation.

40. Terminating Representation
Problems
Not transferring the file timely
Not refunding unearned fees

41. Declining or Terminating Representation
Key Points:
If you get out of a case, protect your client’s interests
Give adequate time to get new counsel
Transfer information and the file promptly
Give an unearned fee back to the client

42. Safeguarding Property

43. SAFEGUARDING PROPERTY – 7.5% No. 5

44. 1.14 Safekeeping Property
(a) A lawyer shall hold funds and other property belonging in whole or in part to clients or third parties that are in a lawyer’s possession in connection with a representation separate from the lawyer’s own property. Such funds shall be kept in a separate account, designated as a “trust” or “escrow” account, maintained in a state where the lawyer’s office is situated, or elsewhere with the consent of the client or third person. Other client property shall be identified as such and appropriately safeguarded. Complete records of such account funds and other property shall be kept by the lawyer and shall be preserved for a period of five years after termination of the representation.

45. 1.14 Safekeeping Property
(b) Upon receiving funds or other property in which a client or third person has an interest, a lawyer shall promptly notify the client of third person. Except as stated in this Rule or otherwise permitted by law or agreement with the client, a lawyer shall promptly deliver to the client or third person any funds or other property that the client or third person is entitled to receive and, upon request by the client or third person, shall promptly render a full accounting regarding such property.

46. COMMENT TO RULE 1.14
A lawyer should hold property of others with the care required of a professional fiduciary.
If there is risk that the client may divert the funds without paying the fee, the lawyer is not required to remit the portion from which the fee is to be paid. However, a lawyer may not hold funds to coerce a client into accepting the lawyer’s contention. The disputed portion of the funds should be kept in trust and the lawyer should suggest means for prompt resolution of the dispute, such as arbitration. The undisputed portion of funds should be promptly distributed to those entitled to receive them by virtue of the representation.

47. Safeguarding Property
Problems
Receiving settlement funds and not giving them to the client
Comingling client and law firm money

48. Safeguarding Property
Key Points:
Keep you client’s money separate from your own
Operating account
Trust account
Don’t take your client’s money unless you earned it
Don’t put in operating before earned
Give your client’s money back, if not earned, when asked
Keep records of client money for 5 years
Be transparent. Give an accounting when asked

49. Fees

50. FEES – 3.5% No. 8
1.04 Fees

51. Fees Rule 1.08 (prohibited transactions between a lawyer and client)
Related rules are:
Rule 1.08 (prohibited transactions between a lawyer and client)
Rule 1.14 (safeguarding property)
Rule 1.15 (terminating representation and refunding unearned fees)
Rule 3.08 (the lawyer as witness)
Rule 5.04 (the lawyer’s relationship with non-lawyers with respect to fees)
Rule 7.03 (prohibited solicitations and payments)
Rule 8.04(a)(3)

52. 1.04 Fees
(c) When the lawyer has not regularly represented the client, the basis or rate of the fee shall be communicated to the client, preferably in writing, before or within a reasonable time after commencing the representation.

53. 1.04 Fees
(d) A fee may be contingent on the outcome of the matter for which the service is rendered, except in a matter in which a contingent fee is prohibited by paragraph (e) or other law. A contingent fee agreement shall be in writing and shall state the method by which the fee is to be determined. If there is to be a differentiation in the percentage or percentages that shall accrue to the lawyer in the event of settlement, trial or appeal, the percentage for each shall be stated. The agreement shall state the litigation and other expenses to be deducted from the recovery, and whether such expenses are to be deducted before or after the contingent fee is calculated. Upon conclusion of a contingent fee matter, the lawyer shall provide the client with a written statement describing the outcome of the matter and, if there is a recovery, showing the remittance to the client and the method of its determination.

54. 1.04 Fees
(e) A lawyer shall not enter into an arrangement for charge, or collect a contingent fee for representing a defendant in a criminal case.
(f) A division or agreement for division of a fee between lawyers who are not in the same firm shall not be made unless:
(1) the division is:
(i) in proportion to the professional services performed by each lawyer; or
(ii) made between lawyers who assumes joint responsibility for the representation;
(2) the client consents in writing to the terms of the arrangement prior to the time of the association or referral proposed, including:
(i) the identity of all lawyers or law firms who will participate in the fee-sharing agreement;
(ii) whether fees will be divided based on the proportion of services performed or by lawyers agreeing to assume joint responsibility for the representation; and
(iii) the share of fee that each lawyer or law firm will receive or, if the division is based on the proportion of services performed, the basis on which the division will be made;
(3) the aggregate fee does not violate paragraph (a).

55. Fees Problems No engagement letter or contract
Ambiguous engagement letters and contracts
Keeping fees not earned

56. Fees Key Points Have written contracts with every client
Enter the contract before you do the work
Don’t keep money you haven’t earned
Don’t refer cases for a fee unless you work on the case
All contingent fee contracts must be in writing
Don’t have contingent fee contracts in criminal cases
If you sue your client, expect a malpractice claim or grievance

57. HELPFUL HINTS

58. BE … Honest Respectful of Others Professional Civil Ethical Excellent
Organized
Resourceful
Creative
Alert
Attentive
Proud

59. DO . . . Plan for the unexpected.
Join professional groups
Read the applicable rules (e.g., statutes, discovery, court procedures, TDRPC, etc.)
Demonstrate respect for the legal profession and the administration of justice
Use the Ethics Hotline ( )
Act with competence, commitment and dedication to the interest of the client
Communicate regularly with your client
Timely return phone calls (directly or indirectly through reminders to your attorney)
Maintain confidential and privileged communications

60. DO NOT . . . Do not procrastinate in your work
Do not misrepresent the status of a case
Do not communicate with someone represented by counsel
Do not sign your attorney’s name without permission
Do not hold a file for ransom
Do not mishandle client trust funds
Do not keep unearned fees
Do not backdate letters, discovery or other legal documents
Do not do anything that prejudices your client
Do not lie, cheat or steal