Appellate Division: Second Judicial Department

M81254

E/cb

A. GAIL PRUDENTI, P.J.

WILLIAM F. MASTRO

REINALDO E. RIVERA

PETER B. SKELOS

STEVEN W. FISHER, JJ.

2008-09179 In the Matter of Lisa L. Cox, an attorney and counselor-at-law. Grievance Committee for the Ninth Judicial District, petitioner; Lisa L. Cox, respondent. (Attorney Registration No. 2670289)

DECISION & ORDER ON MOTION

Motion by the Grievance Committee for the Ninth Judicial District for an order: 1) suspending the respondent from the practice of law, pursuant to 22 NYCRR 691.4(l)(1)(i), (ii), and (iii), upon a finding that she is guilty of professional misconduct immediately threatening the public interest in that she has failed to comply with the lawful demands of the Grievance Committee in connection with an investigation of professional misconduct, she has made substantial admissions under oath that she has committed acts of professional misconduct, and that there is uncontroverted evidence of professional misconduct; 2) authorizing it to institute and prosecute a disciplinary proceeding against the respondent; 3) directing that a hearing be held before a Special Referee; and 4) directing the respondent to answer the petition within 20 days. The respondent was admitted to the Bar at a term of the Appellate Division of the Supreme Court in the Second Judicial Department on May 17, 1995.

Upon the papers submitted in support of the motion and the papers submitted in opposition thereto, it is

ORDERED that the motion is granted; and it is further,

ORDERED that pursuant to 22 NYCRR 691.4(l)(1)(i),(ii), and (iii), the respondent, Lisa L. Cox, is immediately suspended from the practice of law in the State of New York, pending further order of the court; and it is further,

ORDERED that the respondent, Lisa L. Cox, shall promptly comply with this court's rules governing the conduct of disbarred, suspended, and resigned attorneys (see 22 NYCRR 691.10); and it is further,

ORDERED that pursuant to Judiciary Law § 90, during the period of suspension and until further order of this court, the respondent, Lisa L. Cox, is commanded to desist and refrain from (1) practicing law in any form, either as principal or agent, clerk, or employee of another, (2) appearing as an attorney or counselor-at-law before any court, Judge, Justice, board, commission, or other public authority, (3) giving to another an opinion as to the law or its application or any advice in relation thereto, and (4) holding herself out in any way as an attorney and counselor-at-law; and it is further,

ORDERED that the Grievance Committee for the Ninth Judicial District is hereby authorized to institute and prosecute a disciplinary proceeding in this court against Lisa L. Cox, based on a petition dated October 3, 2008; and it is further,

ORDERED that the Grievance Committee shall serve the petition upon the Special Referee and file the original petition in the office of the Clerk of this court within 20 days after receipt of a copy of this decision and order on motion; and it is further,

ORDERED that Gary L. Casella, Chief Counsel, Grievance Committee for the Ninth Judicial District, 399 Knollwood Road, Suite 200, White Plains, N.Y. 10603, is hereby appointed as attorney for the petitioner in such proceeding; and it is further,

ORDERED that within 20 days after service upon her of a copy of this order, the respondent, Lisa L. Cox, shall serve an answer upon the petitioner and the Special Referee, and shall file the original answer with this court; and it is further,

ORDERED that the issues raised by the petition and any answer thereto are referred to the Honorable Lewis L. Douglass, a retired Justice of the Supreme Court, Kings County, 166-25 Powells Cove Boulevard, Whitestone, N.Y. 11357, as Special Referee to hear and report, together with his finding on the issues, and to submit a report within 60 days after the conclusion of the hearing or the submission of post-hearing memoranda; and it is further,

ORDERED that if the respondent, Lisa L. Cox, has been issued a secure pass by the Office of Court Administration, it shall be returned forthwith to the issuing agency and the respondent shall certify to the same in her affidavit of compliance pursuant to 22 NYCRR 691.10(f).

We find, prima facie, that the respondent is guilty of professional misconduct immediately threatening the public interest based upon her failure to cooperate with the Grievance Committee, substantial admissions under oath, and other uncontroverted evidence of professional misconduct.

The respondent maintains an attorney escrow account at Bank of America. On or about August 2, 2006, she received a $5,000 deposit on behalf of client Lacarrubba. That deposit was returned unpaid on or about August 7, 2006. The respondent nevertheless, in violation of her fiduciary duty, caused five disbursements to be made from her escrow account on or about September 29, 2006. These were checks in the following amounts: $950 payable to herself; $100 payable to C,S,C,B & V LLP; $777.46 payable to Carriage House Owner's Corporation; $450 payable to Sherry & Sons, Inc.; and $300 payable to Carriage House Owner's Corporation. When making those disbursements, the respondent failed to ensure that she had adequate funds on deposit relating thereto. The Grievance Committee's accounting showed that on October 20, 2006, the respondent's account had a negative balance of $539.96.

On or about August 1, 2006, the respondent received a deposit of $10,000 on behalf of the Forbes clients relating to the sale of real property. Without authorization, she made a disbursement of $7,962.50 to herself as legal fees. On January 29, 2007, she made another disbursement to herself from the escrow account in the amount of $3,057.50 as the balance of legal fees. The Forbes clients are willing to testify that the respondent was never given authority to disburse legal fees to herself. The respondent has failed to provide an accounting of funds being held in escrow to the clients despite their repeated requests.

According to Grievance Counsel, the respondent has continually failed to cooperate with the Grievance Committee's requests and views cooperation as an imposition. On two occasions the Grievance Committee was compelled to seek subpoenas to secure the respondent's cooperation.

By letter dated July 17, 2007, the Grievance Committee advised the respondent that she was the subject of a sua sponte complaint based upon her failure to re-register with OCA. She was directed to submit an answer within 10 days explaining her failure to re-register and to submit proof of her registration and/or change of address within 60 days.

By letter dated July 17, 2007, the Grievance Committee requested an answer to the Forbes complaint within 10 days. Both letters advised the respondent that an unexcused failure to submit an answer to either complaint constituted professional misconduct independent of the merits of the complaint. The respondent nevertheless failed to answer.

The Grievance Committee then sent the respondent two certified letters both dated August 1, 2007, demanding her answers to the two complaints within 10 days and warning that a motion for her interim suspension might otherwise ensue. By letter dated August 3, 2007, the respondent advised the Grievance Committee that her father had passed away and her mother was hospitalized. She represented that she would respond to the complaint by mid- to late-September.

By letter dated August 9, 2007, the Grievance Committee informed the respondent that her time to answer both complaints was adjourned to September 17, 2007. It reminded the respondent that her failure to reply would result in subpoenas for her appearance along with the requested documents and could constitute grounds for her immediate suspension. The respondent still failed to comply. By facsimile dated September 18, 2007, she advised the Grievance Committee that her son had been ill and that she would comply with its requests by September 20, 2007.

Despite her assurances, the respondent failed to comply with the Grievance Committee's requests which necessitated a judicial subpoena and subpoena duces tecum. The respondent appeared at the Grievance Committee's office on October 11, 2007, to testify and also provided her answer and the requested file.

The respondent testified that she was holding $2,000 in escrow on behalf of the Forbes clients and that she had filed her biennial registration with the Office of Court Administration (hereinafter OCA) for the period 2007-2008. Although she was asked to submit proof within 30 days, she failed to do so.

By letter dated November 26, 2007, the Grievance Committee requested that the respondent submit those items within 7 days and also directed her to address the Forbes' allegation that she failed to provide an accounting of funds held and disbursed from her escrow account for their real estate transaction. She was again reminded that an attorney's failure to cooperate constitutes professional misconduct independent of the merits of the complaint and could be grounds for her immediate suspension. The respondent nevertheless failed to comply with the Grievance Committee's request.

By facsimile dated December 31, 2007, the respondent provided proof of her biennial registration and a document purporting to show a $2,000 balance in her escrow account on behalf of the Forbes clients. However, she failed to address the Forbes' other allegations, including her failure to account for funds held in her escrow account relevant to the Forbes' real estate transaction.

By letter dated January 28, 2008, the Grievance Committee acknowledged receipt of those materials and directed the respondent to reply to the remaining allegations and to submit her bookkeeping records within 15 days. The respondent's failure to comply necessitated further court- ordered subpoenas. When the Grievance Committee's investigator served the respondent and requested her signature on the office copy of the subpoenas, she refused. The respondent failed to timely comply with the return date on the judicial subpoena duces tecum. Some 17 days after the return date, the respondent submitted an answer to the Forbes' reply and partial bookkeeping records for her attorney escrow account. This necessitated a subpoena to Bank of America which provided the necessary bookkeeping records for the Grievance Committee to prepare an accounting.

On October 11, 2007, the respondent submitted an answer to the Forbes complaint in which she insisted that she did not receive a legal fee in that matter. She also testified to that effect at her investigative appearance that day. However, on July 1, 2008, she testified that she did, in fact, receive a legal fee of $10,000 in the Forbes matter. She noted on the record that she had been grieving her father's passing since June 2007 and had not previously had a full opportunity to review the Forbes matter. The respondent also testified on October 11, 2007 that she was holding $2,000 in her escrow account on behalf of the Forbes matter. In response to the Grievance Committee's request, the respondent submitted a document purportedly showing a balance of $2,000 in that account. However, at the time the respondent submitted that document, she was not holding any funds on the Forbes' behalf. Rather, the account had a zero balance until the respondent deposited $2,000 cash on December 31, 2007. The cash deposit did not relate to the Forbes matter.

On July 1, 2008, the respondent testified that Lindy Forbes verbally authorized her to take her legal fee from the funds being held in escrow. Ms. Forbes stated that she never authorized the respondent to take any legal fees from funds being held in escrow.

After being retained to represent the Forbes clients in the sale of their real property in May 2006, the respondent entered into a brokerage commission agreement with the Forbes clients on August 17, 2006, whereby she would receive 5% of the $465,000 selling price. The respondent testified that she received a broker's fee of $23,250 on or about August 17, 2006, and that she represented the Forbes at their closing. The Grievance Committee alleges that by acting as both real estate broker and attorney for the Forbes clients, the respondent engaged in an impermissible conflict of interest.

Although the respondent acknowledged receipt of Ronald Forbes' request for an accounting, she failed to reply.

The Grievance Committee further contends that OCA records reflect that she failed to timely file a biennial statement and registration fees for the period 2007-2008.

In opposition, the respondent contends that the Grievance Committee has twisted the facts in such a manner as to portray her as imprudent, incompetent, and a public danger. According to the respondent, she forthrightly detailed the complicated Forbes matter for Grievance Counsel and sought to gather the additional documents requested. The respondent was admittedly consumed by her attempt to regain control of her calendar and legal matters delayed by her father's untimely death as well as helping her sons cope with their loss. The respondent relates OCA's role in misplacing her registration documents, sent via mail, which contributed to her delays. She was dismayed by Grievance Counsel's "exhaustive request" for additional information within 15 days, which she labels "a Herculean task at best under ordinary circumstances, but absolutely sadistic and abusive under these circumstances." The respondent states that compliance with such an exhaustive request within 15 days would be difficult without closing her practice. Per the respondent, the Forbes ' had no disposable cash and always expressed the idea that all fees and expenses were to be paid from the proceeds of the August 17, 2006, closing, as is customary in real estate closings. She answers the Grievance Committee's conflict of interest argument by claiming that separate and additional counsel for each matter and issue was declined by the Forbes, none of whom had funds to retain counsel or the desire to delay prosecution of their issues.

On balance, we find that the respondent's immediate suspension is warranted in the interest of protecting the public pending resolution of the underlying issues. Accordingly, the Grievance Committee's motion is granted.

PRUDENTI, P.J., MASTRO, RIVERA, SKELOS and FISHER, JJ., concur.

ENTER:

James Edward Pelzer

Clerk of the Court