Upon the reading and filing of the following papers in this matter: (1) Notice of Petition by the petitioner, dated August 20, 2011, and supporting papers; and now

UPON DUE DELIBERATION AND CONSIDERATION BY THE COURT of the foregoing papers, the motion is decided as follows: it is

ORDERED that the petition (001) by petitioner, Carol A. Lefkowitz as Executor of the Estate of Jerry I. Lefkowitz, her deceased husband, which seeks an order pursuant to 22 NYCRR 1200, Rule 1.15 et. seq. directing payment to her of the monies ($254,026.40) remaining in Mr. Lekowitz's attorney trust accounts, now being held by the respondent, Lawyers Fund for Client Protection, is hereby denied without prejudice and with leave to resubmit, for failure to establish proper jurisdiction over the respondent and for failure to otherwise establish petitioner's entitlement to the relief requested; and it is further

ORDERED that the Petitioner shall promptly serve a copy of this Order upon the Respondent and upon the Clerk of Court, Appellate Division, Second Department, via Certified Mail (return receipt requested) and First Class Mail, and shall promptly thereafter file the affidavit(s) of such service with the Suffolk County Clerk.

In her petition, Carol A. Lefkowitz seeks an order pursuant to 22 NYCRR 1200, Rule 1.15, directing payment to her of the $254,026.40 remaining from her deceased husband's attorney trust accounts. In a separate but related prior proceeding in Suffolk County (index # 34091/08), Ms. Lefkowitz filed a cross-petition as executor of the estate of her late husband, Jerry I. Lefkowitz, seeking to have Michael J. Hausman, Esq. appointed as successor signatory to the decedent's professional attorney accounts. By order dated December 16, 2008, Hon. Ralph F. Costello granted Ms. Lefkowitz's cross-petition. Thereafter, Mr. Hausman filed a petition in Nassau County Supreme Court (index # 18375/10) for an order directing him to safeguard the remaining funds by turning them over to the Lawyers' Fund for Client Protection. On March 9, 2011, Hon. Karen V. Murphy granted Mr. Hausman's petition and directed him to deposit the funds with the Lawyers Fund. In accordance with Justice Murphy's March 9, 2011 order, those funds are now being held by the Lawyers Fund, the respondent herein. Ms. Lefkowitz now seeks an order directing the Lawyers Fund to pay those remaining funds to her.

Although the Lawyers Fund has not submitted opposition to the petition, the petitioner has failed to establish jurisdiction over the Fund. With regard to manner of service in special proceedings, CPLR §403(c) requires that "[a] notice of petition shall be served in the same manner as a summons in an action." Here, the petitioner's affidavit of service reveals that the petition was served upon the respondent merely overnight mail. Therefore, the petitioner has failed to establish proper jurisdiction over the respondent. Even if the petitioner had established jurisdiction over the respondent Fund, she has, nevertheless, failed to show entitlement to the relief requested.

In an effort to support her claim of entitlement to the remaining funds, Ms. Lefkowitz makes several general, non-evidentiary assertions. For example, she states that"there have been [*2]no inquiries by any former clients of the Decedent regarding the funds on deposit in the IOLA accounts" and that a law firm which previously represented her "undertook an extensive search of all of Decedent's files, records, and books to determine the true owners, or any other claimants, of the funds on deposit ..." Ms. Lefkowitz further summarily asserts that she "has no knowledge or information as to the source of [the subject] funds or the reason why Decedent placed them into his IOLA accounts." The petitioner argues that "[e]ven assuming Decedent improperly deposited his own money into the IOLA accounts, that would simply further evidence that the funds were in fact not the client's money." On that basis, she opines that "[u]nder all of the circumstances, the most reasonable conclusion is that the monies belonged to the Decedent." The Court disagrees. Without any admissible evidence to the contrary, a more reasonable conclusion is that the remaining funds belong to as-yet unidentified clients.

Pursuant to 22 NYCRR 1200, Rule 1.15(b)(1), "A lawyer who is in possession of funds belonging to another person incident to the lawyer's practice of law shall maintain such funds . . . in the lawyer's own name . . . in a special account or accounts, separate from any business or personal accounts of the lawyer or lawyer's firm, and separate from any accounts that the lawyer may maintain as executor, guardian, trustee or receiver, or in any other fiduciary capacity" (emphasis added).

With regard to bookkeeping, 22 NYCRR 1200, Rule 1.15(d)(1) requires attorneys to:

. . . maintain for seven years after the events that they record: (i) the records of all deposits in and withdrawals from the accounts specified in Rule 1.15(b) and of any other bank account that concerns or affects the lawyer's practice of law; these records shall specifically identify the date, source and description of each item deposited, as well as the date, payee and purpose of each withdrawal or disbursement; (ii) a record for special accounts, showing the source of all funds deposited in such accounts, the names of all persons for whom the funds are or were held, the amount of such funds, the description and amounts, and the names of all persons to whom such funds were disbursed; (iii) copies of all retainer and compensation agreements with clients; (iv) copies of all statements to clients or other persons showing the disbursement of funds to them or on their behalf; (v) copies of all bills rendered to clients; (vi) copies of all records showing payments to lawyers, investigators or other persons, not in the lawyer's regular employ, for services rendered or performed; (vii) copies of all retainer and closing statements filed with the Office of Court Administration; and (viii) all checkbooks and check stubs, bank statements, prenumbered canceled checks and duplicate deposit slips."

Despite these specific bookkeeping requirements and the petitioner's claim that there was an "extensive search" of the decedent's files, records, and books, petitioner has not submitted any affidavits from those who allegedly conducted such search, nor copies of any of the records which the decedent was obligated to maintain as a practicing attorney in New York. Such documents, if in proper evidentiary form, may reveal the true owners of the remaining funds, and whether or not any of the decedent's personal funds were commingled with client funds. [*3]

As stated by Timothy O'Sullivan, the Fund's Executive Director, in correspondence to petitioner's counsel prior to commencement of this proceeding, the subject monies "are presumed to be law client funds," and there is "no evidence whatsoever . . . which establishes that the escrow funds in question are property of the Lefkowitz Estate." Accordingly, without admissible proof of entitlement to the requested relief, the funds are presumed to be client funds and the petition is denied without prejudice and with leave to resubmit upon proper proofs.

This constitutes the Order of the Court.

Dated:May 31, 2012

PETER H. MAYER, J.S.C.