KENTUCKY BAR ASSOCIATION V. LEO MARCUM
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2010-SC-000105-KB
KENTUCKY BAR ASSOCIATION
V.
DACT
MOVANT
IN SUPREME COURT
LEO MARCUM
RESPONDENT
OPINION AND ORDER
Leo Marcum, KBA Member No . 43870, was admitted to the practice of
law in Kentucky in 1971 . His bar roster address is P.O . Box 178,
Lowmansville, Kentucky 41232. Now before this Court are two KBA files which
allege Marcum engaged in professional misconduct . KBA File No. 12492
concerns Marcum's representation of Ella Pauley, and KBA File No . 11629
concerns Marcum's representation of Elmer and Evaleena Mullins . The Trial
Commissioner's amended report recommended that Marcum be adjudged
guilty of the majority of the charges in both files and that he receive a one-year
suspension from the practice of law in Kentucky to run consecutively and
separately from sanctions he has received in previous disciplinary matters .
Since neither Marcum nor the KBA filed a notice of appeal pursuant to SCR
3.360(4) we now enter a final order pursuant to SCR 3 .370(10) adopting the
Trial Commissioner's recommendation .
_0ZM=DC11
FINDINGS OF FACT
The Trial Commissioner made the following Findings of Fact which,
pursuant to SCR 3 .370(10), we adopt as our own.
File No . 12492-ELLA PAULEY
Ella Pauley hired Marcum on April 14, 1999, to represent her in a
personal injury claim arising from a car wreck. In September 2000, Marcum
filed suit against tortfeasor Barry McClanahan in Fayette Circuit Court.
However, the address Marcum believed McClanahan lived at was incorrect, and
McClanahan was not given notice of the lawsuit nor ever found . Marcum
apparently made no other effort to contact McClanahan and on October 30,
2002, the Fayette Circuit Court sent Marcum a CR 77.02 Notice to dismiss the
claim for lack of prosecution . Subsequently, on March 14, 2003, the Fayette
Circuit Court dismissed the case for lack of prosecution.
On May 14, 2004, Marcum found a new address for a Barry McClanahan
and asked the Fayette Circuit Clerk to issue another summons to the
McClanahan at that address. On June 18, 2004, Marcum filed a motion to
redocket Ms. Pauley's case stating that McClanahan had been found.
Marcum's representation that McClanahan had been found, however, was not
true . The motion was granted by the Fayette Circuit Court on July 14, 2004.
On July 16, 2004, the McClanahan who was served with notice of the
lawsuit called Marcum's office and talked to someone other than Marcum.
This person claimed he was not the McClanahan involved in the accident with
Ms . Pauley. Marcum did not follow up after learning this information. In
August 2004, Marcum asked the Fayette County Sheriff to locate McClanahan
and was eventually told in September 2004 that McClanahan had moved to an
unknown address . Marcum apparently made no other efforts to locate
McClanahan and the case was subsequently dismissed again since
McClanahan was not served .
During all of this, the record indicates that Marcum never notified Ms.
Pauley of the notice to dismiss for lack of prosecution, the dismissal, or the
reinstatement of her case . Further, Marcum did very little to represent Ms.
Pauley and gave most of the work on the case to other staff members . Marcum
does admit that he failed to respond to KBA letters and requests for
information during its investigation into this matter .
Based on these actions, the Inquiry Commission charged Marcum on
December 15, 2005, with five counts of misconduct . Count one alleged a
violation of SCR 3.130-1 .1 for failure to properly represent Ms. Pauley. Count
two alleged a violation of SCR 3 .130-1 .3 for failure to act with reasonable
diligence and promptness in representing Ms. Pauley. Count three alleged a
violation of SCR 3 .310-1 .4(a) for failure to keep Ms. Pauley reasonably informed
about the status of her -case and failure to comply with her requests for
information. Count four alleged a violation of SCR 3 .130-3 .2 for Marcum's
failure to take reasonable efforts to expedite litigation in Ms . Pauley's interest .
Count five alleged a violation of SCR 3 .130-8 .1(b) for failure to respond to the
KBA's requests for information in connection with this disciplinary matter.
File No . 11629-ELMER AND EVALEENA MULLINS
Sometime in late May or early June, 2003, Elmer and Evaleena Mullins
hired Marcum to collect $1,930 .00 they paid to builder John Burchett.
Marcum called Burchett while the Mullinses were meeting with him and
demanded that he return the money. Burchett complied and gave Marcum the
money within a few days. Marcum in return gave the Mullinses a check in the
amount of $1,630 .00, retaining $300 .00 for his services . The Mullinses
however returned the check and decided that they wanted to sue Burchett for
$4,000 .00 to recoup attorney fees and other costs . Marcum agreed to
represent them and said he would file suit, charging them a one-third
contingency fee. However, Marcum provided no written agreement about costs
and attorney fees. No evidence has ever been presented to indicate that
Marcum filed suit against Burchett. Mrs. Mullins tried to contact Marcum
multiple times in the following months but was not successful . In May or June
2005, Mrs . Mullins asked Marcum to return the $1,630 .00 to her. She never
heard from him and she never received the money. Evidence indicates that
Marcum's escrow account has less than the $1,630.00 the Mullinses
requested.
In June, 2004, the Office of Bar Counsel requested information from
Marcum relating to the Mullins' case . Marcum did not respond. In December
2004, the KBA sent another letter asking for an explanation of the matter and
a copy of the escrow record . Marcum did not respond.
4n September 9, 2005, the KBA sent Marcum a reminder letter of his
failure to respond. This letter also advised him that a review of his escrow
account at the Inez Deposit Bank, which the Inquiry Commission had
subpoenaed, did not reflect that the money Burchett gave him had been
refunded to him . The letter also informed Marcum . that his escrow account
had a negative balance . Bar Counsel asked Marcum to provide verification that
he was keeping money from third parties in his possession in a separate bank
account where the bank would notify the KBA if an overdraft occurred.
Marcum failed to respond to the letter or any of the KBA's requests for
information .
The record discloses that Marcum co-mingled his personal funds with
money belonging to third-parties . At the Trial Commissioner hearing, Marcum
admitted that "sometimes we have a lot of money in the escrow account that
belongs to me." Further, evidence presented at the hearing demonstrated that,
from his escrow fund, Marcum advanced to individuals who were not entitled
to escrow funds at least $1,000.00, loaned himself money of at least $1,500 .00,
wrote checks to his son for at least $500.00, wrote checks for cash, wrote a
check to West Group for $5,342 .00, and wrote a check for $4,000 .00 to
Premier Motors for a van for the business .
Based on these actions, the Inquiry Commission filed charges against
Marcum on December 27, 2007, alleging six counts of professional misconduct .
Count one alleged a violation of SCR 3.130-1 .3 for Marcum's failure to act with
reasonable diligence and promptness in representing the Mullinses. Count two
alleged a violation of SCR 3 .310-1 .4(a) for failure to keep the Mullinses
reasonably informed about the status of their case and his failure to promptly
comply with their reasonable requests for information . Count three alleged a
violation of SCR 3 .130-1 .15(a) for failure to maintain separate accounts for
third-party or client property where the bank would notify the KBA in case of
an overdraft. Count four alleged a violation of SCR 3 .130-1 .15(b) for either
failing to deliver funds belonging to Burchett or to the Mullinses or hold said
funds in a trust until the resolution of the matter. Count five alleged a
violation of SCR 3.130-8 .1(b) for failure to respond to letters sent by the KBA
requesting information on this disciplinary matter. Count six alleged a
violation of SCR 3 .130-8 .1(c) for professional misconduct by taking $1,630 .00
that belonged to the Mullinses to file a lawsuit against Burchett, and then
failing to file the lawsuit or return the money.
CONCLUSIONS OF LAW
The Trial Commissioner held a hearing on June 4, 2009. Following the
hearing, the Trial Commissioner made the following Conclusions of Law in a
report filed on December 17, 2009, on KBA Files 12492 and 11629 which we
adopt as our own.
File No . 12492-ELLA PAULEY
Marcum violated SCR 3 .130-1 .1 and SCR 3 .130-3 .2 by failing to provide
competent representation to Ms . Pauley. Marcum gathered sufficient
information to obtain an offer on Ms. Pauley's case and undertook to file a
lawsuit against the tortfeasor, but then failed to effectuate proper service and
follow up on the lawsuit. After learning that McClanahan's service address had
expired, Marcum then waited another three and one-half years to try to locate
him. Marcum also failed to follow up with the person who received service of
the lawsuit, but claimed not to be McClanahan . The case was ultimately
dismissed for lack of prosecution . Ms . Pauley was never notified of any of these
matters .
Marcum also violated SCR 3.130-1 .3 by failing to obtain service of
process on McClanahan for three and one-half years, and violated SCR 3 .1301 .4(a) by failing to keep Ms. Pauley informed about the status of the matter and
promptly complying with reasonable requests for information. Ms. Pauley tried
to communicate with Marcum, but there is no compelling evidence that
Marcum advised her of the dismissal or the reinstatement either in person or
by phone.
And finally, Marcum violated SCR 3 .130-8 .1(b) by failing to respond to
three letters from Deputy Counsel at the KBA seeking information about the
case .
File No. 11629-ELMER AND EVALEENA MULLINS
Marcum violated SCR 3 .130-1 .3 by failing to act with reasonable
diligence and by failing to take proper safeguards with his clients' funds.
Funds belonging to the Mullinses were co-mingled, spent, and their use was
unauthorized . See KBA v. Hall, 173 S .W.3d 621, 625 (Ky. 2005) . Marcum also
failed to act with reasonable diligence with respect to informing the Mullinses
of his fees for representation .
Marcum violated SCR 3 .130-1 .15(a) by providing improper advances
from his bank account. Marcum or his paralegal wrote personal checks to
himself without documentation or explanation, he or his paralegal wrote
checks to family members (son), without documentation or explanation, and he
paid office expenses, all out of his escrow account. Moreover, Marcum did not
know if his bank had agreed to notify the KBA of an overdraft.
Marcum violated SCR 3 .130-1 .15(b) by not notifying clients of receipt of
funds in which they may have an interest and to promptly deliver such funds
to his clients . Marcum notified the Mullinses upon receiving the check from
Burchett and attempted to give it to the Mullinses . However, the Mullinses
returned the check to Marcum, and requested a lawsuit be filed against
Burchett. However, when the Mullinses were unsatisfied with the progress of
the lawsuit, and requested the money be returned, Marcum did not comply.
Marcum violated SCR 3 .130-8 .1(b) by failing to respond to a lawful
demand for information from a disciplinary authority on this matter.
Marcum violated SCR 3 .140-8 .3(c) by engaging in professional
misconduct related to dishonesty by expending the Mullinses' funds as his
own .
However, the Trial Commissioner found that Marcum did not violate SCR
3 .130-1 .4(a) because the record does not contain sufficient proof that the
Mullinses were not provided information on the case as requested or that they
made requests for information .
CONCLUSION
Based on the above violations, the Trial Commissioner determined that
the appropriate punishment was a one year suspension from the practice of
law. This conclusion was based in part on the prior disciplinary history of
Marcum. Marcum has been reprimanded twice, admonished three times, and
suspended once for 181 days. In October 2000, Marcum was publicly
reprimanded for violating SCR 3 .130-1 .4(a) (failure to keep clients informed) .
See KBA v. Marcum, 28 S .W.3d 861 (Ky. 2000). . In July, 2005, Marcum
received a private admonition for violating SCR 3.130.1 .3 (reasonable diligence
and promptness in representing a client) and SCR 3 .130-8 .1 (responding to
demands from the disciplinary authority) . In 2009, Marcum violated SCR
3.130-1 .15(a) (requiring a lawyer to hold client funds separately from his own)
and SCR 3.130-8 .3(c) (professional misconduct), see KBA v. Marcum, 292
S.W.3d 317 (Ky. 2009), and was suspended for 181 days.
Based on the seriousness of the current charges against Marcum, his
past disciplinary history, Marcum's failure to respond to disciplinary
authorities, and the fact that Marcum did not clean up the handling of his
escrow account, the Trial Commissioner recommends the sanction of a one (1)
year suspension from the practice of law, to run consecutively and separately
.
.360(1)(d)
from sanctions in other matters in accordance with SCR 3 We agree
and adopt the recommendations of the Trial Commissioner, pursuant to SCR
3 .370(1) .
ACCORDINGLY, IT IS HEREBY ORDERED that:
1) Respondent, Leo Marcum, is suspended from the practice of law in
this Commonwealth for a period of one (1) year ;
2) This sanction shall run consecutively and separately from sanctions in
other matters before this Court;
3) If he has not already done so, Respondent shall pay restitution to
Elmer and Evaleena Mullins of $1,630.00, representing the balance of funds
recovered from John Burchett after the deduction of Respondent's $300 fee;
4) Respondent shall notify all necessary courts and clients of his
suspension in accordance with SCR 3.390 . Those notifications shall be made
by letter placed in the United States mail within ten days from the date of this
Opinion and Order. Marcum shall also simultaneously provide a copy of all
such letters to the Executive Director of the Kentucky Bar Association . Also, to
the extent possible, Marcum shall cancel and cease any advertising activities in
which he is engaged;
5) Respondent is directed to pay all costs associated with this
disciplinary proceeding, pursuant to SCR 3 .450, certified to be in the sum of
$2,343 .65, for which execution may issue from this Court upon finality of this
Opinion and Order.
All sitting. All concur.
ENTERED: April 22, 2010.
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