Attorney Grievance v. Lichtenberg

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Circuit Co urt for Baltim ore Cou nty Case No. 03-C-03-002820 IN THE COURT OF APPEALS OF MARYLAND Misc. Docket AG No. 67 September Term, 2002 ATTORNEY GRIEVANCE COMMISSION OF MARYLAND v. MYLES LOUIS LICHTENBERG Bell, C.J. *Eldridge Raker Wilner Cathell Harrell Battaglia, JJ. Opinio n by Rak er, J. Wilner and Harrell, JJ., concur Bell, C.J., dissen ts Filed: February 11, 2004 *Eldridge, J., now retired, participated in hearing and conference of this case while an active member of this Court; after being recalled pursuant to the Constitution, Article IV, Section 3A, he also participated in the decision and adoption of this opinion. On October 12, 2002, the Attorney Grievance Commission, acting through Bar Counse l, filed a petition with this Court for disciplinary action against respondent Myles Louis Lichtenberg, charging him with violating Maryland Rules of Professional Conduct 1.15 (Saf ekee ping prop erty) 1 and 8.4(b) , (c), and (d) (M isconduc t)2 ; Maryland Code (1957, 1 Rule 1.15 provides as follows: (a) A lawyer shall hold property of clients or third persons that is in a lawyer s possession in connection with a representation separate from the lawyer s own property. Funds shall be kept in a separate account maintained pursuant to Title 16, Chapter 600 of the Maryland Rules. O ther property shall be identified as such and appr opriately safeguard ed. Com plete records of such account funds an d of other p roperty shall be kept by the lawyer and shall be preserved for a period of five years after termina tion of th e repres entation .. (b) Upon receiving funds or other property in which a client or third person ha s an interest, a la wyer shall promptly notify the client or third person. Except as stated in this Rule or otherwise permitted by law or by 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 p erson is entitled to receive and, upon request by the client or third person, shall promptly render a full ac countin g regar ding su ch prop erty. (c) When in the course of representation a lawyer is in possession of prope rty in whic h both the lawyer and another person claim interests, the property shall be kept separate by the lawyer until there is an accounting and severan ce of their interests. If a dispute arises concerning their respective interests, the portion in dispute shall be kept separate by the lawyer until the disp ute is res olved. 2 Rule 8.4 provides, in pertinent part, as follows: It is professional misconduct for a lawyer to: 1996 Repl. Vol., 2001 Cum. Supp.) Article 27, § 132 (Fraudulent misappropriation by fiduciaries); Maryland Code (1957, 1996 Repl. Vol., 2001 Cum. Supp.) Article 27, § 342 (Theft); Maryland Code (1989, 2000 Repl. Vol., 2003 Cum. Supp.) § 10-306 of the Business Occupations and Prof essions A rticle (Misus e of trust m oney); and Maryland Code (2002 Repl. Vol, 2003 Cum. Supp .) § 22-103 of the Insu rance Article (Depo sits of trust money). Pursuant to Maryland Rule 16-752(a), we referred the matter to Judge Christian M. Kahl of the Circuit Court for Baltimore County to make findings of fact and proposed conclusions of law. Judge Kahl held an evidentiary hearing on May 12, 2003, after which he concluded that neither the Rules of Professional Conduct nor the other provisions of the Maryland Code had been violated as alleged by Bar Counsel. We shall dismiss the petition for the reasons stated herein. I. *** (b) commit a criminal act that ref lects adverse ly on the lawyer s honesty, trustworthiness or fitness as a lawyer in other respects; (c) engage in conduct involving dishonesty, fraud, deceit or misrepresentation; (d) engage in conduct that is prejudicial to the administration of justice -2- The following is quoted from the parties joint stipulation of facts, which is referenced by the hearing court s proposed findings of fact and conclusions of law: 1. Respon dent, Myles Lichtenberg ( Lichtenberg ), is an attorney who ha s been licen sed to practice law in Maryland since June 17, 1987. Mr. Lichtenberg receive d a joint J .D. and Masters of Business Administration Degre e from the Un iversity of Baltim ore La w Sch ool in M ay 1986 . 2. Since 1980 through the present, Lichtenberg has been employed in the real estate settlement an d title business , working as a title agent. Lichtenberg s professional career has been almost exclusively devoted to the business of conducting real estate settlements as a title agent. He has never been actively involve d in the prac tice of law with the exception of the representation of clients in a very few isolated matters. In conjunction with his separate law practice, Lichtenberg maintains a required Interest on Lawyer Trust Account (IOLTA) and has complied with all IOLTA reporting requireme nts with resp ect to this acco unt. 3. Pursuant to Md. Cod e Ann., Insur. § 10-1 25(b), a title agent who conducts a real estate settlement does not have to be an attorney; and thus, the providing of real estate settlement services does not constitute the practice of law. 4. From June 1995 through June 30, 1999, Mr. Lichtenberg was the -3- President and 100% shareholder of a real estate title company, Guaranteed Title and Escrow ( GTE ), which was licensed and regulated by the Maryland Insurance Administration. In addition, Mr. Lich tenberg is p ersonally licensed by the M aryland In suranc e Adm inistratio n as a title insuran ce age nt. 5. During its operation, GTE conducted real estate settlement closings and issued title insurance policies as agent for various title insurance companies. In 1999, G TE had two offices in Owings Mills, Maryland, and Landover, Maryland, with approximately twenty employees, some of whom were licensed to conduct real estate settlem ents. Mr. Lichtenberg directed the operations of the com pany, and m aintained an office at the Owing s Mills location. He employed an office manager to manage the Landover location. Both Lichtenberg and his employees conducted real estate closings at the office s, avera ging ap proxim ately 160 closing s per m onth in 1999. 6. With regard to the transaction that forms the basis for Bar Counsel s Petition, in 1999, George Gigioli sought to refinance the mortgage on his home located at 4603 Mercury Drive, Rockville, Maryland, through a mortgage he had obtained from C itywide Mortgage C orporation ( Citywide ). Mr. Gigioli w as referred to GTE b y Citywide to perform the title and settlement services. GTE Landover office employees worked with Mr.Gigioli, Citywide, and other persons (i.e., prior lenders and cred itors, the title -4- abstractor, insurers , taxing a uthoritie s, etc.) to prepare the transaction for settleme nt. 7. Lichtenberg had no personal involvement in the preparation of any of the settlem ent docum ents for this transaction, including the calculation of the pay-off amount owed to the prior lender, Option One, or the settlement itself. 8. Consistent with GTE s usual and customary p ractices , a settlement file was maintained for the transaction. The parties have stipulated to the authen ticity and admissibility of a copy of the complete GTE Landover office file, #99-55-577, bates labeled GTE INC-0001 through GTE INC-0197, and made a part of this proceeding as Joint Exhibit 1. 9. As part of the preparation for settlement, GTE obtained pay-off information from Mr. Gigioli s then-existing lender, Option One. Option One calculated the amount M r. Gigioli owed on his mortgage as of April 14, 1999, and provided a formula for calculating additional interest charges if the settleme nt was held at a later date . See GTE INC-00028. 10. Settlement took place on Thursday, April 29, 1999 at M r. Gigioli s house. Prior to settlement, a GTE employee had prepared the settlement sheet (common ly referred to as the HUD-1 ) for closing, and mistakenly reported an incorrect amount on the settlement sheet to collect from -5- Mr. Gigioli s new lender, Citywide, to p ay-off his prior mortgage with Option One. See GTE INC 0 084-0 086 at lin e 105. 11. At settlement, Mr. Gigioli executed the necessary paperw ork to complete the transaction, including a separate document entitled, HUD Addendum 3, Acknowledgment and Receipt of Settlement Statem ent ( Add endum ). See GTE INC 0087. 12. Paragraph five of the Addendum signed by M r. Gigioli states: Guaranteed Title, [in ] its sole d iscretion , hereby expressly reserves the right to deposit any amounts held by it in escrow in any interest bearing account in a federally insured institution and to credit any interest so earned to its own account as additional compensation for its service as Settlement Agent in this transaction. See GTE INC 0087. 13. Paragraph 6 of the Addendum signed by Mr. Gigioli provides that: Receipt is hereby acknowledged of Pages 1 and 2 of the Settlemen t Statemen t and Truth in Lending Disclosure Statements covering the above captioned property and same is hereby approved; and is subject to further adjustment between the parties in the event of errors in calculations and/or omissions, and authorization is given to the Guaranteed Title to advance any necessary funds in the event o f errors and /or omission s and to make distribution an d payments in accordance therewith. If, after reasonable demand, monies remain unpaid pursuant to this paragraph, and -6- legal action to collect the same is initiated, the responsible party hereto ag rees to pay unto Guaranteed Title and any all costs of collection including but not limited to court costs, incidental and/or consequ ential dama ges and/o r reasonab le attorney s fees arising out of the collection of monies due and owing. See GTE INC 0087. 14. Mr. Gigioli s transaction was a refinancing, and therefore, he was allowed three business days to rescind. See GTE INC-0083. Upon the expiration of th e three-d ay per iod o n Wednesda y, May 5, 1999, GTE received the new mortgage funds fro m Citywide , which w ere wired in to GTE s interest bearing escrow accou nt at Allfirst Bank pursua nt to Paragraph 5 of the Addendum. The same day, GTE forwarded funds to pay-off the prior mortgage held by Op tion One, a s well as all the parties entitled to be paid from the settlement proceeds of the transaction. See, e.g., GTE INC-0204. 15. Because of the GTE employee s prior erroneous calculation of the payoff amount, GTE forwarded an insufficient amount to Option One. The amount of the shortfall as of the May 6, 1999 date was $145 2.31. See GTE INC-0206. 16. On or about May 6, 1999, Option One advised GTE that they had not credited the payment to Mr. Gigioli s account, and therefore, they were not releasing their mortgage on the property. Over the next two w eeks, a series of -7- attempts were made by GTE e mployees to determine the source of the problem with Option One and correct it. At some point during this period, M r. Lichtenberg was made aware of the pay-off discrepancy by GTE employees. GTE later learned of its employee s miscalculation of the pay-off amount, and on May 19, 1999, GTE advanced from its operating account the additional funds (which now totaled $1,856.30 as a result of further interest charges) needed by Option One to co mplete the pay-off and release its mortgage on the proper ty. See GTE INC- 0205 a nd 021 1. 17. GTE later attempted to collect the $1856.30 it had advanced on behalf of Mr. G igioli to pay-off h is mortgage with Option One. At least two letters were sent to Mr. Gigioli by Mr. Lichtenberg regarding this issue. On February 8, 2000, Mr. Lichtenberg wrote Mr. Gigioli and sought rep ayment. See GTE INC-01 99. After s peaking w ith Mr. Gigioli, on February 18, 2000, Mr. Lichtenberg wrote again and reduced his deman d for repaym ent to $1452.31; the amount due Option One by Mr. Gigioli as of May 6, 1999, when Option One first a dvised G TE that it would not accept the paymen t. See GTE INC-0206. 18. Ultimate ly, GTE was forced to file suit in the District Court for Montgom ery County seeking repayment of the monies it adv anced in Mr. Gigioli s behalf. On January 24, 2001, the Court awarded judgment to GTE. -8- 19. On January 8, 2001, Mr. G igioli s attorney in the District Court case filed a complaint with the Attorney Grievance Commission, alleging that, paragraph 5 and 6 of the Addendum violated certain provisions of the Maryland Rules of Professio nal Responsibility and Rules of Professional Cond uct. 20. On October 16, 2001, Bar Counsel filed a statement of charges against Lichtenberg, alleging possible violations of Maryland Rules of Professional Conduct 1.15 and 8.4(b), (c), and (d), solely as it related to GTE s retention of interest derived from settlement funds, and the matter was referred to a Peer Review Committee for consideration pursuant to Maryland Rule 16741. 21. A hearing was held before the Peer Review Committee on January 17, 2002 . At the con clusion of th e hearing, the Peer Review Committee issued its recommendation to the Attorney Grievance Commission that the statemen t of charge s be dismiss ed against L ichtenberg pursuant to Maryland Rule 16 -743(e). 22. On March 20, 2002, the Attorney Grievance Commission rejected the Committee s recommendation, and directed Bar Counsel to file a Petition for Di sciplina ry Action . 23. On October 4, 2002, Bar Counsel filed its Petition for -9- Disciplinary Action. On January 10, 2003, Bar Counsel filed the instant Amended Petition. The miscond uct alleged against Lichtenb erg in the Petition is solely related to GTE s retention of interest derived from the settlement funds in Mr. Gigioli s refinancing transaction. 24. Section 22-103(b) of the Insurance Article, Md. Ann. Code, requires a title insurer or its agents to pool settlement/trust funds from its clients that otherwise would not generate interest of more than $50.00, or an insufficient amount to cover the cost of maintaining a separate account for the proceeds of each in dividual settlem ent: (b) Pooling and commingling trust money authorized. A title insurer or its agent shall pool and commin gle trust mon ey received fro m clients or beneficial owners in connection with escrows, settlements, closings, or title indemnifications if, in the judgm ent of the title in surer or its age nt, a separate deposit of th e trust money w ould generate interest in an amount no t greater than $50 or the cost o f adminis tering a sepa rate account. Insurance Article § 22-10 3(b). See Joint Exhibit 2 (attached here to). Section 22-103(c) provides that, the interest earne d on fun ds deposite d into this account shall be paid to the Maryland Aff ordable Housing Trust ( MAH T ). 25. Section 22-103(f) provides for the procedures to be followed for settlement proceeds (or trust money ) that are expected to generate interest in excess of $50.00: -10- (f) Other deposits of trust money allowed. Except for trust money that a title insurer or its agent places in a commingled account under subsections (b) and (c) of this section, and subject to the regulations of the Commissioner, trust money in the possession of the title insurer or its agent may be deposited in any other deposit or investmen t vehicle: (1) specified by the client or beneficial owner; or (2) as agreed o n by the client or beneficial owner and the title insurer or its ag ent. Section 22-10 3(f). See Exhibit 2. 26. The term client referenced in Section 22-103(f) is not defined in the statute; ho wever, C OMA R 31.16.0 3.05 interpre ts the term as referring to the buyer of the home, or in this case, the person refinancing his mortgage. See Joint Exhibit 3 attached. A beneficial owner is defined in the statute as, a person, other than the buyer in a re al estate transac tion, for wh ose bene fit a title insurer or its agent is entrusted to hold trust mo ney. Section 22-103(a). Thus, beneficial owner includes any local and state taxing au thorities, utility companies, real estate agents, condominium associations, or any other thirdparties w ho ma y be paid from re al estate s ettleme nt trust fu nds. 27. GTE maintained both a MAHT account for settlement proceeds generating less than $50.00 in interest, and a non-MAHT account for proceeds genera ting mo re than $ 50.00 in interest. -11- 28. In order to assist title companies in complying with Insurance Article Section 22-103, MAHT publishes a table on its website for title agents to use as a gu ide in determ ining wh en settlement proceed s are held in sufficient amount and for a sufficient period of time to generate interest in excess of $50 .00. See Exhibit 4 attached . MAHT also requires an annual report to be filed by title companies detailing the amount of interest earned on both M AHT accou nts and non-M AHT accou nts. See Exhib it 5 attach ed. 29. Pursuant to Paragraph 5 of the Addendum, GTE retained all of the interest earned on the settlement proceeds received by Citywide in the Gigioli transaction, which were maintained in GTE s non-MAHT escrow account. The amount of the interest earned was more than $50.00. 30. Lichtenberg believed that G TE wa s complying w ith all applicable laws and regulations, as well as the MAHT guidelines, in establishing the procedures at GTE for the creation and use of both a MAHT and a non-MAHT account. L ichtenberg is aware fr om his membership in the Maryland Land and Title Association that it is common in the title industry for title companies to have customers sign agreements similar to the Addendum in this case authorizing the title company to retain the interest in excess of $50.00 on settleme nt funds a s additional c ompens ation for the ir settlement services. See, e.g ., Joint Exhibit 6 (1991 Report and Recommendation of -12- Inquiry P anel. B C Do cket #9 1-52-1 4-5). 31. The total amount of interest earned b y GTE in 1 999 on a ll settleme nt fund s held in GTE s non- MA HT ac counts was $ 33,436 .55. 32. In December 1991, and prior to the enactment of the current version of Section 22-10 3, a prior Inquiry Panel considered whether a lawyer could retain interest earned on settlement proceeds in his capacity as the owner of a title compa ny, notwithsta nding any requirements of Interest on Lawyer Trust Accou nts ( IOL TA ) r ules. (O pinion attache d as Ex hibit 6). The Inquiry Panel concluded that the retention of such interest by a lawyer in a non-IOLTA accou nt did n ot violat e any rule s of pro fession al cond uct. 33. On February 12, 1992, in response to a letter from multiple requesting attorneys, Bar Counsel, Melvin Hirschman, reiterated the holding of the 199 1 Inquiry Pan el and its find ings. Stating th at: Section 10-301 et. seq. of BOP [Business, Occupations, Profession als Article, Md. Ann. Code] does not apply to real estate settlement practices of an attorney who owns a c orporate title com pany, since no atto rney/client relations hip exists between Respondent (or the other attor neyemployees of the title company) and the parties to the real estate transaction; The BU Rules are similarly inapplicable to a corporate title compan y escrow ac count, because such an account is not an Attorney Trust Acco unt, as defined in Rule BU2.c. of the Maryland Rules of Procedure. The Respondent -13- clearly complies with IOLTA requirements by virtue of the IOLTA account related to his separate law practice; The Respondent has not violated any of the Maryland Rules of Professional Conduct of which he is subject as a licensed Maryland atto rney, solely by virtue of his practice of retaining escrow account interest through h is corporate title compan y; And Atto rneys who choose to conduct real estate closings as part of their law practice, rather than through an inde pende nt title com pany, must maintain their settlement escrow accounts as IOLT A acc ounts. See Exhibit 7 (February 12, 1992 letter from B ar Counsel M elvin Hirshman). 34. Legislation was introd uced in the Maryland S enate around this same time to create the Marylan d Affo rdable Housing Trust. This legislation would eventually become Insurance Article section 22-103. Prior to the passage of this legislatio n, on M ay 5, 1992, the Maryland A ttorney Gene ral, in a letter to then Governor William Donald Schaefer, stated his opinion that the proposed legislation (then titled Senate Bill 594) does not work [as] an unconstitutional taking by the Maryland A fforda ble Ho using T rust. See Exhib it 7 (attach ed). 35. As it applies to the Addendum referenced in at paragraph 11 above, and pertains to the particular language contained therein as set f orth in paragraph 12 above, COMAR 31.16.03.05 ( Separate Accounts ) is attached -14- as Joint Exhibit 8. After the eviden tiary hearing of May 12, the hearing court made the following conclusion s of law (f ootnotes o mitted): For the following reasons, the Court finds that, based on these facts, Petitioner has failed to sustain its burden of proof by clear and convincing evidence that Respo ndent has engaged in any misconduct as alleged by Petitioner. The facts demonstrate that Respondent complied with the applicable statutes governing the title company industry in which he was engaged, specifically, Insurance Article § 22-103. Accordingly, this Court finds that Respondent has not violated any of the Rules of Professional Condu ct, or any applicable statutes or regulations alleg ed by Petitione r to suppo rt the alleg ations in the Am ended Petition . First, Responden t committed no crimina l violation and Petitioner s contentions in this regard are completely unfounded. There is simply no evidence of any fraudulent and willful intent to appropriate to any use and purpose not in the due and lawful execution of his trust any m oney in his care as a fiduciary as is required for a violation of Article 27 § 132 of Md. Ann. Code. Nor is there any evidenc e that Resp ondent willfully or knowin gly obtained control which is unauthorized. . . . over property of the owner . . . . as is required for a violation of Article 27 § 342 of M d. Ann. C ode. The facts -15- establish that Respondent hones tly believed he w as comp lying with all applicable laws an d regul ations, see ¶ 30, and had disclose d to Mr. Gigioli that GTE would retain the interest on the settlement funds pursuant to the Addendum Agree ment M r. Gigilio signed . See Joint Exh ibit 1 (GTE INC 0087). Accordingly, there is no violation of Maryland Rule of Professional Conduct 8.4(b) and 8.4(c), because there was no evidence of a criminal act that reflects adversely on the lawyer s honesty, nor any conduct involving dish onesty, fraud, deceit, or misrepresentation. Similarly, Respondent has not violated Maryland Rule of Professional Conduct 8.4(d) and its prohibition against conduct that is prejudicial to the administration of justice inasmuch as Respondent s good faith compliance with the ap plicable insurance s tatute cannot amount to conduct that is prejudicial to the administration of justice. Second, there is no evidence of a statutory violation of Business Occupations and Professions Article, § 10-306. Section 10-306 provides that a lawyer may not use trust money for any purpose other than the purpose for which the trust money is entrusted to the lawyer. In this case, the trust funds for Mr. Gigioli s settlement were, in fact, used by GTE for that settlement and to pay off all the required parties. Indeed, the buyer and every beneficial owner in the transaction were paid exactly the amount they were owed. The interest earned on these funds w as retained b y GTE pu rsuant to its sep arate -16- Agreement with the bu yer, Mr. Gigio li, as allowed by the applicab le insuran ce statut e. Third, there is no ev idence that R esponde nt violated M aryland Rule of Professional Con duct 1.15 rega rding the safe keep ing o f a cl ient s pro perty. Sections (a) and (c) o f Rule 1.1 5 apply to clien t property in connection with a representation by the lawyer. H ere, there is no lawyer/client rela tionship w ith the buyer, especially when Respondent did not even conduct the settlement transaction at issue. Further, the parties have agreed that the providing of real estate settlement services does no t constitu te the pra ctice of law, see ¶ 3, an identical position articulated by Bar Counsel in an earlier letter to requesting attor neys and placed into the record of this case . See Joint Exhibit 7 (February 12, 199 2 letter fr om M elvin H irshma n) and ¶ 33 abo ve. While Rule 1.1 5(b) may im part duties on a law yer be yond the lawyer/client relationship, th e rule mere ly requires the lawyer to promp tly deliver to the client or third person any funds that the client or third perso n is entitled to receive, or as is otherwise permitted by law or by ag reement w ith the client . . . . Petitioner here has failed to demonstrate that the buyer, or any of the other beneficial owners in the transaction were entitled to receive any of the interest earned on the settlement funds. Indeed, GTE had obtained the signature of the buyer on GTE s separate Addendum Agreement indicating -17- GTE s intention to retain the interest on the settlement funds . See Joint Exhibit 1 (GTE INC 0 087). The evidence establishes that Respondent delivere d to the c lient and all applic able thir d parties all fund s due th em. Petitioner s remaining allegations of misconduct turn on its interpretation of Insuran ce Article § 22-103. S ection 22-1 03(b) of th e Insurance Article, Md. Ann. Code, requires a title insurer or its agents to pool settlement/trust funds from its clients that otherwise would not generate interest of more than $50: (b) Pooling a nd com mingling trust money authorized. - A title insurer or its agent shall pool and commin gle trust mon ey received fro m clients or beneficial owners in connection with escrows, settlements, closings, or title indemnifications if, in the judgme nt of the title insur er or its ag ent, a separate deposit of the trust mo ney would generate interest in an amount not greater than $50 or the cost of administering a separate accou nt. Insurance Article § 22-103(b) (emphasis added). Further, section 22-103(c) provides that, the interest earned on funds deposited into this account shall be paid to the Maryland Affordable Housing Trust [MAHT] to enhance the availab ility of aff ordabl e hous ing thro ughou t the state . . . . Section 22-103(f) describes the procedures used for settlement proceeds (or trust money ) that is expected to generate interest in excess of $50.00, w hich may be retained by the title a gent in a no n-MA HT acc ount: -18- (f) Other deposits of trust money allowed. Except for trust money that a title insurer or its agent places in a commingled account under subsections (b) and (c) of this section, and subject to the regulations of the Commissioner, trust money in the possession of the title insurer or its agent may be deposited in any other deposit or investmen t vehicle: (1) specifically by the client or beneficial owner, or (2) as agreed on by the client or beneficial owne r and th e title insu rer or its a gent. Section 22-103(f ) (emphas is added). T he client referenced in the statute refers to the buyer of the home, or in this case, the person ref inancing h is mortgage. A beneficial owner is defined in the statute as a person, other than the buyer in a real estate transaction, for whose benefit a title insurer or its agent is entrusted to hold trust mone y. Section 22-103(a). Con ceiv ably, this could include all local and state taxing authorities, utility companies, real estate agents, condominium associations, and any other parties paid out of real estate se ttlemen t trust fun ds. In the instant cas e, because the settlemen t at issue was expected to generate interest in excess of $50.00 pursuant to Section 22-103(f), GTE had the client/buyer sign a separate Addendum to the HUD-1 statement in which he agreed that GTE could retain any interest earned on the settlement funds. See Joint Exhibit 1 (GTE INC 0087). Thu s, Respon dent com plied with a ll statutory requirements. Petitioner s argument that section 22-103 requires that -19- GTE must obtain the agreement of all the beneficial owners of the trust funds before it can retain the interest on those fund s, see Amended Petition ¶ 18, ignores the disjunctiv e use of the word, or, in Section 22-103(f) and the plain mean ing of th e statute . When a statutory provis ion is clear and unambiguous and express[es] a plain m eaning , a court must g ive eff ect to the statute a s it is writte n. Oaks v. Connors, 339 Md. 24, 35, 660 A.2d 423, 428 (1995) (citations omitted). Further, where the statute is clear, no construction or clarification is needed or permitted, it being the rule that a plainly worded statute must be construed without forced or subtle interpretations designed to extend or limit the scope of its operation. Giant Food, Inc. v. Dept. of Labor, Licensing and Regulation, 356 Md. 180, 189, 738 A.2d 85 6, 861 (1999). If the interpretation offered by Petitioner is ac cepted, and not only the clien t/buyer, but all beneficial owners would need to agree to an alternative use of the interest earned on settlement trust fund s in excess o f $50, then the word or wou ld have n o mea ning in the statu te. Further, under Petitioner s interpretation of the statute, title agents such as GTE would have to obtain the consent of every conceivable beneficial owner of settlement proceeds such as mortgage companies, banks, lien holders, taxing authorities, utility companies, condominium associations and -20- other entit ies befor e reta ining the inter est earne d. Cl early, obtaining this consent from mu ltiple parties w ould be log istically difficult, if not impossible, given the short time the funds are in the title company s account bef ore closing, and conceivably could render the statute unconstitutional as applied. Petitioner contend s that it me rely se eks to apply the common law principle that the interes t follows th e principal. In the instant m atter, however, the C ourt mus t app ly the Maryland statutory law that govern s this situation, and there is no clear and convincing evidence that Respondent has violated the applicable statute. F urther, to ado pt Petitioner s p osition wo uld create two mea nings of th e statute: one for lawyers, and one for non-lawyers authorized to conduct real estate settlements in Maryland who would not otherwise be restricted from obtaining the interest earned in these transactions. In the instant matter, GTE obtained the consent of GTE s c lient or buyer, Mr. Gigioli, to retain this interest, and therefore, neither GTE nor Respondent violated the requirements of Section 22-103. Petitioner s attempt to place an additional requireme nt that Resp ondent also obtain the consent of any other beneficial owner of these funds is contrary to the c lear, plain reading of the statute, and not sp ecifically supported by any case law, or any ruling of the Maryland Insurance Administration, which is charged with enforcing the statute. -21- In sum, GTE and Respondent complied with the plain language of § 22-103 in this case. Accordingly, Petitioner has failed to demonstrate by clear and convincin g evidenc e that Respondent violated any statute or Maryland Rules o f Prof essiona l Cond uct. II. A. This Court has origina l jurisdict ion ove r attorne y disciplin ary proce edings . See Attorney Grievance Comm n v. Harris, 371 Md. 510, 539, 810 A.2d 457, 474 -75 (2002). In the exercise of our obligation, we conduct an independent review of the record, accepting the hearing judge s findings of fact unless they are clearly erroneous. See Attorney Grievance Comm n v. Garfield , 369 Md. 85, 97, 797 A.2d 757, 763-64 (2002). We review the hearing judge s proposed conclusions of law de novo. See Attorney Grievance Comm n v. McLa ughlin, 372 Md. 467 , 493, 813 A.2d 1 145, 1160 (200 2). The heart of Bar Counsel s complaint against respondent boils down to one contention: that by depositin g into his title insurance company s account the interest from funds entrusted to him by clients of the title insurance company, without the express consent of the beneficial owners, respondent violated the Maryland Rules of Profession al Condu ct. Respondent does not engage in the active practice of law but instead was acting as a title agent whose m ain business ac tivity is to conduc t real estate settlements, which is governed, -22- pursuant to the Insura nce Article of the M aryland Cod e, by the Com missioner of th e Insurance Administration. A title insurance a gent or bro ker mea ns a person that, for com pensation, solicits, procures, or nego tiates title in suranc e contra cts. § 10-101(i)(1) of the Insurance Article.3 A title insurance agent or broker includes a person that provides escrow, closing, or settlement services that m ay result in the issua nce of a title insurance contract. § 10101(i)(2). Before a person may act as a title agent or broker in the State, that person must obtain a license, which issued by the Insurance Commissioner. § 10-103. Respondent received such lic ense fr om the Insuran ce Ad ministra tion. See Joint Stipulation of Facts, at ¶ 4. As a duly licen sed title a gent, respondent became subject to the authority of the Insurance Commissione r who, in the exercise of his authority, could revoke respond ent s license or impose other penalties, such as fines or financial restitution, for violations of the Insuran ce Artic le. See § 10-1 26. The Insurance Article contains a detailed structure for the denial, suspension or revocation of a license. Section 10-1 26 autho rizes the Insur ance Com miss ione r to deny, revoke, suspend or refuse to renew or reinstate a license if the ap plicant o r holde r has, inter alia, violated the insurance article; misappropriated, converted or unlawfully withheld money belonging to an insure r, agent, brok er, beneficia ry or insured; or c ommitted fraudulent or 3 Unless otherwise specified, all future statutory references shall be to Maryland Code (2003 Repl. Vol.) §§ 1-101 to 12-306 of the Insurance Article and to Maryland Code (2002 Repl. V ol., 2003 Cum . Supp .) §§ 13 -101 to end of the Insu rance A rticle. -23- dishonest practice s in the in suranc e busin ess. Section 10-131 provides that certain violations of the insuran ce article con stitute a misde meanor, su bject to a fine or imprisonment up to six months or both for eac h violati on. Before a license may be revoked or suspended, the holder must be afforded notice and an opport unity to be heard. § 10-126(a). The actions of the Insuran ce Co mmiss ioner ar e subje ct to judi cial revie w. See § 2-215. It is undispute d that the C ommissio ner has take n no adm inistrative action again st respondent, and more specifically, we were advised at oral argument that the Insurance Administration was contacted by Bar Counsel for guidance on the matter but provided none. Bar Counsel urges us to take the initiative and to interpret the Insurance Article in a matter of first im pressio n. Bar Counsel argues that respondent violated the statute and that as a result, we shou ld discipline him in his capacity as a lawyer. Bar Counsel maintains that respondent violated § 22-103(f) by not securing the consent of any beneficial owner before he retained the interest on settlement proceeds, notwithstanding the fact that he secured the consen t of his client. Bar Counse l also alleges that the statute requires consent that co nformed to the applicable admin istrative r egulatio n, which mandates that any funds not deposited into a MAHT account must be p ursuant to a written agreem ent that is either (1) a separate agreement or (2) if part of another agreement, in conspicuous type and initialed by the buyer or beneficial owner. COMAR. 31.16.03.05B. Respondent argues that although GTE retained all of the interest earned on the -24- settlement proceeds which were received in the Gigioli transaction and m aintained by GTE s non-MAHT escrow account, he complied with all the statutory requirements of § 22-103(f). Responden t s argument is twofold: First, respondent argues the statute is written in the disjunctive and that the use of the word or clearly contemplates that consent of either the beneficial owner or the client satisfies the statute; and respondent obtained the consent of Mr. Gigioli in the HU D-1 Ad dendum in accordance with all applicable statutes, a finding of fact by the hearing court to which Bar Counsel does not take exception. Second, respondent argues that obtaining consent from every conceivable ben eficial owner is not possible and was not contemplated by the statute. As result, he argues the disciplinary petition must be dismissed. B. We shall not proceed down the path suggested by Bar Counsel. While this Court has the authority to proceed in the man ner suggested by Bar Counsel in this case of first impression, we think it injudicious under the circumstances to engage in an analysis of the Insurance Article and to construe the statute and the obligation s of a title agent vis-a-vis the trust account and MAHT account. In order for us to address this issue, we would be required to interpret a provision of the Insurance Article that has not previously been addressed judicially. Specifically, we would need to determine whether § 22-103(f) of the Insurance Article was violated when respondent did not info rm the be neficial ow ners of th e interest- -25- sweeping provision in the contract. This interpretation of § 22-103(f) is not at all selfevident, which is demonstrated by the lengthy arguments from both parties regarding th is issue, and as a consequence, the culpability of respondent s conduct becomes highly questio nable. There is the complete absence of any case or authority on this issue in this State or elsewhere in the country. In addition, the Insurance Commissioner is not a party to these proceedings and thus would be precluded from input on an issue of significant importance to many title insuran ce agents and brokers practicin g in this S tate. Cf. Luskin s v. Consumer Protection, 338 Md. 188, 196, 657 A.2d 788, 791-92 (1995) (noting that [w]e find that the mere nature of this dispute indicates the need for the interpretation of the facts and the application of the law to the facts to be done, in the first instance, by the agency with special expertise in the area ); Fosler v. Panoramic Design, Ltd., 376 M d. 118, * , 829 A .2d 271 , * (2003) (noting that when an administrative agency like the Home Improvement Commission is charged with administering a statute, the administrative agency's interpretation and application of the statute which the agency administers should ordinarily be given considerable weight by reviewing courts (citations omitted)). Under the circumstances presented herein, it makes sense to us to construe the statute in question, as a matter of first impression, in a judicial case other than in the exercise of our role to supervise and discipline attorneys. Respondent has argued vigorously that he has complied with § 22-103 under any -26- reasonab le reading of that statute. He argues the statute d oes not require consent fr om both the title agent s clien t and the benef icial owne rs but from the client or the beneficial owners, as indicated by the plain language of the statute. The trial court found that respondent received the consent of his client, Mr. Gigioli, in accordance with the statute, a finding which Bar Counsel does not dispute. Bar Counse l disputes respondent s statutory construction and argues that the statute required consent from the beneficial owners in addition to the clients. What is striking, however, is that neither party can refer us to a single opinion, decision, or action issued by the Insurance Administration on this question; indeed, at oral argument, Bar Counsel informed us that he had contacted the Commissioner of the Insurance Administration but had received no answer to his inquiry on the issue. In stead, they both would have us opine without receiving any input from the agency in charge of administering this statute. We decline to do so. Neither a criminal conviction nor a statutory violation is a prerequisite for this Cou rt to proceed with disciplinary action against an attorn ey. See, e.g., Attorney Griev. Co mm n v. Childress, 364 Md. 48, 55, 770 A.2d 685, 689 (2001) (recognizing that a criminal conviction is not necessary to show that attorney s conduct was criminal, but in the absence of a conviction, Bar Counsel must prove the conduct was criminal by clear and convincing evidence). Noneth eless, under the circum stances of this case, where the basis of Bar Counsel s complaint relates to conduct not connected with the practice of law, it would be inapprop riate for this Court to determine in the first instance if respondent violated the -27- Insurance Article, and then to impose sanctions with respect to his license to practice law, particularly where the Commissioner was aware of the condu ct and dec lined to exercise his authority to regulate respondent s conduct as an agent or broker. Accord ingly, Bar Counsel s exception to the hearing court s interpretation of § 22-103 is overruled. Bar Counsel s exception to the hearing court s finding that § 342 of Article 27 4 was not violated is also overruled. R esponde nt did not co mmit theft a s defined in § 342 of Article 27. Bar Counsel argues that because respondent had the purpose of depriving the owner of proper ty, id., this intent was sufficient to render his actions theft. We need not decide whether respondent had the intent necessary to satisfy § 342 because his actions do not fall within § 342 in another respect: Respondent never had any unauthorized control over the property as required by the statute because his client consented to respondent s retention of the disputed interest. Nor did respondent violate Maryland Code (1989, 2000 R epl. Vol., 20 03 Cu m. Sup p.) § 10-306 of the Business Occupations and Professions Article. Bar Counse l excepts to the findings of the hearing court on this matter, but provides no theory explaining why the hearing court s legal analysis was incorrect. We agree with the hearing court, and the exception is overruled. 4 Except where o therwise indicated, all statu tory reference s to Article 27 shall be to Article 27 of the Maryland Code (1957, 1996 Re pl. Vol., 2001 Cum. Supp.), which was referred to by both Bar C ounse l and the hearing judge in this case . Article 27 has now been repealed and recodified in the Maryland Code. -28- Bar Counse l alleges that res ponden t violated Ru le 1.15(a), (b), an d (c), dealing with a lawyer s safekeeping of property. We agree with the hearing cou rt with respe ct to Rule 1.15(a) and (c), and find no v iolation of those provisions be cause responden t s actions were not in connection with legal representation of a client. Rule 1.15(b), unlike (a) and (c), does not indicate explicitly whether it applies to actions outside the course of legal representation. We do not decide the question of whether 1.15(b), like (a) and (c), contemplates some so rt of nexus with legal representation, because the only plausible violation of this provision by respondent arises only if he violated § 2 2-103(f) o f the Insura nce Article by not notifying the beneficial owners, which we have already discuss ed and dismissed. T hus, Bar Coun sel s exception is overruled. Fina lly, Bar Co unsel exce pts to the hearing judge s conclusion that respondent did not violate Rule 8 .4(b), (c) , and (d) . We agree with the hearing judge=s analysis that Bar Counsel has not proven by clear and convincing evidence that respondent committed a criminal act that reflects adversely on respondent s honesty, nor has Bar Counsel proven that respondent engaged in conduct prejudicial to the administration of justice or involving dishonesty, fraud, deceit or misrepresentation. The exception is therefore overruled. There being no violation of the Ru les of Prof essional C onduct, the petition is hereby dismissed.5 5 Respondent has also filed several exceptions, which we need not address, because, as we have indicated, the petition will be dismissed. -29- PETITION FOR DISCIPLINARY ACTION DISMISSED. COSTS TO BE PAID BY THE ATTORNEY GRIEVANCE COMMISSION OF MARYLAND. -30- In the Circu it Court for B altimore C ounty Case No. 3-C-03-002920 IN THE COURT OF APPEALS OF MARYLAND Misc. Docket AG No. 67 September Term, 2003 ______________________________________ ATTORNEY GRIEVANCE COMMISSION OF MARYLAND v. MYLES LOUIS LICHTENBERG ______________________________________ Bell, C.J. *Eldridge Raker Wilner Cathell Harrell Battaglia, JJ. ______________________________________ Conc urring O pinion by Wilne r, J., in which Harrell, J., joins ______________________________________ Filed: February 11, 2004 *Eldridge, J., now retired, participated in the hearing and conf erence of this case w hile an active member of this Court; after being recalled pursuant to the Constitution, Article IV, Section 3A, he also participated in the decision and adoption of this opinion. -1- I concur in the result. I would dismiss the petition because I do not believe that Bar Counsel has presented to us any basis for overturning Ju dge Kahl s con clusion that Mr. Lichtenberg did not violate any of the rules or statutes alleged by B ar Coun sel. I write separately only to express my disagreement with the Court s refusal to construe § 22-103(f) of the Insurance Article. When charges are brought against an attorney based on the violation of a statute, even one that is subject to administrative enforcement by some Executive agency, it is the proper a nd neces sary function o f this Cou rt to construe th e statute in the attorney grievance proceeding, if such construction is necessary to determine whether a violation of the Maryland Rules of Professional Conduct has occurred. I am not aware of any other instance in which this Court has shied from that responsibility simply because the statute has not previously been construed, or because it may be ambiguous, or because it is also subject to administrative enforcement by an Executive agen cy. If construction of the statute is relevant to a determina tion of the issu e presented to us in the disciplinary proceeding, it is our duty and resp onsibility to construe the statute, even if the administrative agency is not a party. We are, in this case, ignoring that duty and responsibility and thus leaving uncertain, for every lawyer wh o operates o r works f or a title or settlement company, an issue of g rave importance to them . The notion that the Co urt should construe statutes only when adjudicating disputes in th e normal litiga tion contex t is unprecedented, unwarranted, and unwork able. If this strange notion is intended as a disguised application of the doctrine of primary jurisdiction, it is, for the reasons stated in my dissent in the companion case of Attorney G rievance C ommis sion v. Da vis, Md. , A.2d (2004), also Constitutionally inappropriate. As noted, Judge Kahl found that, by obtaining his client s consent to retain the interest, over $50, o n the escrow funds, Mr. Lichtenberg did not violate § 22-103(f). Bar Counsel excepted to the conclusion, but only on the ground that the statute, in his view, requires the consent of not only the client but also of every other person who may qualify as a beneficial owner. Because the consent requirement is stated in the disjunctive the client or the beneficial owners and because the term beneficial ow ner is defined to exclude the client, I do not accept Bar Counsel s argument that, in a case such as this, any other person s consent was ne cessary. There may be situatio ns in whic h third parties w ill have a property interest in escrowed funds and will therefore be beneficial owners whose consent will be requ ired. This w as not such a case, how ever. No o ne other tha n Mr. G igioli could have had any beneficial o wnership with respe ct to the interest generated by the escrow funds. Bar Counsel did no t except to the conclusion o n any other basis, including that Mr. Lichtenberg failed p roperly to obtain h is client s consen t. Altho ugh, in light of the requirement of COMAR 31.16.03.05, that a client s consent be obtained either in a separate document or in conspicuous type and initialed by the client, and the absence from this record of evidence of comp liance with that regulation, a question may be raised whether M r. Lichtenberg did properly obtain his client s consent, Bar Counsel has not argued a violation on that ground, and it would therefore be inappropriate for us, on this record, to find a violation on that basis. We should, however, address and construe the statute based on Bar -3- Counsel s exception, find no violation on that basis, and not leave Mr. Lichten berg wondering whether, if he does the same thing tomorrow, he will again be haled before the Attorney Grievance Commission. Judge Harrell has authorized me to state that he joins in this concurring opinion. -4- IN THE COURT OF APPEALS OF MARYLAND Misc. Docket AG No. 67 September Term, 2002 ______________________________________ ATTORNEY GRIEVANCE COMMISSION OF MARYLAND v. MYLES LOUIS LICHTENBERG ______________________________________ Bell, C.J. *Eldridge Raker Wilner Cathell Harrell Battaglia, JJ. ______________________________________ Dissenting Opinion by Bell, C. J. ______________________________________ Filed: February 11, 2004 *Eldridge, J., now retired, participated in the hearing and conference of this case while an active member of this Court; after being recalled pursuant to the Constitution, Article IV, Section 3A, he also participated in the decisio n and ado ption of this opinion. For the reasons set forth in Attorney G rievance C omm n v. Davis, I respectfully dissent. -1-

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