|FOR THE RESPONDENT |FOR THE INDIANA SUPREME COURT |
| |DISCIPINARY COMMISSION |
| | |
|Frank B. Harshey, pro se. |Donald R. Lundberg, Executive |
| |Secretary |
| |Dennis K. McKinney, Staff Attorney|
| |115 West Washington Street, Suite |
| |1060 |
| |Indianapolis, IN 46204 |
IN THE
SUPREME COURT OF INDIANA
IN THE MATTER OF )
) CASE NO. 49S00-9904-DI-261
FRANK B. HARSHEY )
DISCIPLINARY ACTION
January 5, 2001
Per Curiam
While prosecuting a lawsuit on behalf of a client, lawyer Frank B.
Harshey intentionally caused the acceptance of a settlement offer that his
client had earlier instructed him to reject. Because of this violation of
the Rules of Professional Conduct for Attorneys at Law, we find today that
Harshey, the respondent in this attorney disciplinary matter, should be
publicly reprimanded.
This case formally began on April 23, 1999, when the Indiana Supreme
Court Disciplinary Commission filed a Verified Complaint for Disciplinary
Action against the respondent, charging him with violation of two
provisions of the Rules of Professional Conduct. The parties thereafter
agreed upon a resolution of the pending charges, which is now before us for
approval in the form of a Statement of Circumstances and Conditional
Agreement for Discipline, pursuant to Ind. Admission and Discipline Rule
23, Section 11(c). Our jurisdiction in this matter derives from the
respondent’s admission to the bar of this state on October 12, 1984. We
find the undisputed facts, as agreed to by the parties, are as follow:
In 1991 the respondent represented a plaintiff corporation in a
lawsuit it brought against a defendant corporation. The plaintiff
corporation’s president (hereinafter the “president”) had hired the
respondent for the representation and spoke for the plaintiff corporation.
The respondent’s contingency fee agreement provided that he would receive a
percentage of any recovery.
In 1996, the president’s wife filed for dissolution of marriage. The
respondent did not appear as attorney for the president or his wife in the
dissolution proceeding. On November 17, 1997, the trial court hearing the
dissolution entered a dissolution decree providing that the president would
retain the plaintiff corporation as his business, but that the wife would
receive 45% of the net proceeds of the still-pending corporate litigation.
The decree also provided that the attorneys for the president and wife were
appointed as commissioners for the sole purpose of selling the couple’s
real estate.
In November of 1997, the defendant corporation offered to settle the
corporate litigation by paying $125,000. The offer, if not accepted, was
to expire in mid-January 1998. The case at that time was set for trial on
February 17, 1998. The respondent advised the president to accept the
settlement offer, but the president instructed the respondent to refuse it.
On January 12, 1998, without having rejected the offer as previously
instructed by the president, the respondent telephoned the judge who
presided over the president’s dissolution action and informed him of the
settlement offer and that a response was needed by January 16, 1998. The
judge set an emergency hearing regarding the settlement offer for January
16, 1998, and notified the attorney for the president’s wife. The
president’s wife subpoenaed the respondent to testify about the offer. On
January 14, 1998, the president spoke to the respondent by telephone and
instructed him to not appear at the emergency hearing in the dissolution
matter. The respondent told the president that, being under subpoena, he
was required to appear, and further advised the president that he was now
representing the commissioners in the dissolution matter and that only they
or the judge could fire him.
On January 15, 1998, the respondent met, in the chambers of the judge
handling the dissolution, with the president’s dissolution attorney, the
wife’s attorney and the judge to discuss the settlement offer. The
respondent asked the judge to authorize him to accept the settlement offer,
pending final approval at the next day’s hearing. The respondent asked for
this authorization because he was concerned that the president might
somehow undermine the respondent’s attempt to settle the corporate
litigation. The judge issued an emergency order authorizing the respondent
to notify the defendant corporation’s attorney that the settlement offer
would be accepted.
The president moved to continue the hearing in the dissolution case on
the corporate settlement offer, but the court denied the motion, and
conducted the hearing without the president being present. During the
hearing, the respondent testified about the settlement in the corporate
litigation and gave his opinion as to its reasonableness. The judge in the
dissolution case ordered the commissioners to accept the settlement offer.
Although the president objected to the settlement of the corporate
litigation as accepted by the dissolution commissioners, the judge hearing
the corporate litigation approved the settlement.
Indiana Professional Conduct Rule 1.2(a) requires lawyers to abide by
their clients’ decisions concerning the objectives of representation,
including whether to accept an offer of settlement in the matter, and to
consult with them about the means by which such objectives are to be
pursued. Despite the president’s clearly expressed wish that the
settlement offer in the corporate litigation be refused, the respondent
unilaterally set into motion a chain of events which resulted in the
settlement offer being accepted. As such, he violated Prof.Cond.R.
1.2(a).[1]
Professional Conduct Rule 1.6(a) generally prohibits lawyers from
revealing information relating to representation of a client unless the
client consents after consultation.[2] By informing the court handling
the president’s dissolution case of the pendency of the settlement offer in
the corporate litigation, the respondent revealed information relating to
his representation of the plaintiff corporation. The respondent failed to
consult with his client, the plaintiff corporation, prior to revelation of
that information and failed to obtain the client’s consent prior to
disclosing the fact of the settlement offer. Accordingly, we find that he
violated Prof.Cond.R. 1.6(a).
Having found misconduct, we must determine if the public reprimand
agreed to by the parties is an appropriate sanction. Factors we consider
in this assessment include the nature of the misconduct, the duty violated,
the lawyer’s mental state, the actual or potential harm caused by the
misconduct, the duty of this Court to preserve the integrity of the
profession, and the potential risk to the public in permitting the
respondent to continue in the profession. Matter of Drozda, 653 N.E.2d 991
(Ind. 1995); Matter of Cawley, 602 N.E.2d 1022 (Ind. 1992).
The respondent simply ignored his client’s clear wishes, as expressed
to him by the president, with regard to whether to accept the settlement
offer in the corporate litigation, and instead imposed his contrary will.
By so doing, he ceased serving as an advocate for his client and instead
became an adversary, one who disclosed confidential information about the
representation in order to achieve his goal of obtaining a quick recovery
and its attendant legal fee.
This Court has imposed public reprimands for roughly similar
violations of the Rules of Professional Conduct. In Matter of Mullins,
649 N.E.2d 1024 (Ind. 1995), a lawyer sought to have herself appointed as
the personal guardian of a person in a persistent vegetative state, and
then, without consent, released personal medical information about the
person to the press. In Matter of Bender, 704 N.E.2d 115 (Ind. 1999), a
lawyer pursued litigation on behalf of an individual he named as co-
plaintiff even after that person clearly stated that she did not wish to be
represented by the lawyer. For that, along with an attendant conflict of
interest, we publicly admonished the lawyer.
We also consider aggravating and mitigating circumstances. Matter of
Christoff and Holmes, 690 N.E.2d 1135 (Ind. 1997); Matter of Darling, 685
N.E.2d 1066 (Ind. 1997). In purported mitigation, the parties in this case
note that, although the client never authorized respondent to reveal the
proposed settlement or the amount offered therein, the client himself had
communicated the existence of the offer and its general amount to others
before the respondent divulged the information to the judge.
Based upon consideration of the foregoing factors, we find that the
proposed sanction should be approved, but only because of our strong
inclination to support agreed resolutions. In view of the respondent’s
knowing breach of his fiduciary obligation to this client, had this case
been litigated, the sanction may well have been more severe.
It is, therefore, ordered that the respondent, Frank B. Harshey, is
hereby reprimanded and admonished for his misconduct.
The Clerk of this Court is directed to provide notice of this order in
accordance with Admis.Disc.R. 23(3)(d) and to provide the clerk of the
United States Court of Appeals for the Seventh Circuit, the clerk of each
of the United States District Courts in this state, and the clerks of the
United States Bankruptcy Courts in this state with the last known address
of respondent as reflected in the records of the Clerk.
Costs are assessed against respondent.
SULLIVAN, BOEHM, and RUCKER, JJ., concur.
SHEPARD, Chief Justice, dissenting, joined by JUSTICE DICKSON:
Mr. Harshey’s stunning treatment of his client is remarkably simple
to describe.
After the client decided to turn down the defendant corporation’s
offer of settlement, Harshey decided not to act on the client’s decision
and set about finding some way to make the client accept it anyway.
He started off with an ex parte communication to the judge who had
presided in the client’s divorce, a venue in which Harshey had no status at
all. In the course of this communication, he violated his duty to preserve
the confidences of his client by revealing the status of the settlement
negotiations.
When the client got wind of what Harshey was up to and asked him to
stop, Harshey lied to the client, claiming he was now representing the
lawyers who had litigated the divorce and could be fired only by them.
Fearful that his client might find a way to stop him, Harshey decided
to meet with the dissolution judge and the dissolution lawyers a day in
advance of the scheduled court hearing – to ask for permission to inform
the defendant corporation that its settlement would be accepted. In
effect, he assured that even if the client showed up at the hearing to
stand on his rights, it would be too late. It was too late.
The client who wanted to go to trial – and whose trial was just a few
weeks off – never got his day in court. He was thwarted by the active and
willful effort of his lawyer, who refused the client’s proper instructions,
breached his confidences, lied to him, and ex parte’d the judge.
Our disciplinary system should not treat such behavior as a matter
for mere reprimand.
-----------------------
[1] Professional Conduct Rule 1.2(a) provides:
A lawyer shall abide by a client’s decisions concerning the
objectives of representation, subject to paragraphs (c), (d) and (e), and
shall consult with the client as to the means by which they are to be
pursued. A lawyer shall abide by a client’s decision whether to accept an
offer of settlement of a matter. . . .
[2] Professional Conduct Rule 1.6 provides:
(a) A lawyer shall not reveal information relating to representation
of a client unless the client consents after consultation, except for
disclosures that are impliedly authorized in order to carry out the
representation, and except as stated in paragraph (b).
(b) A lawyer may reveal such information to the extent the lawyer
believes necessary;
(1) to prevent the client from committing any criminal act; or
(2) to establish a claim or defense on behalf of the lawyer in a
controversy between the lawyer and the client, to establish a defense
to a criminal charge or civil claim against the lawyer based upon
conduct in which the client was involved, or to respond to allegations
in any proceeding concerning the lawyers’ representation of the
client. . .