THE STATE OF SOUTH CAROLINA
In The Supreme Court
In the Bennett Joseph Schiller, III, Respondent.
Appellate Case No. 2017-001645
Opinion No. 27753
Submitted October 24, 2017 – Filed November 22, 2017
PUBLIC REPRIMAND
Lesley M. Coggiola, Disciplinary Counsel, and Julie K.
Martino, Assistant Disciplinary Counsel, both of
Columbia, for Office of Disciplinary Counsel.
Thomas A. Pendarvis, of Pendarvis Law Offices, PC, of
Beaufort, for Respondent.
PER CURIAM: In this attorney disciplinary matter, respondent and the Office
of Disciplinary Counsel have entered into an Agreement for Discipline by Consent
(Agreement) pursuant to Rule 21 of the Rules for Lawyer Disciplinary
Enforcement (RLDE) contained in Rule 413 of the South Carolina Appellate Court
Rules (SCACR). In the Agreement, respondent admits misconduct and consents to
a public reprimand. We accept the Agreement and issue a public reprimand. The
facts, as set forth in the Agreement, are as follows.
Facts
Co-counsel was retained by Client, a North Carolina resident, to represent him
with regards to a motor vehicle accident that occurred in North Carolina. Co-
counsel subsequently associated respondent on the case. Neither co-counsel nor
respondent were admitted to practice law in North Carolina.
Client signed two fee agreements. The first agreement was a fee agreement stating
the attorneys' fee was 33% of any recovery and that if there was no recovery,
Client would be responsible for "all actual expenses." The agreement did not
specify whether the attorneys' fee would be calculated before or after litigation and
other expenses were deducted. Although respondent asserted he and his co-
counsel explained to Client how funds would be distributed under the agreement,
respondent admits that the failure to document in writing whether litigation and
other expenses are to be deducted before or after a contingent fee is calculated is a
violation of Rule 1.5(c) of the North Carolina Revised Rules of Professional
Conduct.1
After recovering the policy limit of $30,000 from the at-fault driver's insurance
carrier, respondent and co-counsel pursued recovery under Client's underinsured
motorist (UIM) policy. That carrier tendered $220,000 to respondent and co-
counsel, which represented the policy limit of $250,000 minus a set-off of $30,000
based on the payment by the at-fault driver's carrier.
Client refused to accept the funds due to a disagreement over the disbursement
statement, specifically, the disbursement of attorneys' fees. Client informed
respondent and co-counsel he was terminating the "fee contract," as he believed the
fees were unreasonable and he did not understand there were other fee agreement
options. Client also stated he did not understand from the fee agreement that
respondent and co-counsel could place a lien on the insurance proceeds for the
amount of the attorneys' fees owed.
Thereafter, respondent sent letters to Client's UIM carrier informing the carrier that
he and co-counsel had a lien on the $220,000 for their one-third contingency fee.
In one of the letters, respondent directed the carrier not to discuss the matter with
Client or Client's brother without the consent of respondent or co-counsel.
Subsequently, Client left a voice message with the carrier notifying the carrier that
he had terminated respondent and co-counsel. Client also sent a letter to
respondent and co-counsel asking them to notify the carrier that they were no
longer representing Client.
The carrier sent a letter to respondent informing him Client had notified the carrier
that he had discharged respondent and co-counsel. The carrier requested
respondent contact Client about the outstanding claim. Three weeks later, and over
1
Pursuant to Rule 8.5(b)(2) of the South Carolina Rules of Professional Conduct, Rule 407,
SCACR, because the predominant effect of the conduct at issue was in North Carolina, the North
Carolina Revised Rules of Professional Conduct apply.
a month after Client requested such action, respondent and co-counsel notified the
carrier they were no longer representing Client and returned the insurance proceeds
to the carrier.
Client alleged respondent and co-counsel failed to withdraw as counsel after he
terminated the fee agreement and that they failed to inform the UIM carrier they
were no longer representing Client after he requested they do so. Respondent
admits his failure to withdraw from representation after multiple communications
from Client requesting respondent and co-counsel cease representation violated
Rule 1.16(a)(3) of the North Carolina Revised Rules of Professional Conduct.
Finally, Client alleged respondent and co-counsel forged Client's signature on a
document entitled "Settlement Agreement and Covenant Not to Enforce Judgment
- North Carolina." Client stated he had never seen the document but it had a
signature purporting to be his that was witnessed by respondent and notarized by
respondent's paralegal.
Respondent and co-counsel explained they discussed with Client the possibility of
pursuing the at-fault driver's personal assets but Client understood the only way to
secure payment more quickly was to accept the limits of the driver's insurance
policy by way of a covenant not to execute and accept the limits of the UIM
coverage on a policy release. Respondent and co-counsel stated Client understood
the difficulty of recovering from the driver's personal assets and therefore agreed to
accept the insurance limits. Respondent and co-counsel stated they explained the
settlement agreement and disbursement from the driver's carrier to Client and
asked him to come to the office and sign the covenant not to execute and the check
issued by the carrier. According to respondent and co-counsel, Client directed
them to sign the items for him and send him the check.2 Respondent signed the
covenant not to execute, witnessed it himself, and had his paralegal notarize it.
The document stated the person signing was affirming he had carefully read the
document, understood its contents, and was signing it as his own free act. The
cover letter respondent sent to Client along with the check did not reference the
covenant not to execute or indicate a copy was enclosed.
Respondent admits the covenant not to execute was falsely witnessed and notarized
and that he did not provide a copy to Client. Respondent states the document was
2
Respondent provided documents to support his position that Client gave him permission to sign
Client's name, but the documents are not contemporaneous with the signing and notarizing of the
documents.
not relied on by the at-fault driver's insurance carrier because Client refused to sign
the settlement agreement.
Respondent admits his actions with regard to the covenant not to execute were
improper and in violation of the following North Carolina Revised Rules of
Professional Conduct: Rule 4.1 (a lawyer shall not knowingly make a false
statement of material fact or law to a third person); Rule 5.3(b) (a lawyer with
supervisory authority over a nonlawyer shall make efforts to ensure the
nonlawyer's conduct is compatible with the professional obligations of the lawyer);
Rule 5.3(c)(1) (a lawyer is responsible for the conduct of a nonlawyer who
commits a violation of the Rules of Professional Conduct when the lawyer orders
or ratifies such conduct); and Rule 8.4(d) (it is professional misconduct to engage
in conduct that is prejudicial to the administration of justice).
Law
Respondent admits that by his conduct he has violated the above provisions of the
North Carolina Revised Rules of Professional Conduct. He also admits the
violations constitute grounds for discipline under Rule 7(a)(2) of the South
Carolina Rules for Lawyer Disciplinary Enforcement, Rule 413, SCACR.
Conclusion
We find respondent's misconduct warrants a public reprimand. Accordingly, we
accept the Agreement and publicly reprimand respondent for his misconduct. In
addition, as set forth in the Agreement, respondent shall (1) complete the Legal
Ethics and Practice Program Ethics School and a notary public class within one
year of being disciplined; (2) require all notary publics in his office to attend a
notary public class within the same time period, to maintain records of attendance,
and to sign a statement that they have read and will abide by the South Carolina
Notary Public Reference Manual; and (3) pay the costs incurred in the
investigation of this matter by ODC and the Commission on Lawyer Conduct
within thirty days of the date of this opinion.
PUBLIC REPRIMAND.
BEATTY, C.J., KITTREDGE, HEARN, FEW and JAMES, JJ., concur.