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In re Butler

Supreme Court of Louisiana

January 30, 2019



          PER CURIAM

         This disciplinary matter arises from formal charges filed by the Office of Disciplinary Counsel ("ODC") against respondent, Alicia Johnson Butler, an attorney licensed to practice law in Louisiana.


         Before we address the current charges, we find it helpful to review respondent's prior disciplinary history. Respondent was admitted to the practice of law in Louisiana in 2000. In 2013, this court accepted a joint petition for consent discipline in which respondent stipulated that she failed to promptly notify a third party of receipt of funds in which the third party had an interest, failed to hold those funds separate from her personal funds, and misinformed a federal court of the correct amount of a reimbursement owed to her following the settlement of her client's case. For this misconduct, respondent was suspended from the practice of law for six months, fully deferred, subject to one year of supervised probation with the condition that she attend Ethics School. In re: Butler, 13-2632 (La. 1/10/14), 144 So.3d 844 ("Butler I").


         In October 2013, Tammy Charles hired respondent to represent her on a contingency fee basis in a claim for damages arising out of injuries she had sustained in a motor vehicle accident. Prior to hiring respondent, Ms. Charles had negotiated with her insurer and made a claim for "med pay" benefits. These benefits were paid.

         Respondent filed suit against the alleged tortfeasor and his insurer in the 16thJDC for the Parish of Iberia. The case was set for trial in March 2015, but was continued because respondent, who also works as an indigent defender in Iberia Parish, had a criminal matter scheduled the same day which under the local practice had priority over civil matters. Ms. Charles was advised of the continuance and the new trial date set in September 2015. Ms. Charles indicated that she never agreed to or authorized respondent to file the motion for continuance.

         In May 2014, Ms. Charles was deposed by the defense. Due to an emergency, respondent was unable to attend the deposition. However, respondent made arrangements for another attorney to attend the deposition to represent Ms. Charles' interests and provided Ms. Charles with written material in preparation for giving deposition testimony. According to Ms. Charles, she did not know the attorney who appeared at the deposition on her behalf.

         On August 20, 2015, respondent met with Ms. Charles. During the meeting, respondent advised Ms. Charles of a settlement offer of $75, 000 plus court costs, which she recommended that Ms. Charles accept. On August 24, 2015, respondent faxed an acceptance letter to defense counsel. Two weeks later, defense counsel sent respondent the settlement documents and a check made payable to both Ms. Charles and respondent. Respondent endorsed Ms. Charles' name on the settlement check and deposited the check into her trust account on September 16, 2015. Respondent also signed a judgment of dismissal in Ms. Charles' suit, which was granted by the trial court on September 22, 2015.

         On September 25, 2015, respondent met with Ms. Charles to have her execute the settlement documents and review the disbursement of settlement funds. In anticipation of Ms. Charles' agreement to the disbursement, respondent prepared seven checks drawn on her trust account to pay third-party healthcare providers and to pay her attorney's fee and advanced expenses.

         During the meeting, a dispute arose concerning the disbursement of funds. Specifically, respondent and Ms. Charles disputed whether the "med pay" carrier had a lien on the settlement funds, whether monies needed to be set aside to satisfy such a lien, and which healthcare providers were paid and in what amounts. Multiple disbursement sheets were prepared in an attempt to properly allocate the proceeds, but respondent and Ms. Charles could not agree on how to disburse them.

         Respondent's trust account records indicate that on September 30, 2015, she took $36, 279.72 for her fees and expenses from the settlement funds. However, respondent did not simultaneously pay the remaining balance of $38, 720.28 to Ms. Charles or to any third-party healthcare providers.

         On October 12, 2015, the ODC received a complaint from Ms. Charles, alleging that respondent failed to communicate with her and settled her personal injury matter without her knowledge or consent.[1] Ms. Charles alleged that she did not learn about the settlement until September 11, 2015, a few days prior to the second trial date, when she called respondent to see if the trial was still set or if it had been "bumped" again.

         On October 27, 2015, respondent hand-delivered to defense counsel an unsigned copy of the receipt and release of claim, a $75, 000 check drawn on her trust account (although there were not sufficient funds in the account to honor the check had it been presented at that time), and a letter explaining that she was refunding the settlement funds because Ms. Charles refused to sign the release. The next day, defense counsel returned the check to respondent, advising that the settlement was enforceable and suggesting that the proceeds be deposited into the registry of the court.

         Respondent then filed a motion to rescind the judgment of dismissal. Although she was advised that a $300 filing fee had to be paid before the pleading could be processed, these costs were never paid. According to the deputy clerk for the Iberia Parish Clerk of Court, no funds were ever placed in the registry of the court in the matter. Instead, on November 13, 2015, respondent used $40, 000 in personal funds to purchase a certificate of deposit from Regions Bank. Respondent listed herself as the "sole owner" of the certificate of deposit, which had a term of seventy months. There is no contemporaneous writing to evidence that this certificate of deposit was money set aside for paying Ms. Charles her share of the settlement proceeds or to pay any third-party healthcare providers.

         Ms. Charles did not receive any settlement proceeds from respondent, and collection activity was initiated against Ms. Charles and her husband. Respondent also did not pay third-party health care providers from the settlement funds. Between January 2016 and May 2016, respondent's trust account had a balance of less than $38, 720.28, the amount due to Ms. Charles and owed to her healthcare providers.

         The ODC alleged that respondent's conduct violated the following provisions of the Rules of Professional Conduct: Rules 1.2 (scope of the representation), 1.3 (failure to act with reasonable diligence and promptness in representing a client), 1.4 (failure to communicate with a client), 1.15(a) (safekeeping property of clients and third persons), 1.15(d) (a lawyer shall promptly deliver to a client or third person any funds or other property that the client or third person is entitled to receive), 3.3(a) (candor toward the tribunal), 4.1(a) (a lawyer shall not knowingly make a false statement of material fact or law to a third person), 8.1(a) (a lawyer shall not knowingly make a false statement of material fact in connection with a disciplinary matter), 8.4(a) (violation of the Rules of Professional Conduct), 8.4(b) (commission of a criminal act that reflects adversely on the lawyer's honesty, trustworthiness, or fitness as a lawyer), 8.4(c) (engaging in conduct involving dishonesty, fraud, deceit, or misrepresentation), and 8.4(d) (engaging in conduct prejudicial to the administration of justice).


         In December 2016, the ODC filed formal charges against respondent, as set forth above. Respondent, through counsel, answered the formal charges, and the matter proceeded to a formal hearing on the merits.

         Formal ...

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