Disciplinary Opinion: People v. Gregson
| Publication year | 2011 |
| Pages | 148 |
| Citation | Vol. 40 No. 6 Pg. 148 |
2011, June, Pg. 148. Disciplinary Opinion: People v. Gregson
June 2011
Vol. 40, No. 6 [Page 148]
Colorado Disciplinary Cases
The Colorado Supreme Court adopted a series of changes to the attorney regulation system, including the establishment of the Office of the Presiding Disciplinary Judge (PDJ), pursuant to C.R.C.P. 251.16. The Court also made extensive revisions to the rules governing the disciplinary process, repealing C.R.C.P. 241 et seq., and replacing those rules with C.R.C.P. 251 et seq. The PDJ presides over attorney regulation proceedings and, together with a two-member Hearing Board, issues orders at trials and hearings. The Rules of Civil Procedure and the Rules of Evidence apply to all attorney regulation proceedings before the PDJ. See C.R.C.P. 251.18(d). Disciplinary Opinions may be appealed in accordance with C.R.C.P. 251.27.
The Colorado Lawyer publishes the summaries and full-text Opinions of PDJ William R. Lucero and the Hearing Board, whose members are drawn from a pool appointedby the Supreme Court. For space purposes, exhibits, complaints, and amended complaints may not be printed. Disciplinary Opinions are printed as submittedby the Office of the PDJ and are not editedby the staff of The Colorado Lawyer.
Complainant:
THE PEOPLE OF THE STATE OF COLORADO
Respondent:
RONALD E. GREGSON
On June 28, 2010, a Hearing Board composed of Robert A. Millman, a member of the Bar, Frances L. Winston, a citizen Hearing Board member, and William R. Lucero, the Presiding Disciplinary Judge (PDJ), held a one-and-a-half-day hearing pursuant to C.R.C.P. 251.18. Charles E. Mortimer, Jr., appeared on behalf of the Office of Attorney Regulation Counsel (People), and Mark S. Bove appeared on behalf of Ronald E. Gregson (Respondent) who also appeared. The Hearing Board now issues the following "Decision and Order Imposing Sanctions Pursuant to C.R.C.P. 251.19(b)."
Attorneys must adhere to certain standards of conduct that define the duties they owe as professionals, including the obligation to charge reasonable fees according to reasonable terms. In this matter, Respondent drafted a hybrid fee agreement allowing him to retain hourly fees upon his withdrawal from the case, rather than seek fees before a court under quantum meruit. Respondent also pressed his client for trial retainers not contemplated in the fee agreement, and he charged her for fees and expenses associated with his travel back to Colorado after he moved his practice to Massachusetts. What, if any, is the appropriate sanction?
The Hearing Board finds clear and convincing evidence that Respondent violated Colo. RPC 1.5(a) (Claim II) and 8.4(h)(fn1) (Claim IV)by billing his client for fees and expenses arising from his travel to Colorado. But we do not find Respondent violated Colo. RPC 1.5(a) (Claim I) for retaining his hourly fees, nor do we conclude he violated Colo. RPC 8.4(d) (Claim III) or 8.4(h) (Claim IV)by seeking additional trial retainers. Given these circumstances, the Hearing Board determines public censure and restitution is warranted in this instance.
On January 5, 2010, the People filed a complaint, and Respondent filed an answer on February 2, 2010. Respondent filed a "Motion for Summary Judgment" on April 13, 2010. On April 22, 2010, the People filed "Complainant's 1) Response to Respondent's Motion for Summary Judgment, and 2) Cross Motion for Summary Judgment." Respondent later submitted a "Response to Complainant's Cross Motion for Summary Judgment." Because the case was not susceptible to a resolution as a matter of law and instead hinged on facts necessitating a hearing, the PDJ summarily denied both motions on June 1, 2010, with a written order following on June 16, 2010. The parties then stipulated to certain facts on June 18, 2010. At the June 28-29, 2010, hearing, the Hearing Board heard testimony and the PDJ admitted the People's exhibits 1-13(fn2) and Respondent's exhibits A-C.
The Hearing Board finds the following facts and rule violations have been establishedby clear and convincing evidence.
Respondent took the oath of admission and was admitted to the Bar of the Colorado Supreme Court on September 29, 1978. He is registered upon the official records, Attorney Registration No. 08996, and is thus subject to the jurisdiction of the Hearing Board in these disciplinary proceedings.(fn3) Respondent's registered business address is 25B Main Street, Lenox, Massachusetts 01240.
In March 2005, Michelle Garcia (Garcia) contacted Respondent and eventually retained him as counsel to file a discrimination lawsuit in federal district court against her employer, City Market.(fn4) Garcia believed City Market failed to promote her within the company as quickly as her similarly-situated male counterparts.
Although Respondent represented Garcia from March 2005 onward, it was not until November 2, 2005, that the two entered into a fee agreement.(fn5) The fee agreement, though only two pages, is convoluted, poorly worded, and fails to explicitly anticipate certain events. Paragraph 3 of the agreement provides for a 33 1/3% contingent fee, yet Paragraph 4 requires Garcia to pay Respondent an hourly fee of $150-roughly half of what he would normally charge on an hourly basis. The contract then provides that the "total hourly fees paidby [Garcia] will be returned to [her] up to the amount of the contingent fee." Paragraph 11 of the agreement further muddies the waters:
In the event the client terminates this contingent fee agreement without wrongful conductby the attorney which would cause the attorney to forfeit any fee, or if the attorney justifiably withdraws from the representation of the client, the attorney may ask the court or other tribunal to order the client to pay the attorney a fee based upon the reasonable value of the services providedby the attorney. If the attorney and the client cannot agree how the attorney is to be compensated in this circumstance, the attorney will request the court or other tribunal to determine: (1) if the client has been unfairly or unjustly enriched if the client does not pay a fee to the attorney; and (2) the amount of the fee owed, taking into account the nature and complexity of the client's case, the time and skill devoted to the client's caseby the attorney, and the benefit obtainedby the client as a result of the attorney's efforts. Any such fee shall be payable only out of the gross recovery obtainedby or on behalf of the client and the amount of such fee shall not be greater than the fee that would have been earnedby the attorney if the contingency described in this contingent fee agreement had occurred.(fn6)
As discussed in more detail below, Respondent represented Garcia until April 16, 2008, when he was granted leave to withdraw as counsel due to health reasons. Rather than seek quantum meruit under Paragraph 11 of the fee agreement, Respondent elected to retain the $150 per hour fee that he had charged, and that Garcia had paid, for that two-and-a-half-year period.(fn7)
Pointing to the agreement's language, the People allege Respondent violated Colo. RPC 1.5(a), which proscribes making an agreement for, charging, or collecting an unreasonable fee. Specifically, the People aver that either Respondent interprets and applies the fee agreement unreasonably or the Respondent interprets the fee agreement correctly but the agreement charges an unreasonable fee on its face.
As regards the first alternative, the People argue Respondent failed to comply with the strictures of paragraph 11 when read in conjunction with paragraph 4. Under this language, the People contend, Respondent's hourly fees were nothing more than an advance on an ultimate contingency fee and thus Respondent was required, when he withdrew from the case, to disgorge those hourly sums and seek under quantum meruit an award for the reasonable value of his services.
But we cannot adopt the People's interpretation of Respondent's obligations under paragraphs 4 and 11 of the fee agreement. We beginby acknowledging that the agreement is ambiguous on the issue of whether Respondent was obligated to return hourly fees and seek quantum meruit upon his withdrawal.(fn8) This ambiguity stems from the hybrid nature of the arrangement: it provides for the possibility of either hourly or contingent fees without a clear delineation as to when either might apply. Paragraph 4 mandates ongoing and periodic payment of a reduced hourly fee. Yet the title of the document and paragraph 11 characterize the agreement as a "contingent fee" arrangement whereby Respondent may seek quantum meruit should he withdraw. It also provides Respondent will request a court to make fee determinations should he and Garcia disagree about his compensation.
Because the fee agreement is fairly susceptible to more than one interpretation as to whether Respondent was required to return hourly fees upon his withdrawal, we look to extrinsic evidence, including parol evidence, to ascertain the intent of the parties and explain the terms of the fee agreement.(fn9)
It is first worth noting that Respondent copied paragraph 11 of the...
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