California Bar Journal
CBJ - April 2012 #06.
Disbarment urged for six-figure misappropriation
The California LawyerApril 2012Disbarment urged for six-figure misappropriationA Carlsbad attorney faces disbarment after a State Bar Court review panel upheld a hearing judge's findings that she misappropriated more than $112,000 from two clients. The three-judge panel's recommendation that PATRICIA ANN GREGORY [#226239], 62, be disbarred goes to the Supreme Court for action.
Gregory also pleaded guilty in January in San Diego superior court to felony embezzlement and advertising her legal services without a license, a misdemeanor. She initially was charged with 11 felonies, including fraud and grand theft, for allegedly stealing from her clients. Eight charges were dropped and two were reduced to misdemeanors. She was sentenced in February to one year in jail and five years of probation.
State Bar Court Judge Richard Honn recommended disbarment for Gregory a year ago and ordered restitution of $74,162.50 plus interest to one client and $27,500 plus interest to another. Gregory appealed to the review department, denying misappropriation and asserting that the funds in question were earned and properly collected as attorney fees. She also said her former clients lack credibility and that she deserved more mitigation than the hearing judge awarded.
Judge JoAnn Remke, writing for the review panel, disagreed. "We conclude the record supports the hearing judge's findings that Gregory misappropriated over $112,000 from two clients and that her misconduct was surrounded by significant aggravating factors, including dishonesty."
In a 2007 divorce case, Gregory received $188,325 on behalf of her client, Luwain Ng, and Ng's husband. The money represented the proceeds from the sale of the couple's home. Although she placed the money in her client trust account, Gregory repeatedly transferred funds to a non-trust account and withdrew more than $85,000 for personal expenses. Although she gave Ng's husband more than $94,000, she allowed the trust's balance drop to $239.
When ordered by the court to disburse $79,162 to Ng, Gregory told Ng she didn't have the money because it had been seized to pay her outstanding student loans. She signed a promissory note acknowledging she owed Ng money and although she began to make monthly payments...