Before MAJOR, Chief Judge, and DUFFY and LINDLEY, Circuit Judges.
This is an appeal by Thomas Hart Fisher, a lawyer (hereinafter referred to as respondent), from an order entered on December 3, 1948, disbarring him from the practice of law in the United States District Court for the Northern District of Illinois, suspending him from such practice, and decreeing that he should not apply for readmission to the bar of that court for a period of three years from the date of the order. The proceeding had its inception in an order entered by Judge John P. Barnes on January 27, 1947, in which respondent was directed to show cause "why he should not be disciplined for his acts and conduct" as attorney in a proceeding then pending entitled "In the Matter of the Estate of George R. Joslyn, Bankrupt, No. 62732." Mr. Robert B. Johnstone, attorney for the Trustee in Bankruptcy, was directed to file specifications of charges against respondent. In the meantime, the matter had been transferred to Judge William J. Campbell. Thereupon, Johnstone filed charges of unprofessional conduct containing 24 specifications. Respondent answered, denying all charges. A trial was had before Judge Campbell, who filed a lengthy opinion which forms the basis for the order appealed from. Specification 17 was dismissed by the court and respondent was found not guilty on specifications 4, 5, 7, 11, 12, 13, 19, 21, 22 and 23, and on portions of 8, 9 and 14. Respondent was found guilty on specifications 1, 2, 3, 6, 10, 15, 16, 18, 20 and 24, and on portions of 8, 9 and 14.
Robert B. Johnstone in the court below conducted the proceeding against respondent. On September 22, 1948, an order was entered by Judge Campbell appointing Honorable Otto Kerner, Jr., United States District Attorney, as additional counsel, and he and his assistants have conducted the proceeding against respondent in this court.
Judge Campbell made no separate findings of fact and conclusions of law but did in his opinion recite in considerable detail the evidence relative to each of the specifications. while we find it difficult to distinguish his findings of fact from conclusions of law, we think this not too important for the reason that there is, with one exception hereinafter noted, little if any dispute regarding the facts, and certainly this is so as to the evidentiary facts.It is in the main the conclusions drawn from such facts which respondent relies upon for a reversal of the order.
In the view we take, we think it unnecessary to enter into a detailed narration of the specifications or the evidence relied upon in their support. The case against respondent is summarized by Judge Campbell as follows: "The gist of the charges of unprofessional conduct resulting from the respondent's actions in the bankruptcy is, first, that respondent's position as attorney for the Elks in the bankruptcy case was in conflict with his position as attorney for Mrs. Joslyn in her marital difficulties with Mr. Joslyn, hinging as they did around the question of support money; second, that respondent attempted to use his position as attorney in the bankruptcy case to effect his real purpose in undertaking the case, which was not to represent the interest of creditors but to compel the payment of his claim for legal fees as attorney for Mrs. Joslyn; third, that he used his position as attorney for Mrs. Joslyn in the state court to take action nominally on her behalf but actually intended to provide funds for payment to him and that such action was directed against the same funds that respondent in the bankruptcy action was allegedly seeking for the bankrupt's creditors; and finally, allegations of misrepresentation to the bankruptcy court and to Mrs. Joslyn and of false testimony in the bankruptcy case, and charges of disobedience to orders of the bankruptcy court."
In our opinion, too much emphasis has been placed upon isolated incidents, some of them frivolous and of no legal consequence, rather than on a consideration of the entire setting and the over-all picture, which is important in making a fair appraisement of respondent's activities. In clearing the forest the underbrush has been attacked and the trees remain standing. The Joslyn bankruptcy proceeding has been protracted and much ill feeling has been engendered. Of all the numerous lawyers who have appeared in the proceeding, there are few, if any, who have not at some time been charged in connection with their activities in this case with contempt or accused of unprofessional conduct, and in some instances of a serious nature. The proceeding, long pending before Judge Barnes, was subsequently transferred to Judge Elwyn R. Shaw, and even the judges have not escaped the accusation of arbitrary, biased and non-judicial conduct. Even so, we hope to dispose of the matter without undue reflection upon either the bench or the bar.
That the many difficult legal problems posed, together with the combatant attitude of some of the lawyers involved, were sufficient to test the patience of Job can hardly be doubted. And we share the feeling no doubt entertained by members of the court below that this proceeding long ago could and should have been disposed of in a manner consistent with the rights of all parties. However, neither that court nor this was empowered to force a settlement as long as there was a legal question before the court for decision. Every lawyer, and that includes respondent so we think, is entitled to the presumption that he is honest and acting in the best interest of those whom he is employed to represent even though he mistakenly pursues an erroneous course.
In our view, it becomes necessary to review some of the more salient events which have transpired in the long drawn out proceeding from which the instant matter arises. We think this is important in order properly to appraise respondent's conduct which has resulted in his disbarment. This court has heretofore considered and decided three appeals from orders entered in this bankruptcy proceeding. In re Joslyn's Estate, 168 F.2d 803 (hereinafter referred to as the first appeal); In re Joslyn's Estate, 171 F.2d 159 (hereinafter referred to as the second appeal), and Young Trustee v. Handwork et al., 7 Cir., 1949, 179 F.2d 70 (hereinafter referred to as the third appeal). Reference to those opinions will obviate the necessity for a detailed statement of facts here.
George R. Joslyn was adjudicated a voluntary bankrupt February 27, 1936, and obtained his discharge June 29, 1936. He failed to schedule his interest in two trust estates, in each of which he was named as a beneficiary. Subsequently, marital difficulties developed between Joslyn and his wife, Charlotte C. Joslyn, and the latter employed respondent as her attorney. After efforts at reconciliation had failed, respondent filed in the Superior Court of Cook County on behalf of the wife a suit for divorce on the ground of desertion. Joslyn filed a cross-complaint charging adultery. After a bitter and prolonged trial Mrs. Joslyn was granted a divorce for desertion and exonerated from the charges made in the cross-complaint. The divorce decree provided for alimony and support of minor children of $500 per month, which was later substantially increased. The decree made no provision but left open for future consideration the question of Joslyn's liability for respondent's fees earned as attorney for Mrs. Joslyn. In the meantime, Mrs. Joslyn and respondent entered into an agreement that the latter's fees and expenses would be paid by her from alimony received in excess of $500 per month, and in conformity with this agreement she executed and delivered to respondent as collateral security an "assignment and power of attorney coupled with an interest." In addition, respondent loaned and advanced Mrs. Joslyn various sums of money and, according to the statement of facts contained in our opinion on the first appeal, there was due and owing respondent in January, 1946, $65,674.22. We need not dwell upon this phase of the situation because no question is raised as to the value of the services rendered by respondent to Mrs. Joslyn or the amount owing him.
Subsequently, respondent learned of Joslyn's voluntary petition in bankruptcy and his discharge and that he had failed to schedule his interest in the trust estates. A petition was filed by respondent as attorney for the Benevolent and Protective Order of Elks (referred to as the Elks), alleging that Joslyn's discharge in bankruptcy was fraudulent and requesting that the proceedings be reopened. The facts and circumstances concerning this proceeding are described in our former opinions. It is here sufficient to note that after a long and protracted hearing before a Special Master to whom the matter was referred, the latter on November 15, 1945 filed a report in which it was found that the bankruptcy proceedings of Joslyn were fraudulent. The Master's report was approved by Judge Barnes on May 20, 1946, and an order was entered reopening the proceedings. Thereupon, the bankrupt filed an amended schedule listing his interest in the trust estates but claiming that they were not property administrable in bankruptcy.
There are other undisputed facts and circumstances relative to the reopening proceeding not shown in our former opinion and which we think are material. Respondent first met, in fact had several conferences, with Mr. Wallace Streeter, a Referee in Bankruptcy, concerning the advisability of initiating the reopening proceeding. According to respondent's testimony, he made a full disclosure of the situation to the Referee, including the relation he sustained with Mrs. Joslyn. Streeter also testified concerning these conferences and in general to the same effect as respondent, although he did not recall all the facts as testified to by respondent. Respondent also conferred with Judge Floyd E. Thompson (formerly of the Illinois Supreme Court) because he knew by reputation that Judge Thompson was one of the leading Elks of the city and that the Elks had a large claim against Joslyn. Again, according to respondent, he made a full disclosure of the situation and laid before Judge Thompson all the facts in his possession. He informed Judge Thompson of his view that the bankruptcy was fraudulent and urged him on behalf of the Elks to initiate reopening proceedings. Judge Thompson informed him that he was busy with other matters and suggested that respondent proceed on behalf of the Elks. He offered to and did introduce respondent to representatives of the Elks, with a recommendation that respondent be employed. Judge Thompson as a witness did not contradict respondent's testimony although his recollection of the conversation was not as specific as that of respondent. At any rate, it is plain that respondent was employed by the Elks on the recommendation of Judge Thompson.
Thereupon respondent consulted with Mrs. Joslyn and explained the bankruptcy situation to her. He advised her she would have to have another lawyer represent her in the bankruptcy case. Mrs. Joslyn consented and employed Charles Ralph Johnston (not to be confused with Robert B. Johnstone, attorney for the Trustee), as her Chicago attorney in that matter. He represented her until June, 1946, when she employed John P. Hampton as her attorney in both the bankruptcy and the state court litigation.
This brings us to the major issue in the instant proceeding, that is, whether respondent's appearance on behalf of the Elks was such unprofessional conduct as to justify his disbarment in view of his prior relation as attorney for Mrs. Joslyn, and in view of the further fact that he had a financial interest in her claim against the bankrupt. As stated by Johnstone in his opening statement before Judge Campbell, "Briefly the charge against respondent may be summarized as an attempt to obtain a pecuniary advantage for himself by virtue of his position as attorney for the applicant to reopen in case number 62732 in bankruptcy." While of course there are other issues, we think it can be safely stated that they in the main diverge from and are subsidiary to this central issue. In any event, the most serious charge against respondent is that he represented conflicting ...