MR. JUSTICE UNDERWOOD DELIVERED THE OPINION OF THE COURT:
Rehearing denied May 26, 1978.
Pursuant to the directions from the Inquiry Board of the Attorney Registration and Disciplinary Commission, the Administrator of the Commission filed a 9-count complaint charging unprofessional conduct on the part of the respondent, Louis M. March, who was licensed to practice law in this State in 1937 and maintains an office in Chicago. At the conclusion of hearings on the complaint the Hearing Board found that counts I, II and VIII had not been proved by clear and convincing evidence and that only a part of the misconduct alleged in count III had been established. The proof offered in support of counts IV, V, VI, VII and IX, however, was found to establish unprofessional and unethical conduct by respondent tending to bring the legal profession into disrepute. Suspension from practice for 3 years was recommended as to each of counts III, IV, V, VII and IX and disbarrment as to count VI. It was also recommended that as counts III, IV, V, VI and VII "collectively show a continuing standard of conduct on the part of respondent, we conclude that he is unfit to practice law and respondent should be disbarred."
Respondent filed with the Review Board his exceptions to the findings and conclusions of the Hearing Board. Those findings and conclusions were affirmed by the Review Board, which has filed with this court its report recommending respondent's disbarrment. The case is before us on respondent's exceptions to that report and oral argument by the parties.
It is alleged in count III that, in addition to representing her in several legal actions, respondent represented to Leocadia Borkowski that he was a financial advisor and an expert in the stock market; that as a result of such representations Mrs. Borkowski entrusted respondent with funds to invest on her behalf which respondent failed to do and for which he has failed to give Mrs. Borkowski an accounting; that his conduct constituted misrepresentation, fraud, deceit, dishonesty, gross overreaching, abuse of the attorney-client privilege and conversion of funds. The Hearing Board concluded that it had not been proved by clear and convincing evidence that respondent's conduct involved misrepresentation, fraud, deceit or dishonesty or that respondent had converted funds to his own use. It did find, however, that respondent's conduct with respect to the investing of Leocadia Borkowski's funds constituted a gross overreaching and an abuse of the attorney-client relationship violating two provisions of the Code of Professional Responsibility. Illinois Code of Professional Responsibility, as approved by the Illinois State Bar Association (rev. 1977), Disciplinary Rule 5-104(A) (conflict of interest) and Disciplinary Rule 9-102(B) (failure to account).
At the outset of the hearing before the Hearing Board, respondent moved to dismiss the complaint against him, citing the fifth and fourteenth amendments to the Federal Constitution and section 10 of article I of the Illinois Constitution. When that motion was denied the Administrator sought to call respondent as an adverse witness for cross-examination under section 60 of the Civil Practice Act (Ill. Rev. Stat. 1975, ch. 110, par. 60). Respondent objected, again asserting the constitutional protections against self-incrimination. The chairman of the hearing panel indicated the panel's view that the fifth amendment and the corresponding provisions of the Illinois Constitution protected respondent from testifying to incriminating facts but were not a basis for dismissing the complaint. After respondent indicated his intention to refuse, on these grounds, to answer any questions relating to any of the complainants, respondent was excused.
Thereafter, proof was introduced through a number of building and loan, bank and brokerage firm employees or officers called to identify various cashier's checks, drafts and stock certificates representing funds apparently given by Mrs. Borkowski to respondent to invest for her. A stockbroker with whom respondent dealt at the brokerage house of Paine, Webber, Jackson and Curtis, Inc., testified he first met respondent when the latter walked in one afternoon, started talking about the stock market, and proposed that the witness let respondent handle the witness' personal account, the respondent to receive a percentage of any profits he made for the witness. There are in evidence forms signed by Leocadia Borkowski authorizing respondent to buy and sell securities on her behalf, and it is clear that he did so in substantial amounts. Respondent decided what stocks to buy and when to do so. Those he purchased were highly speculative, a fact which disturbed the Paine, Webber firm, which was aware that Mrs. Borkowski was a widow. The firm both wrote and called her, informing her of the speculative nature of the stocks in her account. She indicated she understood this, wished to purchase them, and desired respondent to handle her account. By 1973 her relationship with him had deteriorated to the point where she filed a written complaint with the Commission, indicating she was without funds and unable to secure an accounting from respondent. In mid-1975 she notified the Commission that she wished to withdraw her complaint against respondent, and she refused, on fifth amendment grounds, to testify in the disciplinary proceedings.
Despite the rather substantial volume of testimonial and documentary evidence relating to the Borkowski matter, we do not believe that any portion of the misconduct alleged in count III can be said to have been proved by clear and convincing evidence.
Counts IV and V concern respondent's dealings as a "financial advisor" to Irving Gold, an assistant director of the municipal division of the circuit court of Cook County. That complaint did not involve an attorney-client relationship. Gold was, however, aware that respondent March was an attorney when they happened to meet on several occasions at a cafeteria in the Richard J. Daley Center. During such chance meetings, the discussion often centered upon the stock market, with March indicating to Gold that he was an expert in the market.
On June 10, 1968, after several such meetings, Gold and March entered into a written agreement whereby, in consideration of his experience in the buying and selling of stocks, March was to "select stocks for purchase and sale by Irving Gold in his account for a period of three years." In exchange, March was to receive 15% of any gains resulting from such purchases and would not be liable for any losses or expenses. All expenses of March were to be taken into account when an accounting was made between the parties. March was given the "sole discretion to determine when the stock * * * shall be sold during said term, and accounting to be made after each sale of stock." Based upon March's representations as to the company's potential, the agreement also provided that March's first transaction would be to buy approximately 1,000 shares of common stock in Western Land Corporation in Gold's name for a purchase price of $2,500.
During subsequent encounters throughout 1968-70, March continued to assure Gold that the stock was increasing in value and represented the price to be from $2 to $5 per share. The market value did, in fact, range from $1 to $1.50 during this period. Accompanying such false assurances, March continued to solicit funds for the purchase of Western Land stock, and on two separate occasions Gold forwarded March $2,500 and $750 respectively to purchase additional Western Land stock. The $750 transaction was concluded by a written agreement, dated January 2, 1969, by which 30% of those shares purchased for Gold were assigned to March and which entitled March to 30% of the profits derived from this stock. March failed to disclose to Gold that March's wife owned stock in Western Land, even though part of the stock purchased by March for Gold at $2.50 per share was purchased from respondent's wife when the market value was substantially below that level.
In 1971, as the term of the original March-Gold agreement ended, Gold made several unsuccessful efforts to contact March in order to obtain an accounting. On May 20, 1971, Gold sent a letter to March requesting an accounting under their agreement. March denies receiving this letter. In September 1971 Gold finally met with March, at which time Gold was informed by March that the Western Land stock was worth $.50 per share. In early 1972, Gold hired another attorney, who sued March for an accounting and rescission of their original agreement. In settling that case, March agreed to repay Gold over $3,000. Gold testified he felt this was the best settlement he could receive, although he suffered a substantial loss and was forced to pay his attorney fees.
We recognize that respondent was not acting in his professional capacity with respect to his dealings with Gold. However, we agree with the hearing panel and Review Board that March may be subject to discipline for conduct outside his professional capacity. "[I]t is not necessary that his acts be strictly in the discharge of professional duties. Any act which evidences want of professional or personal honesty, such as renders him unworthy of public confidence affords sufficient grounds for disbarrment." In re Melin (1951), 410 Ill. 332, 337; see also In re Sanitary District Attorneys (1932), 351 Ill. 206, 237.
We believe the sale of respondent's wife's stock to Gold at a price substantially above its then market value, together with his misrepresentation of the value of the Western Land Corporation stock, supports the conclusion of the hearing panel and Review Board that March's conduct with respect to Irving Gold "constitutes fraud, deceit and misrepresentation, the representation of conflicting interests to his own advantage and is conduct which is unprofessional and unethical and which tends to bring the legal profession into disrepute." Illinois Code of Professional Responsibility, as approved by the Illinois State Bar Association (rev. 1977), Canon 1, Disciplinary Rule 1-102(A)(4).
Counts VI and VII concern alleged unethical and unprofessional conduct based upon respondent March's attorney-client relationship with Creston and Freida McIntyre. The McIntyres consulted respondent concerning a medical malpractice claim stemming from the alleged negligence of a doctor in examining and treating Freida McIntyre on February 16, 1968. Respondent was retained by the McIntyres on July 21, 1969, on a 50% contingency basis and was paid a $1,000 retainer.
After approximately 9 months elapsed with no apparent action by respondent, the McIntyres took the initiative and consulted him. On April 17, 1970, the McIntyres paid March $1,000 in exchange for a promissory note from March due and payable, with interest, 3 years from that date. Creston McIntyre testified that it was his impression that this amount was to cover the costs of the suit if it was unsuccessful, while March contends it was unrelated to the malpractice claim and was received in response to his general representation to the McIntyres that it was a good investment period. In any event, this note was not paid when due. Additionally, on that same date, the McIntyres paid respondent $500 to cover the costs of employing a doctor to assist them in pursuing their malpractice claim.
On May 22, 1970, 10 months after the McIntyres had retained March and 3 months after the 2-year statute of limitations had expired, suit was filed by March on behalf of the McIntyres against the allegedly negligent doctor. That suit was dismissed because barred by the 2-year statute, and an amended complaint was filed attempting to allege fraudulent concealment by the doctor which would have brought the case under the 5-year statute of limitations. The amended complaint was dismissed for failure to allege facts stating a cause of action under the 5-year statute. An appeal was dismissed ...