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02/11/88 In Re Harvey Leonard Walner

February 11, 1988



519 N.E.2d 903, 119 Ill. 2d 511, 116 Ill. Dec. 688 1988.IL.209

Disciplinary proceeding.


JUSTICE MILLER delivered the opinion of the court.


On January 21, 1985, the Administrator of the Attorney Registration and Disciplinary Commission filed a two-count complaint charging the respondent, Harvey Leonard Walner, with professional misconduct in connection with settlements he made in two personal injury cases. A panel of the Hearing Board found that the respondent acted improperly in one case but not in the other and recommended that he be censured. Both the Administrator and the respondent filed exceptions to the Hearing Board's report and recommendation. The Review Board found that the respondent's conduct in both cases was improper and recommended that he be suspended from the practice of law for one year. The respondent has filed exceptions to the Review Board's recommendation. See 107 Ill. 2d R. 753(e)(5).

For the most part, the facts in this case are not in dispute. The parties submitted to the Hearing Board an extensive stipulation concerning the activity at issue here, and the summary that follows is based largely on the stipulation. Count I of the Administrator's complaint grew out of the respondent's representation of a client, Michael Jordan, in a personal injury action. Jordan, two of his cousins, Perry Hale and John Miller, and a friend, Alton Childs, were involved in an automobile accident in Chicago on November 2, 1975. All four retained the respondent's law firm, Harvey L. Walner & Associates, Ltd., to represent them in the matter on a contingent-fee basis. The attorney-client agreement signed by each one contained the provision, "It is further agreed that no settlement will be made without the consent of the injured party."

Initial attempts to settle the claims failed, and the respondent's law firm filed suit on behalf of the four in February 1977. In January 1978, the firm was unable to locate Jordan and wrote to the other plaintiffs seeking their help; by that time Jordan had moved from Chicago to Minneapolis, and the office did not have a record of the new address. On January 26, Jordan went to the firm's office to sign his responses to interrogatories submitted by the defendant; it is not clear from the record how contact with Jordan had been made. The next apparent contact with Jordan came more than two years later, in March 1980, when the firm wrote to Jordan at his Minneapolis address to tell him of the scheduling of his deposition. Jordan responded to the letter, and he gave the deposition in Chicago on July 3, 1980.

The case was set for a pretrial conference in July 1981. At that time, the respondent's firm presented the special damages and demand of each client, and the defendant made a settlement offer for each of the four claims. Jordan's special damages were $210, he was demanding $1,000, and the defendant offered $400; the special damages, demands, and offers for the three others were all greater than Jordan's. At the Conclusion of the conference, the trial Judge recommended that each of the offers be accepted. Brian Higgins, the attorney handling the matter for the respondent's firm, relayed the offers to plaintiff Alton Childs, and at some point Childs told Higgins that the four plaintiffs would accept the offers. On September 15, 1981, Childs called Higgins and said that the plaintiffs had decided to reject the settlement offers. Childs called back later that day, however, to say that they would accept the offers. By that date, Jordan had moved from Minnesota to California; the firm's records did not indicate his new address. Higgins' note of the two telephone calls says, "Alton Childs called says P's changed minds re settlement want trial -- called back again in afternoon says OK to settle. OK to settle at pretrial." On September 16, the respondent's firm informed defense counsel that the plaintiffs had accepted the settlement offers, and the trial Judge dismissed the action later that day.

Defense counsel sent to the respondent's firm releases to be signed by the four plaintiffs, and Childs, Hale, and Miller signed theirs at the respondent's office early in October. Neither the firm nor a private investigator was able to reach Jordan, however, and on October 8, an employee of the firm, in accordance with the respondent's instructions, affixed Jordan's signature to the release of his claim. There was no indication that the signature was made by anyone other than Jordan, and it was notarized by one of the respondent's employees.

The respondent's firm received the four settlement checks in January 1982. Childs, Hale, and Miller went to the office, signed closing statements, endorsed the settlement checks, and received their shares of the proceeds. Jordan could not be located, so the law firm held the draft and again hired an investigator to look for him. Late in April, the firm learned from the defendant's insurer that Jordan's settlement draft would still be honored even though it was already three months old. On May 7, 1982, an employee of the firm, acting under the respondent's direction, affixed Jordan's endorsement to the draft, and it was then deposited in the firm's general business account. Later that day, a check for $133.33, representing the amount determined to be Jordan's share of the $400 settlement, was drawn on the general account and deposited in the firm's escrow account. Several days later, the respondent paid $133.33 from the general account to Jordan's doctor in satisfaction of a medical lien and retained the remaining sum, $133.34, in the general account as attorney fees; the medical and legal fees represented voluntary reductions of the amounts actually due.

In December 1982, Jordan contacted the respondent's firm about his case. Jordan wrote, "I would like to know if the case was settled out of court. If so, I would like for you to send my part of the settlement to . . .." The firm responded to the inquiry in February 1983. On August 5, 1983, the firm mailed Jordan settlement papers to sign. Jordan did not sign and return the papers, and at the time of the disciplinary hearing the respondent still held Jordan's settlement proceeds in the firm's escrow account. Neither the respondent nor the Administrator was able to locate Jordan after August 5, 1983.

Count II of the Administrator's complaint involved the case of Frances Cuevas and Julio Feliciano, who retained the respondent's firm on a contingent-fee basis on March 2, 1979, to handle claims arising from an automobile accident that had occurred in Chicago earlier that day. The attorney-client agreements signed by Cuevas and Feliciano granted the firm a general power of attorney, which provided, "It is further agreed that I (we) give the said attorneys full power and authority to do and perform all and every act and thing whatsoever including executing drafts and releases requisite and necessary to be done in and about the claim as fully, to all intents and purposes, as might or could do if personally present at the doing thereof."

About five months later, the respondent's firm received a letter dated August 9, 1979, from the insurance carrier of the owner of the other vehicle involved in the accident. The letter expressed the insurance company's desire to have the matter resolved quickly, and it concluded, "Time is of the essence in this settlement and we will therefore expect to hear from you in fifteen days after receipt of this letter as to the specific medical and special damage facts." That information was relayed to the company in a letter from the respondent on October 25, 1979; Cuevas's special damages were $185, and Feliciano's were $589.50. About two weeks later, the insurer offered to settle the two claims for $600 and $950 respectively. After reviewing the settlement offer, the respondent told the insurer to send him the releases and settlement checks. Those documents were received on November 30, 1979; office staff then tried to call Cuevas and Feliciano and learned that their lines had been disconnected. Post cards and telegrams later were sent to the clients' last known addresses to advise them ...

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