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12/06/88 In Re Kenneth Henry Holz

December 6, 1988

IN RE KENNETH HENRY HOLZ, ATTORNEY, RESPONDENT.


SUPREME COURT OF ILLINOIS

533 N.E.2d 818, 125 Ill. 2d 546, 127 Ill. Dec. 736 1988.IL.1752

Disciplinary proceeding.

Rehearing Denied January 30, 1989

APPELLATE Judges:

CHIEF JUSTICE MORAN delivered the opinion of the court.

DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE MORAN

The Administrator of the Attorney Registration and Disciplinary Commission filed a six-count complaint alleging, inter alia, that respondent, Kenneth Henry Holz, commingled and converted the funds of two of his clients, Carolyn Monacelli and R. W. Riley; charged excessive fees for his representation of Monacelli; and filed false bankruptcy documents. A majority of the members of the Hearing Board found that respondent commingled Riley's funds with his own and charged an excessive fee to Monacelli. The majority dismissed the remaining charges and recommended that its findings remain a part of the Administrator's records to be considered as an aggravating factor in any future disciplinary proceedings. One Dissenting member of the Hearing Board found that respondent commingled and converted the funds of Monacelli and Riley, charged an excessive fee to Monacelli, and filed false bankruptcy documents. The Dissent recommended that respondent be disbarred. The Review Board adopted the findings of the Dissent and recommended that respondent be suspended from the practice of law for a period of three years. Respondent filed exceptions to the report and recommendation of the Review Board. 107 Ill. 2d R. 753(e)(5).

The issues presented for review are: (1) whether the Administrator proved each of the allegations by clear and convincing evidence; and (2) if so, what measure of discipline, if any, should be imposed upon respondent.

The initial charges of misconduct stem from respondent's representation of Carolyn Monacelli. Respondent testified that he and his wife were close friends with the Monacelli family. On January 24, 1973, Mr. Monacelli committed suicide. Respondent testified that Monacelli immediately asked him to handle the sale of the residence, collection of life insurance benefits and settlement of the estate.

In her deposition, Monacelli testified that she told respondent to "handle whatever has to be handled." She further stated that she had not signed any documents and had not discussed attorney fees. On January 29, 1973, Monacelli moved to Pennsylvania.

On March 9, 1973, respondent opened Mr. Monacelli's estate in probate court. Respondent testified that he had only minimal probate experience and he had never prepared a Federal estate tax return. He stated that his practice is concentrated primarily in the areas of workers' compensation and personal injury.

On June 22, 1973, respondent completed the sale of the residence. He received a draft payable to Monacelli in the amount of $51,120.14, representing the net proceeds of the sale. He endorsed the draft and deposited it in an account at the First Federal Savings and Loan Association of Aurora (the Aurora account). Respondent testified that this was not an attorney-client trust account and he had never maintained a trust account.

In a letter dated July 22, 1973, Monacelli directed respondent to retain the amount of money necessary to cover all of the fees and taxes, and then to send her the balance. On July 31, 1973, respondent withdrew $9,232.10 from the Aurora account to discharge a loan obligation of Monacelli. Respondent stated that he withdrew an additional $2,500 as his fee for handling the sale of the residence. Respondent did not remit the balance to Monacelli. He explained that he was unsure how much money would be needed to pay the taxes.

On October 11, 1974, respondent closed the Aurora account. The balance totaled $42,059.57, including the interest earned. Respondent testified that he believes he transferred the funds to the Harris Trust and Savings Bank (the Harris account). He stated that the Harris account was not a trust account. The records of the Harris account were not available and were therefore not introduced into evidence.

Respondent testified that in April 1975, he retained another attorney, Stephen Lewis, to close the probate estate. He further testified that he learned from Lewis that it was not even necessary to open the estate in 1973. Respondent also stated that Monacelli agreed to pay Lewis $2,500 for his services.

On July 9, 1975, respondent opened an account at the American National Bank and Trust Company (the American account). He testified that the ...


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