Kentucky Bar Ass'n v. Roberts
2014 Ky. LEXIS 153, 2014 WL 1409424, 431 S.W.3d 400 (2014)
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Rule of Law:
A lawyer violates ethical duties by representing clients with directly conflicting interests in an estate without proper, informed consent, and by failing to promptly surrender a client's file to successor counsel upon request. However, a de facto contingent fee in a criminal case is not established merely by a lawyer's financial interest in an acquittal if the client expresses a clear desire to go to trial.
Facts:
- Earl Manning suffered a violent death on November 23, 1997, and his will left a 160-acre farm to his adopted son, David Manning, naming Lawrence Williams as executor.
- David Manning became an immediate suspect in his father's murder, and the Commonwealth's Attorney offered him a flat five-year sentence for a guilty plea before he consulted with legal counsel.
- David Manning hired Respondent Nancy Oliver Roberts as defense counsel, and they entered into several attorney-client agreements, including one for $25,000 for the murder charge, to be paid via a promissory note and mortgage, and another stating Manning would pay from the sale of timber on inherited estate land.
- Roberts entered an appearance on David Manning’s behalf as an heir in the probate of his father’s will, though no employment agreements covered probate matters; she also moved the probate court to appoint Manning’s friend Russell Justice as executor, who was subsequently appointed.
- Roberts entered an employment agreement to represent both Russell Justice as executor of the estate and David Manning’s brother, Andrew Manning, an heir.
- Roberts caused Justice to send two $1,000 checks from the estate’s checking account to a ballistics expert for David Manning’s criminal defense, with 'loan' written on the memo line of the second check.
- The Commonwealth offered David Manning another plea bargain of a five-year sentence for second-degree manslaughter, but Roberts did not advise him to take it, and Manning maintained his innocence, wanting to go to trial.
- Roberts obtained purported waivers of conflict of interest from David and Andrew Manning for her joint representation of the estate and David in his criminal case, but David Manning later testified she did not explain the waiver to him, and Justice did not execute such a waiver.
- After David Manning filed a motion alleging ineffective assistance of counsel, Sarah Jost, an attorney for the Department of Public Advocacy, attempted to obtain Manning's client file from Roberts, but Roberts delayed and refused full access until a court order compelled her to do so.
- Roberts objected to the proposed final settlement of Earl Manning's estate, noting that the $2,000 paid for the ballistics expert had not been included, and she disclosed a pending bar complaint against her in a probate filing.
Procedural Posture:
- David Manning was indicted for murdering his adoptive father and being a persistent felony offender in the first degree.
- David Manning was found guilty by a jury of first-degree manslaughter and being a PFO, and was sentenced to life in prison.
- Respondent Nancy Oliver Roberts moved for a new trial, which was denied.
- David Manning's conviction was affirmed by the Kentucky Supreme Court (Manning v. Commonwealth, 23 S.W.3d 610 (Ky.2000)).
- David Manning filed an RCr 11.42 motion in Warren Circuit Court, alleging ineffective assistance of counsel due to Roberts's alleged conflict of interest (2003).
- The Warren Circuit Court granted David Manning’s RCr 11.42 motion in September 2005, vacating his conviction, finding a de facto contingent fee agreement and a conflict of interest.
- David Manning later entered into a plea bargain, pleading guilty to first-degree manslaughter in exchange for a ten-year sentence.
- In June 2006, the Inquiry Commission issued a complaint against Roberts related to her representation of Manning in his criminal case, and in January 2008, issued a formal charge alleging four ethical violations (KBA File No. 13737).
- In October 2009, the Inquiry Commission issued a second complaint, resulting in five additional disciplinary charges against Roberts (KBA File No. 17411), and the two disciplinary cases were consolidated.
- A trial commissioner was appointed and held a hearing in September 2010.
- In April 2011, the trial commissioner filed a report finding Roberts guilty of all nine counts and recommending a one-year suspension.
- Roberts appealed the trial commissioner's decision to the KBA Board of Governors, which took up the case in March 2012.
- The Board of Governors, after de novo review, found Roberts not guilty of seven charges and guilty of two, recommending a 30-day suspension.
- Both the KBA Office of Bar Counsel and Roberts sought review by the Kentucky Supreme Court under SCR 3.370.
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Issue:
Does an attorney violate the Rules of Professional Conduct by jointly representing an estate's executor and heirs whose interests are diametrically opposed due to a slayer statute, and by failing to promptly surrender the client's file to successor counsel upon termination of representation?
Opinions:
Majority - Special Justice Dennis Repenning
Yes, an attorney violates ethical duties by jointly representing an estate's executor and heirs whose interests are diametrically opposed, and by failing to promptly surrender the client's file to successor counsel. The Court found Respondent Nancy Oliver Roberts guilty of two ethical violations. First, she violated SCR 3.130-1.7(b) by representing David Manning, his brother Andrew Manning, and Russell Justice (the executor) in the probate action, as their interests were “diametrically opposite” due to Kentucky’s “slayer statute” (KRS 381.280), which bars a convicted killer from inheriting. No waiver could make this conflict disappear. Additionally, Roberts inappropriately directed the executor to use estate funds to pay for expert witness fees in Manning’s criminal defense, an unallowable expenditure not related to estate administration that also financially benefited Roberts. Second, Roberts violated SCR 3.130-1.16(d) by failing to make David Manning’s criminal file available to his new counsel, Sarah Jost, for his RCr 11.42 motion. Roberts’s delay and refusal of full access to the file, despite Manning’s authorization and a court order, constituted unjustified foot-dragging and unprofessional conduct, as the client owns the file. The Court, however, dismissed the charges related to a de facto contingent fee arrangement in Manning’s criminal defense (SCR 3.130-1.5(d)(2)) and related conflict of interest (SCR 3.130-1.7(b)), finding that Manning’s testimony established his desire to go to trial and that Roberts’s representation was consistent with his intention. The Court also dismissed charges of incompetent representation, failure to expedite the estate settlement, and improper disclosure of a bar complaint. Considering Roberts’s disciplinary history and lack of appreciation for the rules, the Court imposed a 61-day suspension from the practice of law and ordered her to pay one-half of the court costs.
Concurring-in-part-and-dissenting-in-part - Justice Noble
Yes, the attorney violated ethical duties regarding the file and estate representation, but also on grounds of incompetent representation and de facto contingent fees, warranting a longer suspension. Justice Noble concurred with the majority that Roberts violated SCR 3.130-1.16(d) (failure to turn over client file) and SCR 3.130-1.7(b) (conflict of interest in estate representation), emphasizing that the client owns the work product in a file, and three weeks was ample time to resolve any work-product issues. The conflict of interest in the estate was clear and could not be waived given the diametrically opposed interests created by the slayer statute. However, Justice Noble dissented from the majority’s dismissal of charges related to Roberts’s fee arrangement and competent representation. He argued that while the fee agreements were not explicitly contingent, their clear effect, given the slayer statute, was that Roberts would only be paid if Manning was acquitted. This created a de facto contingent fee arrangement (violating SCR 3.130-1.5(d)(2)) and an undeniable conflict of interest (violating SCR 3.130-1.7(b)) by incentivizing Roberts to seek acquittal rather than advising Manning on a favorable plea bargain. Roberts's "mystifying" failure to advise Manning on the plea deal was "patently obvious" when viewed through this financial lens. He also argued that Roberts’s failure to properly advise Manning about the proposed plea bargain constituted incompetent representation (violating SCR 3.130-1.1). Given these additional violations and Roberts’s disciplinary history, Justice Noble believed a harsher sanction of 120 days was appropriate.
Analysis:
This case offers critical guidance on managing attorney conflicts of interest, particularly in complex probate and criminal defense scenarios, and reinforces the fundamental duty to promptly surrender client files. The split among the justices regarding the de facto contingent fee and its impact on advice in a criminal case highlights the ongoing challenge in proving the subjective influence of a lawyer's financial interests versus a client's expressed desires. The ruling solidifies that direct statutory conflicts, such as those arising from a slayer statute, cannot be overcome by client consent alone, underscoring the limits of waivable conflicts. It further emphasizes that a client's ownership of their file is paramount, preventing attorneys from impeding successor counsel’s access. This case serves as a crucial reminder for attorneys to meticulously structure fee agreements, provide clear client communication, and act with professionalism, especially when navigating delicate ethical boundaries.
