The prior complaint of misconduct is Commission number 97 CH 24.
Watch this web-site for further reports on Caryl Jacobs Gabe,
as they become available.
BEFORE THE HEARING BOARD
OF THE
ILLINOIS ATTORNEY REGISTRATION
AND
DISCIPLINARY COMMISSION
In the Matter of:
CARYL JACOBS GABE, |
Commission No. 04 CH 8
FILED- February 5, 2004 |
|
Mary Robinson, Administrator of the Attorney Registration and Disciplinary Commission, by her attorneys, Sarah R. Masarachia, and Wendy J. Muchman pursuant to Supreme Court Rule 753(b), complains of Respondent Caryl Jacobs Gabe, who was licensed to practice law in Illinois on October 29, 1976, and alleges that Respondent has engaged in the following conduct which tends to defeat the administration of justice, or to bring the courts or the legal profession into disrepute: Background Common to Counts I through V
2. On July 21, 1998, a hearing was held before a panel of the Hearing Board of the Attorney Registration and Disciplinary Commission on the parties’ joint motion for approval to file with the Illinois Supreme Court a petition to impose discipline on consent in case number 97 CH 24. The petition requested that Respondent be suspended from the practice of law for two years, with all but the first six months stayed by the imposition of probation for a period of eighteen months, commencing upon the completion of the six-month actual suspension and subject to certain conditions. On July 21, 1998, the Hearing Board panel allowed the motion and approved the submission of the petition to impose discipline on consent to the Illinois Supreme Court as an agreed matter, pursuant to Supreme Court Rule 762(b)(1)(b). 3. As of July 21, 1998, Respondent knew that the petition for discipline on consent would be filed with the Illinois Supreme Court and that the petition requested that she be suspended from the practice of law for a period of six months. 4. As of at least July 21, 1998, Respondent knew (and was so advised by her counsel) that if the petition were approved, she would be required to comply with the conditions of Supreme Court Rule 764. Supreme Court Rule 764 dictates that an attorney suspended from the practice of law for a period of six months or more comply with certain requirements, which include but are not limited to the following: the maintenance of certain records [764(a)]; the withdrawal from their law office and the removal of any indicia as being a lawyer [764(b)]; and the notification to all clients, opposing counsel and courts of the fact of their discipline [764(c), (e), & (f)]. 5. On July 28, 1998, the petition for discipline on consent was filed with the Illinois Supreme Court, and notice of this filing was served by mail to Respondent’s counsel on that day. 6. On about August 27, 1998, Respondent sent letters to her clients which stated in relevant part: "It is with great pleasure that I forward this correspondence, to advise you that effective September 1, 1998, I have formed a partnership with two (2) extremely competent lawyers I have known for a substantial length of time, both personally and professionally, namely: STEVEN POPUCH and PAUL CHAWLA. Both attorneys are experts in the field of matrimonial law.[emphasis added]. 7. On August 31, 1998, Respondent signed and entered into a written partnership agreement with attorneys Steven L. Popuch and Tarranpaul S. Chawla in anticipation of her suspension from the practice of law. The partnership agreement provided in relevant part that: "WHEREAS, The Parties do, by this agreement intend to form a partnership for the practice of law which shall commence business, as a partnership on August 24, 1998… 1. Gabe will work, on an agreed per diem basis, as an associate counsel, up until the date of her leave of absence from Popuch & Chawla. She will perform services for clients of the Law Firm [Popuch & Chawla] as reasonably required… 8. Pursuant to the August 27, 1998 letter to her clients and the August 31, 1998 agreement with Popuch & Chawla, between August 1998 and until September 28, 1998, Respondent continued to perform legal work on her clients’ cases and continued to bill the clients under the name "Caryl Jacobs Gabe & Associates".1. The parties do, by execution of this document, form a partnership for the practice of law which shall commence business on the first day when Gabe returns from leave of absence…" 9. On September 28, 1998, the Illinois Supreme Court allowed the petition for discipline on consent and Respondent was suspended from the practice of law for two years, with all but the first six months stayed by the imposition of probation for a period of eighteen months, commencing upon the completion of the six-month actual suspension and subject to certain conditions. 10. As of September 28, 1998, there remained pending in the Circuit Court of Cook County or the Circuit Court of DuPage County the following cases in which Respondent had entered an appearance on behalf of a client at sometime prior to September 28, 1998:
COUNT I
11. At all times relevant there was in force and effect Supreme Court Rule 764 which provided in pertinent part: RULE 764. Duties of a Disciplined Attorney and Attorneys Affiliated with Disciplined Attorney.12. Prior to her suspension, Respondent had sent to her clients, including those in the cases identified in Paragraph 10 above, the August 27, 1998 letter described in Paragraph 6 above. At no time did Respondent inform any of those clients that her agreement with Popuch & Chawla provided that she would serve as associate counsel, not a partner, to the firm until a contemplated "leave of absence," or that Respondent’s partnership with Steven Popuch and Paul Chawla would not actually commence until Respondent returned from that leave. At no time before she was suspended, did Respondent inform those clients that their acquiescence after August 27, 1998, to representation by the firm of Popuch & Chawla constituted an agreement to be represented by a firm in which Respondent was not a partner and would not be a partner until some time more than six months into the future, and in which Respondent could have no presence for a period of six months likely to commence prior to the conclusion of representation in their cases. 13. By reason of the representations Respondent made to her clients, including those listed in Paragraph 10 above, in the letter of August 27, 1998 (described in Paragraph 6), and Respondent’s continuing to perform legal services for those clients and billing those clients under the name "Caryl Jacob Gabe & Associates" until September 28, 1998, those clients remained clients of Respondent as of the date of her suspension. 14. At no time after September 28, 1998, did Respondent inform any of her clients, including those listed in Paragraph 10 above, that she had been suspended from the practice of law for six months by the Illinois Supreme Court, that she could not continue to represent them during her suspension, that the clients had the right to retain another attorney, and that their files, documents and other records were available to them. At no time did Respondent secure her client’s consent to the representation by Popuch & Chawla without Respondent’s involvement. 15. By her representations to her clients in the letter of August 27, 1998 described in Paragraph 6 above, by continuing to perform legal services for those clients and billing those clients under the name "Carol Jacob Gabe & Associates" until September 28, 1998, and by her failure anytime after sending the August 27, 1998 letter to reveal to the clients her unavailability to represent them due to her suspension from the practice of law, Respondent intended to, and reasonably did, mislead the clients to believe that Respondent would personally be available to continue to represent them in association with the Popuch & Chawla firm for the foreseeable future after August 27, 1998. 16. By reason of the conduct described above, Respondent has engaged in the following misconduct:
(Failure to provide notice of suspension to courts and opposing parties; filing false affidavit of compliance with Supreme Court Rule 764) 17. At all times relevant Supreme Court Rule 764 provided in pertinent part: RULE 764. Duties of a Disciplined Attorney and Attorneys Affiliated with Disciplined Attorney.18. In the Aliotto, Bilar, Blaszko, Bublitz, Clark, Dilaura, Driscoll, Fowler, Gardner, Hartwig, Hearon, Herkey, Kenley, Lanham, Lonergan, Looby, Marski, Mead, Michels, Polinski, Tredenick and Velasquez cases identified in paragraph 10 above, at no time before or after September 28, 1998, did Respondent move to withdraw her appearance. In each of those cases, at some time between August 31, 1998, and September 28, 1998, the firm of Popuch & Chawla and/or an attorney from that firm filed an appearance as substitute counsel, in some instances, securing an order allowing the substitution of counsel. In some of the cases identified in this paragraph, Respondent personally signed the substitute appearance on behalf of Popuch & Chawla. 19. At no time before or after September 28, 1998, did Respondent file a notice before the courts in the cases identified in paragraph 18 advising the court of the discipline imposed upon her by the Illinois Supreme Court, or serve such notice upon her former clients and all other parties in those cases. At no time did Respondent serve notices of the action taken by the Supreme Court and her inability, during the period of her suspension, to practice law in Illinois upon the attorneys of record or parties not represented by an attorney in the cases identified in Paragraph 18. 20. In the Barnes, Caradonna, Gordon and Malone cases identified
in paragraph 10 above, at no time before or after September 28, 1998, did
Respondent move to withdraw her appearance, nor was any substituted appearance
filed or order entered allowing a substitution of counsel.
22. On November 5, 1998, Respondent filed her Affidavit in Compliance with Supreme Court Rule 764 with the Illinois Supreme Court. The affidavit stated in relevant part: "c. That I have removed all indicia of my name as a lawyer…23. Respondent’s statement in the above affidavit that she had withdrawn her appearance in every existing court proceeding was false and Respondent knew or should have known the statement was false, in that Respondent had not withdrawn her appearance in any of the cases identified in paragraphs 18 & 20 above. 24. Respondent’s statement in the above affidavit that Popuch & Chawla had filed its appearance in each case in which Respondent had previously represented clients was false and Respondent knew or should have known the statement was false, in that Popuch & Chawla had not entered an appearance in the cases identified in paragraph 20 above. 25. Respondent’s statement in the above affidavit that she did not have any clients or court matters as of the date of the imposition of discipline was false, and Respondent knew or should have known the statement was false in that Respondent had led the clients in the cases identified in paragraphs 18 & 20 to believe that she continued to represent them after August 27, 1998, she continued to perform legal services for them and continued to bill them for her services performed up until the time discipline was imposed, and she did not move to withdraw in any of the cases prior to the imposition of discipline. 26. By reason of the conduct described above, Respondent has engaged in the following misconduct: a. conduct involving dishonesty, fraud, deceit, or misrepresentation, in violation of Rule 8.4(a)(4) of the Illinois Rules of Professional Conduct; (Misrepresentations to Nancy Driscoll) "Please note, that commencing October 1, 1998, I will be in Florida for most of the winter, a necessary R & R for my health, but, that my partners, Steven Popuch and Paul Chawla, will be taking good care of you…Further, you will be getting a letter in the mail, under separate cover, which will advise you that as of September 1, 1998, the name of my law firm has been changed to Popuch & Chawla…"28. Respondent’s statement in the above letter that she would be unavailable for most of the winter because of a necessary R & R for her health was false and misleading and Respondent knew the statement was false and misleading, in that Respondent’s predicted unavailability was due to her proposed suspension from the practice of law and not health reasons. 29. Respondent’s statements in the above letter that "my partners, Steven Popuch and Paul Chawla, will be taking good care of you" and that as of September 1, 1998, the name of her lawfirm had been changed to Popuch & Chawla, were false and misleading in that Popuch and Chawla were not partners of Respondent at the time she sent the letter to Nancy Driscoll and under the terms of the partnership agreement, would not be partners of Respondent until after the period during which Respondent told Driscoll her "partners" would take care of Driscoll, and in that under the terms of the partnership agreement, Respondent had no partnership interest in Popuch & Chawla as of September 1, 1998, so that it was in no sense Respondent’s firm. Respondent knew those statements were false and misleading. 30. By reason of the conduct described above, Respondent has engaged in the following misconduct:
(Failure to comply with Rule 764(b) & (h) during period of suspension) 32. During the period of Respondent’s suspension, September 28, 1998 through March 28, 1999, bills were sent out to clients whom Respondent represented prior to September 28, 1998. Respondent, or someone at her direction, prepared the bills which instructed clients to make their checks payable to "Caryl Jacobs Gabe & Associates" and instructed the clients to mail their checks to Maloney & Co., Ltd., an accounting firm. Maloney & Co. received Respondent’s mail during the period of her suspension and then forwarded the mail, unopened, to Respondent. 33. By directing her clients to make their checks payable to "Caryl Jacobs Gabe & Associates" during the period of her suspension, Respondent was continuing to use her firm name during her suspension. 34. During the period of her suspension, Respondent received the following payments from her clients for legal services which she had provided to the clients prior to September 28, 1998, in matters in which legal proceedings were instituted prior to the imposition of discipline:
36. By reason of the conduct described above, Respondent has engaged in the following misconduct: a. receiving compensation from Respondent’s former law practice regarding matters in which legal proceedings had been instituted without the approval of a tribunal in violation of Illinois Supreme Court Rule 764(h); b. failure to remove indicia of her name as an attorney during the period of her suspension in violation of Rule 764(b); and (failure to maintain records pursuant to Rule 769 and Rule 764(a)(4) "It shall be the duty of every attorney to maintain the following:38. At all times relevant there was in force and effect Illinois Supreme Court Rule 764(a)(4) concerning the duties of an attorney suspended for six months or more, which provided in pertinent part: "(a) Maintenance of Records. The Disciplined attorney shall maintain…39. On March 30, 2001, the Administrator served Respondent through her counsel with a subpeona duces tecum, requiring in relevant part, the production of "any and all billing records and accounts receivable records, including but not limited to records related to services performed, time expended and fees and costs, for the period of September 1, 1998 to April 1, 1999." 40. Respondent failed to produce any records in response to that demand, and as her excuse for noncompliance, asserted that she did not have and could not reproduce such records. 41. By reason of the conduct described above, Respondent has engaged in the following misconduct: a. Failure to maintain billing records pursuant to Illinois Supreme Court Rule 769; (failure to make an accounting and failure to promptly refund unearned fee) 43. Between January 9, 1995, and September 17, 1999, Noel Stoutenburg paid Respondent a total of $6,075 in fees and costs to represent him in the dissolution matter. 44. On September 17, 1999, Respondent filed a verified petition for interim attorney’s fees and other relief alleging that as of that date, Noel had incurred total fees in the amount of $24,659.66 beyond the $6075 that Noel had paid, and unpaid costs in the amount of $1,261.41. Respondent requested that the court order the petitioner, Jane Stoutenburg ("Jane") to pay at least $5500 toward that balance. 45. On December 23, 1999, the court entered an order in case number 94 D3 31215 ordering that Jane pay Respondent the sum of $7,500 toward Respondent’s fees for representing Noel. Jane did so in January 2000. 46. Between September 30, 1999, and March 31, 2000, Respondent issued statements to Noel for outstanding attorneys’ fees. Those statements showed an additional $6,014.11 in fees and costs incurred subsequent to Respondent’s petition for interim attorney’s fees, and reflected, as of March 31, 2000, a total balance due of $30,038.94. Although Respondent had reported to Noel that Jane had made a $7500 payment toward her fees, the statements issued to Noel did not reflect a credit for that payment. If the March 31, 2000 statement had included a credit for the $7500 payment made by Jane, the outstanding balance would have been $22,538.94. 47. On or around March 31, 2000, while discussing with Noel finalization of a settlement between Noel and Jane to include provision for payment of Respondent’s outstanding fees, Respondent told Noel that with his outstanding balance and the additional work that would be necessary to conclude the case, Noel’s remaining fee obligation to Respondent would exceed $40,000. Respondent offered to reduce the balance to $30,000 if Noel would agree to that amount being incorporated as a term of the settlement agreement and agree to pay that amount from sums he would receive from Jane under other terms of the settlement agreement. Noel agreed to Respondent’s proposal. 48. On April 3, 2000, a judgment for the dissolution of marriage was entered in case number 94 D3 31215, incorporating a Marital Settlement Agreement which provided, inter alia, that "Husband covenants and agrees to pay to the law firm of CARYL JACOBS GABE & ASSOCIATES the sum of THIRTY THOUSAND DOLLARS ($30,000) on the date of entry of the Judgment for Dissolution of Marriage in this cause.". 49. At the time Respondent told Noel that her fees would exceed $40,000 and at the time she asked him to agree to pay $30,000, Respondent knew or should have known that Noel’s outstanding balance of fees and costs, less a credit for the $7500 payment made by Jane, amounted to less than $23,000; that under the terms of her fee agreement with Noel, Respondent was entitled to be paid only that amount plus an amount equal to her hourly rate times the number of hours she would expend in completing the case; and that the number of hours Respondent could reasonably expect to expend to complete the case would not bring the outstanding hourly fee to $30,000 or $40,000. 50. At no time before she secured Noel’s agreement to pay $30,000 in fees did Respondent explain to Noel how she calculated that her fees would exceed $40,000. She did not identify what amount she believed she had already earned, what payments she calculated as credits, or how many hours she expected to dedicate to the matter prior to its completion. She did not inform Noel that the $40,000 fee estimate she provided included interest, value-added bonuses, or any other amounts beyond the hourly fee due under the terms of their fee agreement. Respondent did not advise Noel that the fees she was quoting exceeded the amount he was required to pay under the hourly fee agreement, that he was entitled to insist that Respondent’s fees be calculated under the terms of that agreement, or that he should consider consulting independent counsel prior to agreeing to pay the amount Respondent requested. 51. On or about April 3, 2000, Noel Stoutenburg paid Respondent $30,000. 52. On April 9, 2000, Noel Stoutenburg mailed a letter to Respondent advising her that he had reviewed Respondent’s statements in detail, that he believed that there were numerous errors, and that he requested a complete accounting from Respondent. 53. On April 10, 2000, Respondent mailed a letter to Stoutenburg. Respondent did not specifically address Stoutenburg’s concerns set forth in his April 9, 2000 letter, nor did she include a detailed fee statement or accounting. 54. On April 21, 2000, August 14, 2000 and January 5, 2001, Noel Stoutenburg wrote to Respondent repeatedly requesting Respondent to provide him with an accounting to determine whether he overpaid Respondent’s fees. At no time did Respondent respond to Stoutenburg’s requests. 55. After this matter was referred to the Inquiry Panel, on July 15, 2002, Respondent refunded $9,559.00 to Stoutenberg. To date, Respondent has not provided Stoutenberg with a full accounting of her time expended in this matter. 56. By the conduct outlined above, Respondent has engaged in the following misconduct: WHEREFORE, the Administrator requests that this matter be assigned to a panel of the Hearing Board, that a hearing be held and that the panel make findings of fact, conclusions of fact and law and a recommendation for such discipline as is warranted.a. Overreaching the attorney-client relationship; Wendy J. MuchmanRespectfully submitted, Counsel for Administistrator One Prudential Plaza 130 East Randolph Drive, #1500 Chicago, Illinois 60601 Telephone: (312) 565-2600 Facsimile: (312) 565-2320 |