Immigration Attorney Avoids Disbarment for Commingling Funds – Bloomberg Law

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By Brian Flood
A Washington, D.C., immigration attorney will face suspension but not disbarment for misappropriating and commingling a client’s pre-paid flat fee, after the district’s top court on Thursday said his actions were merely negligent, not reckless or intentional.
The Office of Disciplinary Counsel charged Paul Haar with misappropriation and commingling in two separate cases involving two different clients, in violation of D.C. professional rules.
In 2000, the D.C. Bar began requiring that “advances of unearned fees…shall be treated as property of the client,” requiring that such property be kept separate from the lawyer’s property in a trust account “until earned…unless the client gives informed consent to a different arrangement.” In 2009’s In re Mance, the D.C. Court of Appeals said that the rule wasn’t clear on its face as to whether it applied to flat fees, but held that it does because they consist of “money paid up-front for legal services that are yet to be performed.”
The Hearing Committee concluded that Haar recklessly, or even intentionally, disregarded the rule by not moving his clients fees into trust in two cases. It recommended disbarment.
But the Board of Professional Responsibility concluded that there wasn’t misconduct in the first case, where Haar failed to move into trust a partially unearned flat fee he’d received before Mance was decided. The board also concluded that he only acted negligently in the second case, where he failed to deposit or later move into trust a partially unearned flat fee he received after Mance. It recommended a seven-month suspension.
The D.C. Court of Appeals affirmed the lighter sanction.
For the earlier case, Harr “should not be sanctioned for failing to take affirmative steps to place previously received flat fees in trust, when it was quite unclear from In re Mance that he was required to take such steps,” the court said. The court in Mance “expressly stated that that holding was only ‘prospective,’” at least suggesting that flat fees which had already been received at the time “were grandparented,” the court said.
By his own admission Haar didn’t keep up to date on the changes to the rule or the court’s interpretation of it. “Haar’s inattention to continuing legal education is lamentable” but doesn’t rise above the level of negligence in the second case, the court said.
The opinion was written by Judge Catharine F. Easterly and joined by Judges Roy W. McLeese and Vanessa Ruiz.
Schumack Law Firm represents Haar.
The case is In re Haar, D.C., No. 19-BG-0554, 2/24/22.
To contact the reporter on this story: Brian Flood in Washington at bflood@bloomberglaw.com
To contact the editors responsible for this story: Rob Tricchinelli at rtricchinelli@bloomberglaw.com; Nicholas Datlowe at ndatlowe@bloomberglaw.com
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