In Re Morton Allan Segall, Attorney
Supreme Court of Illinois, 1987.
117 Ill.2d 1, 509 N.E.2d 988, 109 Ill. Dec. 149.
Author: Judd Bean

Statement of Case:

* An action upon three counts involving the Administrator of the Attorney Registration and Disciplinary Commission against an attorney.

Count I: the attorney’s attempts to settle a lawsuit brought against him by the Carte Blanche Corp. violated certain sections of the Codes of Professional Responsibility.

Count II: the same claim but involving the Amoco Oil Company.

Count III: charged that the attorney’s repeated refusal to allow Amoco to take his deposition violated Rule 1-102(a)(5).

Facts:

Count I:

*An attorney owed Carte Blanche Corp. almost $13,000 in credit card charges.  The attorney was sued, and a default judgment was entered in favor of Carte Blanche, plus costs.

*The attorney moved to vacate the default judgment, claiming lack of notice.

*On Oct. 4, 1982, while the motion was pending, the attorney who was in Florida at the time, directed his secretary to send a $95.60 check and a letter in his name directly to Carte Blanche with the stipulation that if Carte Blanche cashed the check, a full and final release in settlement of all claims and causes would be assumed.

*On Nov. 22, 1982, the motion to vacate was denied.

*On Dec. 10, 1982, the attorney filed another motion to vacate, attaching copies of the letter and negotiated check by Carte Blanche.  The attorney claimed that the negotiated check evidenced a settlement of Carte Blanche’s claims.  The trial court found that there had been no accord and satisfaction, and dismissed the action.

*The attorney appealed, but the appellate court affirmed the trial court.

*On May 24, 1984, the attorney paid the judgment in full to Carte Blanche.

Count II:

*The attorney owed Amoco over $11,000 in credit card charges.  The attorney was sued

*On Oct. 4, 1982, while the motion was pending, the attorney who was in Florida at the time, directed his secretary to send a $48.76 check and a letter in his name directly to Amoco with the stipulation that if Amoco cashed the check, a full and final release in settlement of all claims and causes would be assumed.

*On Nov. 10, 1982, the attorney moved to vacate the default judgment, claiming that the negotiated check evidenced a settlement of Amoco’s claims.  The attorney also motioned to quash his own deposition, for which he failed to appear despite two court orders.

*On Dec. 16, 1982, the attorney’s motions were denied, and a judgment was entered for full costs to Amoco as a sanction against the attorney for his repeated refusal to be deposed.  The appellate court upheld this order.

*Three months later , the attorney paid the judgment in full.

Procedure:

The hearing board found no ethical violation with regard to Count III, but found against the attorney on Counts I and II.  The hearing board recommended that the attorney be censured.  The Review Board agreed w/ the hearing board’s findings but recommended a two year suspension.  The attorney filed exceptions.

Issue:

Whether an attorney should be sanctioned under the Attorney Code of Professional Ethics for violations which occurred while he was representing himself in his own litigations.

Holding:

The attorney is still in the position of an attorney when he is representing himself in his own litigations.  Therefore, he is still held under the Attorney Code of Professional Conduct when he is engaged in his own litigations.  While the attorney’s attempted fraud was not successful, an attempted deception is as serious an ethical violation as a successful one.  Together with his violation of contacting the other party w/out going through their attorney, was serious enough to warrant a substantial suspension.

Reasoning (Rules):

*Disciplinary Rule 7-104 states that an attorney may not communicate with the other client, unless he has the permission of that client’s attorney.

-The attorney admits that on both occasions, he knowingly contacted the other client w/out permission of the other attorney, but he argues that these contacts were made on his own behalf as a litigant and thus were not during the course of his representation of a client.

            -Court states that an attorney who is himself a party to the litigation represents himself when he contacts an opposing party.

            -A party, having employed counsel to act as an intermediary b/w himself and opposing counsel, does not lose the protection of the rule merely b/c opposing counsel is also a party to the litigation.

*Rule 1-102

(a)A lawyer shall not

(4)engage in conduct involving dishonestly, fraud, deceit, or misrepresentation; or

(5)engage in conduct that is prejudicial to the admin. of justice.

           -The Administrator argues that the attorney’s conduct was deceptive and was an attempt to defraud Carte

            Blanche and Amoco, in violation of Rule 1-102(a)(4).  The Administrator also argues that, by representing

            himself in each case that the suit had been settled, the attorney attempted fraud on the court, in violation

            of Rule 1-102(a)(5).

            -Administrator argues that the letters , together w/ the circumstances under which they were sent, amounted

            to an attempted fraud.

*The court has applied a broad definition of fraud, finding fraud whenever there is conduct “calculated to deceive”

*The attorney bypassed the other client’s attorney and sent each client a letter to make them believe that the minimal amount tendered was the amount actually due.  The letters did not state the actual amount due, and, in the Carte Blanche case, did not even mention that the dispute had been reduced to a judgment.  Violation of Rule 1-102(a)(4)

*Also, by filing motions to dismiss the suits due to the purported settlements, the attorney attempted to involve the courts in his fraudulent scheme.  Involving the courts in such a scheme must be considered prejudicial to the administration, and thus the attorney violated Rule 1-102(a)(5).

*no accord and satisfaction!

Disposition:

The attorney was suspended for two years