THE NORTH CAROLINA STATE BAR

WINTER JOURNAL2012

IN THIS ISSUE Is Justice Being Priced Out of the Common Man’s Reach? page 8 Damages in Case of Negligently Killed Pet Dog page 14 An Interview with New President M. Keith Kapp page 28

THE NORTH CAROLINA STATE BAR JOURNAL

Winter 2012 FEATURES Volume 17, Number 4 8Is Justice Being Priced Out Editor of the Common Man’s Reach? Jennifer R. Duncan By Christopher R. Clifton

Publications Committee 10 Their Other Brother—Why Have We Margaret J. McCreary, Chair John E. Gehring, Vice-Chair Forgotten Samuel Phillips? Marcia Armstrong By Donna LeFebvre Dorothy Bernholz Lauren Collins 14Recovery of “Intrinsic Value” Harry B. Crow Margaret H. Dickson Damages in Case of Negligently Rebecca Eggers-Gryder Forrest A. Ferrell Killed Pet Dog Douglas R. Gill By Calley Gerber and William Reppy Jr. James W. Hall Anna Hamrick 18 Professionalism - The Loss of Civility Charles R. Hardee George L. Jenkins Jr. in the Legal Community Darrin D. Jordan By Clifton W. Everett Jr. Robert Montgomery Nancy Black Norelli 24State Taxation of the Pro Hac Carlyn G. Poole Harold G. Pope Vice Lawyer Barbara B. Weyher By Jerry Meek G. Gray Wilson Alan D. Woodlief Jr. 26Meet the Federal Judges—Judge

© Copyright 2012 by the North Carolina State Bar. All Robert J. Conrad Jr. rights reserved. Periodicals postage paid at Raleigh, NC, By Michelle Rippon and additional offices. Opinions expressed by contributors are not necessarily those of the North Carolina State Bar. 28An Interview with New President POSTMASTER: Send address changes to the North Carolina State Bar, PO Box 25908, Raleigh, NC 27611. M. Keith Kapp The North Carolina Bar Journal invites the submission of unsolicited, original articles, essays, and book reviews. 32 The Ring Submissions may be made by mail or e-mail (ncbar@bell- By Terry Orndorff south.net) to the editor. Publishing and editorial decisions 2012 Fiction Writing Competition are based on the Publications Committee’s and the editor’s Second Prize Winner judgment of the quality of the writing, the timeliness of the article, and the potential interest to the readers of the Journal. The Journal reserves the right to edit all manu- Update Membership Information: Members who need to update their membership scripts. information must do so by contacting the Membership Department via one of the four following methods: (1) log on to the Member Access section of the State Bar’s website www.ncbar.gov (www.ncbar.gov); (2) mail changes to: NC State Bar, Membership Dept., PO Box 26088, Raleigh, NC 27611-5908; (3) call (919) 828-4620; or (4) send an e-mail to PRINTED ON RECYCLED PAPER [email protected]. In deciding what address to list with the State Bar, be advised that this address will be used for all official correspondence from the State Bar and that membership information is a public record pursuant to the NC Public Records Act.

THE NORTH CAROLINA STATE BAR JOURNAL 3 Officers Tim Batchelor, Investigator M. Keith Kapp, Raleigh - President 2012-2013 Kelly Beck, Compliance Coordinator, Membership/CLE Ronald G. Baker Sr., Ahoskie - President-Elect 2012-2013 Krista Bennett, Fee Dispute Facilitator, ACAP Ronald L. Gibson, Charlotte - Vice-President 2012-2013 Michael D. Blan, Systems Analyst/Programmer L. Thomas Lunsford II, Raleigh - Secretary-Treasurer Peter Bolac, District Bar Liaison/Trust Account James R. Fox, Winston-Salem - Past-President 2012-2013 Compliance Counsel Elizabeth E. Bolton, Receptionist Eddie Capel, Investigator Councilors DEPARTMENTS Becky B. Carroll, Paralegal By Judicial District Margaret Cloutier, Senior Deputy Counsel 1: Donald C. Prentiss, Elizabeth City Joseph J. Commisso, Director of Investigations 2: G. Thomas Davis Jr., Swan Quarter Luella C. Crane, Director of ACAP 6 State Bar Outlook 3A: Charles R. Hardee, Greenville Bruno E. DeMolli, Staff Auditor & Investigator 36 Profile in Specialization 3B: Debra L. Massie, Beaufort Sharon Denton, Events Manager 4: Robert W. Detwiler, Jacksonville Jennifer R. Duncan, Director of Communications 38 Lawyer Assistance Program 5: Harold L. Pollock, Burgaw A. Root Edmonson, Deputy Counsel 6A: Gilbert W. Chichester, Roanoke Rapids Kelly Farrow, Asst. Dir., Paralegal Certification 40 IOLTA Update 6B: Lloyd C. Smith Jr., Windsor Martha Fletcher, Admin. Asst., Administration 7: Randall B. Pridgen, Rocky Mount Towanda Garner, Piedmont LAP Coordinator 42 The Disciplinary Department 8: George L. Jenkins Jr., Kinston Lanice Heidbrink, Exec. Asst., Administration 9: Julius E. Banzet III, Warrenton 43 Tracey Henry, CLE Clerk Paralegal Certification 9A: R. Lee Farmer, Yanceyville Jeffery Hill, Computer Systems Administrator 44 Legal Ethics 10: Nicholas J. Dombalis II, Raleigh Leanor Hodge, Deputy Counsel John N. (Nick) Fountain, Raleigh Joshua Hoffman, Admin. Asst., Office of Counsel 45 Featured Artist David W. Long, Raleigh Debra P. Holland, Asst. Director, CLE Carlyn G. Poole, Raleigh Buffy Holt, Admin. Asst., LAP 46 Proposed Ethics Opinions Donna R. Rascoe, Raleigh Tammy Jackson, Membership Director Sally H. Scherer, Raleigh Katherine Jean, Counsel and Assistant Executive Dir. 59 Rule Amendments John M. Silverstein, Raleigh David R. Johnson, Deputy Counsel Cynthia L. Wittmer, Raleigh Barbara Kerr, Archivist 11A: Donald E. Harrop Jr., Dunn Cathy D. Killian, Clinical Case Manager, LAP BAR UPDATES 11B: Marcia H. Armstrong, Smithfield Melanie Kincaid, Paralegal 12: Lonnie M. Player Jr., Fayetteville Erica Leventhall, Grant Data Asst., IOLTA 13: Harold G. Pope, Whiteville Suzanne Lever, Asst. Ethics Counsel 14: John A. Bowman, Durham 63 Joyce L. Lindsay, Exec. Asst., Administration State Bar Swears in New Officers Margaret J. McCreary, Durham L. Thomas Lunsford II, Executive Director 64 Resolution of Appreciation 15A: Steven H. Messick, Burlington Adam Maner, Professional Organization Coordinator 15B: Dorothy Bernholz, Chapel Hill Beth McIntire, IT Manager 65 Fifty-Year Lawyers Honored 16A: William R. Purcell II, Laurinburg Jessica M. McKeever, Paralegal 16B: C. Christopher Smith, Lumberton Beth McLamb, Payment Coordinator, Membership 66 Client Security Fund 17A: Joseph G. Maddrey, Eden Nichole P. McLaughlin, Deputy Counsel 17B: John E. Gehring, Walnut Cove Barry S. McNeill, Deputy Counsel 67 Law School Briefs 18: Barbara R. Christy, Greensboro Diane Melching, Admin. Asst., ACAP Robert C. Cone, Greensboro 69 2013 Appointments to Boards Sandra R. Melvin, Office Manager 18H: Richard S. Towers, High Point Dottie K. Miani, Facilities Manager/Deputy Clerk of DHC and Commissions 19A: James D. Foster, Concord Claire U. Mills, Accounts Manager, IOLTA 19B: W. Edward Bunch, Asheboro Alice Neece Mine, Asst. Executive Dir., Dir. of CLE, 69 Distinguished Service Award 19C: Darrin D. Jordan, Salisbury Specialization, & Paralegal Certification 19D: Douglas R. Gill, Southern Pines Robynn E. Moraites, LAP Director 70 Annual Reports of State Bar Boards 20A: Frederick D. Poisson Jr., Wadesboro George Muench, Investigator 20B: Harry B. Crow Jr., Monroe Denise Mullen, Asst. Director of Specialization 74 In Memoriam 21: Michael L Robinson, Winston-Salem Pat Murphy, Deputy Counsel G. Gray Wilson, Winston-Salem Loriann Nicolicchia, Accreditation Coordinator, CLE 22: Kimberly S. Taylor, Taylorsville Emily Oakes, Attendance Compliance Coordinator, CLE 22B: Roger S. Tripp, Lexington Brian Oten, Deputy Counsel 23: Vacant Lisanne Palacios, Accounting Manager 24: Rebecca Eggers-Gryder, Boone Heather Pattle, Administrator, Office of Counsel 25: Forrest A. Ferrell, Hickory C. Fred Patton Jr., Investigator 26: David N. Allen, Charlotte Wondella Payne, Paralegal Robert J. Bernhardt, Charlotte Scott Perry, AP Investigator F. Fincher Jarrell, Charlotte Aaliyah Pierce, Acct. Data Asst., IOLTA Mark W. Merritt, Charlotte Angel Pitts, Mail/Copy Accounting Clerk Nancy Black Norelli, Charlotte Jennifer Porter, Deputy Counsel The North Carolina State Bar Journal (ISSN 27A: Sonya Campbell McGraw, Gastonia Evelyn Pursley, Executive Dir., IOLTA 27B: Ralph W. Meekins, Lincolnton 10928626) is published four times per year in Sonja B. Puryear, Admin. Asst., Investigations 28: Howard L. Gum, Asheville Lori Reams, Admin. Asst., Office of Counsel March, June, September, and December under 29A: Marvin R. Sparrow, Rutherfordton Joan Renken, Admin. Asst., LAP 29B: Margaret M. Hunt, Brevard the direction and supervision of the council of Randall C. Ross, Investigator 30: W. David Sumpter III, Murphy Whit Ruark, Investigator the North Carolina State Bar, 208 Fayetteville Sandra L. Saxton, Public Liaison, ACAP Street, Raleigh, NC 27601. Member rate of Public Members Sonya Sells, Paralegal Fern Gunn Simeon, Deputy Counsel $6.00 per year is included in dues. Nonmember Margaret H. Dickson, Fayetteville Jaya Singh, Accounting Asst. rates $10.78 per year. Single copies $3.21. The Paul L. Fulton, Winston-Salem Jennifer Slattery, Paralegal James W. Hall, Ahoskie Lawyer’s Handbook $10.78. Advertising rates Judith Treadwell, Public Liaison, ACAP Edmund F. Ward, Asst. Director, LAP available upon request. Direct inquiries to Staff A. Dawn Whaley, Admin. Asst., Investigations Edward R. White, Investigator Director of Communications, the North Roger Allen, Investigator Mary D. Winstead, Deputy Counsel Carmen H. Bannon, Deputy Counsel Carolina State Bar, PO Box 25908, Raleigh, Christiane Woods, Admin Asst., Investigations Betsy C. Barham, Receptionist North Carolina 27611, tel. (919) 828-4620.

4 WINTER 2012 We want your fiction! Tenth Annual Fiction Writing Competition

The Publications Committee of the Journal is pleased to warrants that all persons and events contained in the article are ficti- announce the Tenth Annual Fiction Writing Competition. tious, that any similarity to actual persons or events is purely coinciden- tal, and that the article has not been previously published. Rules for Fiction Writing Competition 4. Articles should not be more than 5,000 words in length and should be submitted in an electronic format as either a text document The following rules will govern the writing competition spon- or a Microsoft Word document. sored by the Publications Committee of the Journal: 5. Articles will be judged without knowledge of the identity of the author’s name. Each submission should include the author’s State Bar 1. The competition is open to any member in good standing of or certified paralegal ID number, placed only on a separate cover the North Carolina State Bar, except current members of the sheet along with the name of the story. Publications Committee, as well as North Carolina State Bar 6. All submissions must be received in proper form prior to the Certified Paralegals. Authors may collaborate, but only one submis- close of business on May 31, 2013. Submissions received after that sion from each member will be considered. date and time will not be considered. Please direct all questions and 2. Subject to the following criteria, the story may be on any fictional submissions to: Fiction Writing Competition, Jennifer Duncan, topic and may be in any form—the subject matter need not be law relat- 6568 Towles Rd., Wilmington, NC, 28409, [email protected]. ed). Among the criteria the committee will consider in judging the arti- 7. Depending on the number of submissions, the Publications cles submitted are: quality of writing; creativity; extent to which the arti- Committee may elect to solicit outside assistance in reviewing the cle comports with the established reputation of the Journal; and adher- articles. The final decision, however, will be made by majority vote of ence to specified limitations on length and other competition require- the committee. Contestants will be advised of the results of the com- ments. The committee will not consider any article that, in the sole judg- petition. Honorable mentions may be announced. ment of the committee, contains matter that is libelous or violates 8. The winning article, if any, will be published. The committee accepted community standards of good taste and decency. reserves the right to edit articles and to select no winner and to pub- 3. All articles submitted to the competition become property of the lish no article from among those submitted if the submissions are North Carolina State Bar and, by submitting the article, the author deemed by the committee not to be of notable quality. STATE BAR OUTLOOK

Say it Ain’t So, Bruno!

B Y L. THOMAS L UNSFORD II

Bruno DeMolli has given his notice. He will lawyers strained to hear the answer. “Why the random audit program post-DeMolli in be retiring at the end of the year. If you’re not yes, I do,” Bobby responded. “I had lunch much the same vein as heretofore. Tim practicing in District 2 or 6B—the districts with him just yesterday.” Immensely grati- Batchelor, a financial investigator with the which have been selected for random audit this fied by that answer, the lawyer roughly Office of Counsel for the past ten years, has quarter—you are likely to miss seeing him embraced Bobby. “Hey everybody,” he been persuaded—somewhat reluctantly—to again in his official capacity as the State Bar’s shouted, “he knows Bruno!” and ordered a step into Bruno’s expensive Italian loafers. auditor. Back in 2000, when Bruno was still in round for the house. We simply made him an offer that he his 70s, we suspected that he might soon be call- Bruno DeMolli is a celebrity—the only couldn’t refuse. He will hit the road in ing it quits. I referenced that possibility in an celebrity in the history of the State Bar. Like January. Although the name “Tim” by itself essay about the regulation of Sting, Madonna, and the is rather ominous and has evoked mild dis- trust accounting I wrote for the members of the Brazilian tress among some lawyers in our focus Journal in the fall of that year National Soccer team, he is groups, we have decided that, for the time entitled, “If You Knew Bruno known universally by a sin- being, Mr. Batchelor should continue using Like I Know Bruno.” Perhaps gle, wonderfully evocative both of his names professionally. some of you will remember it. name: “Bruno.” The usages Of course, the random audit program— In any event, the report of his are familiar to virtually every- though highly visible and important—is imminent retirement was one with a law license. only one component of the State Bar’s regu- wildly premature. He has in “Bruno’s coming!” “Bruno latory scheme regarding the handling of trust fact soldiered on at maximum was here.” “Bruno’s in town.” funds. There are several others. Most signifi- efficiency and effectiveness for “I think we can do it, but cant are the trust account rules themselves, as more than a decade since I we’d better ask Bruno.” In his set forth in Rule 1.15 of the Rules of foreshadowed his separation role as the State Bar’s auditor, Professional Conduct. These provisions gov- from our staff. However, since Bruno DeMolli has become ern how trust funds are to be held, where much of the information and virtually all of the a modern-day Kilroy. He is everywhere, they are to be deposited, how they are to be sentiment contained in my essay have continu- monitoring compliance with the trust handled, and what records are to be main- ing validity and relevance, I thought it might be account rules in, it seems, a thousand places tained. The specificity of these rules, along appropriate to dust it off and publish it again. at once, covering the state like a spectral with the considerable emphasis they have So I have, and here it is, with just a bit of refur- Italian blanket. Indeed, lawyers have, on received in CLE programs over the last quar- bishing. occasion, reported seeing his towering figure ter century, has just about eliminated igno- and great white hair in law offices 400 miles rance as a credible excuse. There are also pro- Not long after Bobby White accepted a apart on the same afternoon. But for all this visions that are designed to alert the State Bar position on our staff as director of the Client ubiquity, his presence is abiding and benefi- to possible irregularities. Chief among these Assistance Program, he attended a meeting cent wherever he happens to be. Simply by is Rule 1.15-2(k), which requires lawyers to of the bar in the district where he resided. showing up, he personifies and dignifies the direct their banks to notify the State Bar Because he had worked in academia prior to State Bar, and raises the standard of fiduciary whenever an instrument is presented against joining the State Bar staff and had not been practice. We suppose that the very idea of insufficient funds. Since it is a rare case of engaged in the actual practice of law, he was Bruno has dissuaded some lawyers from embezzlement that does not at some point relatively unknown in the local legal commu- stealing from their clients. involve the issuance of a bad check, the pro- nity. On the evening in question he was For the past 27 years Bruno has been in vision has quite frequently led to the discov- introduced to the group as a member of the the forefront of the State Bar’s effort to ery of misappropriation. There is also a very State Bar’s legal staff and then largely ensure that North Carolina’s lawyers are han- specific provision requiring lawyers to report ignored. But as the gathering was breaking dling funds entrusted to them in a profes- situations in which trust funds have been up, one of the local lawyers noticed him at a sionally responsible manner. He has per- withdrawn without authority. This provi- table by himself and fired a conversational formed heroically and has succeeded, we sion—Rule 1.15-2(o)—makes it clear that a shot in the dark. He asked the simple ques- suppose, to a very large extent. But we know lawyer, having discovered the defalcation of a tion, “Do you know Bruno?” Instantly the there is still much work to be done. For that partner, associate, nonlawyer employee, or entire room fell silent as the remaining reason, the council has chosen to continue fellow member of the bar, has an absolute

6 WINTER 2012 duty to bring that matter to the attention of When the auditor arrives he reviews the program was designed to serve several pur- the State Bar, even if the information is trust account records and performs what is poses. First and foremost, it is an educational arguably confidential. Unfortunately, there is known as a “limited procedural audit” to ver- initiative. It was intended to raise the stan- no good way of finding out to what extent ify compliance with the trust account rules. dard of trust accounting practice in North such discoveries are, in the context of law He is particularly interested in determining Carolina by inducing self-study, motivating firms, being disclosed in accordance with the whether the minimum recordkeeping voluntary compliance, and providing rule. The State Bar also receives on a fairly requirements set forth in Rule 1.15-3 have authoritative feedback. I believe that the pro- regular basis copies of orders requiring lawyer been satisfied. The entire onsite procedure gram has been quite successful in this regard. fiduciaries to show cause why they have usually takes less than half a day. The results When Bruno DeMolli is known to be visit- failed to file timely accountings. Such reports of the audit are subsequently reported to ing a particular district, there is usually a have occasionally led to discoveries of defal- Peter Bolac, the State Bar’s trust account marked increase in fiduciary consciousness cation. compliance counsel (the counsel). If no defi- and in requests for copies of the State Bar’s The State Bar’s rules also provide for the ciencies were noted, or if observed deficien- Lawyer’s Handbook. Accounts that have not issuance of investigative subpoenas in those cies are de minimis, there is no follow-up and been reconciled in months are brought cur- cases where the chairperson of the Grievance the subject attorney is then exempt from ran- rent. Efforts are made to determine the ben- Committee finds reasonable cause to believe dom audit for the next three years. If minor eficial owner(s) of the small “mystery” bal- that trust funds have been or are being mis- deficiencies were noted, the counsel will gen- ance that has been carried for several years handled. “Cause audits” performed pursuant erally communicate with the subject attorney without attribution. And resolutions are to such authority occupy most of the time of and attempt to confirm informally that the made never again to let the trust account get five of the State Bar’s 11 investigators. necessary remediation has occurred or is out of whack. This kind of activity “in con- Although these audits are vital to the proof or occurring. If so, that will generally conclude templation of” audit is quite salutary in that disproof of suspected irregularities, including the matter. If substantial deficiencies were it fosters the kind of care and precision that misappropriation, they can occur only after noted, the matter is referred to the Grievance the handling of other people’s money some specific circumstance constituting “rea- Committee and a disciplinary file is opened. requires. The resulting improvements greatly sonable cause” comes to the attention of the If observed deficiencies are serious but not lessen the likelihood that trust funds will be Bar. They are not available on any other patently indicative of dishonesty, client inadvertently mishandled and compromised. basis. The State Bar cannot employ this pow- harm, chronic inattention, or reckless indif- These benefits are usually compounded for erful tool to verify hunches or to monitor the ference, the Grievance Committee may offer those lawyers who actually receive a visit trust accounting practices of lawyers who are the subject attorney the opportunity to par- from our auditor. As those who have had the merely suspected of being dishonest. ticipate in the relatively new Trust Account experience almost universally attest, Bruno is By far the most visible of the State Bar’s Compliance Program (TACP) as a possible a tremendous source of information and efforts to improve trust accounting practice alternative to the imposition of professional advice, and he can generally be counted and deter malfeasance is the random audit discipline. This entails a consensual contrac- upon to assist lawyers and their bookkeepers program. It was to implement this program, tual undertaking by means of which the par- in improving their procedures. which became operational in 1985, that ticipating attorney, on a confidential basis, Unfortunately, improved procedures can’t Bruno DeMolli was employed. During the must agree for a period not to exceed two prevent stealing. It does appear likely, howev- 27 years since he was hired, little about the years to cure all deficiencies and to allow the er, that the random audit program is fairly program has changed. Each quarter two counsel to monitor his or her trust account effective as a deterrent. Certainly, that was judicial districts are randomly selected from and to review all pertinent records and trans- the hope of those who founded the program among the total of 44. Sixty lawyers are then actions involving entrusted funds. Successful and is the reason many State Bar leaders con- selected randomly from the two districts, the completion of the contract will be considered tinue to support it. Of course, it is very diffi- number selected from each being roughly a significant mitigating factor in the cult to establish what may have prevented a proportional to the size of the lawyer popu- Grievance Committee’s determination as to tempted lawyer from stealing. But it does lations of the respective districts. After whether discipline should be imposed seem fair to suppose that the same “concern” culling those lawyers who are not in private regarding the deficiencies that were originally that compels the honest lawyer to go to great practice or who do not maintain, use, or observed. If the subject attorney chooses not lengths to prepare for an audit might also fig- have access to trust accounts, appointments to participate, or fails to fulfill the contract, ure in a dishonest lawyer’s decision to resist are made by telephone several days in the matter will be referred back to the temptation. advance and subpoenas are issued. Since the Grievance Committee for investigation, pro- Another purpose served by the random auditor is obliged to inspect every trust cessing, and possible imposition of disci- audit program is theft detection. Experience account to which the chosen lawyer has pline. In cases where the apparent deficien- has shown that the embezzling lawyer, access, and most firms maintain common cies are significant and diversion into the though often quite clever in the practice of trust accounts, he is often, in actuality, TACP is not deemed appropriate, the matter her profession, is generally a mediocre crook. reviewing the trust accounting practices of will be referred directly to the Grievance This is perhaps because most thefts are initial- all members of the firm. This effectively Committee for investigation, processing, and ly rationalized as “borrowings.” The typical multiplies the number of lawyers being possible imposition of discipline. “audited” many fold. It should be noted that the random audit CONTINUED ON PAGE 37

THE NORTH CAROLINA STATE BAR JOURNAL 7 Is Justice Being Priced Out of the Common Man’s Reach?

B Y C HRISTOPHER R. CLIFTON

“Upon a plea of guilty there is a everyone in North Carolina in one way or verdict of guilty. It’s the judgment another. Gas prices have skyrocketed, home values of this court that you pay all fees, have plummeted, the prices of common goods fines, and costs of court associated has risen while employers and businesses cut back on with your traffic ticket, sir.” raises or lay off employees altogether. However, “How much is that, judge?” another devastating impact of the recession is “The clerk tells me it’s $463.” in the average person’s access to the courts. Due “For a speeding ticket?” to the lack of revenue required to balance the nyone who spends budget, the General enough time in traffic Assembly has increased courts in this state will costs associated with the tell you that this dia- court system, and in some logue between defen- cases has fashioned entire- dant and judge is ly new fees for things that occurring all too often. For decades, citizens had always been free. wereA able to handle de minimus offenses such Situations that many indi- as speeding or other traffic infractions by viduals find themselves in pleading guilty to a reduced charge and at some point during their incurring slight court costs and fines. lives—such as filing for Likewise, the fees and costs of court related to divorce, paying off a civil matters such as filing for simple divorces, speeding ticket, or bring- Bruno Budrovic/Illustration Source small claims, or estates were often just ing a small claim in civil enough to generate some revenue without court—carry the added acting as a deterrent to filing said actions. difficulty of having to balance the need for police officer, feeling the pressure to increase Unfortunately, in the current economic envi- these actions with the potential cost that will the amount of tickets written, issues the cita- ronment, the General Assembly has become be incurred bringing them. tion for this relatively minor speeding more inventive by both fashioning new fees The rise in court costs has been felt most offense. In an attempt to save money, our cit- and fines, and by raising existing ones in keenly by the average citizen who is cited izen decides to handle the ticket himself order to hedge a shortfall in the budget. with a speeding ticket or other minor traffic instead of hiring an attorney. Our wayward These constant increases raise the question: Is infraction. Consider the following scenario: defendant fails to understand the difference the concept of equal justice for all citizens The average citizen is pulled over for driving between an infraction court where atten- being unduly tested in the age of increased ten miles per hour over the speed limit. dance is not mandatory and traffic court fines and court costs? Though this citizen has a flawless record and where attendance is required. Our citizen is The current recession has affected most has never before been issued a ticket, the surprised when he receives a letter from the

8 WINTER 2012 clerk of court notifying him that he missed any other costs and fees in the case. The same the court date that the officer set for him. failure to appear now carries a $200 fine in Our hapless man runs to the court house and addition to any of the usual costs, fines, and convinces an assistant district attorney to fees associated with a traffic ticket or other reset his court date for the following day. criminal offense. Encouraged and renewed in his belief that While there are mechanisms in place that everything will work out, our citizen appears allow for a judge to mitigate the severity of in court before the judge and assistant district the costs involved with criminal offenses, the attorney and requests a reduction in his average citizen is usually either unaware that speeding ticket due to his exemplary record. they exist or does not know how to request The ADA reduces the speeding ticket to an that the judge apply them to the case. For as improper equipment infraction and explains long as people have been charged with that this carries no driver’s license or insur- crimes, there have been attorneys to aid them ance points. Ecstatic to realize he’s been given in the navigation of the court system. Yet, a break, our citizen pleads responsible to the many are handling these traffic offenses Paralegal Program reduced charge only to find out that he owes themselves due to the failure to afford both You might think all paralegal programs approximately $463 in court costs, fines, and attorney fees and court costs. However, the have been approved by the ABA. fees, and must pay that balance in cash. citizen in traffic court isn’t the only person in They haven’t. Unable to pay the full amount that day, he the court house feeling the effects of the cost Meredith’s Paralegal Program has been requests one extra day to pay the money. The increases. approved by the American Bar Association since 1983. court acquiesces to this request, but due to Civil court costs, though not as excessive changes in the law, this delay in paying carries as criminal, have also increased 50% or high- You might think all paralegal programs an additional $20 fee. er over the past year. Prior to July 2011 the have a selective admissions policy. They don’t. Though many will consider this example cost for bringing an action in civil district to be the exception, anyone who works in the court was approximately $100. Since passage At Meredith, every student has a bachelor’s degree and admission is competitive. court system knows that this is becoming the of the new budget in 2011, the costs associ- norm in traffic courts around this state. ated with filing a civil action have increased You might think all paralegal programs While several small increases in costs of court to $150. Since the filing for an absolute are the same. They’re not. and fines were to be expected, the astronom- divorce (currently at $75) necessarily includes Our instructors are experienced attorneys ical rise in such costs caught most by surprise. the cost of filing a lawsuit, a client can now and paralegals who teach the practical skills you need to know in just two In 2010 the General Assembly increased the expect to pay approximately $225 for an semesters of evening classes. cost for criminal offenses in district court absolute divorce, close to 35-40% more than from $120 to $126. In July 2011 the they would have paid a couple of years ago. Design a new future for yourself— Assembly increased the cost of court again The General Assembly increased the fee from today. meredith.edu/legal from $126 to $155. A month later in August $15 to $30 for each item of civil process The Meredith College Paralegal Program admits qualified 2011, new fees, fines, and court costs were served by the sheriff. Another new fee estab- students without regard to race, creed, sexual orientation, national implemented that increased court costs from lished by the legislature is the $150 fee to file or ethnic origin, gender, age or disability. $155 to $188 for district court infractions. a counterclaim. Formerly there was no cost 12-142 The Administrative Office of the Courts associated with this action. North Carolina breaks down the $188 as follows: $129.50 now charges a $20 fee to file most any to hedge the shortages. As long as the court for general court of justice fee, $12 facility motion in civil court, including motions to system generates a large portion of the gen- fee, $4 telephone fee, $7.50 law enforcement dismiss and motions for default judgment. eral revenue for the state, the average citizen retirement fee, $2 law enforcement training You even get to pay $20 to ask for an exten- should expect to bear the burden of the fiscal fee, $18 misdemeanant confinement fee, $5 sion of time to file answers, etc. All these fees deficits in Raleigh regardless of the economic service fee, and a $10 fee for a Chapter 20 and extra costs trickle down to the client or impact it has on said citizen. The sad irony offense. In addition to the over 50% increase the pro-se litigant. The relatively simple of the whole situation is that though the in mandatory court costs, the General action of filing for divorce or a small claim court system has brought in more money Assembly also created a new improper equip- includes costs never imagined several years than ever for the state, the funding for the ment fee. Beginning August 2011 a reduc- back. Judicial Department was cut by over $4 mil- tion of any speeding ticket or other infraction While many were aware that our state’s lion with the latest budget bill. How’s that to improper equipment carries a mandatory budgetary problems would likely result in for gratitude. n $50 fine in addition to the regular speeding increases in criminal and civil court costs, fine and costs of court. In addition to the cost few expected the changes to be as drastic as Christopher R. Clifton practices with the of court increases, the General Assembly also they have been. With further budget short- firm of Grace, Tisdale & Clifton, PA. He is a raised the failure to appear fine by 100%. falls on the horizon, it is a safe bet that the Board Certified Specialist in state and federal Prior to August 2011 if a citizen failed to General Assembly will again look to the criminal defense, and concentrates his practice appear in court, a $100 fine would attach to court system to generate the revenue needed on serious felonies in state and federal courts.

THE NORTH CAROLINA STATE BAR JOURNAL 9 Their Other Brother—Why Have We Forgotten Samuel Phillips?

B Y D ONNA L E F EBVRE

amuel Field Phillips might

be the most extraordinary

Chapel Hill lawyer and civil

rights champion you’ve never heard of. HisS sister, the bell ringer, sure. His brother, CEO of the university for a couple of years, yes. Maybe even his father, a bigamist who deserted the British military, fled the country, and reinvented himself before settling into the Carolina faculty.

Sam, class of 1841, argued the most about 15 years famous US Supreme Court civil rights cases ago did I actually of the 19th century as solicitor general under look closely at Samuel Field Phillips - photo from the North Carolina Collection Ulysses Grant. He represented Homer Plessy the line that Photographic Archives. in the landmark Plessy v. Ferguson and argued immediately pre- passionately in his legal brief against the “sep- cedes any court’s opinion, the line that iden- was Phillips, a member of the very promi- arate but equal” doctrine of racial segrega- tifies the lawyers: It reads “A.W. Tourgee and nent 19th-century Chapel Hill family. tion. S.F. Phillips, for plaintiff in error.” My interest was piqued: How did Sam Now you’re starting to get it. In the racial- I was astonished: I realized these lawyers Phillips end up being the lawyer for an ly charged politics of the Reconstruction Era, were in fact North Carolinians. Albion African-American man from New Orleans, Sam Phillips wasn’t “one of us.” Tourgee was the controversial “carpetbagger” arguing against segregation—insisting that As a lawyer and teacher of law-related lawyer, journalist, best-selling novelist, and Louisiana, not Homer Plessy, was a law- courses to undergrads at UNC, I’d read the judge who helped re-write the NC breaker? And why, as a lawyer, a graduate of Plessy case dozens of times, but not until Constitution after the Civil War. And “S.F.” the UNC law school, and a North

10 WINTER 2012 Carolinian, did I know nothing about him the informal education his father had Julia Phillips apparently was not as enthu- Samuel Phillips? given him. He jettisoned everything, includ- siastic about Chapel Hill as her husband. She Cornelia Phillips Spencer’s name adorns ing his name. was, after all, living in a southern backwater, the first women’s dorm. Brother Charles When James Postlethwaite walked off a world apart from New York and New (class of 1841) and their father James, along that ship in New York City in 1818, he was Jersey. Julia spent a lot of time during her with Charles’ son William Battle Phillips James Phillips, with no accompanying fami- marriage back north and was away in March (1877, 1883 PhD), are on the plaque at ly. The “new” James also had a university 1867 when James, 75, died in Person Hall. A Phillips Hall. Sam, whose law office was in degree and was a scholar and gentleman, student found him there, shortly before the the charming little stucco house at the corner ready to open an academy for boys in the beginning of geometry class. Julia was not of Franklin and Raleigh streets, is rather con- promised land. On his military record back eager to come back to Chapel Hill even for spicuously missing from bronze or granite, in Plymouth, next to his name was written her husband’s funeral, and Cornelia had to though he was given an honorary degree in the word “run,” which means he was a persuade her mother to return. 1879. deserter. Perhaps only in America could a James remained a well-respected member He was on the unpopular side of the young Englishman; a laborer with no money of the UNC faculty and the Chapel Hill events of his homeland’s most turbulent or formal education; a military and family community. No one knew the true story of times. deserter, shed his class and life so thoroughly. his past until the middle of the 20th century, Perhaps it is time for a new appraisal of James transformed himself into the man he when some Phillips family descendants Sam’s legacy. obviously thought he deserved to be. decided to take a trip to England to visit In 1821 he married Julia Vermuele, churches in St. Gomonda and Nevendon, A Man Named Postlethwaite whose Dutch-American family in New near London, where James’ father, Richard, Phillips was a Whig legislator in the Jersey was well off. James was now a also had been vicar. 1850s and held state political offices in the bigamist. He did, indeed, start a private One can only imagine their surprised early 1860s. In 1864, he was re-elected to the school for boys in Harlem, and he began confusion when they saw no record at the NC General Assembly, and he served as publishing articles on mathematics. In 1825 churches for a Reverend Richard Phillips. Speaker of the House in 1866. But at the end a prominent mathematician recommended For the years that Richard Phillips was sup- of the Civil War, he broke from his friends, him for a position at a small university in the posed to be the vicar, the name of Richard family, and longtime political cronies when South: The University of North Carolina was Postlethwaite was inscribed on the church he publicly advocated immediate reunion of looking for someone to be professor and walls. (I visited these churches a few years the South with the North. It was political chair of its math and natural philosophy ago, as well as the vicarage in St. Gomonda, and social suicide. department. James was offered the post, and and verified this information.) Years before Phillips’ political and moral he accepted. After that family visit to England, James’ metamorphosis, his father, James, underwent Thus, through a complicated deceit, he story about his past began unraveling, and an equally remarkable transformation. finally had achieved position and status. At the truth about his identity, education, and In 1818, James Postlethwaite—a 26-year- the time, UNC was made up of a handful of desertions of wife, children, and the military old mathematically gifted Englishman with professors, a rowdy bunch of male students, came out. no prospects or money, son of a poor vicar at four or five buildings, and a lot of mud. St. Gomonda-of-the-Rock in Roche, James transported his family to the village, The Government’s Lawyer Cornwall—boarded a ship bound for New where they moved into the Widow Puckett’s By the middle of the 19th century, Sam York. house on East Franklin Street. There they Phillips was a Chapel Hill favorite son, doing A Royal Marine of low rank who had re- raised Sam, Cornelia, and Charles. everything expected of him. And most likely, enlisted the year before, he lived in James was not a popular professor. His if he had kept to that script, he might have Plymouth, near the naval base. When he first UNC students complained about his rude- been written into North Carolina’s law and joined the marines at age 16, James identi- ness and knew better than to ask him a ques- history books after all. But Phillips took an fied his occupation as a “farm laborer.” He tion in class. (One student wrote that James unpopular stand during Reconstruction that had no formal education, and his father like- acted like “a malignant scoundrel” in class made him a traitor to his state. ly had taught him at home. In 1814 at age 22 and said the experience “left deep in my Phillips grew up in Chapel Hill, married he married Agnes Robins, who was six years mind the impression of his perfect con- the granddaughter of a former governor, older; on their marriage certificate, Agnes temptibility, and I henceforth deem no revil- shared top honors in his undergraduate class marked an “X” because she couldn’t write her ings [sic] too severe.”) with brother Charles, received bachelor’s and name. By the time James left England, he James’ students were aware of his naval master’s degrees from UNC, read the law and Agnes had two small children. Despite knowledge and background from his lectures under UNC President David Swain (who is his considerable intellectual gifts, the best life but, of course, did not know the whole truth. described as having been like a second father that James could hope for in England was the Over time, James became quite religious and to Phillips) and William H. Battle, and prac- one he already had: a dead end. was ordained as a minister. His zeal for ticed and taught law in Chapel Hill. His law He decided to abandon England—leav- preaching to anyone he could corral was well office doubled as a school where he taught ing his wife and two children destitute—and known; folks were known to dart into hiding Latin, Greek, math, geography, history, and pursue his dreams in America. He took with if they saw him coming down the street. English grammar to boys.

THE NORTH CAROLINA STATE BAR JOURNAL 11 By most measures of success, Phillips— among folks in Chapel Hill and on the social courted by the press and public, and com- known around town as “Mister Sam,”—had circuit. Sam and Fanny lived in Washington fortable in the safe, successful life the rest of everything. for the rest of their lives. his family had at UNC and in the state. His mentors were prominent Whigs, and As the government’s lawyer before the Two months before he died, he wrote to a that affiliation served him well through the Supreme Court, Phillips, a white southerner, young scholar who had requested informa- war. But as reconstruction set in, Phillips had argued against racial discrimination in the tion about Reconstruction, “I have no regrets a change of heart and mind. As Phillips cases of United States v. Reese (1876) (con- for any substantial part of the part that I took Russell, a UNC professor of creative writing, cerning voting rights under the Civil Rights in Reconstruction.” explained in These Old Stone Walls, “To Mr. Act of 1870 and the 15th Amendment); Phillips followed his conscience into Phillips…the Republican Party was the party United States v. Cruikshank (1876) (concern- Chapel Hill anonymity. of union and progress, and he told his friends ing the Colfax Massacre of African- His is an inspiring and powerful part of he could not stomach the ‘corruption and Americans by a white Louisiana mob, the the story of North Carolina, the South, and extravagance’ of the Democratic Party, which Civil Rights Act of 1870, and the applica- civil rights, during and after Reconstruction. was replacing the upper-class Whigs.” tion of the First Amendment to states); the No white lawyer, northern or southern, He’d not always felt strongly about black five cases known as the Civil Rights Cases comes close to Phillips’ record in fighting suffrage, and he admitted it. (1883) (concerning sections of the Civil race discrimination before the Supreme But as Speaker of the House he deplored Rights Act of 1875 and the 10th Court. He is a southern hero who took a attempts to coerce blacks’ voting by threaten- Amendment, as well as the applicability of moral, legal, highly unpopular, and very ing their employment if they voted the 13th and 14th amendments to racial dis- lonely stand against racial discrimination, Republican. “How can we [the South] say crimination in hotels and theaters and on and his contributions to American civil [to the North], leave the freedman to us,” he railroad cars); United States v. Harris (1884) rights law are extraordinary. said in 1866, “we will do him justice, refus- (also called the Ku Klux Case, in which a Cornelia Phillips Spencer, because of her ing in the same breath to allow him to tell his Tennessee sheriff led a lynch mob that beat gender, was denied the education and careers tale before a jury of white men and white African-American prisoners, one fatally, open to her brothers. She fashioned her own judges?” which focused on the constitutionality of the journalism career, writing for publications in By 1870 he was a Lincoln Republican, Civil Rights Act of 1871 under the 10th the state in the editorial and letters columns. running for state attorney general on the Amendment); and Ex Parte Yarbrough After the Civil War she was bitterly, persist- Republican ticket. His friends and colleagues (1884) (regarding the constitutionality of ently critical of the Republican UNC presi- felt betrayed. “He could not have drawn the 1870 act and the federal government’s dent and the faculty he hired, and she was an more fury on his head had he joined the part right to protect African-Americans’ voting important anti-Republican force in closing of Satan,” Russell wrote. rights). the university from 1871 to 1875. The “san- At first his sister Cornelia, prolific writer Phillips said the doctrine of separate-but- itized” Cornelia is known better for the tri- and virulent Democrat that she was, took it equal “amounts to a taunt by law of that pre- umphant re-opening of UNC. But an annu- easy on him, writing, “I have too much faith vious condition of their class.” al award for women given in her name was in the heart and head of my brother to be Phillips was a serious contender for nom- retired in 2005 because of concerns about affected by what the newspapers say of him ination to the Supreme Court, losing in her white-supremacist rhetoric and her role disparagingly.” 1877 to John Marshall Harlan, who later in closing UNC. Later she was embarrassed: “What a mis- would write the profound prescient dissent Charles Phillips, a minister by training, take it was, dear Sam’s joining the — borrowing heavily from Phillips’ brief — became a UNC professor of engineering in Republican Party. When I recall those days of in Plessy v. Ferguson in 1896. 1844 when Swain asked him to return to humiliation, exasperation, and despair it Phillips and co-counsel Albion Tourgee Chapel Hill from Princeton as his father’s doesn’t seem so very long ago.” had argued that “separate but equal” is racial assistant. He was ousted from the faculty He was defeated in the attorney general discrimination and unconstitutional under during Reconstruction and exiled at race, but not daunted. Phillips moved to the 13th and 14th amendments. They lost, Davidson College until it was politically safe Raleigh with his wife Frances (called Fanny) and racial segregation—and the violence that for him to return to UNC. and their children, where he prosecuted Ku went with it—became in most places the Both Sam and Charles Phillips destroyed Klux Klan members for the federal govern- norm. It took nearly 60 years for the their personal records. ment. Supreme Court to reverse Plessy in Brown v. All three Phillips houses, standing shoul- In 1872 President Grant appointed him Board of Education in 1954. der to shoulder next to Sam’s law office, still solicitor general of the United States. are occupied today: the homes of Charles and Because of the solicitor general’s enormous A Southern Hero James are owned privately, and Sam’s house influence on the US Supreme Court, arguing On November 18, 1903, Samuel Field (with a porch added after he lived there) is all the government’s cases, the person in that Phillips died in Washington. He was buried now the Delta Delta Delta sorority house. position often is called the “10th justice.” back in the Old Chapel Hill Cemetery at Cornelia lived across the street, beside what is Fanny understandably was delighted UNC. He easily could have had a stellar now the UNC System president’s residence, about moving to Washington since she, like career in North Carolina politics; secure in her husband, was likely persona non grata his standing among the southern aristocracy, CONTINUED ON PAGE 37

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B Y C ALLEY G ERBER AND W ILLIAM R EPPY J R .

he North Carolina Court Seth Casteel/TandemStock.com

of Appeals, in a case

where negligent killing of

a pet dog with no market

Tvalue was admitted, has denied recovery of “intrinsic” damages (also called “actual” damages). Shera v. NC

State University Veterinary Teaching Hospital, 723 S.E.2d

352 (N.C. App. 2012). Because the holding is narrow and the type of damages denied are not the same as emotional damages, a close look at the decision is warranted.

The Veterinary Hospital Admits returned the dog to the hospital for treatment. and she could not be resuscitated. Not know- Negligence; Minimal Damages are She was admitted on March 31. ing the cause of their pet’s death, Plaintiffs paid Awarded Following days of tests, Defendant deter- the hospital’s veterinary bill in full. Three days Laci, a Jack Russell Terrier owned by Mr. mined that Laci should have an intranasal later, Defendant advised them that the mis- and Mrs. Shera, began to be treated for liver feeding tube, which on April 5 was inserted by placed feeding tube had caused Laci’s death. cancer at the defendant state veterinary hospi- the hospital staff. Laci was transferred to the In 2009, Plaintiffs filed a veterinary mal- tal in 2003. After treatment, the cancer was in intensive care unit. Unknown to anyone at the practice action against the hospital with the remission, but Laci had quarterly checkups at time, the feeding tube was placed into Laci’s North Carolina Industrial Commission pur- the hospital. In 2007 Laci began experiencing lungs rather than her stomach, and she began suant to the state’s Tort Claims Act, seeking problems with poor appetite, vomiting, and drowning due to the material forced into her damages based on the “intrinsic” value of Laci difficulty with urination, and Plaintiffs lungs. The next day her heart stopped beating, to them and citing the 1988 decision in

14 WINTER 2012 Freeman, Inc. v. Alderman Photo Co.1 conclusory to support an award of damages currently is possible under our law.12 Defendant’s answer admitted negligence and based on intrinsic value. Said the court: “The This seems to tell pet owners as future litigants requested a hearing on the issue of damages. testimony reveals no absolute unique tasks or that they should just prove replacement value The initial hearing officer awarded Plaintiffs functions that Laci performed for plaintiffs, in the absence of market value, as the Freeman only $2,755.72, the amount the pet owners aside from her calming presence....”7 case and its theory of intrinsic value will not had paid the hospital for treatment billed Plaintiffs also argued that the large sums of entitle them to recover anything more. A from March 31 through April 6, 2007. money they had spent treating Laci for cancer highly trained service dog will have intrinsic Reviewing this award, the full commission proved that Laci had an intrinsic value or actu- value, but will also have a market value, a fact increased the damages by $350, which it al value to them in excess of replacement that will preclude resort to the intrinsic value found to be the cost of replacing Laci with value. theory of damages. another Jack Russell. The commission The court of appeals rejected the argu- employed the replacement value measure of ment, stating: “[P]laintiffs fail to adequately The Shera Decision has No Effect on damages upon finding that the aged Laci had explain how amounts spent on the dog’s care Future Claims for Emotional Damages no fair market value. The commission noted prior to 31 March 2007, when Laci was The actual holding in Shera leaves wide that North Carolina courts have recognized admitted to defendant’s care and negligently open the question whether in North Carolina intrinsic value as a category of damages that is killed, were proximately related in any way to emotional damages may be recovered for the appropriate in some circumstances, but defendant’s negligent act on 6 April 2007 and tortiously-caused injury or death of a pet that declined to expand applicability of that meas- plaintiffs’ resulting injury.”8 While this state- was treated by its owners as a member of the ure of damages to cases involving injury to or ment does not address the point made by family. That is so because the plaintiffs in death of companion animals. Plaintiffs, it would seem to establish that, for Shera rested their claim to intrinsic value dam- some reason, amounts spent on health care for ages on the Freeman case where the property The Court of Appeals Affirms Based on a pet are not relevant when intrinsic damages damaged—architectural drawings—was non- Insufficient Evidence are sought. sentient personal property, and where the The court of appeals affirmed, initially “The sentimental bond between a human court specifically held that intrinsic value holding that replacement value is properly and his or her pet companion,” the Shera damages did not include “purely emotional employed to assess damages where damaged court concluded, “can neither be quantified in value” that the property may have had.13 property had no market value (citing cases monetary terms or compensated for under The court of appeal in Shera stated: “The involving a damaged power pole and trans- our current law.... [H]ow to value the loss of current law in North Carolina is clear that the former and a stolen pay telephone). The court the human-animal bond between a pet owner market value measure of damages applies in did note that in the Freeman case—where the and his or her companion animal...is more cases involving the negligent destruction of defendant’s negligence resulted in the destruc- appropriately addressed to our legislature.”9 personal property, whether sentient or not.”14 tion of “hundreds of architectural drawings, Since the plaintiffs in Shera had not argued work papers, and surveys”2 that had no mar- Unfortunate Dictum for Pro-Animal that a special rule of damages—that permitted ket value—recovery of damages based on Advocates recovery of emotional damages—applied intrinsic or actual value to the plaintiff of the While the narrow holding of Shera is that where the property negligently destroyed was lost property was approved.3 In Freeman the the plaintiffs failed to prove any intrinsic value a sentient pet, the quoted statement is at best jury had been instructed that one factor to to them of their dog, apparent dictum in the dictum. It is also wrong. It cannot be “clear” consider in determining intrinsic or actual case renders Freeman (the architectural draw- that North Carolina law bars recovery of emo- value was “the uniqueness of that [destroyed] ings case) and its intrinsic value theory of tional damages where a pet has been negli- property.”4 The evidence in Freeman estab- damages essentially worthless in future litiga- gently killed (or injured) because the issue has lished that some, although not many, of the tion concerning death of or injury to a pet. not been before the courts of the state in a lost drawings—which were unique—could be Shera read Freeman as employing the intrinsic reported decision. On the other hand, as dis- reused if recreated. On the other hand, exam- value measure of damages “rather than the cussed previously in this journal,15 a 1913 ination of the evidence in the Shera case led property’s replacement value,” which it decision of the North Carolina Supreme the court of appeals to conclude, in essence, inferred would be greater.10 “Thus, the ‘actual Court can readily be construed as establishing that Laci was not a unique pet. In sum, the value’ instruction in Freeman was applied to the right by a plaintiff-owner to recover emo- plaintiffs could not get the benefit of Freeman limit, rather than enhance, the plaintiff’s tional damages for the willful killing of a pet because of a failure of proof. recovery....”11 Intrinsic value “damage dog in the plaintiff’s presence.16 This older The inadequate evidence included testi- awards,” said the Shera court, decision could lead North Carolina courts to mony that Laci “brought so much joy” to the have proven to be the rare exception and follow the precedents of Florida, where emo- Shera home and “brought so much comfort” have never been applied to either enhance tional damages are recoverable for the willful to Mr. Shera, who suffered from a heart con- a damages award or to the recovery of dam- or grossly negligent killing or injury of a pet, dition; and that Laci “was just very helpful in ages for the loss of companion animals. but not if the level of fault by the tortfeasor is stressful situations.”5 The court of appeals This is surely due in part to the fact that a ordinary negligence.17 In other states there is acknowledged that Mrs. Shera testified that multitude of companion animals are avail- a trend to allowing emotional damages to be “Laci was unique. She had her own personal- able in society, and...replacement of the awarded where a pet has been injured or killed ity.”6 But apparently this was viewed as too type of property—a companion animal— willfully.18 Such decisions recognize pets as a

THE NORTH CAROLINA STATE BAR JOURNAL 15 special type of personal property subject to mit recovery of veterinary expenses far in defendant escape paying such damages by unique rules concerning recovery of damages. excess of replacement value of an injured pet convincing the trier of fact that because of its that had no market value (for example, training as a watchdog, the mutt had a market The Hospital had Grounds to Appeal because it was an older mixed-breed dog). In a value of $25. n the Award of Economic Damages 2011 California decision,23 after defendant Because the veterinary hospital in Shera shot Plaintiff’s cat, Plaintiff spent $36,000 to Calley Gerber is the principal attorney in did not appeal, the decision there is not prece- save the cat’s life and treat it for paralysis. Raleigh’s Gerber Animal Law Center and was dent supporting the amount of economic Reversing the trial court, the appellate court’s counsel for the pet owners in the Shera case dis- damages awarded to the pet owners by the holding was that if the veterinary expenses cussed in this article. William Reppy is the commission panel. The $350 replacement were reasonable the defendant was liable for Charles L. B. Lowndes Professor of Law value surely was based on the cost of buying a them. Suppose, however, the cat was a young Emeritus at Duke University. young Jack Russell Terrier, but Laci was a sick- and attractive pure-bred Persian, and the trier ly 12 3/4-year-old dog.19 Should not her age of fact was convinced it had market value of Endnotes and health status have guided the determina- $25. That such a finding should bar Plaintiff’s 1. 365 S.E.2d 183 (N.C. App. 1988). tion of replacement value? claim for recovery of all but $25 of the veteri- 2. Shera, 732 S.E.2d at 355. In addition, the veterinary hospital could nary bills is grossly unfair, yet the California 3. The intrinsic value damages recovered in Freeman have objected on appeal to being ordered by court stressed the absence of market value for totaled $73,600. 365 S.E.2d at 184. the commission to refund all of the veterinary the cat in question. 4. Id. at 186. bills paid by a pet owner after the hospital North Carolina should follow the lead of 5. Shera, 732 S.E.2d at 355. conceded there had been veterinary malprac- New Jersey, which holds that a tortfeasor who 6. Id. at 356. Plaintiffs also placed in evidence this state- ment found on the defendant hospital’s website: tice. Much of the $2,755.72 that the pet own- has injured a pet—whether negligently or The bond formed between humans and animals is ers had paid the hospital related to veterinary through willful misconduct—is liable for rea- unique....They become members of our family care during the period March 31 through sonable veterinary costs incurred to save or and can provide a sense of constant support April 4, which involved no malpractice. attempt to save the animal’s life even though through various life changes in our lives....This special human-animal relationship is what makes Should the improper placement of the feeding the animal had a market value far less than the the death of a pet one of the most significant loss- tube on April 5 have tainted the non-objec- total of the bills for veterinary care. In 1998 es we experience in our lives. tionable veterinary services rendered prior to New Jersey’s intermediate appellate court Trial Transcript Exhs pp 687, 24. that negligent act?20 affirmed a judgment awarding reimbursement 7. 732 S.E.2d at 356. of the full amount of $2,500 in veterinary bills 8. Id. at 357. Must a Non-Veterinarian Tortfeasor paid to save the life of a tortiously injured pet 9. Id. Who Injures a Pet Reimburse for dog despite a finding that the dog’s replace- 10. Id. at 355. Reasonable Veterinary Bills that Exceed ment value was $500, holding: “[A] house- 11. Id. the Market or Replacement Value of hold pet is not like other fungible or dispos- 12. Id. at 357. the Animal? able property, intended solely to be used and 13. Shera, 723 S.E.2d at 355, quoting Freeman, 365 Even if North Carolina courts establish a replaced after it has outlived its usefulness.” S.E.2d at 186. precedent that a veterinarian guilty of mal- The New Jersey Supreme Court subsequently 14. Shera, 723 S.E.2d at 357 (emphasis added). practice that injures or kills a pet cannot retain approved this decision on the ground “that 15. William A. Reppy Jr., A New Specialty: Animal Law, NC State Bar Journal, spring 2002, at pp. 12-13. sums paid by the pet’s owners for treatment, pets are a special variety of personal proper- 25 16. Beasely v. Bynum, 163 N.C. 3, 79 S.E. 270. The cause such a development would not necessarily dic- ty.” of action asserted there was apparently trespass both to tate how the state’s judiciary will answer the the home where the slaying occurred and to a chattel, question whether a non-veterinarian tortfea- Market or Replacement Value Should the pet dog. The court held that damages could be sor who injures a pet is liable to reimburse the Not Be a Cap on Intrinsic Value based on evidence that “the alarm and shock caused by Damages defendant’s conduct had caused her [Plaintiff] great pet owner for veterinary expenses reasonably suffering.” Id. at 4, 79 S.E. at 271. The opinion would incurred to save (or attempt to) the life of the New Jersey’s approach should also be not have focused on the killing of the dog, in addition animal when those expenses exceed the fair applied to cases where the pet owner seeks to the entry into the home, if the pet’s death had not market value or, if there is no market value, damages based on intrinsic value of the tor- been pertinent to the assessment of damages. the replacement value of the animal. Where tiously injured or killed pet and proves that 17. Compare LaPorte v. Associated Independents, Inc., 163 So.2d 267 (Fla. 1964) (willful tort) and Knowles an item of inanimate personality has been tor- the pet had—before the injury—provided Animal Hospital, Inc. v. Wills, 360 So.2d 37 (Fla. App. tiously damaged, North Carolina measures special services but could no longer do so. For 1978) (gross negligence), with Kennedy v. Byas, 867 recoverable damages as “the difference example, in a 1980 case from New York, a So.2d 1195 (Fla. App. 2004) (ordinary negligence). between its fair market value immediately finding that a negligently killed pet dog had 18. See, e.g., Plotnik v. Meihaus, 2012 W.L. 3764874 (Cal. before and immediately after the injury.”21 no market value as a mixed breed entitled the App., Aug. 31) (recovery of over $50,000 for clubbing of pet dog); Womack v. Von Rardon, 135 P.3d 542 Where the damaged item of inanimate per- owner to recover $550 in damages on proof (Wash. App. 2006). sonal property has no market value, the cost of that “plaintiff relied heavily on this well- 19. Although the defendant in Shera admitted negligence, repair is the measure of damages.22 trained watchdog and never went out into the that should not have resulted in the imposing on it the Other states with similar rules applied streets alone at night without the dog’s protec- burden of proving that there was no market in mature where damaged personality is inanimate per- tion.”26 The law should not let the negligent CONTINUED ON PAGE 25

16 WINTER 2012 NC Legal Aid Providers

l Serv a of ic g e e southern piedmont s L

Legal Aid of North Carolina & Legal Services of Southern Piedmont would like to recognize the following major donors to our first annual joint law firm giving campaign in 2012:

ABOVE & BEYOND FIRMS—$400/ATTORNEY SUPPORTER FIRMS—$100/ATTORNEY (CONTINUED) MAXWELL, FREEMAN & BOWMAN KING & SPALDING NORELLI LAW PACESETTER FIRMS—$300/ATTORNEY POYNER SPRUILL ALSTON & BIRD PULLEY, WATSON, KING & LISCHER HARRIS WINFIELD SARRATT & HODGES RAY & PENNINK KILPATRICK TOWNSEND & STOCKTON WINSTON & STRAWN LEWIS, DEESE, AND NANCE WOMBLE CARLYLE SANDRIDGE & RICE MYERS BIGEL SIBLEY & SAJOVEC WYRICK ROBBINS YATES & PONTON

HONOR ROLL FIRMS—$200/ATTORNEY OTHER CONTRIBUTORS DECHERT BROOKS, PIERCE, MCLENDON, HUMPHREY & LEONARD MCGILL & NOBLE CRANFILL SUMNER & HARTZOG SCUDDER & HEDRICK CROSSLEY, MCINTOSH COLLIER HANLEY & EDES THARRINGTON SMITH K&L GATES MOORE & VAN ALLEN SUPPORTER FIRMS—$100/ATTORNEY MURCHISON, TAYLOR & GIBSON BERNHARDT AND STRAWSER NELSON MULLINS RILEY & SCARBOROUGH BLOCK, CROUCH, KEETER, BEHM & SAYED ROUNTREE LOSEE & BALDWIN BROCK & SCOTT SHIPMAN & WRIGHT HARTSOE & ASSOCIATES SMITH, ANDERSON, BLOUNT, DORSETT, MITCHELL & JERNIGAN HESTER GRADY & HESTER WILLIAMS MULLEN FOUNDATION HUNTON & WILLIAMS WOOD JACKSON KATTEN MUCHIN ROSENMAN

Each year, legal aid service providers in North Carolina fight to protect the rights of more than 100,000 low- and fixed-income people like Ms. Clyde (pictured above). Find out how you can help at ncaccesstojustice.org. Professionalism – The Loss of Civility in the Legal Community

B Y C LIFTON W. E VERETT J R .

ome time ago, Charles Hardee asked if I would consider the attorneys in their practice. The district attorney was then referred to as the “solici- tor.” In the 33 counties comprising the 1st writing an article for the Journal on the subject of profes- Division of the North Carolina Superior Court, there were eight elected resident superior court judges. They were all very dis- sionalism. After giving the matter some thought, I decid- tinguished gentlemen who had all enjoyed a successful career at the bar before assuming the bench, and most were no younger than ed that after 27 years of practicing law and 18 years on 50 years of age. With the exception of maybe two, these superior court judges ran their courtrooms with a tight hand, expected you the superior courtS bench, I was probably as knowledgeable about the subject as anyone else who to be prepared to try your case and be knowledgeable in the law, be prompt in your attendance to your court functions, be well would agree to undertake a discussion of professionalism. In addition, one of my private disap- mannered and courteous to the bench, and be civil to your opposing counsel. At that time, lawyers made an effort to pointments—and, to a few of my friends, a public sadness—is the lack of participation of the converse with each other prior to the filing of civil actions in an effort to spare their clients the undue expense of protracted liti- practicing bar east of Raleigh in bar activities that further the progress of the legal profession. I gation, resolved the dispute in an expedi- tious manner, and tried to keep parties out of court. Pleadings were detailed and exten- have been asked on several occasions to lecture at CLE seminars, and have always agreed to give sive. Pre-trial discovery—including inter- rogatories, requests to admit, depositions, and the ever persistent pre-trial motions, freely of my time and resources to the legal community. Hopefully, those of us who do participate which are prevalent today—were virtually unknown. Lawyers who practiced alone or with small groups did most of their own will encourage others to also give of their time, talents, and resources in this endeavor. investigations, interviewed witnesses them- selves, and took an active role in the nuts and bolts of preparing cases for trial. I am It is hard to really comprehend that this North Carolina had not yet been fully proud to say that I came to the bar during past summer—August 2012—I was licensed implemented throughout the state. In fact, the twilight years of the great civil trial to practice law in North Carolina for 45 in my home district, my first appearances in lawyers and criminal defense attorneys. It years. When I finished law school, we were court were before Judge Dink James, the was a great time to be a lawyer. We all had a still operating under the old Rules of Civil county recorder’s court judge. All of the local good time practicing law and socializing. Procedure (we were required to learn both mayor’s courts, the justice of the peace There was a marked absence of carping and the old and new rules at Wake Forest), and courts, and the various recorder’s courts and sniping. Older members of the bar made a the district court system as we know it in city courts then in existence were utilized by conscious effort to mentor and direct

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www.wealthcounsel.comwww.wealthcounsel.com PoweredPPoowerreed byby WealthDocxWWeealthDocx® younger members of the bar in developing familiarize him with the matter he was to told, “Cliff, I think I am getting the hang of their legal skills. Certain lawyers who had handle. Some time during the next week, this.” I am sure this story is very amusing the judge’s confidence were often asked pri- My father was in Tarboro attending to a and somewhat amazing to some of you who vately to counsel on a knotty legal problem matter and decided to go to the superior read this article, but I can assure you that it the court was then involved with which, of courtroom to see what Judge Bundy was all is absolutely true and is probably something course, did not involve that lawyer. about. He walked into the courtroom and not entirely uncommon in that era. Such an I remember well an episode involving sat in the fourth row. Judge Bundy was up event this day and time might have the judge Judge William J. Bundy and my father. They on the bench, his head back in the chair and and the lawyer brought up on disciplinary were very close friends, and the good judge his eyes closed. (Judge Bundy, as some of charges since we have to be, like Caesar’s would often seek out my father’s advice on a you may remember, had a speech impedi- wife, beyond reproach. I will have to admit legal matter with which he was uncertain. ment in which he stuttered rather obviously to you that my view from the bench in pres- The story goes something like this: At the until after 5 PM, when his stuttering calmed ent-day times is somewhat different than my outset of Judge Bundy’s appointment to the down.) Momentarily, one of the attorneys view of the bench at the beginning of my superior court bench, he was scheduled for rose to his feet and, in a loud voice, shouted, legal career and during it. Tarboro in Edgecombe County. It was a will “Objection, Your Honor.” Judge Bundy The handling of civil litigation matters, case. Judge Bundy related to my father the popped open his eyes, wheeled his chair which encompasses discovery practice, dep- nature of the case, and his uncertainty and around, and looked directly at my father. osition matters, and especially the motion trepidation in having to try a matter with My father nodded his head in the affirma- practice, is the most onerous and burden- which he had little experience. My father tive. Judge Bundy then said to the lawyer, some duty I have to perform as a judge. advised Judge Bundy that it was not a diffi- “objection sssssssssssustained.” A few min- When a civil action finally reaches a trial cult matter to handle—most of the evidence utes later, one of the lawyers on the other posture, it is fairly pleasant. However, it relating to the testator’s state of mind and side arose and exclaimed, “Objection, Your takes an undue amount of time to reach that relationship with others could be admitted. Honor.” Judge Bundy, following the same posture. My observation from the bench as a Judge Bundy was still not satisfied, and my practice, turned and looked at my father trial judge and in my district as a resident father gave him a will brief that he had who, on this occasion, shook his head in the judge is that very little interaction, coopera- worked up containing all the will law and negative. Judge Bundy then said, “Objection tion, conversation, or accommodation goes caveat proceeding law to that date. He told oooooooooverruled.” Later, my father visit- on between litigant attorneys. It appears that Judge Bundy to read it over and it would ed Judge Bundy in his chambers and was neither side—the plaintiff nor the defen-

THE NORTH CAROLINA STATE BAR JOURNAL 19 dant—is anxious to resolve any civil litiga- put it mildly. Harsh allegations and abu- fession” as follows: “A vocation or occupa- tion until the proper amount of “time” has sive epithets fly about with reckless aban- tion requiring special, usually advanced, been spent filling the court file with reams of don. There is a rush to take technical education and skill; such as law or medical paper. Civil motion day in my district is a advantage of one’s opponent and openly professions. The term originally contemplat- real back-breaker. The last motion day I con- question his or her ethics. Suspicion of ed only theology, law, and medicine, but as ducted some several weeks ago included a motives hovers over the length and applications of science and learning are calendar of 32 motions running the gamut breadth of professional actions. Have I extended to other departments of affairs, from A to Z. Of course, I was unable to hear overstated the case? Would that it be so. other vocations also receive the name, which all of the matters, some of which were very This sort of thing just poisons a well and implies professed attainments in special protracted, and left the bench about 6 PM makes trying cases too unpleasant to knowledge as distinguished from mere skill.” that day. It was only because I had arranged bear. I for one have become sick of it. Professionalism is defined by Webster’s to have the following week free that I was Relations between lawyers shouldn’t be Dictionary as “the conduct, aims, or qualities able to come back Monday and Tuesday and like that. that characterize or make a profession.” finish the calendar for some of the lawyers What an apt and brilliantly stated obser- Several months ago I was honored to par- who actually begged me to do so. I was vation of the present state of civil litigation. ticipate in the presentation and hanging of about to leave my home district for a new You should read this article, not only for its an oil painting of Mr. Louis W. Gaylord Jr., rotation, and I guess the lawyers wanted to content, but also for a brilliant perspective of a prominent Greenville attorney who retired get their best shot in while they had me. a seasoned trial judge who has been on the from the practice of law several years ago and This was somewhat of a dubious honor, but firing line of developing civil litigation for is now 94 years old. A vigorous 94, I might I took it. more than 30 years. Although Judge add. He is truly a remarkable individual. I On the rarest of occasions do lawyers Albright is now retired, I could not have bet- well remember coming to Greenville with attempt to resolve matters in the motion ter expressed to you today what he said in his my father to attend to court business and field or discovery field, or the perceived article, and I wanted to refer to it to high- other work at the courthouse. I remember sanction field, by conversation prior to com- light what I have said and will say further in seeing Mr. Gaylord as a young boy—he was ing to court. There is an air of hostility and this article. As a trial judge, it is always a a sight to behold. Tall, erect, possessing a suspicion between many lawyers who appear pleasure to hear good lawyers argue and booming and very persuasive voice, he effec- before me, and it is readily evident and present their legal positions, which are tively represented his clients before the apparent to the court. This attitude makes a always done in a civil, polite, and profession- court. A skilled trial lawyer in every respect, day on the bench for this old judge hard and al process. Neither side will interrupt the Louis Gaylord primarily devoted his court- tiring, and it detracts from the professional- other during presentation and neither side room appearances to defense work—both ism that should be evident between col- ever has a caustic or accusatorial comment criminal and civil—and handled some of the leagues at the bar even while representing about the other lawyer during any point of more complex cases that have come before different opinions and points of view. the hearing. This is as it should be. the court in Pitt County. He and my father As was stated by Judge Doug Albright, Study after study has been done about were adversaries on many occasions, but retired senior resident superior court judge the problem with professionalism in the were always, always good friends, and were from Gilford, in his excellent article in the legal practice. The chief justice has even courteous and professional to each other. I Spring 2007 Journal, which I enthusiastical- established a commission on professionalism say all of this to you to let you know that ly and whole-heartedly recommend that you to address these problems I have mentioned. Louis Gaylord, and those of his generation read and assimilate: The North Carolina State Bar and the at the bar, practiced law in the grand man- I am sad to say, however, that some very North Carolina Bar Association have various ner. They were always well prepared, pos- observable negative developments have programs dealing with chemical dependency sessed skill in the trial of cases, professional crept into the practice. I see tangible evi- by lawyers, depression among lawyers, and to their opposition, never entered into any dence demonstrated all too frequently the general lack of civility among those picks or quarrels in the courtroom before the that there is an insidious, perceptible appearing in the civil trial courts of our state. court, never made any insulting remarks decline in respectful professionalism Sadly, the day is almost gone where mem- about the perceived integrity of the other (noticed by just about every objective bers of the legal profession avail themselves lawyer, or any of those things that daily observer of the scene). Professional civili- of the opportunity to participate in civic come before me as a judge now. I am sad- ty, common courtesy, polite cordiality, endeavors, serve on commissions and dened by the fact that I have to listen to and mutual respect between lawyers too boards, and serve in the General Assembly, those things from lawyers when they should often gives way to open rancor, bitter where the lack of legal knowledge on matters never be personal to each other. As my father acrimony, adversarial hostility, and abra- being taken up by the House and Senate has said, “always remember, son, it is the client’s sive gamesmanship. Lawyer relations at resulted in the unwieldy legal approach to case and not yours.” We all have a duty to times become contentious and some- legislation, and the problems and pitfalls represent our clients professionally, ethically, times just plain rude. The old days when could be addressed by lawyers if they were and strenuously, but we should never fall most, if not all, problems in litigation willing to serve. victim to personal swipes and demeaning could be cleared up by a single five- So what does the term “professionalism” comments of our opposing counsel. Louis minute telephone call are long gone, to entail? Black’s Law Dictionary defines a “pro- Gaylord never stooped to this level. Nor, I

20 WINTER 2012 am sure, did he enjoy seeing it take place problems. I am sure Louis Gaylord had the and truly demean yourselves. This com- during the latter year of his practice. Louis same experience and that is why, to a great prehends the whole duties of a courteous Gaylord was a mentor to all the younger degree, he was such a successful practitioner gentleman and faithful agent. There lawyers. He viewed his example of law prac- of the law. Additionally, Mr. Gaylord devot- must never be the slightest departure tice as the gold bar or standard, which every- ed a considerable amount of time to matters from the strictest rule of propriety, nor one should try to emulate. He, as well as outside of his law practice, such as serving the shadow of a shade of professional others I have mentioned of his generation, on the Board of Education for a number of delinquency. did set the standard for younger lawyers, and years, actively participating in the business Temptations, in whatever shape they may older lawyers of that era were quite free in of his church, serving on the regional bank come, and whether they threaten, harm giving their advice and counsel to younger board, and other such examples of public or promise favor, must not only have no lawyers who sought them out. It made a service. Several years ago, Mr. Gaylord was force or charm, but they must be severely great deal of difference in the type of lawyers recognized by the North Carolina Bar despised. But this inquiry is intended we had during that period of time—their Association as an inductee into the General mainly, as to your general and public demeanor and their interaction with their Practice Hall of Fame. This designation is bearing as lawyers, officers of the court, fellow members of the bar. That is sorely awarded yearly to those lawyers who have engaged in administering the law. The missing these days, and it shows itself, unfor- distinguished themselves in the various fields laws of this country are its majesty. The tunately, in the civil as well as the criminal I have mentioned, and Louis Gaylord was so courts and their officers are the represen- arena. I can truly say that I began my legal rewarded prior to the time he ceased his tatives of majesty. Your deportment career in 1967 during the swan song of the active practice of law. I use Mr. Gaylord as should be as in the presence of majesty; golden era of law practice. I enjoyed it an example of what the legal profession and not with arrogance, but with gentleness immensely and enjoyed my relationship professionalism should be about. As stated and dignity, towards the court, and all with those lawyers I have mentioned, all of by The Honorable Edwin Godwin Reade, who have business there. whom I knew personally, as well as having attorney at law and later justice of the The best practitioner sometimes finds practiced 22 years with my father, who was Supreme Court, on July 9, 1884: themselves at fault: and then indulgence also of that generation and was always ready What shall be your behavior in your pro- or favor from the opposing counsel is and willing to assist others with their legal fession? Your oath will oblige you, to well very grateful. Some are so liberal as to

THE NORTH CAROLINA STATE BAR JOURNAL 21 grant any favors at any time, others nei- per hour so much as it is the number of start by relating what a classmate of mine ther grant nor ask them. There may be hours that are billed. That statement directly told me his father—who was an attorney— nothing dishonorable in either, but I correlates to the lack of professionalism we told him were the two most important advise liberality where a brother has are now experiencing. Money is the ruler attributes of being a lawyer. The first, he made a slip, a slip which would injure and until we, as a profession, get a handle on said, is to dress and look like a lawyer; and him if taken advantage of and where no the money problem, we will continue to dis- the second, show up. All too often these substantial right of your client is surren- cuss the problem of professionalism ad nau- days that is not the case. Also, I might tell dered, and when you do not put yourself seam. Legal practice has slipped away from a you what my father told me when I began in fault by seeming indifference to your profession into a business. Law firms are the practice of law so many years ago. He client’s advantages. My own practice was operated with a view to the bottom line and said there are three things a lawyer needs to to allow a brother to supply defects, cor- not necessarily what is in the client’s best know how to do to be successful. He told rect errors, and do almost anything he interest. Of course, this subject is taboo and me, first, a lawyer needs to know how to desired to do in fixing up his case before is not discussed in any seminars I have charge for his or her work—if a lawyer does trial; but, when the trial commenced, attended regarding professionalism. The lack not know how to charge for his or her work, and swords were drawn, I threw away the of responsibility by newer lawyers is so evi- no substantial income will ever be made. scabbard and fought for a funeral. dent that it smacks you in the face as a judge. Second, a lawyer needs to know how to How apt are Justice Reade’s remarks to Law schools are evidently not doing a proper retreat—that is, back away from a conflict the problems we face today with profession- job of educating the new lawyer on the pro- and not go full boar all of the time. Third, alism. He summed it up beautifully. fessional aspects of the law practice, and the he said, a lawyer needs to know when his I can say to you that I am acutely aware fact that it is not necessary to pursue a mat- “A” is whipped and get out (he related that of the financial and economic pressures ter with “winning” being the only driving he had seen lawyers cost their clients more exerted by law firms on their lawyers. force of the litigation. money by not knowing that third element Hourly billing has run amok and has placed In my small way, I always try to encour- than anything else he knew). I might add to the cost of civil litigation beyond the means age lawyers to discuss their differences and to those that a lawyer needs to be prompt in of most citizens. Mediation and arbitration attempt to avoid the unpleasantness of seek- attendance, be attentive to the business of and other alternative resolutions to court- ing motions of retribution. I can say, howev- the court, always be well prepared to argue room trials will and could do a great deal to er, as an old civil lawyer myself, that during his or her point for a client’s case, be knowl- alleviate many civil disputes, but only if it is my time on the bench I have attempted not edgeable about the law, be conversant with effectively embraced by the parties. I place to meddle with lawyers when they are trying the facts, and, when citing case authority, specific emphasis on the word “effectively” their cases. I always resented that of a judge give the court a factual situation analogous in this regard. Statistics show that the great when I was practicing. My normal practice to the case at hand and not just boiler plate majority of civil litigation is resolved other during a civil term is to call the lawyers into language from the opinion. Also, be than by trial to a jury. Statistics also show my chamber and receive an assessment as to straight-up with the judge and never, never that only 10% of civil litigation is carried to the nature of the case and where they are in ever prepare an order for a court to sign a jury verdict. With the exception of medical an attempt to resolve the dispute. After hav- finding facts which are not supported by the malpractice action, class action lawsuits, and ing obtained that information, I ask if there evidence, or try to slip in some provision not large personal injury actions, civil court- is anything I can do to assist them in resolv- considered by the court or supported by the room trials have virtually dwindled down to ing the lawsuit. If I am advised that consul- testimony or other evidence and exhibits. rear-end collisions and soft tissue injuries, tation with the trial judge will help, I partic- Your reputation in this regard is paramount which are more often than not tried to a jury ipate in their discussions. If I am advised and, if ever breached, will slacken your rep- verdict simply because the insurance compa- that the litigants are so far apart that there is utation with the court forever and make the ny is well aware that most jurors are fed up no reasonable expectation of settlement, practice of law in civil litigation that much with this type of lawsuit and are not going to then I begin the trial and that is the end of more rigorous and unpleasant. award any sizeable verdict. As a conse- my bullying. I allow justice to take its natu- In closing, I want to say that I hope these quence, the day of the great trial lawyers is ral course. In addition, I allow the attorneys remarks on the subject of professionalism fast approaching its demise. to pick their jury because, in my view, that is will be a benefit to the bar as an insight into We have, unfortunately, over the last 30 what their clients have paid them to do, and how one judge views the legal practice and or 40 years strayed from the definition of clients like to see their lawyers perform. If the professional aspects of it during our professionalism and what the legal profes- certain lawyers are not able to do this effec- time. I hope you find herein something that sion should be. This is due in large part to tively and expeditiously, I may attempt to will awaken your duties as a member of the the introduction of hourly billing, which help them “move along.” But, generally, I try legal profession and the professionalism that requires a lawyer to produce a certain num- not to meddle with lawyers during the trial. is required of that position. n ber of hours per year in order to substantiate I am aware that this is not a uniformly his or her position in the firm. Needless time accepted practice among my colleagues, but Clifton W. Everett Jr. was elected in 1994 is spent generating needless reams of paper it is my practice. as a resident superior court judge for District in order to fill the file and increase compen- If I were asked to give some pointers to 3A (Pitt County). Prior to assuming the bench, sation. As one lawyer said, it is not the rate lawyers involved in civil litigation, I might he practiced law for 27 years in Greenville.

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North Carolina State Bar Board of Legal Specialization State Taxation of the Pro Hac Vice Lawyer

B Y J ERRY M EEK

n 2010 the NC State Bar amended its Pro Hac Vice Admission

Registration Statement to require the out-of-state attorney to

sign a statement verifying that he or she will report to the NC

Department of Revenue any income earned in the case, “if

Irequired to do so by law.” The amendment prompts the obvious question:

When will an out-of-state attorney be required to pay North Carolina

income tax? And, relatedly, when should a North Carolina attorney be con-

cerned about paying income tax in another state?

Both the Due Process Clause and the Trademark, Inc. v. North ©iStockphoto.com Commerce Clause limit a state’s ability to tax Carolina,3 the North non-residents. As the United States Supreme Carolina Court of Appeals Court held in Complete Auto Transit, Inc. v. rejected the argument that the physical pres- has jurisdiction to impose an income tax. Brady,1 a state can tax non-residents only if ence test applied to taxes other than sales Notwithstanding this dispute, ultimately the non-resident is engaged in an activity taxes. According to our court of appeals, the whether any tax is owed depends upon how which has a “substantial nexus” with the tax- existence of sufficient economic ties will sub- any income generated from the representa- ing state, and if the tax imposed is “fairly ject a non-resident to income taxation in our tion is apportioned. apportioned” among the states. state, even absent physical presence. Each state, including North Carolina, has For income tax purposes, it’s not clear Often, the pro hac vice attorney will travel adopted legislation to implement the what is required for “substantial nexus” to into our state in furtherance of the represen- Constitution’s requirement for fair apportion- exist. In Quill Corp. v. North Dakota,2 the US tation, thereby indisputably creating substan- ment of multistate business income. The goal Supreme Court held—in the context of tial nexus. When the non-resident attorney of apportionment statutes is to roughly requiring a non-resident to collect sales performs services without ever physically approximate the income that can be said to taxes—that substantial nexus required physi- appearing in our state, there is a continuing be fairly related to the services provided by cal presence in the taxing state. But in A&F dispute over whether or not North Carolina the respective states. In the context of multi-

24 WINTER 2012 state legal services, this is rarely the same as Let’s take a practical example. A nonresi- LLC, or S-corporation to file a “composite what the client actually paid for the services. dent lawyer is admitted pro hac vice in North return,” thereby paying the tax on behalf of Under most statutes, states employ a three Carolina. She has no real or tangible property all of the firm’s owners. This will avoid the “factor” formula for apportioning the busi- in our state and pays no “compensation” administrative and compliance burdens asso- ness income earned by multistate actors, within our state. The property and payroll ciated with filing and processing multiple including lawyers. Usually these formulas factors are therefore zero. She is paid individual returns, often with little income to take into account the taxpayer’s property, pay- $150,000 for 500 hours of work on the case. report. n roll, and sales in each state, relative to the tax- She spent 100 of those 500 hours in North payer’s total property, payroll, and sales. Carolina. The numerator of the sales factor is Jerry Meek is a Mecklenburg County business Different states apply different weights to therefore $150,000 x [100/500], or $30,000. and tax attorney. He is a graduate of Duke these factors. North Carolina weighs the sales Assuming that her gross receipts from all University (BA, Economics and Political factor twice as heavily as either of the other states during the year was $600,000, the sales Science), the University of Notre Dame (MA, two factors. factor is $30,000 / $600,000, or 0.05. Government), Duke Law School (JD), and Since it is unlikely that a non-resident To calculate the apportionment factor, all Georgetown Law Center (LL.M., Taxation). He attorney appearing pro hac vice in North of the factors must be combined, with the is licensed to practice law in North Carolina, Carolina will own or rent any real or tangible sales factor weighted twice: [0 + 0 + 0.05 + South Carolina, Texas, Oklahoma, and personal property in our state, the property 0.05] / 4 = 0.025. This apportionment factor Arkansas. factor is likely to be zero. Similarly, since the is then multiplied by her net business income non-resident attorney typically will not pay from all states to determine the income that Endnotes compensation in our state, the payroll factor must be reported in North Carolina. Thus, if 1. 430 U.S. 274 (1977). is likely to be zero.4 her net business income for the year was 2. 504 U.S. 298 (1992). As a result, the sales factor is of greatest $320,000, the amount which must be report- 3. 167 N.C. App. 150 (2004). concern to the non-resident attorney. The ed to North Carolina is $320,000 x 0.025, or 4. This is true because, under N.C.G.S. § 105-130.4, sales factor represents the gross revenue $8,000. compensation is considered “paid in this state” only if: (a) the individual’s service is performed entirely in sourced to North Carolina, divided by the Fortunately, her home state will typically North Carolina; (b) only an incidental amount of the gross revenue from all states. Especially in the give her a credit for any tax she paid to North service is performed in another state; or (c) the base of context of services revenue, the critical task is Carolina. She will in the end face a higher operations, or place from which the service is directed, determining to what state the revenue should total tax burden only if her North Carolina is in our state. Typically, the pro hac vice attorney will perform a substantial (and therefore non-incidental) be sourced. Two main approaches have devel- tax bill is greater than her home state’s bill. amount of the services in his or her home state—draft- oped. Obviously, if her home state has no income ing pleadings, preparing or responding to written dis- First, in states that have adopted the tax, this burden can be significant. covery, or preparing for depositions or trial. Uniform Division of Income for Tax A similar calculation results when a North 5. N.C.G.S. § 105-130.4(l)(3)(c). Purposes Act (UDITPA), services revenue is Carolina lawyer performs legal services in a attributed to the state in which the greater foreign state. But since the Supreme Court’s proportion of costs are incurred to perform interpretation of the Commerce Clause gives the activities that give rise to the income. the states considerable discretion when Animal Damages (cont.) Second, in the 11 states which have adopted adopting apportionment formulas, differ- a market-based sourcing rule, services revenue ences abound. South Carolina, for example, Jack Russells in which a replacement for Laci could is attributed to the state where the customer adopts a single factor formula, under which have been bought for less than $350. or client receives the benefit. only sales sourced to the state are considered 20. Consider, too, whether ordering the refunding of vet- North Carolina employs a variation on in determining the tax. As a result of this erinary charges paid by the Sheras was a remedy sound- ing in breach of contract that was not available in their the UDITPA approach. Services income is diversity, apportionment formulas could suit against state veterinary hospital under the North sourced to our state if the “income-producing overlap, resulting in double taxation of the Carolina Tort Claims Act. activities are in this state.”5 This rather same income. When a firm’s employees are 21. Heath v. Mosley, 286 N.C. 197, 199, 209 S.E.2d 740, unhelpful rule is explained through guidance physically present is another state, some 742 (1974). Costs of repairs are some evidence of the issued by the NC Department of Revenue, states may even require the payment of pay- decrease in value. 22. Givens v. Sellars, 273 N.C. 44, 51, 159 S.E.2d 530, which provides that when services are per- roll taxes. 536 (1968). formed across state lines, gross receipts for Finally, if the non-resident attorney is a 23. Kimes v. Grosser, 126 Cal. Rptr. 3d 581 (App. 1911). performing those services “shall be attributed partner, member, or shareholder of a partner- See also Burgess v. Shampooch Pet Industries, 131 P.3d to this state based upon the ratio which the ship, LLC, or S-corporation, must each part- 1248 (Kan. App. 2006) (full amount of veterinary bills time spent in performing such services in this ner, member, or shareholder file a tax return recoverable, although plainly in excess of replacement state bears to the total time spent in perform- in North Carolina? Because the distributive value, where 13-year-old dog had no market value). 24. Hyland v. Borass, 719 A.2d 662, 664 (NJ App. Div. ing such services everywhere.” Consequently, share of each owner of a pass-through entity 1998). Accord, Leith v. Frost, 899 N.E.2d 635, 641 (Ill. a non-resident lawyer who spends no time in will include income apportioned to North App. 2008). North Carolina will owe no North Carolina Carolina, the answer is generally yes. 25. McDougall v. Lamm, 48 A.3d 312, 324 (NJ 2012). tax, even if paid for appearing in a North Fortunately, North Carolina—along with 26. Brousseau v. Rosenthal, 443 N.Y.S. 2d 285, 286 (Civ. Carolina action. most other states—permits the partnership, Ct NY Cnty, 1980).

THE NORTH CAROLINA STATE BAR JOURNAL 25 Meet the Federal Judges—Chief Judge Robert J. Conrad Jr.

B Y M ICHELLE R IPPON

In the early 1990s what was then the State scholarship earned him the Atlantic Coast Bar Quarterly published a series of articles loosely Conference James Weaver Award for top stu- held together with the theme, “Meet the Federal dent athlete, and Clemson’s Norris Medal for Judges.” In the next few editions of the State Bar Most Outstanding Student. Journal, we will be updating that series. Basketball not only afforded Bob Conrad with an opportunity to attend college, but also Chief Judge Robert J. Conrad Jr. provided him with tools for success. He “He has shown you, O Mortal, what is explains that the game is not only competitive, good. And what does the Lord require of you? but also requires a constant striving for excel- To act justly and love mercy and to walk lence and building relationships, as well as humbly with your God.” Micah 6:8. respect for the dignity and worth of others. He These words give insight into the experi- certainly carries this forward in his work at the ences and character of Judge Bob Conrad. court where he has the utmost respect for Judge Conrad credits his father—a corru- court personnel—the administrative staff, the gated box salesman—with his early success as marshalls, his clerks, the maintenance crews, a litigator, at least to the extent that he learned and, of course, the parties and attorneys who the art of “a good sales pitch.” He grew up appear before him. with his younger brother and two sisters in a Judge Conrad isn’t entirely sure what moti- suburb of Chicago. He was 14 years old when vated him to choose law as a vocation. He his youngest sister was born and she became a does remember a lawyer who lived close by nice “magnet” for the good looking girls! and whom he wanted to emulate. Once there, It was a basketball scholarship to Clemson he says, he thoroughly enjoyed every aspect of University that enticed Bob Conrad to move law school from the challenge of study to the south. He majored in history, minored in collegiality and campus life at the University of Attorney General Janet Reno appointed him German, and played point guard for what Virginia, where he graduated in 1983. as head of her Campaign Financing Task Force could be considered the university’s best bas- The practice of law began with Michie, charged with investigating fundraising impro- ketball team—the Elite Eight of the NCAA Hamlett, Donato & Lowry, a 12-person law prieties during the 1996 election campaigns. Basketball Tournament in 1980. In fact, he is firm in Charlottesville, where he handled He deposed both President Clinton and Vice- now included on a poster that he keeps in his plaintiff’s litigation. He then moved to President Gore in the same week! Then in office depicting the “25 Man All-time Team” Charlotte where he practiced general litigation 2001 Attorney General John Ashcroft which was recognized as part of the 100 year with Horn & Conrad, and later with Bush, appointed him to the Advisory Committee on anniversary of basketball at Clemson. Thurman & Conrad. In 1989 Conrad was Terrorism. In connection with that assign- However, he is quick to point out that he appointed as assistant US attorney for the ment he prosecuted supporters of a Hezbollah embraced a love of learning once he began his Western District of North Carolina, and in terrorist cell in North Carolina and testified on studies at Clemson. While he jests that he 2001 he was promoted to US attorney. terrorism related matters before the US Senate. might be the only ACC player whose grade Although he found the private practice of law In 2004 Conrad became a partner at point average was higher than points scored, appealing, occasionally he would pick up the Mayer Brown where he remained until he was it’s hard to argue with his eight for eight free old billable hour notepad that he first used in appointed to the federal bench by President throws in an upset overtime victory over #1 his law practice to remind him that he didn’t Bush and later confirmed by the Senate in Duke—the first time in the school’s history miss having to keep time in the least bit! April 2005. He has been the chief judge since that Clemson had beaten a first-ranked team. Judge Conrad’s career as a United States 2006. His seven-year term will expire in June The combination of excellence in athletics and attorney brought its own challenges. In 1999 2013 at which time Judge Whitney has been

26 WINTER 2012 selected to take over this responsibility. He Office, and with Conrad’s help TJ was able to 2004, she began, “He is a storyteller and a finds the work on the court enjoying and intern in that office between his second and reader, an adventurer and a homebody, a joke- enriching. “No case is typical,” he says, which third year of law school. After graduation, TJ ster and a leader. Bob Conrad is a man of con- also makes the work always interesting. He can took a job in the District Attorney’s Office in tradictions, two people in one personality—a still be a lawyer, but with a different skill set Nashville, Tennessee. They continued to keep distinguished career man and a giving father.” where the role is deciding instead of advocat- in touch. The two worked together again This is a worthy tribute by a talented and ing. It does give him the opportunity to take when, with the blessing of Janet Reno, Conrad proud daughter for a loving and deserving time to research and to work on a case until he asked TJ to join him on the Campaign father. His daughter also recalls the time when “gets it right”—a real luxury! “Sentencing Financing Task Force, and he was appointed as Conrad spent 15 months from January 2000 hearings,” he says, “are the most intense and an assistant US attorney out of the Nashville to April 2001 working in Washington, DC, in challenging aspect of this work, particularly division. As the work on the task force phased connection with his work on the Campaign now that the judge must take the facts of each out, TJ returned to the US Attorney’s Office to Financing Task Force. He would come home case into consideration and exercise discretion work as a federal prosecutor. By 2005 TJ was on weekends and begin to do laundry. When in reaching a decision.” Close to 90% of all married with a family. He had never forgotten his wife Ann asked him why he was suddenly criminal cases are resolved with a plea, which the lessons he learned from his early coach and doing laundry, he told her, “I just tried to explains the significant caseloads. mentor about making family count and he think of something that would make your life Judge Conrad enjoys trying cases. He was finding it more and more difficult to work easier.” His ability to maintain the priorities of respects the work that the trial lawyers put into the kind of hours he was expected to work and family life with a strong work ethic has been their cases and believes in the jury system as devote time to his family. He knew that Judge entirely intentional as he integrated his family the best way to resolve cases. For the most part, Conrad would appreciate his priorities and life with his work. As the children were grow- “the jury gets in right.” He also believes that together they decided that TJ would be the ing up the ritual was Saturday morning break- trials are “cathartic for the litigants.” In fact, career clerk. fast together at Anderson’s and then all off to the judge worries that while dispute resolution Coaching has been a major influence in the office. When he traveled he would make a may be less expensive and offer a faster resolu- Judge Conrad’s life. Basketball was his passion point of taking one child at a time with him tion, important legal issues remain unresolved. and coaching was, at one time, his goal. This, for quality alone time. The family meets He refers to Joe Anderson’s law review article, he explains, is maybe why none of his five chil- together on a regular basis and his children “The Vanishing Civil Jury Trial,” and observes dren followed his example and became have remained best friends. that as fewer and fewer cases reach a trial, there lawyers. He instilled in them his love of the Judge Conrad presides in the courtroom is a lessening of trial skills among attorneys— sport and used the “coaching method” to raise once occupied by his friend and mentor Bob especially a good grasp of the rules of evidence them. All except the youngest have graduated Potter. Under the glass top of Judge Potter’s and civil procedure. Rather, attorneys “work at from university and all are successful—”They desk were these words of wisdom: “Bad plan- becoming skilled at taking depositions and all have jobs!” His youngest son is a senior at ning on your part does not necessarily consti- resolving cases in mediation.” Belmont Abby where he plays on the basket- tute an automatic emergency on my part!” Judge Conrad has the greatest respect for ball team and plans a career as a college basket- The saying is no longer there, but his col- his law clerks with whom he enjoys both a col- ball coach. His older brother teaches religion league’s sense of humor has not been forgot- legial and a coaching relationship. He explains at Charlotte Catholic and will be coaching the ten. While attorneys see the serious and delib- that if students are “obsessive” in law school, basketball team at Belmont Abby this year. erate side of Judge Conrad in the courtroom, they will generally carry that obsessiveness over As is the case with many of his colleagues, behind that exterior is the gentle, often hum- to the practice of law. Instead he looks for Judge Conrad feels a sense of isolation—one ble humor of a man who is comfortable with clerks who have not only excelled in law of the few negatives to the job. If he socializes himself. school, but who also bring with them good with attorneys he is “funnier and right more Behind his desk hang two portraits: one is judgment and a balanced approach to life. His often.” He does actively support the of Sir Thomas More the English lawyer, social advice to them is, “people matter, your word Mecklenburg County Bar and the North philosopher, statesman, and author of Utopia, matters, your character matters.” His respect Carolina Bar Association where he has served who died the king’s servant but God’s first. and consideration for those who work with on the Board of Governors. He will be partic- The other is of Fr. John Bradley, one time him is no better illustrated than with the deci- ipating with a panel on, appropriately, sports assistant to Bishop Fulton Sheen and president sion to hire his career law clerk. law at the Southern Conference of Bar at Belmont Abbey College. Also decorating his Bob Conrad first met TJ Haycox in 1987 Association Presidents later this year. He, office walls are two beautiful oil paintings of when he came to work at Bush, Thurman & along with his clerks and other court person- children done by his wife Ann, an accom- Conrad as a summer intern between high nel, run on Fridays before work. And he par- plished artist; a framed flag given to him at his school and college. Even at that early age, TJ ticipates in “lunch and learn” opportunities for swearing-in; and a framed rendition of the recognized that Conrad was someone special interns to meet and talk with other law clerks, famous Shroud of Turin. He also keeps a copy in that he was remarkably able to balance his judges, and court personnel. of the Bible and a treatise on the United States law practice while genuinely caring for his No summary of Judge Conrad’s life or Constitution on a table in the sitting area of family. Once in law school, TJ decided that he career would be complete without mentioning his office. wanted to practice criminal law. By then the pride and devotion he has for his family. In Conrad was working in the US Attorney’s an article written by his daughter Kim in CONTINUED ON PAGE 45

THE NORTH CAROLINA STATE BAR JOURNAL 27 An Interview with New President M. Keith Kapp

Q: What can you tell us about your roots? I’m a native of North Carolina with deep Tar Heel roots on both my mother’s and father’s side. I was born in Winston-Salem and grew up between Rural Hall and Bethania in Forsyth County. My parents live on a farm in Forsyth County that has been in my father’s family since the 1790s. My mother is from the Yadkin River Valley in Wilkes County, where her family history is equally as long. Q: When and how did you decide to become a lawyer? I studied history and English at UNC- Chapel Hill. As a Morehead Scholar, I had the privilege of participating in a program that strongly emphasizes leadership and responsibility. I took advantage of leadership opportunities on campus, particularly in the Dialectic and Philanthropic (Di-Phi) debat- ing societies, which I served as president. However, at first I had no clear idea what With his wife Chancy looking on, M. Keith Kapp is sworn in as president of the State Bar. profession would combine my interest in scholarship with the chance for leadership. Kingsfield! What made the difference for me my profession for every one of those years. Academia looked like a good option. I could were, again, the people of the law—the Q: What’s your practice like now, and how see myself as an American history teacher. lawyers themselves practicing an honorable did it evolve? Ministry within the Moravian Church was a profession. After my first year I was fortu- I have a commercial and administrative possibility, too. I chose to apply to law nate to obtain a summer clerkship with the litigation practice. To my knowledge, I was school in part because a number of the men- Winston-Salem firm of Hall, Booker, Scales the last associate hired by Maupin Taylor tors I met at the university—especially and Cleland. Back then, law students didn’t and Ellis who was required to try a case, among Di-Phi alumni—were lawyers. John always have clerkships that first summer. draw a will, draft a contract, close a piece of Sanders, past director of the Institute of Some firms preferred to wait until the end of real estate, and go to an administrative hear- Government and past vice-president of the the second year to offer that experience. ing. What stuck with me out of all that was university system, is an outstanding exam- From the first week I knew that the law was the dispute side rather than the transactional ple. Another is Chuck Neely, who hired me where I was meant to be. One of the part- side. However, I am thankful for the broad at Maupin Taylor and Ellis. That grueling ners, Roy Hall, was a terrific lawyer and a knowledge I got in those early years of taking first year at UNC Law did not convince me county commissioner, demonstrating that a every file in the firm that either nobody that I had made the right choice! The movie demanding profession and public service can knew how to handle or that nobody wanted The Paper Chase was just a couple of years go together. Everybody put in long hours of to handle. I believe because of that training I old at that time, and I promise you – I hard work yet seemed to have time for great am able to see issues in cases that lawyers understand completely why that first-year families and interesting lives. They treated who are more focused and specialized do not student literally lost his lunch, because my me as one of the team. 2012 marks the 33rd necessarily see. seatmate did exactly the same thing in the anniversary of my admission to the bar. I Q: You are a partner in a large interstate law face of UNC’s version of Professor have been glad of my choice and proud of firm and the majority of lawyers in North

28 WINTER 2012 Carolina are practicing alone or in very Council? have licenses and no employment have prob- small firms. Can you relate to the average The most difficult issue I’ve faced was my lems with addiction, stress, or mental illness, lawyer and understand his or her problems? participation in the special committee that and we are seeing them in the LAP program. My service to the bar at the local, region- looked into the Hoke/Graves matter or, as Inexperienced, unmentored young lawyers al, and the state level has brought me into some people call it, the Gell matter. It was do not know what they are doing, and we contact with what you describe as the “aver- very hard to reconcile the decision of the are seeing grievances filed against them. age lawyer” in North Carolina. I’ve practiced Disciplinary Hearing Commission and to They do things that are unethical because with the “average lawyer” throughout my explain the State Bar’s part of it as the prose- they do not know the North Carolina Rules career. At each level of service, whether as cutor. Perhaps we didn’t present the best of Professional Conduct or State Bar ethics president of the Wake County Bar or on the case, but still, justice was done and adminis- opinions. It is one thing to pass the multi- Board of Governors of the North Carolina tered by the Disciplinary Hearing state ethics exam and another to know what Bar Association, or as a councilor to the Commission. The public does not under- the North Carolina Rules and ethics opin- State Bar, I’ve tried to focus on what is best stand the distinctions for due process for the ions require in practical application. for the practicing lawyers in the state. I’m accused provided by the investigator, the Q: What about lawyers who are approach- also supported by a State Bar Council where prosecutor, and the judging body. ing the end of their legal careers? Does the the great majority of the members are prac- Q: What do you think are the biggest issues State Bar have a role to play facilitating ticing in small firms or as solo lawyers in currently facing the council? their retirements? their judicial districts. They were a constant The increased globalization of the prac- Lawyers now practice and live longer source of help to me as a fellow councilor tice of law and the technology changes that and, with the aging of baby boomers (myself and will continue to be so as a State Bar offi- are wrought on a daily basis are the biggest included!), we must acknowledge that more cer. issues with which we must wrestle in the lawyers will be facing illness, family stresses, Q: How and why did you become involved State Bar. Change is constant, but change is addictions, and dementia. The State Bar has in State Bar work? much more rapid than it was in the past. an excellent LAP in place, and interventions I was elected as a councilor for Wake Q: You have indicated that the State Bar for cognitive impairment due to age are on County 10th Judicial District in 1999 and ought to assist lawyers as they enter the the rise in LAP. In the coming year, we will served three terms. This was my first involve- profession and as they leave it. What do be looking at additional ways to assist ment with the Bar Council. However, my you see as the biggest problems facing new lawyers as they exit practice. State Bar involvement goes back to the era of lawyers and what should the organized bar Q: Are you concerned at all about global- Roy Davis, as president of the Bar, and Bill being doing about them? ization and whether the State Bar ought to Davis, as chair of the Ethics Committee. At This year we had the highest number of be involved in the regulation of foreign that time, the State Bar embarked on a pro- applicants in our history for the bar exam in lawyers? gram to get young lawyers’ views on issues, July. Our state has seven schools of law. This We should regulate only those for whom and I was appointed the only young lawyer year 42,000 people nationwide took the bar we provide licensure. The question is on the State Bar Ethics Committee. In that exam, and only half that number of legal whether we should license foreign lawyers, service I wound up drafting the initial ethics positions are open in the country. How and that is a question first for the Board of opinion adopted by the committee and the many of these new lawyers have taken on Law Examiners. council which led to the case of Gardner v. huge debts in order to earn their law degrees, Q: You’ve been an officer during the past State Bar, wherein it became the law in North expecting that at least a decent living awaits two years, first as vice-president and then as Carolina that an insurance captive law firm them? How many hesitate to go into public president-elect. What has that been like? could not represent the insureds of insurance service law because government salaries can’t Does the president generally call the shots companies (316 N.C. 285 (1986)). keep up with debt payments? Our State Bar unilaterally or does he seek consensus Q: What has your experience on the Bar already works with law school deans and among all the officers before taking action? Council been like and how has it differed others to make sure that prospective students The presidents I have served under have from what you anticipated? have a clear, accurate understanding of the always sought consensus. I plan to do My experience with the State Bar demands and rewards of the profession— absolutely the same thing. I also plan to get Council has been wonderful. I’ve never met and of the realities of potential employment. the involvement of the councilors. Being a more dedicated group of people. The abil- Q: Are there too many lawyers? Is that a president of a licensing body does not make ity to have people on board from literally legitimate concern of the State Bar? one a czar. Manteo to Murphy and from small towns There are too many lawyers. Most statis- Q: Can and should anything be done to and large cities and different parts of the pro- tics I’ve seen in the past year support that. As facilitate the licensure of lawyers whose fession makes it truly a diverse group. As to I mentioned earlier, we have twice as many military spouses are transferred to bases in how it differed from what I anticipated, it people sitting for bar exams in this country North Carolina from other states? has been more rewarding than I expected it as we have job openings for lawyers. I per- This has already been done. I commend would be when I came to serve the first year sonally trust in the free market, and I believe the work of our immediate past president, of my three terms as a councilor. there will be correction in that regard. Tony di Santi, and his committee made up Q: Can you tell us about the most difficult However, it is a legitimate concern of the of members of the Board of Law Examiners issue you’ve faced as a member of the Bar State Bar because many of these people who and councilors of the State Bar. Their work

THE NORTH CAROLINA STATE BAR JOURNAL 29 resulted in changes to the Board of Law provided by those unqualified to provide ogy to enable staff to do their jobs effectively Examiner’s rules which will allow these such services. and efficiently and, very importantly, to pro- spouses to timely seek licensure in this state. Q: In your opinion, does it make sense for vide the convenient public access we have The military is very important to our coun- lawyers to be regulating themselves? Is it not had in previous facilities. The State Bar try and this state. We have reached out as a good public policy? Do we deserve the pub- is a state agency, and our council meetings, self-regulating, licensing entity and provided lic’s trust? disciplinary hearings, and trials are open to assistance in this area by: (1) giving the It does make sense for lawyers to regulate the public. We are on time with the con- spouses of those in the military priority in themselves. It is part of our heritage begin- struction, within our original cost estimates, processing of applications, (2) providing a ning with the Temple Bar and other Bars in and we plan to occupy the building in early comity rule that recognizes their need to London that go back to the Middle Ages. 2013. I look forward to presiding when the move between jurisdictions as often as every These are early examples of lawyers policing ribbon is cut for the new building in April. two years, and (3) recognizing the cost bur- and regulating themselves. It is a tested poli- We have had phenomenal support for the den to them. These are excellent actions. I cy that is tried and true. As long as we have building from inside and outside the profes- will be pleased to preside in January at the the public trust, then we should be allowed sion. I’m very appreciative of the work of the meeting where these rules are brought by the to regulate ourselves. I believe, at present, we governor’s staff, the Department of Board of Law Examiners to the council for have the public trust in the manner in which Administration, the State Construction approval. we regulate the profession. Office, and the Council of State. I am grate- Q: The State Bar has been sued by Q: You served on the State Bar’s Ethics ful for the North Carolina State Bar LegalZoom. What’s the dispute about, Committee for many years. What was that Foundation, which was created by some of what is the status of the case, and why is the like? Was all that arguing worthwhile? Does our past presidents to provide an opportuni- litigation important? the Ethics Committee make a difference in ty for lawyers in the state to contribute if LegalZoom is an online legal document the professional lives of attorneys? Does the they so desire to the enhancement of the preparation service that operates nationwide. process benefit the public? building project. At its website, LegalZoom asks the cus- The North Carolina State Bar Ethics Q: The North Carolina State Bar tomer—a member of the public—a series of Committee is one of the last great debating Foundation, which is independent of the questions. Based upon the customer’s societies in the western world. The debate Bar Council, is running what appears to be answers, LegalZoom prepares a legal docu- that goes on within that committee on the a very successful fund-raising campaign in ment which it either delivers to the customer fine points and the broad strokes of where support of the new building. Do you think or files for the customer. In 2008 the State ethics covers the profession is just amazing. lawyers ought to contribute? Bar’s Authorized Practice Committee sent Chairing the Ethics Committee and giving I’m not yet a past-president and, as part LegalZoom a letter advising it to cease and everybody the opportunity to be heard has of the group that continues to regulate the desist engaging in the unauthorized practice been one of the most challenging things I’ve profession, I’ve not been heavily involved in of law in violation of N.G. Gen. Stat. §§ 84- done in my professional career. It is much the activities of the North Carolina State Bar 2.1, 84-4 and 84-5. LegalZoom sued the better to have a chance to ask what is ethical Foundation. I’m appreciative of what they State Bar, asking the court for a declaration before being informed that what you have have done, and I have thanked a number of that it is not engaged in the unauthorized done is in violation of the rules and subject- people as I’ve become aware of their contri- practice of law. It also asked the court to ing yourself to the potential loss of your butions to and through the North Carolina compel the State Bar to register a purported license. This is the first step in protecting the State Bar Foundation. The opportunity to prepaid legal services plan. LegalZoom con- public. The Grievance Committee and its give is a matter of personal choice, and I tends that the State Bar is violating the anti- recommendations to the Disciplinary appreciate those who are willing and able to monopoly and equal protection clauses of Hearing Commission protect the public, but make gifts. the North Carolina Constitution. The case many, many more reap the benefits when Q: Is there anything else you would like to has been designated by the chief justice and lawyers are able to get guidance on what is accomplish during your year as president? by the chief judge of the North Carolina and is not right before they make a mistake. Always and foremost I will seek to pro- Business Court as a Mandatory Complex Q: At one time you chaired the State Bar’s tect the public as well as support the legal Business Case under N.C. Gen. Stat. § 7A- Facilities Committee. Can you tell us where profession in North Carolina. I hope that we 45.4. The court denied the State Bar’s we are in regard to the construction of the will be able to keep moving forward with all motion to dismiss under Rule 12(b)(6). The State Bar’s new headquarters? the good work my predecessors have put in State Bar filed a counterclaim asking the The State Bar exists to regulate the pro- place. Again, I am interested in working to court to enjoin LegalZoom from engaging fession and to serve North Carolina’s citizens make sure that as the regulatory body, we are in the unauthorized practice of law. The who deserve quality representation from doing the best we can for the lawyers who State Bar expects to file additional disposi- lawyers of integrity. For years the staff and are at the beginning of their practice and tive motions. The case has not been sched- facilities that enable the Bar to carry out those who are at the end of their practice. uled for trial. The State Bar’s interest in this those functions have been scattered across Q: If you had not chosen to become a case is to fulfill its duties under Chapter 84 several locations, many of them leased. The lawyer, what do you think you would have to protect the people of North Carolina new building at the corner of Blount and from harm resulting when legal services are Edenton Streets will have space and technol- CONTINUED ON PAGE 45

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FOR THE ISSUES OF LIFE IN LAW FICTION WRITING COMPETITION - SECOND PRIZE

The Ring

B Y T ERRY O RNDORFF

“To be yourself in a world that is constant- n’t sand. It was gritty like sand, but it had a ly trying to make you something else is the familiar, unpleasant odor...and it was sticky. The Results Are In! greatest accomplishment.” His hands instinctively began searching for his —Ralph Waldo Emerson glasses. “The ring!” he thought. He reached to This year the Publications his chest to find that the ring was still on the Committee of the State Bar sponsored * * * * * chain hanging from his neck. its Ninth Annual Fiction Writing “Kid, get in a seat now!” the bus driver Competition. Eighteen submissions Every nerve in Luke’s body tingled as he yelled at Luke as he struggled to his feet. were received and judged by the com- crossed into enemy territory. Shouldering his The school bus was already moving and mittee members. The submission that gear, he drew a deep breath and carefully made Luke fought to maintain his precarious bal- earned second prize is published in this the initial climb to the top of the incline. That ance. As he bent down to retrieve his glasses, edition of the Journal. was the easy part, he thought. Here the hot, he saw the weapon at his feet—an eighth damp air seemed almost viscous. His lungs grade algebra book. The laughter subsided, struggled at twice their normal rate, and his and Luke attempted to obey the bus driver’s the ring, closed his eyes, and thought about chest shook as his heart hammered against his command as the vehicle jostled him from side his father. Though he would never admit this rib cage. Even as his body began the required to side. to anyone, Luke felt like he somehow con- turn to the left, his brown eyes were already “Yeah, sit down, freak!” a voice barked nected with his father when he held the ring. scanning ahead for any hint of danger. He from the back. Only seven months had passed since the paused briefly to assess what lay ahead. It was This comment initiated another wave of “dark day,” the worst day of his young life. On too quiet—an unnatural quiet. He could laughter. As he approached each row, the seat- August 18th, Luke’s father was driving home almost sense an evil presence ahead. A ribbon ed passengers scooted toward the aisle. No one through the angry remnants of a tropical of sweat trickled down his forehead and wanted to sit next to a target for fear that they storm known only as “TS Four.” Five miles burned in his right eye. He removed his glass- might catch some shrapnel as well. He from home, he spotted a stranded motorist es, ran his sleeve across his face, and replaced searched for Amy’s face without success. Amy through the downpour. While he assisted the them in one smooth motion. This is insanity, always saved a seat for him. Well, not really elderly gentleman with a flat tire, a green van he thought, but I have no choice. I must move “saved” a seat, since no one wanted to sit with suddenly swerved out of the mist. The impact now, before I am noticed. Only a few more her either. But her bus stop was one of the first threw his father’s body over 15 yards. It was yards to go, but they would be the most in the morning, so she was usually able to find the next day that Luke received the ring. treacherous of all. Luke knew from experience a seat for herself, and for Luke. Luke had just made it into the school that he should continue with a slow, careful, The other students regularly terrorized when he heard a voice that made his bones stealthy approach. Unfortunately, the adrena- Amy because of her weight and how she turn to liquid. line surging through his body began to wrestle dressed. She wore long sleeves even on the “Hey Puke! You got my report yet?” Ned control from his prefrontal cortex. Fight or hottest of days. Luke thought he knew why Barfield said. flight. He put his head down and began a she wore the long sleeves. Last month, the “I have to get to class,” Luke replied, as he quick forward drive. Only a few more feet...he school bus had hit a bump that almost sent tried to move ahead through the herd of stu- could still make it. Amy’s clarinet case to the floor. When she dents. A silent projectile rocketed toward Luke. reached out to keep it from tumbling, Luke Luke felt a hand grab the collar of his shirt Its aim was true. He felt a swarm of angry hor- was able to see a series of straight scars running and he was suddenly slammed against the nets attack the base of his skull just before a up and down her forearm like railroad tracks. lockers. Ned then turned him around so that blanket of darkness encompassed him. Amy quickly pulled her sleeve over the disfig- they were face-to-face, or in this case, face-to- As the haze slowly lifted, Luke awoke to a urement and turned away. It was never dis- chest. throbbing pain in his head. He was groggy, cussed by either of them. Ned had his hand on Luke’s throat, pin- but alive. He lifted his face from the ground As Luke’s left buttock finally caught hold ning him against the lockers. Breathing and brushed the sand off his cheek. But it was- of the corner of a crowded seat, he reached for became difficult.

32 WINTER 2012 “It’s due tomorrow, and I better get it just something that we all went through. It the water. But it could also be used just to play tomorrow. You understandin’ me, Puke?” will all work out eventually.... Luke, how in catch, as Luke and his dad often did. They Luke hesitated, and then nodded slightly. the world did you manage to get dirt there?” would usually make it a contest to see how far Ned leaned down and spoke softly so that Before Luke could react, his mother had apart they could get and still throw accurately. others couldn’t hear. His yellow teeth were already reached out and began rubbing his Luke didn’t have a friend to practice with, so only inches from Luke’s ear and his thick, hot neck with her thumb. every day after school he would throw rocks at breath smelled like old eggs. “Ow Mom, stop!” Luke reached up, pro- different targets in the woods. “And you better not think I’m going to feel tecting his neck. “You really should consider trying out for sorry for you because your daddy died, you lit- “Luke, are those bruises?” the baseball team this year.” tle puke. What a waste he was. He sure didn’t “It’s nothing Mom, we were playing foot- “Nah, I just like throwing with you, Dad.” teach you how to be a man. Do you cry for ball today at recess.” Luke’s mom called from the beach, “You your daddy at night like a little baby? Huh? “Are you sure?” Luke’s mom asked. He boys need to finish up if you still want to have Do you curl up in a little ball and whimper? could tell from her tone that she was suspi- time to get to Fort Macon.” Do what I tell you, or I just may show up at cious. Now her hand palmed the top of his It was almost a tradition by now. Before your house and get rid of your mommy, too. head and tilted it slightly, first left, then right, the drive home, Luke’s mom would take a Then you’ll be an orphan baby. How ‘bout all the while scanning for other marks. book and read by the pool, “one last slice of that? I know where you live. Maybe I’ll sneak “Yes Mom, it was football. I’m kinda hard bliss” she called it, whatever that meant. in your house and put rat poison in her coffee to take down,” he said with a crooked smile. “Borrring,” Luke thought. But the men maker. You like that? Or how ‘bout I just show At 13 years old, he was the man of the would do something fun. They would drive up one night and take my ball bat to the back house now. He had to take care of himself and up to Fort Macon State Park and walk around of your mommy’s head? I’ll do it—you think his mother. Mom had enough to worry about. the old fort. I’m kidding, Puke? Do you?” Sometimes, late at night, he could still hear As Luke and Ken Winston sat on a set of Luke shook his head. her crying softly in their room...her room. steps inside the fort, they watched the swollen “Is there a problem here?” Assistant “Are you still getting picked on by the kids clouds drifting over the ocean. Luke’s fingers Principal Coffman asked. Neither boy had at school...that Barfield boy?” traced the century old grooves in the steps that noticed his approach. “No, Mom.” Luke drew out the word were left by a shot from a Union cannon. The “No sir,” Ned said immediately. “My “Mom” like she’d just asked if she could walk shot had chipped the edge of each step as it buddy Luke and I were just playing around.” him to class on the first day of a new school slid down the stairway. Eventually, the “I don’t believe you,” Coffman said, “and I year. Confederates who manned the fort had sur- don’t know who started it, but I want it to end “It’s kind of odd how he suddenly stopped rendered to the Union Army. right now!” bothering you after your father...” her voice “Did they surrender because they weren’t “Really?” Luke thought, “You don’t know trailed off. brave enough?” Luke asked. who started it? Seriously?” But he said noth- “Everything is fine! Ok Mom?” He had “No, Luke. There were many brave men ing. made it to his room before she could reply. and women on both sides in that war. “Now get to class, both of you,” Coffman “Ok, honey,” she said to the closing door. Choosing not to fight is often the right thing ordered. Luke lay in his bed, staring at the ceiling. to do. You can’t worry about what others His face burned with shame as tears silently think, you have to do what you know to be * * * * * glided down to the pillow. He closed his eyes. right.” The room was silent, other than the quiet After a pause, Luke said, “last week in the “Luke, did you see Amy in school today?” hum of the Batman clock, and the whisper cafeteria, some of the guys dumped their his mother asked as he slung his book bag up that escaped his trembling lips, “I miss you, garbage on my tray while I was eating. I on the kitchen table. Dad.” Then he allowed his mind to relax, to couldn’t eat the rest of my food.” “No, she must be sick again,” Luke replied. drift back...to better times...a time before... “Did you tell a teacher?” his father asked. “I spoke to her mother this morning. She “I told one of the cafeteria workers, but was having a time trying to get Amy to go to * * * * * they just told me to clean it up. While I was school. She said that her depression has gotten cleaning it up, a boy at the next table called me so bad that she may have to take her to the They were a complete family again, play- a ‘wimp.’ I guess he thought I should have doctor to get medication.” ing on the beach where they had spent many fought them,” Luke said. “She doesn’t need medication, Mom. She happy times before the Dark Day. “Do you think you should have?” needs kids to stop picking on her because of “Wow, nice throw!” Ken Winston said as “I guess not. If I had tried, I would have her weight. All the girls call her Fats McCoy.” Luke whipped the ball over the waves. been beaten up, and probably would have got- “Well, kids do tease, especially girls at that “Thanks, Dad,” Luke grinned. ten suspended, too.” age.” He wasn’t about to tell his dad that he had Luke looked down at the steps so his father “It’s not just teasing when you’re being practiced his throws every chance he could wouldn’t see the tears beginning to well up in cruel to someone every minute of every day,” since they bought the water ball. The ball, his eyes. “I can’t wait until I’m out of school Luke said. made of a soft rubbery material covered in and I don’t have to worry about bullies any- “Sweetie, I was not defending the girls, it’s cloth, was designed to skip across the top of more.”

THE NORTH CAROLINA STATE BAR JOURNAL 33 His father reached down and placed his “With this,” he said, as he held the ring up slide back onto his father’s right hand with the hand over Luke’s. The ring on his right hand to Luke. word “Love” upside down. If he had pointed glared in the sunlight. Luke took the ring and studied it. It was this out to his father, the response would be “Luke, you need to understand that you the first time he’d ever held it. There was no the same as always, “It’s more important that I will run into bullies all of your life.” stone, and only one word on the face of it - can read it.” Luke looked into his father’s eyes, hoping “Love.” It was the ring Luke’s grandpop and They left the fort and began walking up that he was joking, but knowing he wasn’t. memaw had given his father the day he’d left the cobblestone tracks toward the parking lot. “Even after I’m out of school?” Luke asked. for basic training. “Sometimes I have nightmares about you get- “Yes,” his dad said. “It doesn’t matter where “Is this supposed to be a magic ring?” Luke ting hurt, getting killed...” Luke said. you go or what you do, you will come across grinned. “Well, I was in the marines for eight years bullies. Most of the officers I work with are “The ring itself is only a symbol. Do you and I’ve been a police officer for five now...so very good, honorable people, but over the still have that cigar band?” far, so good,” he said with a grin. years I have met some that use their authority Luke held it up beside the gold ring. “I’m serious, Dad. Don’t you ever worry to bully others. I’ve seen it happen with politi- “The cigar band represents a circle of about getting hurt or killed?” cians, lawyers, prosecutors, even judges. abuse, but this ring represents a circle of love. “I don’t worry about it,” Ken Winston Anybody with power over someone else can Your grandpop and memaw were loved deeply said. “Worrying isn’t helpful. I try to always do be a bully.” by their parents. They were treated with fair- what’s right, which is not always what’s safe. “Do they hit people and dump garbage on ness and respect throughout their childhoods. Besides, I figured out the secret to living forev- them?” Luke asked. Then, when I was born, they treated me that er.” Luke’s father smiled at the question. way. I was brought up in an open, loving “Sure you did,” Luke smiled, “What is it?” “When an adult bullies another adult, it’s usu- home, where I could talk to my mom and dad As they approached the car, Ken Winston ally not physical abuse, it’s an abuse of power. about anything. stopped, looked his son in the eyes, and said, They use some advantage they have over oth- “Just like me!” Luke interrupted. “Your whole life, day after day, little by little, ers to try to demean them, to make them feel “Yes, and when they disciplined me, they I’ve been downloading myself into you. weak and helpless.” did it for me, not to me—even punishment Whenever we spend time together, each time “Why would anyone do that?” was done in love, not anger. On the day I left we talk like this, I leave a little more of me in “Often, it’s because they themselves have for the marines, your grandpop told me that you. Through you, and then through your been the victim of abuse in the past.” as I got older, I would probably forget much children, I will live forever.” Then he winked His father reached down to the bottom of of my childhood. He made me promise that I at Luke as he opened the car door. one step and picked up a small flat piece of would remember one thing above all “Ha! Sure, Dad,” Luke laughed. black and gold paper. He unfolded it into its else...that I was loved. That’s when he gave me Suddenly, Luke heard a scream from across original cylindrical shape, and handed it to his this ring.” the parking lot. But it wasn’t the parking lot son. Luke could just make out the word Luke’s father’s eyes seemed to glisten as he any more. It was...Luke shot upright in bed. “Macanudo” on it. looked thoughtfully into the distance. “And The screaming sounded like his mother, and it “Abuse can be a circle, like that cigar band. it’s that foundation of love that gives you the was coming from outside. Luke bolted out the In some families, children are bullied by their ability to resist becoming a bully.” front door. own parents, and that violence can travel “I guess not every kid gets a Luke sand- “Luke, stay back!” his mother cried. through many generations.” wich?” Luke asked with a grin. Luke’s body instinctively froze as his eyes Luke frowned. “Does everyone who is bul- The “Luke sandwich” had first begun took in the immensity of the beast that was in lied later become a bully?” when he was very young. As far back as he front of her. It was Bear, the large mixed-breed “No. We don’t know why a change occurs could remember he would call for a Luke dog that brutally mauled a 16-year-old girl in in some victims of abuse but not others.” sandwich. Usually this occurred while he and the neighborhood last year. The dog’s great “How can you tell who has been changed his parents were on the sofa together, or some- round head seemed the size of a basketball. As into a bully?” Luke asked. times as he was going to bed at night. The the dog snarled and growled, long strings of “Unfortunately, if abuse changes someone, unwritten rules declared that upon his cry of foamy, white saliva swung from its jaws. The you won’t know until they acquire some type “Luke Sandwich!” his father and mother were lips drew back to reveal impossibly large teeth. of power over others—and that may take then obligated to wrap around him on either Luke looked around for a weapon, but saw years or even decades.” side, thereby becoming the bread of the sand- none. Finally, his eyes fell upon the water hose Luke and his father got up and walked wich—a family hug. And though there were laying in the yard. Within seconds, a hard through the fort, past the field cannon, and no minimum time requirements, the hug stream of cold water struck the dog in the face. toward the entrance. As they reached the sally would always last at least a full minute, and Bear yelped in surprise, and jumped back, but port, Luke asked, “If someone is being abused, often longer. immediately recovered and advanced toward how can they make sure that they aren’t being “That’s right, not every child is raised in a this new adversary. The low rumbling growl changed into a future bully, Dad?” loving home. Always remember that the cycle penetrated Luke’s body. Luke adjusted the aim His father smiled and led him to a bench. of love can overcome the cycle of abuse and of the water stream and gave Bear another As they sat down, Luke watched his father hate, okay?” hard shot in the face. Bear shook his fur, begin working the gold ring off his right hand. Luke nodded as he watched the gold ring looked at Luke, and then turned and ran

34 WINTER 2012 down the road, out of sight. about 20 feet away. behind those words? Wasn’t he, at least partly, “Luke!” his mother ran to wrap her arms “Look Fats, we have front row seats,” Ned becoming the man his father was? His father around him. Though the dog had never got- said. He then turned toward Mike and Goat did what was right, not only what was safe. ten closer than five feet to him, his mother’s and said two words: “Dunk him.” Luke felt the truth hit him like a great rushing eyes took a quick inventory of his body parts, Luke had just opened his mouth to say wave. “My father fought injustice until the making sure everything was present and something when suddenly his head was forced day he died. He was not a bully or a accounted for. into the water. Murky, slimy water rushed into coward...and neither am I.” his mouth. He struggled without success. This time as he was brought up out of the * * * * * “This is how I’m going to die,” he thought. water, Luke put all the strength he had left “I’m going to die and they will get away with into whipping his head backwards. The back “Are you okay, Amy?” Luke asked. it. I will be just another kid who drowned of his skull made crunching contact with She just nodded and looked at him with a while playing in a creek where he shouldn’t something soft and squishy. slight smile, but what was troubling was the have been. And Amy isn’t in any condition to “Ahhhrr! My nose!” Goat screamed. way she seemed to be looking right through tell what really happened.” Luke began con- Luke looked back to see Goat rolling on him. It’s the medication, he thought. vulsing and just when he was sure that he was his back with both hands over his face. Blood When she didn’t board the bus home, about to lose consciousness, he was brought was already streaming from between his fin- Luke searched for her, and eventually found up, sputtering and coughing. gers. her at the edge of school property, beside the Luke was only up for a few seconds, and Luke rapidly sucked in the sweet oxygen as old supply shed. had almost caught his breath, when Ned said, he struggled up to his hands and knees. He “Amy, if we don’t leave now, we’ll miss the “Again,” and he was back in. Luke could feel noticed three things in quick succession. First, bus. We may have missed it already.” the gritty residue in his mouth. His lungs Mike was nowhere around. Second, Ned was “Oh, you’re going to miss the bus, Puke.” burned as he fought against the autonomic still cutting at Amy’s clothes while laughing Ned Barfield had appeared by the supply trail- reflex to breathe. As the burning became maniacally. And third, he felt a familiar, er holding a liquor bottle. Worse yet, his two white-hot, he involuntarily released his smooth, cold object beneath his right hand. accomplices, Mike Bradford and Kevin remaining air in a great “Huuffff!” Just as he He palmed it as he rose to his feet. Ned’s cack- “Goat” McMillan, were with him. Mike was about to inhale the filthy water, he was ling laugh was so loud that it took a few sec- wasn’t too bad when he was by himself. He brought up again. onds for him to notice that Goat was no was really just an immature punk who liked to “Woo hoo!!” Ned was euphoric from longer laughing with him, but instead was disrupt class with fart noises, both imitation Luke’s near drowning. screaming in pain. and authentic. But Goat was almost as mean “Now that’s how you teach respect, isn’t Even as Ned turned and advanced toward as Ned. that right, Fats?” Ned eyed Amy up and Luke, Amy didn’t take the opportunity to run. “So you decided to skip the report and down. “You know you need to learn a little “She’s completely retreated into herself now,” make me fail history, huh Puke? Maybe you respect, too. I mean, how can I respect you if Luke thought. thought I was joking before? Is that it, Puke?” you don’t respect yourself?” Ned said mock- “You die today, Puke. They will find your Before Luke could even get to his feet, ingly. “Just how many rolls do you have under body downstream in a few days and your Mike and Goat grabbed him, twisted his arms there?” He pulled a knife from his pocket and mommy will cry for her stupid little baby.” behind him, and jerked him up. Pain shot placed the blade under one of the buttons on Despite the knife in his hand, Ned didn’t through his elbows. her blouse. With the flick of his wrist, the but- sound as confident as he once did. Maybe it “And looky here, the skinny wimp’s girl- ton was gone. was the way Luke’s eyes locked on his, or just friend is a big tub of lard.” Ned laughed. He Luke heard Mike say, “Ned, what are you maybe he, too, sensed the change in Luke. leaned over and put his face close to Amy’s. doing? I don’t want to be part...” and Luke Not really a change, Luke thought, a reversion “Heya, Fats.” Amy just stared ahead. was back under water. his true self, to the Luke that had existed “Take him to the creek,” Ned ordered. “It’s This time it was only Goat pushing him before the fear, the Luke who hated injustice, time for little Puke here to get a lesson in down. Maybe Mike was still arguing with just as his father before him. A feeling of calm respect. And I’ll take Princess Jabba along as Ned, or maybe he just got scared and left, but focus flowed through Luke’s body. well. She seems like lots of fun.” it didn’t matter—Luke was too weak to fight. “Run or die, Puke!” Ned yelled. Rather Ned reached down, grabbed onto Amy’s Time began to slow. Luke felt the ring on than retreating, Luke began to walk slowly hair, and pulled until she rose to her feet. the chain tap, tap, tapping on his nose in the toward Ned. When Ned’s leading knife hand Mike and Goat began forcing Luke to the water’s slow current. Words from his father was about 15 feet away, Luke leaned back and woods with Ned and Amy following. They swirled in his mind—not to let the bullying then snapped forward, his right arm was a were holding Luke so tight that every time he change him—but there had been a change. I blur. He fired the cue ball size rock with flaw- hesitated, or stumbled, it was a new adventure act like a coward now, but is that who I really less aim. As it slammed into its mark, there in pain. The creek lay only a few yards inside am? He thought of facing Bear with nothing was no scream of pain, but only a dull thud. the woods. It was about 30 feet across and but a hose, protecting his mother. I am not a Ned crumbled to the ground. Luke checked lined with rocks and pebbles. They forced coward. He recalled his father talking about that he was breathing, and picked the knife up Luke to his knees at the water’s edge. Ned sat “downloading” himself into Luke, and Luke Amy down on the side of a large fallen tree had laughed at that, but didn’t some truth lie CONTINUED ON PAGE 41

THE NORTH CAROLINA STATE BAR JOURNAL 35 LEGAL SPECIALIZATION

Profiles in Specialization—Laurie Burch, Robert Joneth, and Kevin Rodgers

BY D ENISE M ULLEN, ASSISTANT D IRECTOR OF L EGAL S PECIALIZATION

recently had an opportunity to talk Q: Does certification with law partners Laurie Burch, help the firm and your Robert Joneth, and Kevin Rodgers, clients? all board certified specialists practic- Rodgers – Yes, it ingI in Raleigh. Burch attended Campbell does. We’ve all had University School of Law, Joneth attended extensive training in the University of Wisconsin Law School, and Social Security law and Rodgers received his law degree from Wake have attained a depth Forest University School of Law. Each began of knowledge in that their legal career in Social Security disability one practice area. We law, Joneth working for the Social Security don’t handle a mix of Administration, Rodgers as a Hyatt lawyer,1 cases—we handle this and Burch in private practice. They formed one type of case and Burch, Joneth and Rodgers in 2000 after we are committed to working together at a larger firm for nearly a doing it well. Clients Kevin Rodgers, Laurie Burch, and Robert Joneth decade. In 2006 when the Board of Legal are better educated Specialization launched the new certification now than even ten years ago; they know forms with the Social Security in Social Security disability law, they quickly what to look for in a lawyer. Administration. There are so many different signed up for the exam. Their firm is one of Joneth - They come in with a list of ques- types of claims to choose from that it can be the few in the state in which all of the lawyers tions about how long we’ve been handling very confusing. In many cases there are also are board certified specialists. Following are these types of cases, what our success rate has peripheral issues, like retirement or unem- some of their comments about the specializa- been, the other types of cases we handle, etc. ployment benefits or workers’ compensation tion program and the impact it has had on They are typically happy to find a lawyer claims that really require a sophisticated their firm. with substantial expertise in the practice area. understanding of the law. Our clients look to Q: When you established Burch, Joneth Q: What do your clients say about the cer- us to help them figure out what’s best for and Rodgers, what was your vision for the tification? their particular situation. firm? Burch – Some come in to the office hav- Q: How do clients find you? What are your Burch – We knew that the firm would ing done a lot of research beforehand and best referral sources? specialize in Social Security disability law. We already knowing that we are board certified. Burch – Most of our referrals come from knew that we worked well together and that They see it as a good thing. They appreciate former, satisfied clients. we shared the common goal of doing our the extra effort that we’ve made and our com- Rodgers – We also get a fair number from absolute best for clients with Social Security mitment to Social Security disability law. workers’ compensation attorneys. and disability problems. Joneth – Social Security law is unique in Joneth – Also television advertising, other Joneth - Our common vision was to that there are also non-lawyer representatives attorneys, and doctors. We have satellite reach out to this segment of the population that handle these cases. Some of them are offices in Rocky Mount, Fayetteville, that has traditionally had a great deal of dif- good at what they do, but some of them are Smithfield, and Goldsboro. In those smaller ficulty finding qualified legal assistance. misleading about their ability to handle a towns, the television advertising is really the Rodgers – The reality is that the work has complicated case in its entirety—through an most effective way of reaching individuals become much more difficult in recent years as appeal. Some clients come to us confused facing these types of problems. procedures are changing and the Social and dissatisfied with their former non-lawyer Q: Are there any hot topics in your practice Security Administration has faced budget representation. We can assure our clients that area? problems. Our firm’s vision, however, remains we are able to handle their case through an Joneth – One issue that’s really having an the same—to provide our clients with the best appeal at the highest level—to federal court. impact on the practice of Social Security law representation and counsel possible. Rodgers – Clients can now file their own is the distancing of the client from the judges

36 WINTER 2012 and even from the lawyers. that then helped us in our practice. petitive unless you specialize, particularly in a Rodgers – There are a few very large, out- Joneth – Just like in the medical profes- city like Raleigh where there are so many of-state law firms handling cases here in sion, if you choose a board certified specialist attorneys. It’s more and more difficult to North Carolina. They send forms to clients you can safely assume that you will be getting have a general practice and do good work. through the mail and don’t actually meet a more sophisticated level of service. And you have to do good work—clients fig- their clients or appear in person at the hear- Q: Any tips for other lawyers preparing to ure out which attorneys are good at handling ings. In addition, many of the hearings are take the exam? complex cases. now handled through video conferencing Burch – There are many resources avail- Joneth – I think that the program will rather than in person. able to help with studying, including the continue to expand. As the law gets more Joneth – This places even greater barriers NOSSCR (National Organization of Social and more complex, you have to have a way between the judge and the client. Barriers in Security Claimant’s Representatives) month- of denoting which lawyers are really up to terms of education and socioeconomic status ly newsletters and the North Carolina speed in different practice areas. n already exist. When you add to that, it makes Advocates for Justice list-serve. it even more difficult for a client to be heard, Rodgers – It is a challenging test, so I For more information on the State Bar’s spe- understood, and believed. would recommend taking a review course, cialization program, please visit us on the web Burch – That’s why it’s so important to us that talking with other lawyers who took the at nclawspecialists.gov. we meet our clients before and at the hearing. We exam, and to start memorizing numbers— view our clients’ credibility as a very important things like limits, dates, and exceptions. Endnote part of the case that we’re handling. Having some of those things memorized will 1. Hyatt was a class action brought in the 1980s on Q: Does certification benefit the legal pro- help answer some of the questions quickly behalf of NC claimants who were denied benefits due to failure of the Social Security Administration (SSA) fession? and leave additional time for thought on the to consider complaints regarding pain, hypertension, Rodgers – Attorneys do a better job, in more complicated questions. and diabetes. The federal courts required the SSA to general, when they focus on learning one Q: How do you see the future of specializa- readjudicate thousands of cases that were improperly area well. When we studied for the specializa- tion? decided. tion exam, we all learned something new Rodgers – These days you can’t be com-

State Bar Outlook (cont.) Tim Batchelor who has what it takes and is Samuel Phillips (cont.) equal to the task, but no one expects him to compel compliance like his predecessor sim- light-fingered lawyer, finding herself in the ply by showing up. They broke the mold in the house built by her daughter’s husband; throes of a temporary cash-flow crisis and when they made that guy. In that regard I am it is now occupied, somewhat fittingly, by the knowing that a big personal injury case will reminded of a story told by Coach Dean UNC Center for the Study of the American settle next week, rationalizes that she is simply Smith at an alumni gathering shortly after South. borrowing from Peter to pay Paul and gives the Tar Heels won the national champi- Samuel Field Phillips has been forgotten, little or no thought to disguising the transac- onship in 1982. As I recall, he said that he with no record or reminder of his brave, tion. This is, it seems, most likely to happen happened to be standing among a large remarkable legacy. So, the next time you’re at in the context of solo practices, probably group of people at another social function UNC and walking around the beautiful cam- because no one else is looking. Inevitably, the earlier in the week and had overheard one pus, I hope you will wonder as I do: Where PI settlement falls through, necessitating Carolina fan commiserating with another is the monument that honors our own Sam additional “borrowing” from the trust regarding the then recent decision of star for- Phillips? n account. Sooner or later the lawyer is so far ward James Worthy to forego his last year of “out of trust” that even a cursory comparison eligibility and jump to the NBA. The gentle- Donna LeFebvre is a senior lecturer in of the books with the latest bank statement man was heard to say, “Don’t worry. Ol’ UNC’s political science department and teaches fairly screams misappropriation and portends Dean will just go out and get himself another law-related courses to undergraduates. She has the disbarment that generally results. Imagine Worthy.” After recounting this conversation- won 13 teaching awards, including two Tanner her dismay when Bruno calls for an appoint- al fragment, Coach Smith sighed audibly, Undergraduate Teaching Awards and three ment. Although his methodology is not that shook his head, and said, “That fellow could- Students’ Undergraduate Teaching Awards, and of a full financial audit, he is always advertent n’t have been more wrong. Ol’ Dean will she has won the UNC Bryant Public Service to irregularities that are in plain view. Perhaps never find another Worthy.” Award for extraordinary service to the not surprisingly, several lawyers visited by In much the same vein, I’m here to tell University community. She was elected to the Bruno have fully confessed before he has even you that I doubt we will ever find another Order of the Golden Fleece, UNC’s highest and had a chance to hang up his coat. Bruno. n oldest honor society, for outstanding contribu- You just can’t beat that kind of moral tions to undergraduate education. authority and, regrettably, it’s in fairly short L. Thomas Lunsford II is the executive direc- Article reprinted with permission of supply. Fortunately, we have found a man in tor of the North Carolina State Bar. Carolina Alumni Review.

THE NORTH CAROLINA STATE BAR JOURNAL 37 LAWYER ASSISTANCE PROGRAM

Being a Lawyer Saved My Life

B Y A NONYMOUS

am a lawyer and an alcoholic, but amazing in her grief, and managed the home not necessarily in that order. I was with quiet care and grace. an alcoholic long before I even con- It was in the year following my father’s sidered becoming a lawyer. I don’t passing that I began my relationship with believe that the inherently stressful alcohol. My very first time drinking alcohol natureI of the practice of law caused or even was the typical experimentation with exacerbated my alcoholic drinking. I do friends—a carefully-planned outing with a believe that because I am a lawyer I was stash of alcoholic contraband. My recollec- offered the care and assistance of the Lawyer tion of the intense feeling of that first intox- Assistance Program of the North Carolina ication remains to this day more vivid than success. Looking back, I think the concentra- State Bar, and that the program, quite frankly, any other childhood or adolescent memory. tion of time and thought required from me to saved my life. At that moment, I felt accepted, self-assured, make it through was healthy for me, and I grew up with few challenges. My father and connected to my friends as never before. upon graduation I felt a real sense of accom- was a doctor, and my mother stayed home to I did not know it at the time, but a switch plishment for the first time. Armed with the raise me and my three older brothers. We was thrown in my brain that would affect degree and licensed to practice, I took a job lived in a nice neighborhood with great pub- and direct my decision making for many with a local firm and joined the fraternity of lic schools. My parents loved and respected years to come. lawyers. Learning to practice law was not each other and never raised a hand in anger to High school became a framework for without its challenges. It is for many of us us or each other. While my father was far alcohol-related social functions. Weekends another opportunity to feel that we don’t from savvy as a businessman or investor, were for drinking with my close-knit group measure up, to wait for the curtain to be finances were never an issue. I always felt of like-minded friends, either at parties or thrown back, displaying for the world that we loved and watched over. otherwise. The excitement would begin with have no idea what we are doing. But the fra- Alcohol was present in the home, but not the anticipatory planning, peak with the ternity of lawyers in the local community of particular importance. My mother and consumption, and continue with the talk proved to be helpful, accepting, and friendly, father frequently shared a drink together after about it the following week. I went to college and I felt both proud and comfortable to be he came home from work while she was because everyone did, and relished the free- one of them. What I lacked in brilliance, I preparing dinner. There was an occasional dom it offered me. I was 300 miles away made up for in work ethic, and I did well for beer on summer evenings while they sat in from home and could pursue my passion for the firm. the yard listening to the ballgame, or played alcohol as an adult and on my own terms. I A few years into practice my marriage Yahtzee with my aunt and uncle. I have no took college seriously and did well enough, began to go downhill, and my alcohol con- recollection of either of them exhibiting but pursued and obtained a degree with no sumption began to grow. I focused all the mood changes related to their alcohol con- thought of its use. energy necessary to continue performing sumption. After college I married a woman with a well in my practice, but beyond that I spent Like many alcoholics, I remember that in decent job, and continued my life of under- most of my time drinking. While it might my childhood and adolescence I had distinct achievement. After several years my wife have seemed obvious to those around me feelings of emotional unease. I felt I was pushed me to obtain a graduate degree. It that I was on a path to destruction, we alco- somehow different from, and did not meas- seems ridiculous in retrospect, but the choice holics are masterful at segmenting our lives ure up to, the other kids in my neighborhood of law school resulted primarily from my to hide what is really going on. I was not a and school. While other kids seemed to carry inability to come up with any profession I social drinker and rarely drank in public. I themselves with confidence and ease, I was really wanted to pursue. I did not even intend drank by myself, where I did not have to be self conscious, a bit depressed, and just to practice law, but as fate has it, I was accept- concerned about anyone forming a judg- uncomfortable in my own skin. Just after I ed into law school and my journey with the ment about the amount or frequency of my turned 15, my father went to work one legal profession began. consumption. morning and suffered a massive heart attack, Law school demanded more effort and In another few years the trajectory of my dying on the spot. My siblings were already in focus than I had ever been called on to give to drinking really took off, and it became more or past college, so the household was sudden- that point in my life. I took it seriously, and more difficult to be in an alcohol-free ly just me and my grieving mother. She was worked hard, and achieved a modicum of office all day. I began drinking before work,

38 WINTER 2012 coming in later, drinking at lunch, and leav- LAP director. He explained that everything The next few years were spent doing the ing the office early to drink. At this point, we discussed would be subject to attorney- right things. I attended peer support meet- even I could not ignore the fact that I could client privilege and held in strict confidence, ings, met with my LAP monitor, worked not manage my drinking. I was not ready to and I told him I needed help. In a matter of hard in my practice, and stayed clean and admit I was an alcoholic, but I knew I need- days, we met in person and he laid out for sober. I remarried, had two children, and ed to change my drinking or I was going to me the framework for a plan of action. He came to know a peace in my life that had pre- wreck my career, cause an accident, or arranged an appointment for an alcohol viously eluded me. After I successfully com- become sick. I began a series of attempts to assessment with the director of an alcohol pleted my LAP contract, I was asked to curb or stop my drinking by the sheer force and substance abuse treatment program, become a LAP volunteer. As a LAP volunteer of my own will and the power of decision. leading to my enrollment in an intensive I have the privilege of helping other attorneys Night after night I swore off the alcohol and outpatient program. imprisoned by their addiction. When an prayed for an end to the drinking. I was con- I was introduced to a LAP volunteer who attorney’s struggles come to the attention of vinced that if I could only stop long enough took me to dinner and an AA meeting. We the LAP, volunteers reach out to the attorney, for the alcohol to get out of my system, I spoke freely, and for the first time I was able share with them their stories, and let them would be free to not drink again. These were to share the secret of my alcohol addiction know of the opportunities the Lawyer futile efforts. If I was determined enough to with a fellow lawyer. The things I shared with Assistance Program has to offer. For those make it through the next morning without a him that I thought were unique to me he attorneys who are ready to accept help, vol- drink, I might get by for a few weeks. could immediately relate to. When we unteers work with them as mentors, contract However, I never lasted more than a couple walked into the meeting, it was clear he was monitors, friends, and colleagues. As any of weeks before I was back to my normal completely at home with the members of alcoholic in recovery will tell you, working routine. this same fellowship I had felt so uncomfort- with other alcoholics is an integral and essen- My “bottom” lasted about a year. First able with on my own. After the meeting we tial part of successful, long-term recovery, came a car accident resulting in an arrest and went for coffee and we talked about what the and being a LAP volunteer provides a con- conviction for driving while impaired. I Lawyer Assistance Program could offer me. tinuing opportunity to do just that. earnestly told the judge I had learned my les- The program would be an advocate for me as I began my story by stating that becom- son and that this was the wake-up call I I worked through my legal challenges. In ing a lawyer and having the opportunity to needed. I earnestly believed it. My limited exchange, I would be expected to follow a reach out to the Lawyer Assistance Program driving privilege allowed me to drive to work regimen of recovery actions. I was intro- likely saved my life. Like so many active alco- and back, and I did not miss a beat. My law duced to the LAP “contract”—a written con- holics, I would not allow myself to open up partners were relieved and appreciative when tract between me and LAP in which I agreed to and become part of a recovery fellowship I told them the good news that I was dedi- to complete my outpatient treatment pro- of which I (incorrectly) believed I had noth- cating myself to cleaning up my act. I attend- gram, attend regular peer support meetings, ing of significance in common. It was only ed my first 12 step program meeting, lis- and submit to random chemical analysis to when I finally asked for help from my fellow tened intently, and tried to fit in. After about confirm my abstinence. In addition, I was lawyers that I was able to see that I was not ten meetings, I stopped going. I was not like assigned to a monitor—a LAP volunteer in so terminally unique. Had I not gained the those folks. I was a professional with an my community who would monitor my ability to accept the grace of the fellowship of important job that took up all of my time. compliance with the terms of my contract. recovery, I’m convinced I would have long After a few weeks of doing it on my own, I The first six months of sobriety were ago met an all-too-common alcoholic death. began drinking again and embarked on my filled with extreme emotions. Work served at It was the Lawyer Assistance Program that final spree. times as a distraction from the fear, anger, gave this alcoholic lawyer that ability to reach I separated from my wife and moved into and remorse typical in early sobriety, but for the prize, and for that I will be forever a small apartment. The second arrest came only at times. With the legal consequences of grateful. n less than a year after the first conviction. The my actions still in front of me, I had no humiliation and fear that followed the arrest choice but to soldier through it. But the new- The North Carolina Lawyer Assistance were unbelievable. The house of cards that found fellowship and support of my col- Program is a confidential program of assistance was my life was collapsing before my eyes, leagues in the LAP enabled me to face the for all North Carolina lawyers, judges, and law and I was seemingly powerless to stop it. I consequences from a position of increased students, which helps address problems of stress, was sure my career was over and that I would personal strength. With a statement from the depression, alcoholism, addiction, or other prob- lose everything. The morning after the sec- Lawyer Assistance Program confirming six lems that may lead to impairing a lawyer’s abil- ond arrest I walked into my senior partner’s months of abstinence from alcohol and com- ity to practice. If you would like more informa- office and told him I had been arrested again, pliance with my LAP contract, the court tion, go to www.nclap.org or call: Cathy Killian certain the result would be my immediate exercised the little discretion it had and (for Charlotte and areas west) at 704-892- termination. In an act of absolute grace, allowed me to do my time monitored at 5699, Towanda Garner (in the Piedmont area) rather than terminate me, he told me to call home followed by probation. The relief of at 919-719-9290, or Ed Ward (for Raleigh and the Lawyer Assistance Program (LAP). I putting this behind me was almost indescrib- down east) at 919-828-6425. made the call and asked for a call back. able, and marked the beginning of the To contact the author, send an email to Within an hour I received a call from the process of putting my life back together. Robynn Moraites, [email protected].

THE NORTH CAROLINA STATE BAR JOURNAL 39 IOLTA UPDATE

NC IOLTA Income is Boosted by New Sources of Funds

Income procedure for distributing class action residu- Supreme Court have approved an IOLTA rule NC IOLTA income has suffered more than als equally to the Indigent Person’s Attorney revision to allow an exception for out of state a 50% decline from our highest income—just Fund and the North Carolina State Bar. The banks with no NC branches to hold NC over $5 million—in 2008, and income from State Bar has asked IOLTA to administer the IOLTA accounts for settlement agents. Several IOLTA accounts remains depressed. Total funds it receives ($50,000 to date), which are large title company accounts will now be NC income from IOLTA accounts for 2011 was for the provision of civil legal services for indi- IOLTA accounts. flat at $2.2 million, though it declined by 16% gents. The NC Equal Access to Justice during the last two quarters as the boost from Commission (EAJC) has published a manual Grants implementing comparability ended. The first on Cy Pres and Other Court Awards to educate Beginning with the 2010 grants, we have two quarters of 2012 showed declines of 17% judges and attorneys as to the importance of limited our grant-making to a core group of and 15%. We expect this situation to continue such awards to legal aid organizations. The (mainly) legal aid providers. Even with that as banks are now recertifying their comparabil- manual includes information on different restriction and using a total of almost $1.4 mil- ity compliance at even lower interest rates. types of court awards, tips for structuring lion from our reserve fund over three consecu- Additionally, the Federal Reserve is predicting award agreements, examples of awards, and a tive years, grants have dramatically decreased-- that they will keep interest rates at the current primer on how to structure a cy pres settle- by over 40%. Following those decisions, we unprecedented low level into 2015. ment. The manual is available on the NC have under $450,000 remaining in reserve for Class Action Residuals. Fortunately, howev- Equal Access to Justice website, ncequalac- future use. The cy pres funds from Washington er, total income for 2012 had already sur- cesstojustice.com, and the NC IOLTA web- state will make a significant difference in our passed our 2011 income figure of $2.4 million site, nciolta.org. ability to make 2013 grants. We should be able by the end of August due to the over $1.2 mil- Settlement Agent Accounts. We are now to keep grants at the 2012 level without using lion received from residual funds directed to receiving some funds from settlement agent any additional funds from reserve. IOLTA programs across the country in a accounts as an amendment to the Good Funds Washington state class action case. After fol- Settlement Act (N.C. Gen. Stat. 45A-9)— State Funds lowing the Washington state court rule that requiring that interest bearing trust and escrow In addition to its own funds, NC IOLTA sent 25% of such residual funds to the state’s accounts of settlement agents handling closing administers the state funding for legal aid on IOLTA program, the court ordered that the and loan funds be set up as IOLTA accounts— behalf of the NC State Bar. Total state funding remaining 75% of the funds go to all other became effective on January 1, 2012. distributed for 2011-12 was $3.8—down IOLTA programs on a pro rata basis using an Though many of these accounts are not from over $5 million administered for 2010- estimate of the statutorily prohibited activity interest bearing and are not being set up as 11. The decrease was the result of reductions (fax blasting of unsolicited advertisements) IOLTA accounts, we have identified over 45 to both the appropriated funds (decreased by that occurred in each state. The court found new accounts as settlement agent only $112,500) and the filing fee allocation for that these entities promote access to the civil accounts (those not associated with an attor- legal aid (from $2.05 to $1.50). The work of legal justice system, something that members ney licensed in North Carolina), and received the Equal Access to Justice Commission, of the certified class, who had claims under over $20,000 from those accounts through NCBA, and legal aid programs saved state consumer protection and other laws, desire August. We are hopeful that we will gain addi- funding from another serious decrease in and need. tional income from these accounts as the vol- 2012-13—a proposed loss of the appropriated Receiving these funds raised the visibility ume of transactions increases. funds. Funding for the 2012-13 year remains of the North Carolina statute that sets out a The State Bar Council and the NC at the 2011-12 levels. n

NC IOLTA Grantee Spotlight

Charlotte Nonprofits Celebrate and Responsibility recognize that, “Every lawyer pro bono publico legal services per year.” Recognize Pro Bono Attorneys and has a professional responsibility to provide Support for pro bono service has been an Advocates legal services to those unable to pay. A lawyer important part of NC IOLTA’s grant-mak- The North Carolina Rules of Professional should aspire to render at least 50 hours of ing from its inception. Beginning in 1992,

40 WINTER 2012 the NC IOLTA increased its commitment to pro bono by proactively offering to make grants to volunteer lawyer programs based on a per lawyer formula to make sure that volunteer lawyer assistance could be provid- ed statewide. Support for such programs has continued, and, through 2012, NC IOLTA has granted over $10 million to support such programs. In Charlotte we currently support a volunteer lawyer program jointly operated by Legal Aid of NC (LANC), Legal Services of Southern Piedmont (LSSP), and the Custody Advocacy Program at the Council for Children’s Rights (CFCR), which uses an innovative team approach (using volunteer attorneys and lay advocates with staff attor- ney supervision) to handle cases by court appointment. This year these three NC IOLTA grantees Brett A. Loftis, Executive Director, Council for Children’s Rights; Kenneth L. Schorr, Executive in Charlotte—that area’s largest recipients of Director, Legal Services of Southern Piedmont; Distinguished Pro Bono Service Award Winner pro bono services—hosted their first annual George V. Hanna III, Moore & Van Allen, PLLC; Theodore O. Fillette, Senior Managing Attorney, Pro Bono Awards celebration sponsored by Legal Aid of North Carolina-Charlotte. Photo courtesy of David Ramsey Commercial Photography, Lawyers Weekly, Bank of America, and Moore and Van Allen. More than 200 attorneys, tions toward the community’s access to vital enriching endeavor as counsel. We as lawyers judges, advocates, and community members legal services, which transformed the lives of have the unique and privileged opportunity gathered on September 11 at the Charlotte hundreds of area residents. to increase access to counsel and legal assis- City Club to honor the advocates who have In addition to recognition for the out- tance for those in need. In doing so, we help generously given their time and expertise to standing service of law firms and individuals, the justice system deliver outcomes that are local indigent families, and to celebrate their George V. Hanna III of Moore & Van Allen fair and accessible to all.” accomplishments. In 2011 approximately received the Distinguished Pro Bono Service As the need for legal services for low- 300 attorneys and advocates gave more than Award, a lifetime achievement honor recog- income families grows each year, more attor- 5,500 pro bono hours to CFCR, LANC, and nizing an individual whose longstanding and neys are stepping outside of their private LSSP, serving upwards of 450 local families exceptional dedication to pro bono legal serv- practices to volunteer with legal aid organiza- and individuals in need, and donating the ice has made a meaningful impact on access tions to help eliminate the financial obstacles equivalent of almost $1.4 million in legal to justice in the community and state. In his to accessing justice. You can offer your assis- services. The local firms, attorneys, and remarks, Hanna said, “Participating in and tance anywhere in the state through the NC advocates recognized and honored at the supporting pro bono efforts is not merely a Equal Access to Justice website, ncaccessto- event made considerable pro bono contribu- benefit for the client; it is a rewarding and justice.org. n

The Ring (cont.) * * * * * As he finished the oath, nobody noticed as Luke reached with his left hand to hold the from the leaves. The large gash in Ned’s fore- But that was 15 years ago, Luke thought as worn gold ring on his right ring finger...and head quickly filled with blood. Luke consid- he forced his attention back to the not even the most seasoned court reporter ered cutting Ned’s clothes off of him, to let present...back to the oath of office he was now would have detected the whisper that came him wake up naked and humiliated. He con- taking as a North Carolina prosecutor. from his lips. “I remember, Dad. I was loved.” sidered doing things much worse than “...I will, in the execution of my office, Luke walked over to where his mother was that...gruesome things...but as his left hand endeavor to have the criminal laws fairly and wiping her eyes, put his arm around her, reached up to hold the ring, he thought, “No, impartially administered, so far as in me lies, closed his own eyes, and thought, “Luke sand- that’s not who I am.” according to the best of my knowledge and wich.” n Luke never saw either Ned or Goat again ability; so help me, God.” after that day. His mother said that they were Luke didn’t know what type of prosecutor Terry Orndorff lives in Wilson, North taken to a place where they trained kids who he would be, but he was confident of two Carolina, with his wife Merry and their son “misbehaved.” things. He would be neither a coward nor a Logan. He has served as an assistant district bully. attorney in the 7th District for the past 16 years.

THE NORTH CAROLINA STATE BAR JOURNAL 41 THE DISCIPLINARY DEPARTMENT

Lawyers Receive Professional Discipline

received a two-year suspension, stayed for client, did not promptly prepare an order Disbarments two years, and Susan McFarlane received a that would have allowed his client to collect Wilmington lawyer Linda Clark cashed one year suspension, stayed for two years. a judgment, and did not timely respond to counterfeit money orders. She was disbarred Jan P. Paul, a former prosecutor from the Grievance Committee. by the DHC. Durham, instructed law enforcement offi- William I. Belk of Charlotte was repri- Russell Crump of Gainesville, Florida, cers to take out charges unsupported by fact manded by the Grievance Committee. Belk was disbarred pursuant to an Order of and/or law against the mother of a child sex- was custodian of funds for his minor daugh- Reciprocal Discipline entered by the chair of ual abuse victim. The mother had just testi- ter and violated his statutory duty by mak- the Grievance Committee. In April 2012 the fied in support of the perpetrator. Paul ing expenditures that were inappropriate Supreme Court of Florida disbarred Crump authorized the charges to prevent the moth- and not for his daughter’s direct benefit. after he was convicted of one count of child er’s imminent visitation with the child pur- Benjamin Small of Concord was repri- abuse, a 3rd degree felony. suant to a civil court order. Paul’s license was manded for failing to respond timely to the In three different real estate closings, Jodi suspended for one year and the suspension Grievance Committee. Ernest of Greensboro erred in a variety of was stayed for one year upon Paul’s compli- Timothy D. Smith of Charlotte was ways, including committing acts of dishon- ance with conditions. reprimanded by the Grievance Committee. esty, neglecting clients, and failing to proper- Louie Wilson of Windsor did not prop- Smith did not communicate with his ly maintain and deliver entrusted funds. erly reconcile his trust account, leading to client, did not diligently represent his Ernest surrendered her law license and was misappropriation by a staff member. The client, did not provide a copy of a final disbarred by the DHC. DHC entered a consent order suspending divorce judgment to his client, and final- Creighton (“Zeke”) Sossomon of Wilson for two years. The suspension is ized the divorce judgment without first Highlands misappropriated entrusted funds. stayed for two years upon his compliance determining if he needed to file for equi- Disciplinary proceedings were stayed for sev- with numerous conditions. table distribution. eral months because Sossomon contended he was disabled due to ADHD. The DHC Show Cause Hearings Transfers to Disability Inactive Status determined that Sossomon was not disabled. The DHC found that Robert J. Burford The DHC transferred Albert Neal Jr. of Just before the October 11 disciplinary hear- of Raleigh did not comply with the condi- Candler to disability inactive status. ing, Sossomon surrendered his license and tions for a stay of his disciplinary suspension was disbarred by the DHC. by failing to timely and unconditionally Reinstatements refund money to his former clients, and vio- Dean Humphrey of Wilmington was Suspensions & Stayed Suspensions lating the Rules of Professional Conduct suspended for one year. After serving six Valderia Bruson of Creedmoor violated during the stay. The DHC lifted the stay months, Humphrey was eligible to obtain a multiple trust accounting record keeping and activated the two-year suspension of stay of the balance upon compliance with rules. The DHC entered a consent order of Burford’s license. conditions. Humphrey complied with those discipline suspending Brunson for two conditions. The secretary entered an order years. The suspension is stayed for five years Censures staying the balance and reinstating upon Brunson’s compliance with extensive Ralph L. Gilbert of Shelby was censured Humphrey to active practice. n conditions. by the Grievance Committee for numerous Dawn Johnson of Graham disrupted the violations of the trust accounting rules and court by failing to appear in court on time, for failing to respond to the State Bar. or at all, and was untruthful with the court. Jeffery P. Boykin of Raleigh was cen- The DHC suspended her for three years. sured by the Grievance Committee. Boykin Thank You to Our After serving one year of active suspension, neglected his client’s personal injury case, Meeting Sponsors Johnson may apply for a stay of the balance did not communicate with his client about upon compliance with numerous condi- the case, and misled his client about the sta- Williams Mullen for sponsoring the tions. tus of the case. Annual Reception Steven McFarlane and Susan McFarlane of Louisburg knowingly failed to timely file Reprimands Lawyers Mutual Liability Insurance state and federal tax returns and did not pay Colin P. McWhirter of Shelby was repri- Company for sponsoring the Annual their tax obligations for four years and two manded by the Grievance Committee. Dinner years, respectively. Steven McFarlane McWhirter did not communicate with his

42 WINTER 2012 PARALEGAL CERTIFICATION

I Brake for Notarial Certificates!

B Y K ELLY F ARROW

Before I joined the State Bar I worked as an the most common error I see on the applica- tified paralegal. Two sets of eyes are always intellectual property paralegal for over ten tions, by far. The notarial certificates on the better than one! years. Intellectual property, like many areas of applications are “oaths” (N.C. Gen. Stat. Any violation of the Notary Act should law, is extremely detail-oriented—one wrong §10B-3(14)), and include the language be reported directly to the Notary numeral in a patent number or not following “[s]worn to (or affirmed) and subscribed Enforcement Section of the Secretary of the Patent Office rules precisely can cause big before me.” For this type of notarial act, the State’s Office. The paralegal certification pro- problems for your client and your firm. notary must verify the applicant’s identity, gram has adopted a policy of notifying the A part of my job now is to process the and then must administer an oath and have applicant and the notary of the error, asking incoming initial certification applications and the applicant make a vow of truthfulness. the applicant to fix the error by signing a new recertification applications. My review proce- (This is the “sworn to (or affirmed)” part.) signature page and having it notarized cor- dure is quite regimented, and there are specif- The applicant must also sign the document rectly, and telling the notary to report the ic things that I must check for when review- in the presence of the notary, meaning that the violation to the Notary Enforcement Section ing these applications. One of these things is notary must physically see the applicant sign himself or herself. The Notary Enforcement a notarized signature. his or her name on the application. (This is Section will investigate the matter and con- Being a person who is all about details and the “subscribed before me” part.) Therefore, tact the notary directly. To resolve the matter, following rules, I have been surprised by the the date of the applicant’s signature and the the Notary Enforcement Section will usually number of applications that are not correctly date of the notary’s signature should always ask the notary to: 1) acknowledge that he or notarized. Not all certified paralegals are be the same. If they are not, it could be an she made an error; 2) tell and show what he notaries, and not all notaries are paralegals, indication that the applicant was not present or she should have done; and 3) state if he or certified or not. However, a paralegal should to sign the document in front of the notary, she needs to be a notary public as part of his be able to review a document (especially a and thus the document was not notarized or her job. If the Notary Enforcement document that he or she has signed) to make properly. According to the National Notary Section finds that there was a violation, it can sure it has been correctly notarized, regardless Association, “[n]otaries are sued and have warn the notary; require the notary to retake of his or her status as a notary. their commissions revoked more for a failure the notary public course; restrict, suspend, or If you have not taken the Notary Public to require personal appearance than for any revoke a notary’s commission; or, in extreme Course or read the Notary Public Act in the other violation.”1 Yes, it’s that serious. cases, prosecute the notary for a misde- North Carolina General Statutes (N.C. Gen. A notarial “oath” is different than an meanor or felony. Stat. §10B), you may not be familiar with the “acknowledgment,” (N. C. Gen. Stat. §10B- Most errors are usually due to haste and statutory notarization requirements in North 3(1)) which is another very common type of can be easily prevented with a quick review Carolina. As a paralegal, however, you may notarial act. For acknowledgement, the docu- of the application before mailing. Being a handle or review notarized documents as a ment can be signed by an individual before certified paralegal is much more than just part of your job. Even if you are not a notary, presenting it to the notary to be notarized, meeting certain requirements or passing an it is beneficial for you to be familiar with the and thus the date of the individual’s signature exam. It’s about doing your best work and rules for notarizing documents so you can and the date of notarization can and may be proudly representing the paralegal profes- ensure that they are notarized correctly to bet- different. However, the individual must still sion. Even when you are busy, slow down ter assist your supervising lawyer and your appear in person before the notary to present and take a minute to double-check your clients. Incorrectly notarized documents can the document, and the notary must still verify work. As a certified paralegal you are only an lead to invalidated documents and lawsuits the identity of the individual before notariz- asset to your supervising lawyer and your against the notary and/or the law firm ing the document. clients if you are careful, accurate, and thor- involved. Most of the time the differences in dates ough. n in the notarial certificates on the applications What Are the Notarial Requirements? are due to either the applicant or the notary Kelly Farrow is the assistant director of the I have several things that I look for when simply writing down the wrong date. This is Paralegal Certification Program. I am checking the notarization of an applica- surprising, given the high standards to which tion. The first thing I do is make sure the certified paralegals are held. It is an error that Endnote date of the notary execution and the date of is easily fixed with a quick review of the sig- 1. nationalnotary.org/bonds_and_insurance/minimize_ the applicant execution are the same. This is nature page by both the notary and the cer- liability/index.html.

THE NORTH CAROLINA STATE BAR JOURNAL 43 LEGAL ETHICS

Mum’s the Word

B Y S UZANNE L EVER

We all know that Rule 1.6 of the Rules of applies if the lawyer is using the information business associate of the lawyer. For Professional Conduct governs a lawyer’s dis- “to the disadvantage of the client.” By impli- example, if a lawyer learns that a client closure of client information. However, in cation, Rule 1.8(b) allows a lawyer to use intends to purchase and develop several addition to Rule 1.6, there are other rules (but not reveal) current client information, parcels of land, the lawyer may not use pertaining to client information. These rules so long as the use is not disadvantageous to that information to purchase one of the may distinguish between one or more of the the client. parcels in competition with the client or following: (1) current and former clients; (2) to recommend that another client make use versus the disclosure of the information; Say What? such a purchase. The Rule does not pro- and (3) information that is, or is not, “gener- Now on to what I believe is one of the hibit uses that do not disadvantage the ally known.” Let’s take a look. more confusing rules addressing client infor- client. For example, a lawyer who learns a mation, Rule 1.9(c). Lawyers often fail to government agency’s interpretation of The Low Down realize that, unlike Rule 1.9(a) and (b), trade legislation during the representation Rule 1.6(a) provides that a lawyer shall which address a lawyer’s duties in a represen- of one client may properly use that infor- not reveal information acquired during the tation adverse to a former client, Rule 1.9(c) mation to benefit other clients. professional relationship with a client unless applies even when the lawyer has not under- In each of the examples above, the lawyer (1) the client gives informed consent; (2) the taken a representation adverse to the former is using the current client’s information with- disclosure is impliedly authorized; or (3) one client. out actually revealing the information. The of the exceptions set out in Rule 1.6(b) Rule 1.9 is limited to former clients. Rule use of a current client’s information is not applies. Interestingly, neither Rule 1.6, nor 1.9(c)(1) addresses use of a former client’s permissible if it is being used to the disadvan- any of the other rules discussed below, actu- information, while Rule 1.9(c)(2) deals with tage of the client. As noted above, a lawyer ally refer to “confidential information.” disclosure of a former client’s information. may use a former client’s information, even Rather, these rules protect information Rule 1.9(c) is the only rule with an exception to the disadvantage of the former client, if it “acquired during the professional relation- for information that is “generally known.” has become “generally known.” Rule ship with a client” or information “relating to Rule 1.9(c)(1) allows a lawyer to use a former 1.9(c)(1). representation of a client.” client’s information if it is not being used to There is no distinction between current the disadvantage of the former client or if it Duh! and former clients in Rule 1.6. The duties has become “generally known.” Rule So when is information “generally under Rule 1.6 continue after the termina- 1.9(c)(2) prohibits disclosure of a former known”? Comment [8] to Rule 1.9 provides tion of the relationship. Rule 1.6(b) does not client’s information, regardless of whether the following explanation: contain an exception pertaining to client the information has become generally The fact that a lawyer has once served a information that is “generally known.” The known. (Rule 1.18, dealing with prospective client does not preclude the lawyer from bottom line of Rule 1.6 is that a lawyer may clients, prohibits the use or disclosure of a using generally known information about never disclose information obtained during prospective client’s information except as that client when later representing anoth- the representation of a client, even if the permitted by Rule 1.9.) er client. Whether information is “gener- client becomes a former client, and even if Let’s take a closer look at the distinctions ally known” depends in part upon how the client’s information becomes “generally present in the various rules. First, what is the the information was obtained and in part known.” difference between “using” client informa- upon the former client’s reasonable expec- In contrast to Rule 1.6, which deals with tion and “revealing” it? In discussing the use tations. The mere fact that information is disclosure of information, Rule 1.8(b) per- of information related to a current represen- accessible through the public record or tains to a lawyer’s use of client information. tation (Rule 1.8(b)), comment [5] to Rule has become known to some other persons Rule 1.8(b) is limited to current clients. The 1.8 provides: does not necessarily deprive the informa- rule provides that a lawyer may not use infor- Use of information relating to the repre- tion of its confidential nature. If the mation relating to representation of a client sentation to the disadvantage of the client information is known or readily available to the disadvantage of the client, unless the violates the lawyer’s duty of loyalty. to a relevant sector of the public—such as client consents. There is no exception for Paragraph (b) applies when the informa- the parties involved in the matter—then information that is “generally known.” tion is used to benefit either the lawyer or However, the prohibition in Rule 1.8(b) only a third person, such as another client or CONTINUED ON PAGE 62

44 WINTER 2012 FEATURED ARTIST

Featured Artist—Ann Conner

Ann Conner lives and works in North defined exclusively by shape and color. Her Carolina. Using non-endangered native prints, which use templates of sophisticated wood and brilliant color palettes, Conner patterns and symmetry are, nevertheless, creates colorful, conceptualist woodcuts that reminiscent of the spirograph drawings that reveal the intrinsic grain of the wood. These so many of us made as children. vibrant woodcuts employ the isolation of Recent exhibits include Two Visions, hard-edged abstraction to create a space New Elements Gallery, Wilmington, NC; New Prints 2012/Winter, IPCNY, International Print Center New York; 2012 Each quarter the works of a different Delta National Small Prints Exhibition, contemporary North Carolina artist are Arkansas State University; Boston displayed in the storefront windows of Printmakers 2011 North American Print the State Bar building. The State Bar is Biennial; New Prints/Autumn, IPCNY; grateful to The Mahler Fine Art, the Advancing Tradition Twenty Years of artists’ representative, for arranging this Printmaking at Flatbed Press, Austin loan program. The Mahler is a full-ser- Museum of Art, 2010–2011; ColorPrint vice fine art gallery in Raleigh represent- USA 40th Anniversary, Museum of Texas ing national, regional, and North Tech University, 2010; and Boston Carolina artists, and provides residential Printmakers’ 2009 North American Print Westwood and commercial consulting. Readers Biennial. who want to know more about an artist Conner’s work is included in over 40 may contact owner Rory Parnell at (919) major museum and corporate print collec- York Public Library; Museum of Fine Arts, 896-7503 or info@themahlerfineart. tions in the US including Philip Morris New Boston; Library of Congress; Credit Suisse com. York; Federal Reserve Bank of Richmond; First Boston, London; RJR Nabisco; and Neiman Marcus; Ritz-Carlton Hotels; New Ackland Art Museum, Chapel Hill. n

Judge Conrad (cont.) Kapp Interview (cont.) State Bar? I enjoy spending time with my family, For Judge Conrad, his life, skills, and tal- done for a living? cheering for the Tar Heels, working in my ents are gifts from God and his commitment I would have been a minister or a garden—particularly my herb garden— is to insure that his life reflects those gifts. As teacher of history. walking on the family farm, and reading he looks back on his life, he sees a divine plan. Q: Tell us a little about your family. nonfiction, particularly biographies and As there is no way to determine the future, My wife Chancy and I have been Byzantine history. “the best we can do is pursue excellence in the together since we were undergraduates at Q: How would you like for your adminis- moment,” and so he takes advice from UNC-Chapel Hill. Our daughter Mary tration to be remembered when the histo- Proverbs 3:5-6, “Trust in the Lord with all Katherine “Katie” Muto, the apple of my ry of the State Bar is finally written? your heart, and do not rely on your own eye, lives in Kernersville with her husband I would like it to be remembered as a insights. In all your ways acknowledge Him, Daniel Muto. Katie is a social worker. My time when we provided a facility for our and He will make straight your paths.” n parents Bill and Betty Kapp live on the dedicated staff to better serve the public family farm between Rural Hall and and the profession. I also hope that it will Michelle Rippon is of counsel with Constangy Bethania. My younger brother Karl and his be remembered as a time when the State Brooks & Smith in Asheville. She is also an wife Toni live in Winston-Salem. They Bar took on the tough challenge of address- adjunct professor in the Business Management have two sons, Jonathan and Jacob ing rapid changes in the business and the Department at UNC-Asheville and serves as the Madison. technology of legal practice while continu- attorney for the Asheville Area Chamber of Q: What do you enjoy doing when you’re ing to uphold the status of the law as a pro- Commerce. not practicing law or working for the fession. n

THE NORTH CAROLINA STATE BAR JOURNAL 45 PROPOSED OPINIONS

Committee Analyzes the Roles a Lawyer May Perform When Appointed to Represent a Child in a Contested Custody Case

Council Actions and Proposed 2012 FEO 7, Copying At its meeting on October 26, 2012, the Represented Persons on Email Communications. State Bar Council adopted the ethics opin- The Ethics Committee also voted to publish Public Information ions summarized below: the following two revised opinions and seven 2012 Formal Ethics Opinion 5 new proposed opinions. The comments of The Ethics Committee’s meetings are Reviewing Employee’s Email readers are welcomed. public, and materials submitted for con- Communications with Counsel Using Employer’s sideration are generally NOT held in Business Email System Proposed 2012 Formal Ethics confidence. Persons submitting requests Opinion rules that a lawyer representing Opinion 2 for advice are cautioned that inquiries an employer must evaluate whether email Lawyer-Mediator’s Preparation of should not disclose client confidences or messages an employee sent to and received Contract for Pro Se Parties to Mediation sensitive information that is not neces- from the employee’s lawyer using the employ- October 25, 2012 sary to the resolution of the ethical ques- er’s business email system are protected by the Proposed opinion rules that a lawyer-media- tions presented. attorney-client privilege and, if so, decline to tor may not draft a business contract for pro se review or use the messages unless a court parties to mediation. determines that the messages are not privi- leged. Inquiry: 2012 Formal Ethics Opinion 6 May a mediator, who is also a lawyer, draft Citation Use of Leased Time-Shared Office Address a business contract for two business propri- or Post Office Address on Letterhead and etors at the conclusion of a successful media- To foster consistency in citation to Advertising tion concerning a matter that is not currently the North Carolina Rules of Professional Opinion rules that a law firm may use a the subject of litigation when neither party is Conduct and the formal ethics opinions leased time-shared office address or a post represented by individual counsel? adopted by the North Carolina State Bar office address to satisfy the address disclosure Council, the following formats are rec- requirement for advertising communications Opinion: ommended: in Rule 7.2(c) so long as certain requirements No. It is a non-consentable conflict of · To cite a North Carolina Rule of are met. interest. Professional Conduct: N.C. Rules of 2012 Formal Ethics Opinion 8 Rule 1.12(a) allows a lawyer to represent Prof’l Conduct Rule 1.1 (2003) Lawyer’s Acceptance of Recommendations a party in connection with a matter in which · To cite a North Carolina formal on Professional Networking Website the lawyer participated personally and sub- ethics opinion: N.C. State Bar Formal Opinion rules that a lawyer may ask a for- stantially as a mediator if all parties to the Op. 1 (2011) mer client for a recommendation for a lawyer proceeding give informed consent, con- Note that the current, informal to be posted on the lawyer’s profile on a pro- firmed in writing. However, under Rule method of citation used within the for- fessional networking website and may accept 1.7(a), joint representation of two parties to mal ethics opinions themselves and in the recommendation if certain conditions are an agreement presents a concurrent conflict this Journal article will continue for a met. of interest even if the lawyer-mediator has transitional period. their consent. Ethics Committee Actions Although Rule 1.7(b) provides for circum- At its meeting on October 25, 2012, the stances under which a lawyer may represent When contemplating joint representation, Ethics Committee voted to send the follow- joint clients, an analysis of the risks associated a lawyer must consider whether the interests ing proposed opinions to subcommittees for with the proposed joint representation leads to of the parties will be adequately protected if further (or continued) study: Proposed 2011 the conclusion that such representation is not they are permitted to give their informed con- FEO 11, Communication with Represented appropriate. Therefore, the lawyer-mediator sent to the representation, and whether an Party by Lawyer Who is the Opposing Party, should not draft the business contract. independent lawyer would advise the parties

46 WINTER 2012 to consent to the conflict of interest. mediator from assisting the parties in prepar- adverse party and about which Attorney J Representation is prohibited if the lawyer ing a written summary reflecting the parties’ acquired material confidential information cannot reasonably conclude that he will be mutually acceptable understanding of the while she was employed with Law Firm H. able to provide competent and diligent repre- issues resolved in the mediation, as long as the Written notice of the screen must be given to sentation to all clients. See Rule 1.7, cmt. lawyer-mediator does not represent to the pro Large Manufacturer and any other affected [15]. As stated in comment [29] to Rule 1.7, se parties that the summary is being prepared former client. the representation of multiple clients “is as a legally enforceable document. Rule 1.9(a) prohibits a lawyer who has improper when it is unlikely that impartiality formerly represented a client in a matter from can be maintained.” Proposed 2012 Formal Ethics thereafter representing an adverse party in the The complex issues that must be Opinion 4 same or a substantially related matter unless addressed when crafting a comprehensive Screening Lateral Hire Who Formerly the former client gives informed consent. business contract may result in adverse inter- Represented Adverse Organization This provision of the rule prohibits Attorney ests. Even if the parties agree on the broad October 25, 2012 J from representing any workers’ compensa- outlines of a business contract at the conclu- Proposed opinion rules that a lawyer who tion claimant on a claim for which she for- sion of the mediation, a disinterested lawyer represented an organization while employed merly defended Large Manufacturer and will not be able to conclude that the interests with another firm must be screened from partic- from representing any claimant on a claim of each party can be completely represented. ipation in any matter, or any matter substan- that is substantially related to a matter upon With respect to the terms on which there tially related thereto, in which she previously which Attorney J formerly represented Large appear to be agreement, one or both parties represented the organization, and from any Manufacturer. may benefit from a disinterested lawyer’s matter against the organization if she acquired Comment [3] to Rule 1. 9 provides the advice as to whether the agreement meets confidential information of the organization following explanation of disqualification with the party’s legitimate objectives, and that is relevant to the matter and which has not because of substantial relationship: what other procedural alternatives may be become generally known. [m]atters are “substantially related” for available to achieve more favorable terms. In purposes of this Rule if they involve the the instant inquiry, neither party is represent- Inquiry #1: same transaction or legal dispute or if ed by individual counsel. Attorney J was employed with Law Firm there otherwise is a substantial risk that Joint representation could lead to ques- H where she did workers’ compensation information as would normally have been tions about the integrity of the mediation defense work. During this time, Attorney J obtained in the prior representation process. The lawyer’s duty to provide each handled many such cases for Large would materially advance the client’s posi- client with necessary and appropriate advice Manufacturer and its insurer. In addition, tion in the subsequent matter... might require informing one party that they Attorney J was privy to Large Manufacturer’s Information that has been disclosed to the made a “bad deal” during the mediation workers’ compensation policies and proce- public or to other parties adverse to the process. It is untenable for a lawyer to coun- dures, litigation strategies, and system for case former client ordinarily will not be dis- sel a client that an agreement the lawyer- preparation. Attorney J participated in work- qualifying. Information acquired in a mediator has assisted him to reach in media- ers’ compensation strategy meetings with rep- prior representation may have been ren- tion may not be in that client’s best interests. resentatives of Large Manufacturer as well as dered obsolete by the passage of time, a If the ultimate agreement turns out to be with defense counsel from Law Firm Y, circumstance that may be relevant in one-sided and unfavorable to one party, the another firm providing workers’ compensa- determining whether two representations lawyer-mediator’s role could be closely scru- tion defense representation to Large are substantially related. In the case of an tinized. Manufacturer. organizational client, general knowledge Finally there is the risk that the proposed Attorney J resigned from Law Firm H to of the client’s policies and practices ordi- joint representation will fail or that the busi- work for Law Firm S, a plaintiffs’ personal narily will not preclude a subsequent rep- ness contract will be the subject of future liti- injury firm that routinely handles workers’ resentation; on the other hand, knowledge gation between the two parties. In either compensation cases against Large of specific facts gained in a prior represen- event, the parties will have to retain new Manufacturer. tation that are relevant to the matter in lawyers for the subsequent litigation. May Attorney J work at Law Firm S? question ordinarily will preclude such a For the reasons cited above, the lawyer- representation. mediator in the facts presented may not joint- Opinion #1: The substantial relationship test serves as a ly represent both parties by drafting their new Yes, if Attorney J is properly screened from proxy for requiring a former client to disclose business contract. participation in (1) any matter in which confidential information to demonstrate that Regardless of the above analysis, the Attorney J represented Large Manufacturer the lawyer has a conflict of interest: lawyer-mediator will be governed by the or any other adverse party; (2) any matter A former client is not required to reveal Supreme Court’s Standards of Professional that is substantially related to a matter in the information learned by the lawyer to Conduct for Mediators, which may also pro- which Attorney J represented Large establish a substantial risk that the lawyer hibit the lawyer’s representation of one or Manufacturer; and (3) any matter in which a has information to use in the subsequent more of the parties following the mediation. lawyer with Law Firm H represents or repre- matter. A conclusion about the possession This opinion does not prohibit a lawyer- sented Large Manufacturer or any other of such information may be based on the

THE NORTH CAROLINA STATE BAR JOURNAL 47 mation that is material to the matter. Inquiry #2: If Attorney J is disqualified under any pro- Large Manufacturer contends that any Rules, Procedure, vision of Rule 1.9, Rule 1.10(c) permits new workers’ compensation claims against screening of Attorney J to avoid imputing her Large Manufacturer that Attorney J handles Comments disqualification to the other lawyers in her at Law Firm S will be substantially related to new firm. The rule provides: her prior representation of Large All opinions of the Ethics [w]hen a lawyer becomes associated with a Manufacturer because Attorney J was privy to Committee are predicated upon the firm, no lawyer associated in the firm shall information about Large Manufacturer’s Rules of Professional Conduct as revised knowingly represent a person in a matter defense of workers’ compensation cases and effective March 1, 2003, and thereafter in which that lawyer is disqualified under this information will materially advance the amended, and referred to herein as the Rule 1.9 unless: interests of any client with a workers’ com- Rules of Professional Conduct (2003). (1) the personally disqualified lawyer is pensation claim against Large Manufacturer. The proposed opinions are issued pur- timely screened from any participation May Attorney J represent claimants on suant to the “Procedures for Ruling on in the matter; and new workers’ compensation cases against Questions of Legal Ethics.” 27 (2) written notice is promptly given to Large Manufacturer if the claimant did not N.C.A.C. ID, Sect .0100. Any interest- any affected former client to enable it to seek representation from Law Firm S until ed person or group may submit a writ- ascertain compliance with the provisions after Attorney J’s employment? ten comment or request to be heard of this Rule. concerning a proposed opinion. Any Comment [4] to Rule 1.9, which relates Opinion #2: comment or request should be directed to lawyers moving between firms, elucidates It depends. If a new matter is not the same to the Ethics Committee at PO Box the policy considerations justifying the use of or substantially related to Attorney J’s prior 25908, Raleigh, NC 27611, by screens in this situation: representations of Large Manufacturer, she is December 31, 2012. [w]hen lawyers have been associated not disqualified from the representation within a firm but then end their associa- unless, during her prior employment with tion, the question of whether a lawyer Law Firm H, she acquired confidential infor- should undertake representation is more mation of Large Manufacturer that is material complicated. There are several competing or relevant to the representation of the new Captions and considerations. First, the client previously client, may be used to the disadvantage of Headnotes represented by the former firm must be Large Manufacturer, and is not generally reasonably assured that the principle of known. Attorney J has a continuing duty A caption and a short description of loyalty to the client is not compromised. under paragraphs (a) and (b) of Rule 1.9 to each of the proposed opinions precedes Second, the rule should not be so broadly monitor any new matter involving Large the statement of the inquiry. The cap- cast as to preclude other persons from Manufacturer to determine whether it is sub- tions and descriptions are provided as having reasonable choice of legal counsel. stantially related to her prior representation of research aids and are not official state- Third, the rule should not unreasonably her former client or she acquired confidential ments of the Ethics Committee or the hamper lawyers from forming new associ- information from Large Manufacturer that is council. ations and taking on new clients after material to the matter. If so, she is personally having left a previous association. In this disqualified and must be screened. See connection, it should be recognized that Opinion #1. nature of the services the lawyer provided today many lawyers practice in firms, that Even if the matters are not substantially the former client and information that many lawyers to some degree limit their related, however, Attorney J has a continuing would in ordinary practice be learned by a practice to one field or another, and that duty under paragraph (c) of Rule 1.9 to ensure lawyer providing such services. many move from one association to that the representation will not result in the Rule 1.9, cmt. [3]. another several times in their careers. If misuse of confidential information of Large Rule 1.9(b) prohibits a lawyer from repre- the concept of imputation were applied Manufacturer. Rule 1.9(c) prohibits a lawyer senting anyone in the same or a substantially with unqualified rigor, the result would who has formerly represented a client in a related matter in which a firm with which the be radical curtailment of the opportunity matter or whose former firm has formerly rep- lawyer was formerly associated had previously of lawyers to move from one practice set- resented a client in a matter from thereafter represented the adverse party and about ting to another and of the opportunity of using confidential information relating to the whom the lawyer acquired confidential, clients to change counsel. representation to the disadvantage of the for- material information, unless the former client As long as a screen is implemented to iso- mer client except as allowed by the Rules or gives informed consent. This provision of the late Attorney J from participation in these when the information has become “generally rule prohibits Attorney J from representing a matters, the consent of Large Manufacturer known.” A screen must be promptly imple- workers’ compensation claimant in a matter to the representation of the claimants by a mented to isolate Attorney J from participa- in which one of the other lawyers at Law Firm lawyer with Law Firm S is not required. See tion in any such case. See Opinion #1. H defended Large Manufacturer and about Rule 1.0(l) and 2003 FEO 8 (setting forth Comment [8] to Rule 1.9 explains the which Attorney J acquired confidential infor- screening procedures). exception for information that is “generally

48 WINTER 2012 known” as follows: vant to the matter in question ordinarily will that Attorney J will have specific confidential ...the fact that a lawyer has once served a preclude such a representation.” information of Large Manufacturer that client does not preclude the lawyer from When evaluating whether a representation would be relevant and useful to the represen- using generally known information about is substantially related to a prior representation tation of the particular claimant. For exam- that client when later representing another of an organizational client or whether a lawyer ple, a manager’s thoughts and opinions client. Whether information is “generally acquired confidential information of a former regarding the claimant could be information known” depends in part upon how the organizational client that is substantially rele- that would not be generally known and information was obtained and in part vant to the representation of a client and may which might be used to the disadvantage of upon the former client’s reasonable expec- be used to the disadvantage of the former Large Manufacturer. tations. The mere fact that information is client, the following factors, among others, May Attorney J represent a claimant on a accessible through the public record or has should be considered: the length of time that new workers’ compensation case against become known to some other persons does the lawyer represented the former client; the Large Manufacturer if the claimant had pre- not necessarily deprive the information of lawyer’s role in representing the former client, viously filed a workers’ compensation case its confidential nature. If the information is including the lawyer’s presence at strategy and against Large Manufacturer that was defend- known or readily available to a relevant sec- decision-making sessions for the former client; ed by a lawyer from Law Firm H while tor of the public, such as the parties the relative authority of the lawyer to make Attorney J was employed by the firm? involved in the matter, then the informa- decisions about the representation of the for- tion is probably considered “generally mer client; the passage of time since the lawyer Opinion #5: known.” represented the former client;1 the extent to As stated in Opinion #2, Attorney J has a Similarly, the Restatement (Third) of The which there are material factual and legal sim- continuing duty to monitor any matter Law Governing Lawyers adopts an access ilarities between former and present represen- involving Large Manufacturer to be sure that approach to the determination of what infor- tations; and the substantial relevance of the the representation will not result in the use of mation is “generally known”: former client’s litigation policies, strategies, confidential information of Large Whether information is generally known and practices to the new matter. Manufacturer that has not become generally depends on all circumstances relevant in known to the disadvantage of Large obtaining the information. Information Inquiry #3: Manufacturer in violation of Rule 1.9(c). A contained in books or records in public May the other lawyers in Law Firm S rep- screen must be promptly implemented to iso- libraries, public-record depositaries such as resent claimants on new workers’ compensa- late Attorney J from participation in any such government offices, or in publicly accessi- tion cases against Large Manufacturer? matter. ble electronic-data storage is generally known if the particular information is Opinion #3: Endnote obtainable through publicly available Yes, if Attorney J is screened from those 1. For an example of a timeframe deemed to be sufficient indexes and similar methods of access. matters for which she acquired confidential to manage post-employment conflicts of interest for federal government employees, see the Ethics in Information is not generally known when information of Large Manufacturer that is Government Act of 1978, 18 U.S.C.§207(c). a person interested in knowing the infor- disqualifying. See Opinion #2. mation could obtain it only by means of special knowledge or substantial difficulty Inquiry #4: Proposed 2012 Formal Ethics or expense. Special knowledge includes Should Attorney J be screened from par- Opinion 9 information about the whereabouts or ticipation in workers’ compensation cases Identifying the Roles and identity of a person or other source from against Large Manufacturer that were defend- Responsibilities of a Lawyer Appointed which the information can be acquired if ed by lawyers from Law Firm Y while to Represent a Child or the Child’s those facts are not themselves generally Attorney J was employed by Law Firm H? Best Interests in a Contested Custody known. or Visitation Case Restatement (Third) of the Law Governing Opinion #4: October 25, 2012 Lawyer, §59, cmt. d. Yes, if she acquired confidential informa- Proposed opinion holds that a lawyer asked Attorney J’s general knowledge of Large tion of Large Manufacturer that is disqualify- to represent a child in a contested custody or vis- Manufacturer’s workers’ compensation case ing. See Opinion #2. itation case should decline the appointment management, settlement, and litigation poli- unless the order of appointment identifies the cies and practices may be sufficient in some Inquiry #5: lawyer’s role and specifies the responsibilities of matters to disqualify her. As observed in the Large Manufacturer has many long-term the lawyer. discussion of “substantial relationship” in employees who over time may file multiple comment [3] to Rule 1.9, “[i]n the case of an workers’ compensation claims against Large Introduction: organizational client, general knowledge of Manufacturer. If Lawyer J or another lawyer This opinion is limited to an examination the client’s policies and practices ordinarily with Law Firm H defended Large of the role of a lawyer appointed to represent will not preclude a subsequent representation; Manufacturer against a particular employee a child in a contested custody or visitation on the other hand, knowledge of specific facts while Attorney J was employed by the firm, it proceeding. It does not examine other con- gained in a prior representation that are rele- is contended that there is a substantial risk texts in which a lawyer may be appointed to

THE NORTH CAROLINA STATE BAR JOURNAL 49 represent a child1 such as when a child is Attorney “provides independent legal repre- the lawyer is appointed to represent more than alleged to be abused or neglected or is a party sentation in a traditional attorney-client rela- one child of the dissolving marriage, the in civil litigation. To avoid confusion, the tionship, giving the child a strong voice in the lawyer must monitor the representation for label “guardian ad litem” will not be used in proceedings”; the Best Interests Attorney, on potential conflicts of interest between the chil- this opinion when referring to a lawyer the other hand, “independently investigates, dren’s differing objectives for the representa- appointed to represent a child in a contested assesses, and advocates the child’s best interests tion. See Rule 1.7. If a conflict evolves that custody or visitation proceeding although a as a lawyer.”5 The former role is “client direct- cannot be managed, the lawyer may have to court may choose to apply this label. This ed” in which the lawyer serves as the tradition- decline the representation or withdraw.10 opinion does not address or seek to question al advocate for the objectives articulated by the A lawyer who is appointed a Child’s the authority of a court to appoint a lawyer to child and owes the child “the same duties of Attorney must determine whether the child is represent a child in a contested custody pro- undivided loyalty, confidentiality, and compe- sufficiently mature and articulate to partici- ceeding. It seeks only to assist the lawyer and tent representation as are due to an adult pate meaningfully in the client-lawyer rela- the court to clarify the responsibilities of a client.”6 The latter role is “advocate directed,”7 tionship. As permitted by Rule 1.14(a), when lawyer serving in such a role. where the advocate’s judgment is substituted a client’s capacity to make adequately consid- In a contested custody or visitation pro- for that of the child with “the purpose of pro- ered decisions is diminished “because of ceeding—especially a “high conflict” pro- tecting a child’s best interests without being minority,” the lawyer “shall, as far as reason- ceeding—the court will, on occasion, appoint bound by the child’s directives or objectives.”8 ably possible, maintain a normal client- a lawyer to represent the child or children Because the differences in the two roles are lawyer relationship with the client.” However, whose custody is at stake. Although the fundamental—particularly with regard to the if a child is too young to articulate his or her authority for such appointments is not clear2 lawyer’s relationship to the child and respon- objectives for the representation or to make and may reside with the court’s inherent sibilities to the court—a lawyer who is decisions about the representation, the lawyer authority to administer justice, such appoint- appointed to represent a child in a contested should recommend to the court that the ments are becoming more common as seen in custody proceeding must be sure that she lawyer be appointed to serve as a Best recent inquiries to the Ethics Committee.3 knows which role she has been appointed to Interests Attorney rather than a Child’s The appointment presents a number of diffi- perform. Attorney. cult issues of professional responsibility for There is another possible role for a lawyer the appointed lawyer. These issues cannot be to play. The court may appoint a non-lawyer Inquiry #3: resolved unless the lawyer’s role is clearly des- or a lawyer to be an advisor (“court-appointed What are the professional responsibilities ignated and understood by all of the parties to advisor”) to assist the court by investigating of a Best Interests Attorney? the proceeding, especially the appointed and reporting information to the court or by lawyer and the court. providing the court with an opinion on some Opinion #3: This opinion identifies the possible roles matter.9 The lawyer in such a role is not act- A Best Interests Attorney is bound by the that a lawyer appointed in a contested cus- ing as an advocate or serving as counsel for Rules of Professional Conduct “except as dic- tody case may play and recommends that the either the child or the child’s interests. As an tated by the absence of a traditional attorney- order of appointment specify the role and advisor to the court, the lawyer may become client relationship with the child and the par- responsibilities of the appointed lawyer. The a witness who is subject to examination by ticular requirements of [her] appointed opinion also addresses some specific issues of the parties. The lawyer appointed to serve in tasks.”11 The lawyer must determine the professional responsibility that arise from this function should also take steps to insure child’s best interests based upon objective cri- those roles. Although there are limited refer- that the order of appointment specifies this teria “as set forth in the law related to the pur- ences to the Rules of Professional Conduct in role and its duties. poses of the proceedings.”12 Any objectives or this opinion, identification of the client and preferences expressed by the child are but one of the lawyer’s role relative to that client is Inquiry #2: factor to be taken into consideration when fundamental to the application of the Rules. What are the professional responsibilities determining the best interests of the child. of a Child’s Attorney? The child’s communications with the Best Inquiry #1: Interests Attorney are subject to Rule 1.6, the What are the roles for a lawyer who is Opinion #2: confidentiality rule, except that “the lawyer appointed to represent a child in a contested A Child’s Attorney serves in the traditional may use the child’s confidences for the pur- custody or visitation proceeding? role of counsel for the child and must fulfill poses of the representation without disclosing that role in accordance with the Rules of them.”13 This means that the lawyer may use Opinion #1: Professional Conduct. The lawyer must ascer- confidential information received from a child Two distinct roles for a lawyer for a child tain the child’s objectives for the representa- to develop other evidence. The example pro- are recognized: (1) “Child’s Attorney” and (2) tion and then seek to obtain those objectives vided in the ABA Standards is of the child who “Best Interests Attorney.”4 As described in the within the bounds of the Rules of Professional discloses a parent’s drug use to the Best American Bar Association, Section of Family Conduct. Rule 1.2. The lawyer owes the duty Interests Attorney. The lawyer may not dis- Law Standards of Practice for Lawyers of confidentiality to the child and her com- close the source of the information but she Representing Children in Custody Cases munications with the child are protected by may investigate and present evidence of the (2003)(“ABA Standards”), the Child’s the attorney-client privilege. See Rule 1.6. If drug use.14

50 WINTER 2012 Representation of multiple children does Inquiry #5: following questions should be answered at the not create a conflict of interest for a Best How does an appointed lawyer know time of appointment (the list is not exhaus- Interests Attorney because the lawyer is not which role he is being appointed to perform? tive): bound, as in a traditional client-lawyer rela- Identifying the Role tionship, to advocate for a client’s objectives. Opinion #5: • Am I being appointed to provide inde- As explained in the ABA Standards, “[a] Best Ideally, the order of appointment will spec- pendent legal representation to the child in a Interests Attorney in such a case should ify which role the lawyer is to perform.16 traditional client-lawyer relationship (the report the relevant views of all the However, because confusion about the roles is Child’s Attorney role)? children...and advocate the children’s best not uncommon, a lawyer who is asked to - or to investigate, assess, and advocate for interests...”15 serve must help the court to articulate the the child’s best interests (the Best Interests lawyer’s role. Standard 1.3 of the Standards for Attorney role)? Inquiry #4: Attorneys for Children in Custody or Visitation - or to assist the court by investigating and What are the professional responsibilities Proceedings of the American Academy of reporting information to the court, or by of a court-appointed advisor? Matrimonial Lawyers (“AAML Standards”) is providing the court with an opinion on instructive: some matter (the court-appointed advi- Opinion #4: Whenever a court assigns counsel for a sor)? The court-appointed advisor is not acting child, the court should specify in writing Child’s Attorney’s Assignment and Tasks as a lawyer; he is not an advocate and does not the scope of the assignment and the tasks • If appointed to be the Child’s Attorney, represent a client or a particular interest. expected, preferably in the form of an has the child’s capacity to direct the represen- Rather, the advisor serves as an investigator order. In the event that the court does not tation been established? for the court and owes the court the duty to specify these tasks at the time of appoint- • If appointed to be the Child’s Attorney, investigate thoroughly and impartially and to ment, the counsel’s first action should be to does the court agree report back to the court. seek clarification from the court of the - the child will be my client; As an investigator who is responsible only tasks expected of him or her.17 - I will owe the child the professional to the court, the lawyer has no duty of confi- Similarly, the ABA Standards state: responsibilities owed to any client includ- dentiality or loyalty to any of the parties or The lawyer should accept an appointment ing the protection of confidences from witnesses. Moreover, it is unlikely that the only with full understanding of the issues unauthorized disclosure and the preserva- attorney-client privilege will attach to the and the functions to be performed. If the tion of the attorney-client privilege; and lawyer/advisor’s communications with parties appointed lawyer considers parts of the - in accordance with Rule 3.7, it would be or witnesses. When a lawyer is serving in this appointment order confusing or incom- inappropriate in most instances for me to role, he must disclose the capacity in which patible with his or her ethical duties, the serve as both advocate and witness? he is acting to anyone who may misunder- lawyer should (1) decline the appoint- • If appointed to be the Child’s Attorney, stand his role. See, e.g., Rule 4.3(b). It is not a ment, (2) inform the court of the conflict will I be permitted/expected to do any of the conflict of interest for a lawyer to serve as a and ask the court to clarify or change the following: make an opening or closing state- court-appointed advisor if he does not repre- terms of the order, or (3) both.18 ment, introduce evidence including witnesses, sent any person appearing in the matter and If the order fails to identify the role and the examine witnesses for any party, subpoena he does not mislead others about his role. In lawyer’s accompanying responsibilities, the records or witnesses, or participate on behalf particular, the lawyer must explain that com- lawyer should first request clarification. In of the child/client in consent agreements munications will not be held in confidence particular, the lawyer should ask that the order between the parties? and may be reported to the court. Since the articulate whether the lawyer is to be a Child’s Best Interests Attorney’s Assignment and Tasks lawyer is not representing a client in the mat- Attorney, a Best Interests Attorney (as those • If appointed to be the Best Interests ter, the prohibition on contact with a repre- roles are defined above), or a court-appointed Attorney, what duty do I have to investigate sented person in Rule 4.2 does not apply to advisor. If the court indicates that the lawyer is and report to the court? his communications with represented per- to be a Best Interests Attorney, the lawyer • If appointed to be the Best Interests sons. However, it is recommended that the should request that the order specify the duties Attorney, will my communications with the lawyer/advisor inform the other lawyer prior that accompany this role. If the court indicates child be confidential but I may use the confi- to speaking to his client. that the lawyer is a Child’s Attorney, the dential information to develop other evi- Non-lawyers, such as social workers and lawyer should confirm that the child is capable dence? psychologists, who are more appropriately of making decisions about important matters • If appointed to be the Best Interests trained to investigate and offer opinions on sufficient to establish the goals of the represen- Attorney, does the court agree that, in accor- issues of child welfare, may be better suited tation.19 If the court indicates that the lawyer dance with Rule 3.7, it would be inappropri- to serve in the role of court-appointed advi- is a court-appointed advisor, the lawyer should ate in most instances for me to serve as both sor. At the time of appointment, a lawyer consider whether a non-lawyer would better advocate (for the child’s best interests) and should consider whether a non-lawyer fulfill this role and, if so, make this recom- witness? would fulfill the role better than the lawyer mendation to the court. - If the court expects me to testify, does the and, if so, the lawyer should express this To assist with the clarification of the scope court understand that this may subject the opinion to the court. of the assignment and the tasks expected, the child’s confidences to disclosure and may

THE NORTH CAROLINA STATE BAR JOURNAL 51 jeopardize my ability to gain the trust of kind of lawyer is a witness.”23 As noted in the Standard 1.2 requires, “[t]o be eligible for the child and of witnesses necessary to my ABA Standards, “[a] court seeking expert or appointment as counsel for a child in a cus- investigation? lay opinion testimony, written reports, or tody or visitation proceeding, a person should • If appointed to be the Best Interests other non-traditional services should appoint be specially trained and designated by the Attorney, will I be permitted/expected to do an individual for that purpose, and make local jurisdiction as competent to perform the any of the following: make an opening or clos- clear that the person is not serving as a lawyer, assignment” and the comment adds, “[a]t a ing statement, introduce evidence including and is not a party.”24 The AAML Standards minimum, counsel for children must know witnesses, examine witnesses for any party, are even more adamant on this issue: how to communicate effectively with chil- subpoena records or witnesses, or participate Courts may choose to appoint someone to dren and understand children’s mental and in consent agreements between the parties? investigate and report information to the emotional states at different ages and stages of Court Appointed Advisor’s Assignment and court. When they do so, these profession- their lives.”26 Tasks als should be called “court-appointed This opinion does not attempt to address • If appointed to assist the court by inves- advisors.” Courts may choose to appoint all of the professional responsibilities or obli- tigating and reporting information to the someone in an expert capacity to provide gations of a lawyer appointed as a Child’s court or by providing the court with an opin- the court with an opinion about some Attorney, a Best Interests Attorney, or a court- ion on some matter, does the court agree that contested matter. When they do so, these appointed advisor. A lawyer who is asked to I will not be serving as a lawyer and I will owe professionals should be called “experts.” serve in any of these roles should understand no duties of representation to any party or Courts may choose to appoint someone to the requirements of each role. Familiarity other person involved in the proceeding? protect children from the harms associat- with the ABA Standards and the AAML • If appointed to be an advisor to the court, ed with the contested litigation. When Standards is recommended. does the court agree that I may communicate they do so, these professionals should be with represented persons without the consent called “protectors.” There may be other Endnotes of their lawyers as would be otherwise reasons courts may choose to add a profes- 1. For example, a lawyer may be appointed, pursuant to required by Rule 4.2? sional to the case. N.C. Gen. Stat. §7B-601(a), to be an attorney- guardian ad litem for a child who is alleged to be • If appointed to be an advisor to the court, Language matters, however. We believe abused, neglected, or dependent; a lawyer may be what tasks will I perform? that assigning any of these tasks to some- appointed guardian ad litem for a minor who is a party - Will I submit an oral or a written report one who is called counsel is unnecessary, in civil litigation pursuant to Rule 17 of the NC Rules to the court? needlessly confusing, and misleading. of Civil Procedure (see infra note 2); or a lawyer may be appointed for a minor child in a domestic violence - Will I limit my role to investigator and Whatever these professionals are called, action pursuant to N.C. Gen. Stat. §50B-3(a1)(3)h. report only my factual findings, or will I and whether or not they happen to be 2. The NC Rules of Civil Procedure authorize the provide the court with an opinion on some members of the bar, these professionals appointment of a guardian ad litem (GAL) to appear matter? should never be mistaken for being coun- on behalf of a minor plaintiff or defendant in civil lit- - Will I be a witness in the proceeding sub- sel for the child or serving in any kind of igation. N.C. R. Civ. P. 17(b)(1) and (2). The General 25 Rules of Practice for the Superior and District Courts ject to testimonial examination? attorney role. provide for the appointment of a lawyer to serve as The potential harm from testifying as a GAL for a minor who is the victim or potential witness Because of the potential for the roles to be witness is evident. If the Child’s Attorney can- in a criminal proceeding. N.C. Gen. R. Prac. Super. & confused, regardless of the specificity of the not assure her client that their communica- Dist. Ct. 7.1. Neither rule authorizes the appointment of a lawyer or a GAL for a child who is a non-party to order, the judge should be reminded at the tions are confidential and the Best Interests a civil proceeding. beginning of each hearing of the role of the Attorney cannot assure the child or other wit- 3. The increasing call for the appointment of lawyers to 20 appointed lawyer. nesses of the same, the ability of a lawyer to represent the children in custody cases is also noted in perform in either role will be undermined. Representing Children: Standards for Attorneys for Inquiry #6: At the time of the appointment, unless Children in Custody or Visitation Proceedings of the American Academy of Matrimonial Lawyer, p. 2, Should a lawyer appointed as the Child’s the lawyer is specifically appointed as an advi- (2011) [hereinafter “AAML Standards”]. Attorney or a Best Interests Attorney agree to sor to the court with no other role, the lawyer 4. The terms are found in American Bar Association, investigate and present evidence? To testify or should recommend to the court that she not Section of Family Law Standards of Practice for Lawyers present a written or oral report or recommen- make a written or oral report to the court or Representing Children in Custody Cases (2003)[here- dation to the court? testify as to her findings, particularly if the inafter “ABA Standards”]. However, the distinction is recognized in other writings. See AAML Standards; lawyer is appointed as the Child’s Attorney. If National Association of Counsel for Children Opinion #6: the court insists that the lawyer perform these Recommendations for Representation of Children in Regardless of the role, the appointed functions, the lawyer may decline the Abuse and Neglect Cases (2001)[hereinafter “NACC lawyer, like any lawyer advocating a position, appointment. Recommendations”]; New York State Bar Assn. Committee on Children and the Law: Standards for should conduct independent discovery and Attorneys Representing Children in Custody, Visitation investigation of the facts.21 At hearings, it is Conclusion: and Guardianship Proceedings (2008)[hereinafter preferable that the lawyer have the authority Serving as a Child’s Attorney or a Best “NYSBA Standards”]. to present and cross-examine witnesses and Interests Attorney in a contested custody or 5. ABA Standards, supra note 3, at 1. offer exhibits.22 However, the standards of visitation case requires special skills, training, 6. ABA Standards, supra note 3, at 2. numerous organizations agree that “[n]either and experience. So much so that the AAML 7. NACC Recommendations, supra note 3, at 4.

52 WINTER 2012 8. ABA Standards, supra note 3, at 2. a national network of lawyers who have tions) prosecutes the eviction through the 9. AAML Standards, supra note 2, at 26-27. entered into a “network agreement” with court system. The lawyer logs actions taken 10. See ABA Standards, supra note 3, at 9. ABC to use administrative and litigation sup- into XYZ’s software, which creates periodic 11. ABA Standards, supra note 3, at 15. port services provided by ABC, including case status reports that are automatically 12. ABA Standards, supra note 3, at 17. default management application software, emailed to the landlord. The website claims 13. Id. and to accept referrals from ABC. The agree- that these status reports virtually eliminate the 14. Id. ment establishes the legal fees that a network need for direct communications between the 15. Id. lawyer may charge to an ABC client as well as landlord and the lawyer. The legal fee for each 16. The lawyer should urge the court to avoid the use of the designation “guardian ad litem” which adds to the the “administrative fees” the lawyer must pay eviction is determined by the lawyer provid- confusion about the lawyer’s role because of its affilia- to ABC for the support services provided by ing the service. The fee is billed and collected tion with Rule 17 and abuse/neglect appointments. ABC. An ABC client is considered the mutu- by XYZ and then forwarded to the lawyer. See ABA Standards, supra note 3, at 2 (“The role of al client of both ABC and the network lawyer ‘guardian ad litem’ has become too muddled through Inquiry #1: different usages in different states, with varying conno- with ABC functioning as the agent of the tations.”) ABC client while providing litigation and May a North Carolina lawyer or law firm 17. AAML Standards, supra note 2, at 14. administrative support services to the net- enter into an agreement to participate in a 18. ABA Standards, supra note 3, at 3. work lawyer. When a mortgage holder or ser- “network” of lawyers for a company using this 19. Standard 2.1 of the AAML Standards states: “Court- vicer becomes an ABC client, it is provided business model? appointed counsel must decide, on a case-by-case with a list of network lawyers. The ABC basis, whether their child clients possess the capacity to client may choose to retain one of the net- Opinion #1: direct their representation. In the event that the court seeks to appoint counsel for children who lack capacity work lawyers to provide legal services in con- No, unless the following conditions are to direct their representation, the lawyer should strive nection with a default, or it may ask ABC to satisfied. to refuse the appointment.” AAML Standards, supra invite a lawyer or firm of the client’s choosing Unauthorized Practice of Law note 2 at15. to become a network lawyer and subsequent- N.C. Gen. Stat. §84-5 makes it unlawful 20. ABA Standards, supra note 3, at 7. ly to provide legal services to the client. The for any corporation to practice law or “hold 21. ABA Standards, supra note 3, at 5. network lawyer invoices the client for the itself out in any manner as being entitled to 22. Id. at 6. legal services provided by the lawyer. ABC do [so]....” Moreover, a lawyer is prohibited 23. Id. at 2; see generally, Standard 3 of the AAML separately invoices the network lawyer for the by Rule 5.5(d) from assisting another person Standards, supra note 2 at 25;NACC Recommendations, supra note 3 at 10. administrative services it provided in support in the unauthorized practice of law. Neither a 24. ABA Standards, supra note 3, at 2-3. of the representation of the ABC client. lawyer nor a law firm may become a member 25. AAML Standards, supra note 2, at 26-27. Another example of this business model is of a “network” for a company using this busi- 26. AAML Standards, supra note 2 at 13. an Internet-based company, XYZ Company, ness model if the company is providing legal which offers “an online eviction processing services or holding itself out as a provider of system that connects landlords and property legal services as opposed to a provider of sup- Proposed 2012 Formal Ethics managers with real estate attorneys.” The evic- port services to lawyers and clients and a Opinion 10 tion services are provided using software method for identifying lawyers who will use Participation as a “Network” Lawyer accessed via XYZ’s website and a network of those services to represent the client. for Company Providing Litigation or lawyers who are licensed by XYZ to use the Lawyer Referral Service Administrative Support Services software. A lawyer who wishes to participate A lawyer may not participate in the net- October 25, 2012 in XYZ’s network signs a licensing agreement work if payments are made to the company Proposed opinion rules a lawyer may not for the use of the eviction software. The for referrals or if the company is a for-profit participate as a network lawyer for a company licensing fee is determined by the size of the lawyer referral service. Rule 7.2(b) prohibits a providing litigation or administrative support market in which the lawyer will be providing lawyer from giving anything of value to a per- services for clients with a particular legal/busi- eviction services. The website states that its son for recommending a lawyer’s services ness problem unless certain conditions are satis- system provides lawyers “with the technology except a lawyer may pay the reasonable cost of fied. necessary to: [e]lectronically receive informa- advertising. Rule 7.2(d) prohibits participa- tion necessary to file eviction requests from tion in a lawyer referral service unless the serv- Introduction: clients; [c]ommunicate with clients through a ice is not operated for profit and the service This opinion explores whether a lawyer message center; [p]rint county-specific forms satisfies other conditions not relevant here. may participate as a “network” lawyer for a necessary for eviction filing with the court, Comment [6] to Rule 7.2 defines a lawyer company, usually offering its services via the completed with pre-populated information referral service as “any organization that holds Internet, that provides litigation or adminis- from the client; [p]rovide automated updates itself out to the public as a lawyer referral trative support services to clients with a par- to client on the status of the case.” A landlord service. Such referral services are understood ticular type of legal/business problem. who signs up for the service is given the names by laypersons to be consumer-oriented For example, ABC Services offers to assist of network lawyers who have contracted with organizations that provide unbiased referrals mortgage holders and mortgage loan servicers XYZ to handle eviction cases within the rele- to lawyers with appropriate experience in the (ABC clients) with the nationwide manage- vant jurisdiction. The selected or assigned subject matter of the representation....” ment of “mortgage defaults.” ABC maintains lawyer (in the case of single-lawyer jurisdic- Despite the prohibition on participation

THE NORTH CAROLINA STATE BAR JOURNAL 53 in a for-profit referral service, 2004 FEO 1 rendering such legal services. See also Rule obtained, in advance, after disclosure of the holds that a lawyer may participate in an on- 1.8(f)(compensation from a third party is pro- risks of such disclosure. Rule 1.6. The risk line service that is similar to both a lawyer hibited unless there is no interference in the that the attorney-client privilege for those referral service and a legal directory, provided client-lawyer relationship). A lawyer has a communications may be forfeited must be there is no fee sharing with the service and all duty to communicate with the client about specifically disclosed to the client to obtain communications about the lawyer and the the objectives of the representation and to informed consent. service are truthful. In 2004 FEO 1, the explain the law to the client to permit the Fee Sharing with Nonlawyer online service solicited lawyers to participate client to make an informed decision about Independent, professional judgment is and then charged participating lawyers a reg- those objectives. Rules 1.2 and 1.4. There can maintained, in part, by the prohibition on istration fee and an annual fee for administra- be no interference with the lawyer’s commu- sharing legal fees with a nonlawyer found in tive, system, and advertising expenses. The nications with the client or with the lawyer’s Rule 5.4(a). The prohibition helps to avoid amount of the annual fee varied by lawyer independent professional judgment as to nonlawyer interference with the exercise of a based upon a number of factors including the which legal services are required to achieve the lawyer’s professional judgment, ensures that lawyer’s current rates, areas of practice, geo- client’s objectives. See Rule 1.2(a)(“a lawyer the total fee paid by the client is not unrea- graphic location, and number of years in shall abide by a client’s decisions concerning sonably high, and discourages the nonlawyer practice. The opinion noted that the online the objectives of representation and...consult from engaging in improper solicitation of service had aspects of both a lawyer referral with the client as to the means by which they business for the lawyer. See 2010 FEO 4. If a service and a legal directory: are to be pursued”). The interference in a net- network lawyer must pay the company an [o]n the one hand, the online service is work lawyer’s professional judgment is “administrative fee” for every legal service like a lawyer referral service because the improper if the company dictates what legal the lawyer provides to the client regardless of company purports to screen lawyers services the lawyer is to provide to a client, the the administrative or litigation support serv- before allowing them to participate and to company is the sole source of information ices provided by the company, the arrange- match a prospective client with suitable about the client and its legal needs, or access ment violates the rule. Any payment to the lawyers. On the other hand, it is like a to the client is restricted by the company. A company for administrative and litigation legal directory because it provides a law firm or lawyer participating in a network support services, including payment for prospective client with the names of must establish the professional relationship access to the company’s litigation support lawyers who are interested in handling his with the client and maintain control of the software, must be reasonable in light of the matter together with information about relationship through direct communications services provided. See Rule 1.5(a). the lawyers’ qualifications. The prospec- as needed to establish the objectives for the Advertising and Solicitation tive client may do further research on the representation and to determine the means to The information that a participating lawyers who send him offer messages. achieve them. See Rule 1.2. lawyer provides to the company for distribu- Using this information, the prospective Competent Representation tion to prospective clients must be accurate. client decides which lawyer to contact Although a lawyer may use the company’s Rule 7.1(a) (prohibiting false or misleading about representation. services or software, including the forms gen- communications about the lawyer or the If a litigation support company provides a erated by that software, the lawyer remains lawyer’s services). If false or misleading state- prospective client with the names and qualifi- professionally responsible for the competent ments about the lawyer or his services are sub- cations of the lawyers in its network who will representation of the client including the sequently made by the company on its web- provide representation in the jurisdiction appropriate determination of the legal servic- site or in other advertising for the company’s where the client’s case is located but does not es needed to achieve the client’s objectives and services, the lawyer must demand that the specify the employment of one particular the quality of any work product that is used statements be corrected or deleted. See RPC lawyer, it is not a prohibited lawyer referral in the representation of the client. Rule 1.1 241 (lawyer who participates in a joint adver- service. Similarly, if at the client’s request, a and Rule 1.2. If the lawyer determines that a tising venture or a legal directory is profes- lawyer or law firm is invited to participate in form or pleading generated by the company’s sionally responsible for content of the adver- the network, the company is not operating a software is not appropriate for a particular tisement even if written or prepared by for-profit lawyer referral service. As stated in client, the lawyer must competently prepare another). If this does not occur, the lawyer 2004 FEO 1, “the potential harm to the con- the appropriate form or pleading and, if addi- must withdraw from the network. sumer [of a for-profit referral service] is avoid- tional information from the client is required, Rule 7.2(b) prohibits a lawyer from giving ed because the company does not decide the lawyer must communicate with the client anything of value to a person for recommend- which lawyer is right for the client.” to obtain the information. ing a lawyer’s services except a lawyer may pay Independent Professional Judgment and Confidential Information the reasonable cost of advertising. Therefore, Communication with the Client The confidentiality of the communica- participation as a network lawyer is prohibit- While a client is entitled to hire an agent to tions between the client and the lawyer, ed if payments are made to the company for manage its legal affairs, Rule 5.4(c) specifically including email communications using the referrals. However, if the payments are for lit- prohibits a lawyer from permitting a person company’s website or software, must be igation support or administrative services pro- who recommends, engages, or pays the lawyer assured or, in the alternative, informed con- vided to the client or to the lawyer to assist in to render legal services for another to direct or sent of the client to the sharing of its commu- the rendering of the legal services to the client, regulate the lawyer’s professional judgment in nications with the company must be and the charge for those services is reasonable

54 WINTER 2012 in light of the service received, the payments the same territory or jurisdiction are charged lawyer to provide the company with his or do not violate the rule. substantially higher fees. This has the effect of her client list. Rule 7.3(a) prohibits a lawyer from engag- discouraging other lawyers from seeking to May a lawyer enter into a network agree- ing in in-person, telephone, or real-time elec- become network lawyers for the same territo- ment with such a provision? tronic solicitation (collectively, in-person ry or jurisdiction and will potentially create de solicitation) for professional employment facto exclusive territories or jurisdictions. Opinion #6: when a significant motive for such conduct is May a lawyer enter an agreement with the No. This would only be permissible if the the lawyer’s pecuniary gain unless the lawyer company under these circumstances? lawyer obtained the informed consent of has a prior professional relationship with the every client whose name will be disclosed to potential client (there are other exceptions Opinion #3: the company. Rule 1.6(a). To obtain not relevant to this inquiry). A lawyer may No. See Opinion #2. informed consent, the lawyer must inform not do through an agent that which he is pro- each client of the likelihood that the disclo- hibited from doing by the Rules of Inquiry #4: sure would result in a business solicitation Professional Conduct. Rule 8.4(a). Therefore, The network agreement specifies that any from the company. if the company engages in in-person solicita- information submitted by a client using the tion of potential clients that do not have a company’s website shall become the exclusive Inquiry #7: prior professional relationship with a network property of the company. In the past, lack of sufficient oversight of lawyer or law firm, and the company’s motive May a lawyer enter into an agreement the ABC employees responsible for preparing for doing so is to solicit clients for legal serv- with such a provision? affidavits for use by network firms in foreclo- ices to be provided by a network lawyer or law sure proceedings lead to instances of “robo- firm, participation in the network arrange- Opinion #4: signing” in which an ABC employee signed a ment is prohibited. No. A lawyer cannot agree that his or her foreclosure affidavit without conducting a Written Agreement confidential communications with a client review of the client’s file on the matter or pos- Although this opinion does not require a will become the property of a third party. sessing the knowledge to which the employee lawyer to have a written agreement with the Such an agreement will interfere not only attested in the affidavit. Such affidavits were company, a written agreement addressing the with the lawyer’s duty to protect confidential executed in a manner contrary to the notary’s conditions set forth above is strongly recom- client communications from unauthorized acknowledgement and verification of the mended. The lawyer may not rely upon a disclosure, but also with other duties includ- documents.1 The affidavits were then for- written agreement alone, however, but must ing, but not limited to, the duty of competent warded to the lawyer for use in the foreclosure monitor the practices of the company on a representation, the recordkeeping duty for proceedings. continuing basis and discontinue the rela- trust account funds, and the duty to avoid What is a network lawyer’s duty relative to tionship if the lawyer cannot insure compli- future conflicts of interest. See Rules 1.1, 1.6, the documents and pleadings provided by ance with the conditions set forth above. 1.9, and 1.15-3. ABC?

Inquiry #2: Inquiry #5: Opinion #7: A participating network lawyer enters into The network agreement contains a provi- This inquiry demonstrates the potential an exclusive arrangement with the company sion that restricts the lawyer from soliciting problems that can result from interference in whereby no other network lawyer will pro- any “customer” of the company for the pur- the autonomy and independent professional vide legal services to participating clients in a pose of providing services that compete with judgment of a lawyer by a third party. A designated territory or jurisdiction. This the services of the company. lawyer should not participate in the network means that a prospective client with a legal May a lawyer enter into a network agree- or a similar service that includes support from matter in this territory or jurisdiction will be ment with such a provision? a third party if the lawyer’s ability to commu- automatically referred to the lawyer with the nicate with the client is so restricted that the exclusive arrangement. Opinion #5: lawyer cannot determine whether the docu- May a lawyer enter into such an agree- No, unless the agreement specifies that the ments and information he receives via the ment? lawyer is not agreeing to restrict his or her third party are reliable. right to practice law in violation of Rule 5.6. If a network lawyer obtains a document, Opinion #2: Presumably, the company does not provide such as an affidavit, from ABC for use in the No, this is essentially a for-profit lawyer legal services because it is prohibited by law representation of a client and the lawyer referral service, which is prohibited by Rule from doing so. See Opinion #1 above. The knows or reasonably should know that ABC 7.2(d). See also Opinion #1. provision in the licensing agreement must has engaged in preparation of erroneous, specify the non-legal services provided by the false, or seemingly false documents or affi- Inquiry #3: company to which the non-compete would davits in similar matters in the past, the After the company enters into a network apply. lawyer may not use the documents until he agreement with a lawyer for a particular terri- has assured himself, through review of the tory or jurisdiction, all lawyers who subse- Inquiry #6: client’s own files or direct communication quently apply to become network lawyers for The network agreement requires the with the client, that the documents are reli-

THE NORTH CAROLINA STATE BAR JOURNAL 55 able. See Rule 5.4(c). Particularly with regard services to a prospective client after consider- out in 2002 FEO 9 and determine whether to sworn statements, a lawyer’s duty of candor ation of the relevant facts and circumstances. such delegation is appropriate. requires the lawyer to avoid offering false evi- A lawyer may not delegate to a nonlawer the The lawyer must also take precautions to dence. See Rule 3.3(a)(3). Nevertheless, if a responsibility for establishing a lawyer-client avoid assisting in the unauthorized practice of client or an agent of the client is not other- relationship. Rule 5.3; Rule 5.5; NC law. See Rule 5.5(d). The lawyer must instruct wise known to be unreliable or to provide Guidelines for Use of Paralegals in Rendering the field representative to disclose to the erroneous or false information, a lawyer may Legal Services (2010) (nccertifiedparalegal. prospective client that he is not a lawyer and rely upon information provided to her to rep- gov/guidelines.asp). that he cannot answer any legal question. The resent the client. lawyer must also admonish the field represen- Inquiry #2: tative not to provide legal advice and to con- Endnote If a lawyer at the firm has reviewed suffi- tact the lawyer should a legal question arise. 1. Such conduct is the subject of the National Mortgage cient information from the prospective client Likewise, the lawyer must be available by Settlement. nationalmortgagesettlement.com. to determine that an offer of representation is some means to consult with and answer any appropriate, may a firm employ a field repre- legal questions the prospective client may Proposed 2012 Formal Ethics sentative to meet with the prospective client have. Opinion 11 and obtain a representation contract prior to Use of Nonlawyer Field Representatives any consultation between the person and a Proposed 2012 Formal Ethics to Obtain Representation Contracts firm lawyer? Opinion 12 October 25, 2012 Agreement for Division of Fees Entered Proposed opinion rules that, subject to condi- Opinion #2: Upon Lawyer’s Departure from Firm tions, a law firm may send a nonlawyer field The Ethics Committee has previously October 25, 2012 representative to meet with a prospective person- determined that a lawyer may delegate certain Proposed opinion rules that an agreement for al injury client and obtain a representation con- tasks to nonlawyer assistants. See, e.g., RPC a departing lawyer to pay his former firm a per- tract without prior consultation by a firm 70, RPC 216, 99 FEO 6, 2002 FEO 9. centage of any legal fee subsequently recovered lawyer with the prospective client. Pursuant to RPC 216, when a lawyer dele- from the continued representation of a contingent gates a task to a nonlawyer, the lawyer has a fee client by the departing lawyer does not violate Inquiry #1: duty under the Rules of Professional Conduct Rule 5.6 if the agreement was negotiated by the ABC law firm employs a large staff of to take reasonable steps to ascertain that the departing lawyer and the firm after the departing nonlawyers, including paralegals, assistants, nonlawyer assistant is competent; to provide lawyer announced his departure from the firm and others. Among the nonlawyer staff are the nonlawyer assistant with appropriate and the specific percentage is a reasonable resolu- employees called “field representatives.” supervision and instruction; and to continue tion of the dispute over the division of future fees. When a prospective client contacts ABC, the to use the lawyer’s own independent profes- firm sends a field representative to the sional judgment, competence, and personal Inquiry: prospective client’s home or other location knowledge in the representation of the client. Attorney B, an associate in Attorney A’s chosen by the prospective client. The field See also Rule 1.1, Rule 5.3, Rule 5.5. firm, resigned from the firm effective representative provides information about the In 2002 FEO 9, the Ethics Committee February 28, 2005. At the time of his resigna- firm in an effort to convince the prospective specifically determined that a nonlawyer may tion, Attorney B signed an agreement with client to choose firm ABC for representation. oversee the execution of real estate closing the firm. The agreement provided that If the prospective client agrees, the field rep- documents and the disbursement of the pro- Attorney B would take all of the active client resentative provides a representation contract ceeds even though the lawyer is not physically files for which the clients had indicated a and obtains the client’s signature on the con- present at the closing. 2002 FEO 9 states desire for Attorney B to continue to represent tract. The field representation also obtains that, in any situation where a lawyer delegates them. The agreement also contained the fol- information from the prospective client con- a task to a nonlawyer assistant, the lawyer lowing provision: cerning the representation. must determine that delegation is appropriate With respect to those files in which the No lawyer with the firm consults with the after having evaluated the complexity of the client chooses Attorney B to conclude his prospective client before the field representa- transaction, the degree of difficulty of the or her active claim, upon recovery made tive meets with the person. No lawyer with task, the training and ability of the non- by Attorney B on each such file, Attorney the firm reviews the information obtained by lawyer, the client’s sophistication and expecta- B shall forward to Attorney A, at the time the field representative before the firm agrees tions, and the course of dealing with the of disbursement, 50% of the attorney’s fee to represent the person. client. The opinion holds that the lawyer is collected on each settlement. This will May the firm accept the representation of still responsible for providing competent rep- include medical payments fees as well. a client without a review of the client’s cir- resentation and adequate supervision of the Attorney B will also pay to Attorney A cumstances by a firm lawyer? nonlawyer. upon recovery the total amount of expens- Similarly, under certain circumstances, a es due to Attorney A in accordance with [a Opinion #1: nonlawyer field representative may oversee computer expense printout provided by No. A lawyer must use his professional the execution of a representation contract. Attorney A]. Finally, Attorney B will for- judgment to determine whether to offer legal The firm lawyer must consider the factors set ward to Attorney A a copy of the settle-

56 WINTER 2012 ment sheet signed by the client reflecting ing to represent a client if the client chooses for costs advanced from any final settlement the disbursements on each such file. All to be represented by the lawyer after the or judgment received by the client.” settlements negotiated by Attorney B lawyer’s departure from the firm,” the opin- Rule 1.5(e) requires a client’s written con- through February 28, 2005, will be han- ion held that a lawyer may participate in the sent to the division of a fee between lawyers dled through Attorney A’s trust account. offering or making of an agreement that who are not in the same firm. This rule, how- Client entered into an agreement for rep- includes a provision for dividing legal fees ever, does not apply to the current situation resentation on a personal injury claim with received after a lawyer’s departure from a because the fee agreement with the client pre- Attorney A’s firm on December 16, 2004, firm. ceded Attorney B’s departure from the firm. while Attorney B was still with the firm. ...provided the formula or procedure for Rule 1.5, cmt. [9]. When Attorney B left the firm in February dividing fees is, at the time the agreement 2005, Client chose to continue to be repre- is made, reasonably calculated to compen- Proposed 2012 Formal Ethics sented by Attorney B. The case was conclud- sate the firm for the resources expended by Opinion 13 ed in May 2010, with a deputy commission- the firm on the representation as of the Duty to Safekeep Client Files Upon er’s award to Client. date of the lawyer’s departure and will not Suspension, Disbarment, There is currently an “attorney-attorney” discourage a departing lawyer from taking Disappearance, or Death of Firm Lawyer fee arbitration between Attorney A’s firm and a case and thereby deny the client access to October 25, 2012 Attorney B pending before the fee dispute the lawyer of his choice. Proposed opinion rules that the partners and committee of the local judicial district bar. Thus, the circumstances and timing of the managerial lawyers remaining in a firm are The distribution of the legal fee from the res- execution of an agreement are important to responsible for the safekeeping and proper dispo- olution of Client’s worker’s compensation the analysis of whether the agreement runs sition of both the active and closed files of a sus- case is in dispute. The judicial district bar’s afoul of Rule 5.6. pended, disbarred, missing, or deceased member bylaws relating to the arbitration of such dis- In the current inquiry, the agreement was of the firm. putes provides: “The committee shall neither negotiated and entered into after Attorney B have nor exercise jurisdiction regarding dis- announced that he was leaving Attorney A’s Inquiry #1: putes…which involve services that may con- firm. The agreement was, apparently, part of The law firm A & B, PA, was formed as a stitute a violation of The North Carolina a global settlement of all issues relative to professional corporation in 1992. Lawyer A State Bar Rules of Professional Conduct, as Attorney B’s departure. It was not entered and Lawyer B were the initial shareholders in now in effect or may be hereafter amended.” into as a condition of continued employ- the firm. In 1993, Lawyer C joined the firm The presiding arbitrator has requested an ment, as were the agreements analyzed in and became a shareholder. The professional opinion from the North Carolina State Bar 2008 FEO 8. It did not deter Attorney B corporation’s articles of incorporation were on the following issue: Does the provision of from leaving the firm or from continuing to amended to change the professional corpora- the agreement quoted above comply with the represent clients who chose to follow him to tion’s name to A, B & C, PA. Rules of Professional Conduct? his new firm. In fact, the agreement specifi- In 1998, Lawyer C closed a real estate cally contemplated that Attorney B would transaction for a client of the firm. The file Opinion: continue to represent those clients. In light of was placed among the firm’s inventory of Rule 5.6(a) prohibits a lawyer from partic- the various stages of his cases at the time of his client files. ipating in offering or making a partnership, departure, a 50% split of the contingent fees In 2008, Lawyer A and Lawyer B learned shareholders, operating, employment, or sim- to be earned on the cases cannot be viewed as that Lawyer C had committed numerous ilar type of agreement that restricts the right “onerous” or “punitive.” Such a division of embezzlements from the firm’s trust account of a lawyer to practice after termination of the fees would favor Attorney B in some cases in a cumulative amount exceeding relationship except an agreement concerning and disfavor him in others. $1,000,000. Lawyer C (hereinafter, “C”) was benefits upon retirement. This prohibition A division of fees based upon a fixed per- ousted from the firm and was subsequently on restrictive covenants protects the freedom centage that fairly allocates, over the range of disbarred. The firm’s articles of incorporation of clients to choose a lawyer and promotes cases, the value of the time and work expend- were amended to change the professional cor- lawyer mobility and professional autonomy. ed before and after a lawyer leaves a firm is a poration’s name back to A & B, PA. When C Rule 5.6, cmt. [1]. reasonable means of achieving an efficient, was ousted from the firm, Lawyer A and 2008 FEO 8 examined provisions in equitable resolution of the fee division issues Lawyer B reviewed the files for the clients of three employment agreements to determine between a departing lawyer and the firm. the firm whose legal services had been provid- whether the agreements complied with Rule Provided the lawyers deal fairly and honestly ed by C. When their review was completed, 5.6. Although the opinion ruled that all three with each other without intimidation, Lawyer A and Lawyer B instructed or allowed agreements violated Rule 5.6, the opinion, threats, or misrepresentation, this type of C to take possession of those client files. Since nevertheless, encouraged lawyers to enter agreement should be encouraged. 2008, the client files have been in a storage into agreements that will help to resolve The provision of the agreement address- facility to which C’s lawyer has the key. potential disputes about the division of fees. ing costs advanced is consistent with 2008 The client whose transaction was closed While cautioning that “such agreements may FEO 8, which provides that the agreement by C in 1998 is now seeking her file, which is not be so financially onerous or punitive as “may require the departing lawyer to protect believed to be in the storage facility. C is in to deter a withdrawing lawyer from continu- the firm’s interest in receiving reimbursement prison. C’s lawyer cannot access the storage

THE NORTH CAROLINA STATE BAR JOURNAL 57 facility due to physical infirmity. However, departed the firm because of suspension, dis- lawyer or firm accountable for the content of C’s lawyer is willing to give Lawyer A and barment, disappearance, or death.1 The the advertisement. However, we conclude that Lawyer B the key to the storage facility and to lawyers are responsible for (1) ensuring that where a gift/promotional item displays only authorize them to access and retrieve the any open client matter is promptly and prop- the name or logo of the lawyer or law firm, client files. Lawyer A and Lawyer B assert that erly transitioned to the lawyer of the client’s and the items are used/disseminated by the they are not obligated to help the client choice, and (2) retaining possession of and lawyer or law firm in a manner otherwise per- obtain her file. safekeeping closed client files of the departed missible under the Rules of Professional When a lawyer leaves a firm and is subse- lawyer until the requirements for disposition Conduct, the gift/promotion item does not quently disbarred, what is the professional of closed files set forth in RPC 209 can be ful- have to display an office address. responsibility of the lawyers remaining with filled. See, e.g., RPC 48 (explaining duties Examples of such items would include the firm relative to the safekeeping and prop- upon firm dissolution including continuity of pens, pencils, hats, or coffee mugs bearing the er disposition of the files of the clients of the service to clients and right of clients to coun- name or logo of a law firm or lawyer. A non- disbarred lawyer? sel of their choice). state issued license plate displaying a law firm’s name is also exempt from the address Opinion #1: Inquiry #2: requirement. The remaining lawyers in the firm are Do Lawyer A and Lawyer B have a duty to responsible for the safekeeping and proper help a former client of the firm obtain the file Proposed 2012 Formal Ethics disposition of both the active and closed files relating to the legal services provided to her Opinion 15 of the disbarred lawyer in their custody. by C when C was a member of the firm? Lawyer as Witness Because of the risk of loss, closed files may not October 25, 2012 be relinquished to a disbarred lawyer who is Opinion #2: Proposed opinion rules that whether a lawyer no longer subject to the regulation of the Yes, when the location of a file is known, is a “necessary witness” and thereby disqualified North Carolina State Bar and no longer the lawyers have a duty to take reasonable from acting as a client’s advocate at a trial is an required to comply with the Rules of measures to assist a client to obtain the file. issue left up to the discretion of the tribunal. Professional Conduct. See Opinion #1 and RPC 209. Rule 1.15 requires a lawyer to preserve Inquiry: client property, including information in a Endnote Based on allegations by A, Defendant B client’s file such as client documents and 1. This opinion does not address the professional respon- was arrested and charged with cruelty to ani- lawyer work product, from risk of loss due to sibilities of the firm lawyers when a lawyer leaves the mals. B’s lawyer wrote to A and asked him to firm to practice elsewhere. destruction, degradation, or loss. See also withdraw the charges. B’s lawyer advised A RPC 209 (noting the “general fiduciary duty that B had not harmed the animals and to safeguard the property of a client”); RPC Proposed 2012 Formal Ethics advised A that he could be sued civilly for 234 (requiring the storage of a client’s original Opinion 14 maliciously instituting charges against B with- documents with legal significance in a safe Advertising Content on Gift or out probable cause. Eventually, B’s motion for place or their return to the client); 98 FEO 15 Promotional Items a directed verdict was granted in the matter. (requiring exercise of lawyer’s “due care” when October 25, 2012 Lawyer, on behalf of B, filed a malicious selecting depository bank for trust account); Proposed opinion rules that the advertising prosecution suit against A. The pleadings con- and 2011 FEO 6 (allowing law firm to use content displayed on certain gift or promotional tained an allegation that Lawyer had contact- “cloud computing” if reasonable care is taken items does not have to include an office address. ed A, assured A that B had not harmed his to protect the security of client files). animals, asked A to withdraw the charges, and If a lawyer practices in a law firm with Inquiry: advised A that “persons who maliciously insti- other lawyers, the responsibility to preserve a Lawyer would like to put her firm name tute charges without probable cause could be client’s property, including the client’s file, is on a non-state issued license plate to be placed held liable for damages.” The pleading then not solely the responsibility of the lawyer pro- on the front of her automobile. The graphics alleges that A “maliciously refused to contact viding the legal services to the client. Rule on the license plate would consist only of the the relevant law enforcement authorities to 5.1(a) of the Rules of Professional Conduct firm name. No other content would appear inform them of the true facts.” requires the partners in a law firm and all on the plate. Is Lawyer required to include an The trial court questions whether Lawyer lawyers with comparable managerial authori- office address on the license plate? had made himself a witness by virtue of his ty to make “reasonable efforts to ensure that inclusion of the above-referenced factual alle- the firm…has in effect measures giving rea- Opinion: gations. sonable assurance that all lawyers in the No. Rule 7.2(c) provides that any adver- firm…conform to the Rules of Professional tisement for legal services must include the Opinion: Conduct.” “name and office address of at least one lawyer Rule 3.7(a) provides that a lawyer shall not The professional responsibilities of the or law firm responsible for [the advertise- act as advocate at a trial in which “the lawyer partners and the lawyers with managerial ment’s] content.” The purpose of the rule is to is likely to be a necessary witness” unless: (1) authority relative to the files of the firm are facilitate the identification and location of a the same regardless of whether the lawyer has responsible lawyer or firm in order to hold that CONTINUED ON PAGE 65

58 WINTER 2012 RULE AMENDMENTS

Amendments Approved by the Supreme Court

At a conference on August 23, 2012, the Amendments to the Administrative accredited law and paralegal schools and who North Carolina Supreme Court approved and CLE Suspension Rules teach classes or courses on topics of substan- the following amendments to the rules of the 27 N.C.A.C. 1D, Section .0900, tive law at accredited graduate schools. North Carolina State Bar (for the complete Procedures for Administrative Committee, text see the Spring 2012 and Summer 2012 and Section .1500, Rules Governing the Amendments to the Legal editions of the Journal or visit the State Bar Administration of the Continuing Legal Specialization Rules website): Education Program 27 N.C.A.C. 1D, Section .1700, The The amendments will facilitate the serv- Plan of Legal Specialization Amendments to the Procedures for ice of notices to show cause (NSC) and sus- The amendments specify that the substan- Election of State Bar Councilors pension orders for failure to fulfill a member- tial involvement and CLE requirements for 27 N.C.A.C. 1A, Section .0800, Election ship or CLE requirement and clarify that a certification apply to the calendar years prior and Appointment of State Bar Councilors written response to a NSC must “show to application and clarify the standard for The amendments permit judicial district cause” rather than merely provide an expla- peer review. bars to adopt procedures for online voting nation for the failure to fulfill an obligation for State Bar councilors. of membership. Amendments to the Rules for Paralegal Certification Amendments to the Discipline and Amendments to the IOLTA Rules 27 N.C.A.C. 1G, Section .0100, The Disability Rules 27 N.C.A.C. 1D, Section .1300, Rules Plan for Certification of Paralegals 27 N.C.A.C. 1B, Section .0100, Governing the Administration of the Plan for A new rule creates an inactive status for Discipline and Disability of Attorneys Interest on Lawyers’ Trust Accounts (IOLTA) certified paralegals who are experiencing The amendments make the Grievance The accounts of lay “settlement agents” financial hardship, illness or disability, on Committee’s procedure for referring cases to are required by law to be IOLTA accounts. active military duty, or following a military the Trust Account Supervisory Program con- The rule amendments clarify that a settle- spouse to another state or country. sistent with the procedures for referrals to an ment agent account may be established at a approved law office management program bank outside of North Carolina provided the Amendments to the Rules of and the Lawyer Assistance Program. account is not maintained by a North Professional Conduct Carolina lawyer, the bank is FDIC insured, 27 N.C.A.C. 2, Rules of Professional Amendments to the Procedures for and the bank has a certificate of authority to Conduct, Rule 1.15, Safekeeping Property Fee Dispute Resolution transact business from the North Carolina Rule 1.15-2 requires a lawyer maintaining 27 N.C.A.C. 1D, Section .0700, Secretary of State. a trust or fiduciary account to file a written Procedures for Fee Dispute Resolution directive that requires the depository bank or The amendments clarify that the Fee Amendments to the CLE Rules other financial institution to report to the State Dispute Resolution Program does not have 27 N.C.A.C. 1D, Section .1600, Bar when an instrument drawn on the account jurisdiction over fees or expenses established Regulations Governing the Administration of is presented for payment against insufficient by private arbitration. the Continuing Legal Education Program funds. The amendments clarify that the bank The amendments authorize the granting directive requirement is limited to trust and of CLE credit to lawyers who teach classes at fiduciary accounts with demand deposit.

Amendments Pending Approval of the Supreme Court

At its meeting on October 26, 2012, the the Journal or visit the State Bar website): The proposed amendments eliminate council of the North Carolina State Bar consensual suspension by court order in voted to adopt the following rule amend- Proposed Amendments to the Lawyer favor of consensual transfer to inactive sta- ments for transmission to the North Assistance Program Rules tus by court order. The lawyer may only Carolina Supreme Court for approval (for 27 N.C.A.C. 1D, Section .0600, Rules return to active status pursuant to a court the complete text see the Fall 2012 edition of Governing the Lawyer Assistance Program order.

THE NORTH CAROLINA STATE BAR JOURNAL 59 Proposed Amendments to the CLE was taken more than two years prior to The proposed rule amendment limits to Procedures for Reinstatement from the petition. 30 days the time for appeal to the State Bar Inactive or Suspended Administrative Council from an unfavorable decision on Status Proposed Amendments to The Plan for certification or continued certification of a 27 N.C.A.C. 1D, Section .0900, Legal Specialization hearing panel of the Board of Paralegal Procedures for Administrative Committee 27 N.C.A.C. 1D, Section .3100, Certification. The proposed amendments to the rule on Certification Standards for the Trademark reinstatement from inactive and suspended Law Specialty Proposed Amendments to the status will cap the CLE requirement for rein- A new section of the Plan for Legal Continuing Paralegal Education Rules statement of lawyers who have been inactive Specialization will establish the standards for 27 N.C.A.C. 1G, Section .0200, Rules or suspended for seven or more years and a new specialty in trademark law. Governing Continuing Paralegal Education who have been practicing in another state or The proposed rule amendments clarify serving in the military. The proposed rule Proposed Amendments to the Rules that law school courses are approved activi- amendments also clarify that CLE taken in for Certifying Paralegals ties for the purpose of satisfying the continu- another state may be used to offset the CLE 27 N.C.A.C. 1G, Section .0100, The ing paralegal education requirements. requirement for reinstatement even if the Plan for Certification of Paralegals

Proposed Amendments

At its meeting on October 25, 2012, the Carolina court or by a court of any other the name of the North Carolina State Council voted to publish the following pro- jurisdiction, the secretary, upon proper proof Bar, signed by the chairperson of the posed rule amendments for comment from of such declaration, will enter an order trans- Grievance Committee, alleging disabili- the members of the bar: ferring the member to disability inactive sta- ty. The chairperson of the commission tus effective immediately and for an indefi- shall appoint a hearing panel to deter- Proposed Amendments to the nite period until further order of the mine whether the member is disabled. Discipline and Disability Rules Disciplinary Hearing Commission. A copy 27 N.C.A.C. 1B, Section .0100, of the order transferring the member to dis- Discipline and Disability of Attorneys ability inactive status will be served upon the Extensive amendments to the disability member, the member’s guardian, or the The Process rule are proposed. In addition to rearrang- director of any institution to which the Proposed amendments to the Rules ing the provisions of the existing rule to member is committed. of the North Carolina State Bar are pub- improve clarity, the proposed amendments (b) Transfer to Disability Inactive Status lished for comment in the Journal. They eliminate ambiguity, add a new provision by Consent – The chairperson of the are considered for adoption by the coun- allowing the Office of Counsel to initiate a Grievance Committee may transfer a mem- cil at the succeeding quarterly meeting. disability proceeding while a disciplinary ber to disability inactive status upon consent If adopted, they are submitted to the proceeding is pending, and explain the pro- of the member and the counsel. North Carolina Supreme Court for cedure to be followed when a hearing panel (c) Initiation of Disability Proceeding approval. Amendments become effective finds probable cause to believe the defen- (1) Disability Proceeding Initiated by upon approval by the court. Unless oth- dant in a disciplinary proceeding is dis- the North Carolina State Bar erwise noted, proposed additions to abled. Because the proposed amendments (A) Evidence a Member has Become rules are printed in bold and under- are extensive, existing Rule .0118 will be Disabled - When the North Carolina lined, deletions are interlined. revoked and replaced with the proposed State Bar obtains evidence that a mem- rule that appears below. Therefore, bold, ber has become disabled, the Grievance underlined print is not used to show the Committee will conduct an inquiry new provisions of the rule. For the text of which substantially complies with the the existing rule, visit the “Rules” section of procedures set forth in Rule .0113 (a)- Comments the State Bar website: (h) of this subchapter. The Grievance Committee will determine whether The State Bar welcomes your com- .0118 Disability there is probable cause to believe that ments regarding proposed amendments (a) Transfer by Secretary where Member the member is disabled within the to the rules. Please send your written Judicially Declared Incompetent - Where a meaning of Rule .0103(19) of this sub- comments to L. Thomas Lunsford II, member of the North Carolina State Bar has chapter. If the Grievance Committee The North Carolina State Bar, PO Box been judicially declared incapacitated, finds probable cause, the counsel will 25908, Raleigh, NC 27611. incompetent, or mentally ill by a North file with the commission a complaint in

60 WINTER 2012 (B) Disability Proceeding Initiated sion of a disability hearing. The discipli- defendant had been transferred to dis- While Disciplinary Proceeding is nary proceeding will be stayed pending ability inactive status pursuant to para- Pending - If, during the pendency of a conclusion of the disability hearing. The graph (c)(3) of this rule, the order shall disciplinary proceeding, the counsel hearing panel appointed to hear the dis- also terminate the defendant’s disability receives evidence constituting probable ciplinary proceeding will hear the disabil- inactive status. cause to believe the defendant is dis- ity proceeding. (e) Stay/Resumption of Pending abled within the meaning of Rule (d) Disability Hearings Disciplinary Matters .0103(19) of this subchapter, the chair- (1) Burden of Proof (1) Stay or Abatement - When a mem- person of the Grievance Committee (A) In any disability proceeding initiat- ber is transferred to disability inactive sta- may authorize the counsel to file a ed by the State Bar or by the commis- tus, any proceeding then pending before motion seeking a determination that sion, the State Bar bears the burden of the Grievance Committee or the com- the defendant is disabled and seeking proving the defendant’s disability by mission against the member shall be the defendant’s transfer to disability clear, cogent, and convincing evidence. stayed or abated unless and until the inactive status. The hearing panel (B) In any disability proceeding initiat- member’s disability inactive status is ter- appointed to hear the disciplinary pro- ed by the defendant, the defendant minated. ceeding will hear the disability proceed- bears the burden of proving the defen- (2) Preservation of Evidence - When a ing. dant’s disability by clear, cogent, and disciplinary proceeding against a mem- (C) Pleading in the Alternative – convincing evidence. ber has been stayed because the member When the Grievance Committee has (2) Procedure - The disability hearing has been transferred to disability inactive found probable cause to believe a mem- will be conducted in the same manner as status, the counsel may continue to ber has committed professional mis- a disciplinary proceeding under Rule investigate allegations of misconduct. conduct and the Grievance Committee .0114 of this subchapter. The North The counsel may seek orders from the or the chairperson of the Grievance Carolina Rules of Civil Procedure and chairperson of the commission, or the Committee has found probable cause the North Carolina Rules of Evidence chairperson of a hearing panel if one has to believe the member is disabled, the apply, unless a different or more specific been appointed, to preserve evidence of State Bar may file a complaint seeking, procedure is specified in these rules. The any alleged professional misconduct by in the alternative, the imposition of hearing will be open to the public. the member, including orders which per- professional discipline for professional (3) Medical Examination - The hearing mit the taking of depositions. The chair- misconduct or a determination that the panel may require the member to under- person of the commission, or the chair- defendant is disabled. go psychiatric, physical, or other medical person of a hearing panel if one has been (2) Initiated by Hearing Panel During examination or testing by qualified med- appointed, may appoint counsel to repre- Disciplinary Proceeding - If, during the ical experts selected or approved by the sent the member when necessary to pro- pendency of a disciplinary proceeding, a hearing panel. tect the interests of the member during majority of the members of the hearing (4) Appointment of Counsel - The hear- the preservation of evidence. panel find probable cause to believe that ing panel may appoint a lawyer to repre- (3) Termination of Disability Inactive the defendant is disabled, the panel will, sent the defendant in a disability pro- Status - Upon termination of disability on its own motion, enter an order staying ceeding if the hearing panel concludes inactive status, all disciplinary proceed- the disciplinary proceeding until the that justice so requires. ings pending against the member shall question of disability can be determined. (5) Order resume. The State Bar may immediately The hearing panel will instruct the (A) When Disability is Proven - If the pursue any disciplinary proceedings that Office of Counsel of the State Bar to file hearing panel finds that the defendant were pending when the member was a complaint alleging disability. The chair- is disabled, the panel will enter an order transferred to disability inactive status person of the commission will appoint a continuing the defendant’s disability and any allegations of professional mis- new hearing panel to hear the disability inactive status or transferring the defen- conduct that came to the State Bar’s proceeding. If the new panel does not dant to disability inactive status. An attention while the member was in dis- find the defendant disabled, the discipli- order transferring the defendant to dis- ability inactive status. Any disciplinary nary proceeding will resume before the ability inactive status is effective when it proceeding pending before the commis- original hearing panel. is entered. A copy of the order shall be sion that had been stayed shall be set for (3) Disability Proceeding where served upon the defendant or the hearing by the chairperson of the com- Defendant Alleges Disability in defendant’s guardian or lawyer of mission. Disciplinary Proceeding - If, during the record. (f) Fees and Costs - The hearing panel course of a disciplinary proceeding, the (B)When Disability is Not Proven - may direct the member to pay the costs of defendant contends that he or she is dis- When the hearing panel finds that it the disability proceeding, including the abled within the meaning of Rule has not been proven by clear, cogent, cost of any medical examination and the .0103(19) of this subchapter, the defen- and convincing evidence that the fees of any lawyer appointed to represent dant will be immediately transferred to defendant is disabled, the hearing panel the member. disability inactive status pending conclu- shall enter an order so finding. If the

THE NORTH CAROLINA STATE BAR JOURNAL 61 cant has experience through substantial substantial involvement by providing Proposed Amendments to the involvement in the practice of criminal law. information that demonstrates the appli- Standards for the Criminal Law (1) Substantial involvement shall mean cant’s significant criminal trial experience Specialty during the five years immediately preced- such as: 27 N.C.A.C. 1D, Section .2500, ing the application, the applicant devoted (A) representation during the applicant’s Certification Standards for the Criminal Law an average of at least 500 hours a year to entire legal career in criminal trials con- Specialty the practice of criminal law, but not less cluded by jury verdict; The proposed amendments specify that than 400 hours in any one year. “Practice” (B) representation as principal counsel jury trial experience is a component of the shall mean substantive legal work, specif- of record in federal felony cases or state substantial involvement standard for certifi- ically including representation in criminal felony cases (Class G or higher); cation in the criminal law specialty. jury trials, done primarily for the purpose (C) court appearances in other substan- of providing legal advice or representa- tive criminal proceedings in criminal .2505 Standards for Certification as a tion, or a practice equivalent. courts of any jurisdiction; and Specialist (2) …. (D) representation in appeals of deci- (a)…. (3) For the specialty of criminal law and sions to the North Carolina Court of (b) Substantial Involvement - An appli- the subspecialty of state criminal law, the Appeals, the North Carolina Supreme cant shall affirm to the board that the appli- board shall require an applicant to show Court, or any federal appellate court. n

Legal Ethics (cont.) fessional relationship with a client (with the that is generally known.” Restatement (Third) noted exceptions), and Rule 1.9(c)(2) pro- of the Law Governing Lawyers §59, 60. hibits disclosure of a former client’s informa- Similarly, Massachusetts and Wyoming pro- the information is probably considered tion, regardless of whether the information vide in their respective Rules of Professional “generally known” [emphasis added]. has become generally known. At first blush, Conduct that a lawyer “shall not reveal con- The Restatement (Third) of The Law this prohibition may seem overly broad and fidential information relating to representa- Governing Lawyers adopts an access approach impractical. tion of a client” (emphasis added). Mass. to the question. If the information is easily For this reason, there is some support for Rules of Prof’l Conduct, R. 1.6(a); Wyo. accessible to the public, it is “generally the proposition that the rules should specifi- Rules of Prof’l Conduct R. 1.6(a). known.” If special knowledge or skills are cally state that information in the public required to obtain the information, or if domain should not be deemed protected Take a Chill Pill acquiring it would be expensive, then it is information. See Laws. Man. on Prof. I don’t believe that such a rule amend- not. See Restatement (Third) of The Law Conduct (ABA/BNA) 55:310. For example, ment is necessary. The Rules of Professional Governing Lawyers § 59(d). the Restatement provides that a lawyer may Conduct are “rules of reason” and should be not use or disclose confidential client infor- applied with a common sense approach. Exsqueeze Me? mation and defines confidential client infor- Rule 0.2, Scope, cmt. [1]. To reveal is to Rule 1.6 provides that a lawyer may never mation as “information relating to the repre- make something that is secret or hidden pub- reveal information acquired during the pro- sentation of a client, other than information licly or generally known. Merriam-Webster Online Dictionary, 2012, merriam- webster.com/dictionary/reveal (1 Nov. 2012). Rule 1.6 and Rule 1.9 prohibit a lawyer from “revealing” information. Common sense would dictate that informa- tion that has been widely disseminated is no Don’t Miss Important State longer capable of being “revealed.” See SC Bar Ethics Advisory Comm., Op. 10-4 Bar Communications (2004). In conclusion, lawyers need to familiarize Log on to ncbar.gov and make sure themselves with the various rules pertaining we have your email address. to the protection of client information as well as the nuances particular to each rule. Lawyers should then take a conservative, yet common sense approach, to the application of these rules in their legal practice. n

Suzanne Lever is assistant ethics counsel for the North Carolina State Bar.

62 WINTER 2012 BAR UPDATES

State Bar Swears in New Officers

Issues Committee, Committee, Program Evaluation Commit- Paperless Banking tee, and the Special Committee to Study Committee, Disciplinary Guidelines, Appointments Executive Commit- Committee. tee, Disciplinary Mr. Baker is active in numerous civic Review Commit- organizations. He is a past-president and tee, and Program life member of the Ahoskie Jaycees, is a US Evaluation Jaycees ambassador, is a former Hertford Committee. County commissioner, and is past-chair of Kapp Baker Gibson Mr. Kapp is the Hertford County Board of Education active in numerous and the Hertford County Committee of civic organizations including the Moravian 100. Kapp Installed as President Ministries Foundation, the Raleigh Raleigh attorney M. Keith Kapp was Kiwanis Club, and the Raleigh Little Gibson Elected as Vice-President sworn in as president of the North Theatre. Charlotte attorney Ronald L. Gibson Carolina State Bar. He was sworn in by was sworn in as president-elect of the Chief Justice Sarah Parker of the North Baker Elected as President-Elect North Carolina State Bar. He was sworn in Carolina Supreme Court at the State Bar’s Ahoskie attorney Ronald G. Baker Sr. by Chief Justice Sarah Parker at the State Annual Dinner on Thursday, October 25, was sworn in as president-elect of the Bar’s Annual Dinner on Thursday, October 2012. North Carolina State Bar. He was sworn in 25, 2012. Kapp earned an AB degree with honors by Chief Justice Sarah Parker at the State Gibson is a graduate of Davidson from UNC and a JD, also with honors, Bar’s Annual Dinner on Thursday, October College. He earned his law degree in 1978 from UNC School of Law. 25, 2012. from the University of North Carolina Kapp is a partner, vice-president, and As an undergraduate Baker attended the School of Law. vice-chair of the Board of Directors at his University of North Carolina as a His experience includes serving as a law firm, Williams Mullen. He represents busi- Morehead Scholar, and he earned his JD clerk to US District Court Judge James B. nesses ranging from multi-national to pri- with honors from the University of North McMillan, private law practice with vate or family-owned enterprises in con- Carolina School of Law. Chambers, Stein, Ferguson & Becton, and nection with their commercial litigation Baker practiced with Henson, Donahue service as associate general counsel and and regulatory needs. He advises clients on & Elrod in Greensboro from 1975-1978, vice-president of marketing with Duke the laws of contract, shareholder rights, then moved to Ahoskie and has since prac- Power Company. He was also a principal antitrust, franchise relations, warranty, ticed with what is now Baker, Jones, Daly with Scott, Madden & Associates, a man- consumer protection, unfair trade prac- & Carter, PA. agement consulting firm. In addition, he tices, and various regulatory statutes. As a Baker has substantial involvement in bar has owned an insurance and financial serv- member of the Commercial Arbitration organizations. He is a member of the North ices agency. Gibson currently is a partner Panel of the American Arbitration Carolina Bar Association and the American with the law firm of Ruff, Bond, Cobb, Association, Kapp also provides arbitration Bar Association. He has served on the Wade & Bethune, LLP. services. board and is past-president of the North As a State Bar councilor, Gibson has Kapp has had substantial involvement Carolina Association of Defense Attorneys, served as vice chair of the Client Assistance in local and state bar organizations. He and has been a North Carolina representa- Committee and Grievance Committee, and served as president of the Wake County Bar tive to the Defense Research Institute. As a has chaired the Administrative Committee. Association and served on the Board of State Bar Councilor, Baker has chaired the He has also served on the Authorized Governors of the North Carolina Bar Grievance Committee and Issues Practice Committee, Executive Committee, Association. As a State Bar councilor, Kapp Committee. He has also served on the Disciplinary Advisory Committee, chaired the Ethics Committee, Facilities Client Assistance Committee, Authorized Appointments Advisory Committee, Ethics Committee, and Administrative Commit- Practice Committee, Legislative Commit- Committee, Facilities Committee, tee. He has also served on the Grievance tee, Administrative Committee, Discipl- Program Evaluation Committee, and Issues Committee, Emerging Issues Committee, inary Advisory Committee, Executive Committee. n

THE NORTH CAROLINA STATE BAR JOURNAL 63 Resolution of Appreciation of James R. Fox

WHEREAS, James R. Fox was elected by his fellow lawyers from the 21st Judicial District in January 2002 to serve as their representative in this body. Thereafter, he was elected for three successive three-year terms as councilor; and

WHEREAS, in October 2009 Mr. Fox was elected vice-president, and in October 2010 he was elected president-elect. On October 21, 2011, he was sworn in as president of the North Carolina State Bar; and

WHEREAS, during his service to the North Carolina State Bar, Mr. Fox has served on the following committees: Grievance, Authorized Practice, Special Committee on Real Property Closings, Emerging Issues, Executive, Disciplinary Review, Disciplinary Advisory, Special Committee to Study Disciplinary Guidelines, Issues, Statute of Limitations Study, Program Evaluation, Program Evaluation LAP/Grievance Subcommittee, Finance & Audit, and Appointments; and

WHEREAS, every individual who is called upon to serve as the president of the North Carolina State Bar must do at least four things well. He or she must defend the core values of the legal profession, continue and build upon the undertakings of his or her predecessors, explain for the edification of the membership and the benefit of the public how and why the State Bar is regulating the profession, and lead the agency in a manner that is consonant with its statutory purposes and the public’s inter- est. Jim Fox has, as set forth below, faithfully and diligently discharged all of these duties, and

WHEREAS, he has defended the profession and its essential precepts honorably and effectively in the legislature, in the courtroom, and in the bureaucracy. On his watch, legislation that would have compromised professional independence and loyalty to clients was challenged and defeated in the General Assembly, unauthorized practice by means of the internet was steadfastly resisted in litigation, and the illicit practices of nonlawyers in real estate closings were clearly defined and proscribed in a definitive opinion that found favor with all concerned, including the federal government, and

WHEREAS, Jim Fox has continued the mighty work of those who have previously served, superintending and sustaining the State Bar’s ongoing programs while earnestly prosecuting the agency’s most ambitious undertaking in several generations, the construction of its new headquarters. Building upon the foundation that was laid, literally, at the beginning of his term, Jim Fox has overseen the raising of an edifice that will well bespeak his stewardship into the 22nd century, and

WHEREAS, Jim Fox has explained the mission and the work of the organized Bar with singular eloquence, elegance, and economy through his skillful use of the president’s message in the State Bar Journal. While his predecessors have all been great communicators, none has surpassed Mr. Fox as an exponent and expounder of self-regulation, and

WHEREAS, Jim Fox has led the North Carolina State Bar with a remarkably sure and even hand, bringing to bear in every instance the finely-honed talents of a lawyer’s lawyer. Though widely appreciated as a serious man well suited to the disposition of business of great importance, Jim Fox has never taken himself too seriously. Those who have had the pleasure of working with and for him have invariably and inevitably been impressed by his modesty, his sense of perspective and proportion, and his good humor, qualities that have made him a great man to follow.

NOW, THEREFORE, BE IT RESOLVED that the council of the North Carolina State Bar does hereby publicly and with deep appreciation acknowledge the strong, effective, and unselfish leadership of Jim Fox, and expresses to him its debt for his personal service and dedication to the principles of integrity, trust, honesty, and fidelity.

BE IT FURTHER RESOLVED that a copy of this resolution be made a part of the minutes of the annual meeting of the North Carolina State Bar and that a copy be delivered to James R. Fox.

64 WINTER 2012 BAR UPDATES

Fifty-Year Lawyers Honored

As is traditional, members of the North Carolina State Bar who are celebrating the 50th anniversary of their admission to practice were hon- ored during the State Bar’s Annual Meeting at the 50-Year Lawyers Luncheon. One of the honorees, Jules E. Banzet III, addressed the gathering, and each honoree was presented a certificate by the president of the State Bar, James R. Fox, in recognition of his service. After the ceremonies were concluded, the honorees in attendance sat for the photograph below. n

First row (left to right): Charles M. Hensey, Peter L. Roda, H. Morrison Johnston, Calvin W. Chesson, William G. Pfefferkorn, Richard C. Pattisall, Joe O. Brewer, Samuel H. Poole Second row (left to right): Reginald S. Hamel, James L. Swisher, C. Thomas Biggs, H. Dolph Berry, Gerald L. Bass, Robert M. Burroughs, Warren A. Winthrop, Jacob (Jack) L. Safron, Murray C. Greason Jr. Third row (standing, left to right): Julius E. Banzet III, Richard N. Randleman, Thomas E. Wagg III, David L. Ward Jr., W. Harrell Everett Jr., John D. Warlick, Samuel J. Crow, Robert L. Cecil, George Roundtree III

Proposed Ethics (cont.) Disqualification is limited to situations issue best left to the discretion of the tribu- where the lawyer’s testimony is “necessary.” It nal. Determining whether a lawyer is likely the testimony relates to an uncontested issue; is generally agreed that when the anticipated to be a necessary witness “involves a consid- (2) the testimony relates to the nature and testimony is relevant, material, and unob- eration of the nature of the case, with value of legal services rendered in the case; or tainable by other means, the lawyer’s testi- emphasis on the subject of the lawyer’s testi- (3) disqualification of the lawyer would work mony is “necessary.” See Ann. Model Rules mony, the weight the testimony might have substantial hardship on the client. of Prof’l. Conduct (6th ed. 2007), p. 361 in resolving disputed issues, and the avail- A lawyer should be disqualified under (citing cases). ability of other witnesses or documentary Rule 3.7 only upon a showing of “com- The issue of whether a lawyer is a “neces- evidence which might independently estab- pelling circumstances.” State v. Schmitt, 102 sary witness” and thereby disqualified from lish the relevant issues.” Fognani v. Young, P.3d 856, 859 (Wash. Ct. App. 2004). acting as a client’s advocate at a trial is an 115 P.3d 1268 (Colo. 2005). n

THE NORTH CAROLINA STATE BAR JOURNAL 65 BAR UPDATES

Client Security Fund Reimburses Victims

At its October 25, 2012, meeting, the Hinnant clients a total of $11,500. Due to misappropriation, Whitley’s trust North Carolina State Bar Client Security 6. An award of $6,000 to a former client of account balance is insufficient to pay all of his Fund Board of Trustees approved payments of Mark Jenkins of Waynesville. The board clients’ obligations. Whitley died on $349,284.29 to 17 applicants who suffered found that Jenkins was retained to handle a December 6, 2011. The board previously financial losses due to the misconduct of civil dispute over a property boundary. Jenkins reimbursed five other Whitley clients a total of North Carolina lawyers. failed to provide any valuable legal services for $103,665.29. The new payments authorized were: the fee paid. Jenkins was disbarred on March 12. An award of $18,060 to a former client 1. An award of $250 to an applicant who 31, 2011, and died on April 5, 2011. The of W. Darrell Whitley. The board found that suffered a loss because of Tonya Ford of board previously reimbursed 11 other Jenkins Whitley was retained to handle a client’s per- Raleigh. The board found that Ford was clients a total of $35,475. sonal injury matter. Whitley settled the matter retained to handle a client’s traffic ticket. Ford 7. An award of $100,000 to a former client without the client’s authorization or consent. failed to appear and provided no valuable legal of Albert Neal of Candler. The board found Whitley forged the client’s name on the release service for the fee paid. Ford was disbarred on that Neal served as power of attorney and and misrepresented to the client the amount April 15, 2011. fiduciary for a client. Neal appropriated the of the settlement. Due to misappropriation, 2. An award of $15,000 to a former client client’s funds for his own personal use. Whitley’s trust account balance is insufficient of Jennifer Green-Lee of Clayton. The board 8. An award of $500 to an applicant who to pay all of his clients’ obligations. found that Green-Lee was retained to handle a suffered a loss because of Robert Morgan 13. An award of $53,050 to a former client client’s real estate closing. From the closing Smith of Goldsboro. The board found that of W. Darrell Whitley. The board found that proceeds, Green-Lee retained funds to satisfy Smith was retained to represent a client on Whitley was retained to handle a client’s per- an IRS lien, but failed to disburse the funds to criminal charges. Smith failed to provide any sonal injury matter. Whitley settled the matter, the IRS or the client. Due to misappropria- valuable legal services for the fee paid. Smith but failed to disburse the funds to the client tion, Green-Lee’s trust account balance is was disbarred on October 14, 2011. The prior to his death. insufficient to pay all of her clients’ obligations. board previously reimbursed three other 14. An award of $16,333.33 to a former Green-Lee was disbarred on August 19, 2011. Smith clients a total of $13,400. client of W. Darrell Whitley. The board found The board previously reimbursed seven other 9. An award of $5,000 to a former client of that Whitley was retained to handle a client’s Green-Lee clients a total of $218,223.43. Nicholas Stratas Jr. of Raleigh. The board personal injury matter. Whitley settled the 3. An award of $4,635 to applicants who found that Stratas was retained to handle a matter, but failed to disburse the funds to pay suffered losses because of Willis Harper Jr. of client’s personal injury matter. Stratas received the client’s medical liens prior to his death. Whiteville. The board found that Harper was med pay for the client and held it in trust to pay 15. An award of $90,000 to a former client retained to handle a client’s real estate closing. a possible VA medical lien. There was no VA of W. Darrell Whitley. The board found that From the closing proceeds, Harper should lien, and Stratas abandoned his practice prior to Whitley was retained to handle a client’s have disbursed funds to a law firm and an paying the funds to the client. Stratas’ trust wrongful death claim. Whitley settled the mat- asset management company, but failed to do account balance was insufficient to cover all of ter, but failed to disburse the settlement pro- so. Due to misappropriation, Harper’s trust his clients’ obligations due to misappropriation. ceeds prior to his death. account balance is insufficient to pay all of his The board previously reimbursed seven other 16. An award of $4,355.96 to a former clients’ obligations. Harper was disbarred on Stratas clients a total of $127,215.78. client of W. Darrell Whitley. The board found February 26, 2012. 10. An award of $10,000 to a former client that Whitley was retained to handle a client’s 4. An award of $100 to a former client of of Nicholas Stratas Jr. The board found that personal injury matter. Whitley settled the mat- Willis Harper. The board found that Harper Stratas was retained to handle a client’s property ter, but failed to pay the client’s medical liens was retained to handle a client’s traffic ticket. settlement in a domestic matter and a possible from the settlement proceeds prior to his death. Harper failed to provide any valuable legal medical malpractice claim. Stratas failed to pro- 17. An award of $4,500 to a former client service for the fee paid. vide any valuable legal service for the fee paid. of Nancy Wooten of Winston-Salem. The 5. An award of $1,500 to a former client of 11. An award of $20,000 to a former client board found that Wooten was retained to han- W. Rickert Hinnant of Winston-Salem. The of W. Darrell Whitley of Lexington. The dle a client’s custody matter. Wooten failed to board found that Hinnant was retained to board found that Whitley was retained to provide any valuable legal service for the fee appeal a civil arbitration award. Hinnant failed handle a client’s personal injury matter. paid prior to her death. Due to misappropria- to provide any valuable legal services for the fee Whitley settled the matter without the client’s tion, Wooten’s trust account balance is insuffi- paid. Hinnant was disbarred on June 15, 2011. knowledge or consent, and failed to disburse cient to pay all of her clients’ obligations. The board previously reimbursed three other any of the settlement proceeds to the client. Wooten died on April 19, 2012. n

66 WINTER 2012 BAR UPDATES

Law School Briefs

All of the law schools located in North Trudi Brown, before holding a discussion and 2012 Elections; and a panel on Unique Carolina are invited to provide material for this question-and-answer session with more than Challenges of Representing Public Servants column. Below are the submissions we received 130 law school students, faculty, and staff was held, along with a Civic Engagement this quarter. members. Forum. A Republican National Convention watch party was also held on campus. Campbell University School of Law Charlotte School of Law Campbell Law Produces Top Bar Passage Charlotte School of Law Students Duke Law School Rate on July Bar Exam—Campbell Law Compete and Contribute in South Africa— Faculty news—Three interdisciplinary stands at the top of the list on the North Chris Harden and Nicole Trautman, both scholars, Matthew D. Adler, Rachel Brewster, Carolina Bar Exam for July 2012. Boasting a members of the CSL Moot Court Honor and Nita A. Farahany, have joined Duke 94.53% bar passage rate, Campbell Law Board, recently competed in the Kovsie First Law’s faculty. Adler studies policy analysis, Class of 2012 graduates outperformed all Year Moot Court Competition hosted by the risk regulation, and constitutional theory. other North Carolina law schools, leading the University of the Free State in Bloemfontein, Brewster studies international trade, interna- state in both first time bar passage and overall South Africa, winning their first round. They tional relations theory, and global economic bar passage. Campbell Law’s overall record of also participated in a community service proj- integration. Farahany studies the intersec- success on the North Carolina Bar Exam has ect, raising $1,050 for the Kidz Care Trust, a tions of criminal law, biosciences, and philos- been unsurpassed by any other North non-profit organization that takes in young ophy. Carolina law school for the past 26 years. boys from the streets of South Africa and W. H. “Kip” Johnson III, a founding 2012 Alums Attend Swearing-In gives them a place to sleep, eat, play, study, member of the Morningstar Law Group in Ceremony—Fifty-eight graduates from the and learn fundamental life skills. Raleigh, also has joined the faculty as director Campbell Law Class of 2012 participated in Charlotte School of Law Student Wins of the Start-Up Ventures Clinic. a swearing-in ceremony at the law school on NCAWA Scholarship—Brandy Hagler is Professor Scott Silliman, director emeritus September 14. The Honorable Paul Gessner Charlotte School of Law’s 2012-2013 North of the Duke Center on Law, Ethics, and and The Honorable Paul Ridgeway, both Carolina Association of Women Attorneys National Security, was sworn in on Wake County Superior Court judges and scholarship recipient. She is an officer in the September 12 as an appellate judge on the Campbell Law graduates, administered the Women in Law group; volunteers for the United States Court of Military Commission oath of office and led the swearing-in of Susan G. Komen Breast Cancer Foundation, Review, after receiving Senate confirmation. Campbell Law alums who recently passed the the Daughters of Charity, and the Harahan For the fourth consecutive year, Supreme July 2012 North Carolina Bar Examination. Guest House for the Elderly; and is a leader Court Justice Samuel A. Alito spent a week at Professor Flanary-Smith Elected to NC in numerous other areas. Duke Law in September, teaching a seminar Society of Health Care Attorneys Board of Fearless Leadership: Maintaining Ethics to upper-year students titled Current Issues in Directors—Campbell Law Assistant No Matter How High the Risk—Karen A. Constitutional Interpretation. Professor Amy Flanary-Smith has been elect- Popp visited CSL to discuss the attorney’s The Legal Services Corporation held a ed to the North Carolina Society of Health duty to maintain the highest ethics in the face daylong forum on civil legal aid at Duke Care Attorneys (NCSHCA) Board of of difficult decision-making. As a former fed- University on October 1. At a subsequent Directors. Flanary-Smith was elected to a eral prosecutor, she litigated several high-pro- reception at Duke Law School, five attorneys three-year term during the NCSHCA annual file cases, and served as associate White were honored for their volunteer service with meeting on September 28. An expert in legal House counsel to President Clinton. Legal Aid of North Carolina (LANC). Senior discourse and advocacy, Flanary-Smith serves Charlotte School of Law Civic Lecturing Fellow Charles R. Holton ‘73, a as the director of Campbell Law’s Legal Engagement Activities—The Democratic partner with Womble Carlyle Sandridge & Research & Writing Program. National Convention brought exciting Rice in Research Triangle Park and the chair Campbell Law Hosts US Senator Burr — opportunities for our students to explore elect of the LANC Board of Directors, was United States Senator Richard Burr paid a legal, political, social, and ethical issues sur- recognized as a pro bono leader in the area of visit to Campbell Law School on October 10. rounding the presidential election. Students fair housing for low-income clients in central Senator Burr toured the law school with field represented arrested protesters through the North Carolina. representative Betty Jo Shepheard, Campbell Clinics program. CSL also hosted a number Duke’s Master of Laws in Judicial Studies Law Interim Dean Keith Faulkner, and of events: Dr. Michael Bitzer spoke about Welcomes its First Class—Eighteen judges Campbell Law Director of Development Predicting the Unpredictable: Looking at the from federal, state, and foreign courts com-

THE NORTH CAROLINA STATE BAR JOURNAL 67 prised the inaugural class of the Duke Master of NCCU Law—Attorney Phyliss Craig- sented three alumni with the Distinguished of Laws in Judicial Studies Program. The Taylor became dean of the North Carolina Alumni Award at the annual Leadership intensive four-week summer session repre- Central University School of Law in July. Awards Dinner on September 27: James E. sented the first of two in the LLM program Assuming the dean’s office marks a return to Delany ‘73, commissioner of the Big Ten for judges, the only one of its kind offered by NCCU for Craig-Taylor, who served as a law Conference; DeWitt F. (Mac) McCarley ‘77, a US law school. professor from 2000 to 2006. Craig-Taylor partner with Parker Poe Adams & Bernstein; most recently served in the positions of direc- and Vasiliki Alis (Celia) Pistolis ‘82, assistant Elon University School of Law tor for teaching excellence, associate dean for director of advocacy and compliance with National Recognition for Innovation and faculty, and associate dean for academics at Legal Aid of North Carolina, Inc. The Small Class Sizes—The National Jurist Charlotte School of Law in Charlotte. Outstanding Recent Graduate Award was ranked Elon this summer as one of America’s Craig-Taylor has more than 22 years of presented to Wilson L. White ‘06, associate 20 Most Innovative Law Schools. Elon’s pre- experience in legal education and adminis- litigation counsel at Google Inc. ceptor program was the basis for the school’s tration. She has been an active faculty mem- Fisher v. Texas Supreme Court Case— selection. The program provides students ber at the University of Tennessee, the The law school hosted the university-wide with a mentoring relationship with attorneys. University of Florida College of Law, the Constitution Day celebration September 17 Students receive guidance about career plan- University of San Francisco School of Law, with a panel discussion on the US Supreme ning and the profession from the moment and the University of Warsaw College of Law Court affirmative action case Fisher v. they enter law school. in Poland. She is certified as a Six Sigma University of Texas. The panel included Dean In October, The National Jurist ranked Green Belt in Process Management from John Charles “Jack” Boger ‘74; Charles Elon #1 in the nation for small class sizes for Villanova University (2010). Edward Daye, Henry Brandis Professor of first-year students. “Practitioners and As an executive-in-residence at InfiLaw Law and deputy director of the UNC Center employers tell us that our students display a Systems, Inc. in Naples, FL, Craig-Taylor for Civil Rights; and center attorneys Mark kind of confidence and readiness to enter the provided leadership and oversight to aca- Dorosin ‘94 and Elizabeth M. Haddix ‘98. world of work,” said Dean George R. demic affairs and academic outcomes for the Boger, Dorosin, and Haddix are co-authors Johnson Jr. “We think a lot of it has to do Charlotte School of Law, Phoenix School of of an amicus brief that UNC filed on the with the opportunities that our students have Law, and Florida Coastal School of Law. case on August 9, and Daye is the lead with these small class sizes. It translates nicely Through her involvement with the ABA, researcher of the ten year diversity study that into internships and the world of work.” Craig-Taylor has held several leadership posi- is referenced in the brief. Fred Lind Receives Leadership in the Law tions in the Section of Litigation, including PreLaw Rankings—UNC School of Law Award—In September, Dean Johnson pre- serving on council, as a member of the Task was named one of America’s 20 Most sented Guilford County Public Defender Force for Civil Practice Rules, and as a divi- Innovative Law Schools, according to The Frederick G. Lind with Elon’s 2012 sion director for the Administrative and National Jurists’ preLaw magazine, released Leadership in the Law Award recognizing Substantive Law Divisions. She has served on August 23. UNC was also ranked number 9 outstanding contributions to the profession the NC State Bar Ethics Advisory in National Jurist magazine’s list of the and to society. Committee and the NC Bar Association nation’s Best Value Law Schools, published “Fred is the kind of lawyer who by dint of Minorities in the Profession Committee. in the September 2012 issue. his personality and his unimpeachable A graduate of the University of Alabama integrity inspires public confidence in our Tuscaloosa, where she earned both her Wake Forest University School of Law legal system,” Johnson said. “For showing us undergraduate degree and law degree, she VALOR Earns Public Interest Award what true dedication to building and sustain- later served as a partner in the law firm of from ABA Law Student Division—The ing a fair judicial system looks like, for show- England & Bivens and as a judicial clerk for American Bar Association Law Student ing so much care in mentoring emerging the Alabama Supreme Court. She earned a Division has announced that Wake Forest lawyers in our community, for exemplifying Master of Laws degree at Columbia University School of Law’s Veteran the determination, consistency, and profes- University in New York. Advocacy Law Organization is the recipient sionalism that defines great public defenders, of the 2012 Judy M. Weightman Memorial and for modeling for us the life of a lawyer- University of North Carolina School Public Interest Award. “The division com- leader, I am honored to present Frederick G. of Law mends VALOR for its dedication to Lind with Elon University School of Law’s CLE Program—The annual Dan K. addressing the legal needs of veterans seek- 2012 Leadership in the Law Award.” Moore Program in Ethics was held October ing benefits from the US Department of Lind served as assistant public defender 26. The continuing legal education program Veteran Affairs, providing legal assistance in for 36 years prior to his appointment as pub- addressed a variety of ethical issues of interest civilian legal matters, and promoting aware- lic defender in 2011. He has tried more than to corporate lawyers—both in-house counsel ness of issues facing veterans and service 325 jury trials. and attorneys in private practice. The topic members,” wrote Tremaine Reese, 2011-12 was “Adjusting to the ‘New Normal’: Ethical chair of the ABA Law Student Division, in North Carolina Central University Challenges for In-House and Outside a letter to WFU Law School Dean Blake D. School of Law Counsel.” Visit law.unc.edu/cle/dankmoore. Morant. “The ABA Law Student Division Phyliss Craig-Taylor Welcomed as Dean Law Alumni Awards—The school pre- appreciates the contributions of your stu-

68 WINTER 2012 dents and school to improve the legal pro- 2012 summer program, the highlight of ate dinner with students, and took in the fession.” the program did not lie in the canals of sights with Dean Blake Morant, his wife Italian, Austrian, and Wake Forest Law Venice or along the strasses of Vienna, but Paulette, Professors Joel Newman and Students Have Opportunity to Study with in their daily contacts with Associate Ralph Peeples, and their wives Jane and US Supreme Court Justice—For 30 years, Supreme Court Justice Ruth Bader Faith. Then Ginsburg hopped a plane to Wake Forest’s Study Abroad program has Ginsburg. During the week of July 9, the law school’s Vienna program, where she offered law students iconic sights, stimulat- Ginsburg visited the law school’s Venice repeated her agenda for the students, facul- ing discussions, and lifetime memories. For program, where she gave a public lecture, ty, International Programs Dean Richard many of the students who attended the served as a guest lecturer in several classes, Schneider, and Professor Tanya Marsh. n

2013 Appointments to Boards and Commissions

January Council Meeting to this board. Roger Smith Jr. is eligible for reappointment. Lawyer Assistance Program Board (3-year reappointment. Board of Law Examiners (3-year terms) – terms) – There are three appointments to be There are five appointments to be made. made. Mark W. Merritt, Burley B. Mitchell July Council Meeting Kimberly A. Herrick, Randel E. Phillips, Jr., and Fred J. Williams are not eligible for Board of Legal Specialization (3-year Reid L. Phillips, Elizabeth C. Bunting, and reappointment. terms) – There are three appointments to be Beth R. Fleishman are eligible for reappoint- made. Laura D. Burton is eligible for reap- ment. April Council Meeting pointment, J. Matthew Martin and Dr. Board of Continuing Legal Education (3- NC Courts Commission (4-year terms) – David A. Hayes (public member) are not eli- year terms) – There are three appointments There is one appointment to be made. gible for reappointment. to be made. James A. Davis, Amy H. Hunt, Thomas R. West is eligible for reappointment. IOLTA Board of Trustees (3-year terms) – and Judge Margaret P. Eagles are eligible for Disciplinary Hearing Commission (3- There are three appointments to be made. reappointment. year terms) – There are three appointments James G. Exum Jr., Charles E. Burgin, and NC LEAF (1-year terms) – There is one to be made. William M. Claytor and Fred Janice M. Cole are eligible for reappoint- appointment to be made. William R. Purcell M. Morelock are eligible for reappointment, ment. is eligible for reappointment. M.H. Hood Ellis is not eligible for reap- Board of Paralegal Certification (3-year pointment. October Council Meeting terms) – There are three appointments to be Grievance Resolution Board (4-year Client Security Fund Board of Trustees made. Lisa Duncan (paralegal), Belinda terms) – The council must make one recom- (5-year terms) – There is one appointment to Thomas (paralegal), and G. Gray Wilson are mendation to the governor for appointment be made. M. Ann Reed is not eligible for eligible for reappointment. n

Seeking Distinguished Service Award Nominations

The John B. McMillan Distinguished who, because of economic or social barriers, tricts, usually at a meeting of the district bar. Service Award program honors current and cannot afford or secure adequate legal coun- The State Bar Councilor from the recipient’s retired members of the North Carolina State sel; seeking to improve the administration of district will participate in introducing the Bar throughout the state who have demon- justice and the quality of services rendered recipient and presenting the certificate. strated exemplary service to the legal profes- by the legal profession; promoting diversity Recipients of the Distinguished Service Award sion. Such service may be evidenced by a and diverse participation within the legal will also be recognized in the State Bar Journal commitment to the principles and goals profession; providing professional services at and honored at the State Bar’s annual meeting stated in the Preamble to the Rules of no fee or a reduced fee to persons of limited in Raleigh. Members of the bar are encour- Professional Conduct, for example: further- means or to public service or charitable aged to nominate colleagues who have ing the public’s understanding of and confi- groups or organizations; encouraging and demonstrated outstanding service to the pro- dence in the rule of law and the justice sys- counseling peers by providing advice and fession. The nomination form is available on tem; working to strengthen legal education; mentoring; and fostering civility among the State Bar’s website, www.ncbar.gov. Please providing civic leadership to ensure equal members of the bar. direct questions to Peter Bolac at the State Bar access to our system of justice for all those Awards will be presented in recipients’ dis- office in Raleigh, (919) 828-4620. n

THE NORTH CAROLINA STATE BAR JOURNAL 69 BAR UPDATES

Annual Reports of State Bar Boards

Board of Legal Specialization appointed to write the standards for the new Whitfield. The Howard L. Gum Excellence in Submitted by Alice Neece Mine, Executive criminal law subspecialty in juvenile delin- Committee Service Award was given to Director quency. His committee spent countless hours Elizabeth Scherer from Raleigh, a board certi- 2012 started on a high note for the special- working with psychometrician Dr. Terry fied specialist in appellate practice, for the ization program with the celebration of the Ackerman, associate dean of the University of devotion of her time and exemplary organiza- 25th anniversary of the first class of certified North Carolina at Greensboro, to develop the tion skills to the writing of the first appellate specialists. In 1987, the Board of Legal specialty examination. The first part of the practice exam as a member of the appellate Specialization certified 92 specialists in the exam will test the applicants’ knowledge of practice specialty committee. The James E. brand new specialty areas of real property, general criminal law. Juvenile delinquency law Cross Leadership Award was presented to bankruptcy, and estate planning and probate will be the focus of the second part of the Justice Robert H. Edmunds from Raleigh for law. Of those 92 inaugural specialists, 59 have exam. The board is grateful to Mr. Zogry and his active leadership role in the field of appel- maintained their certification for 25 years. the members of his committee for their excep- late practice. The Sara H. Davis Excellence This is an incredible achievement requiring tional dedication to writing an exemplary Award was presented to Nancy S. Ferguson, a the specialist to demonstrate, every five years exam. certified real property specialist from during the recertification process, that he or Changes in the administration of the spe- Greensboro, for excellence in her daily work as she has remained substantially involved in cialization exams this year are a sign of the a lawyer and for serving as a model for other practice of the specialty, has taken an extraor- growth and the success of the specialization real property lawyers. dinary number of CLE courses in the special- program. For the past 24 years all of the We were saddened this year by the tragic ty, and continues to have the approbation of exams have been offered on one date. With death in a bicycle accident of a former public his or her peers. In honor of their achieve- the addition of four new specialties or subspe- member of the board, Steve Jordan, who ment, these specialists were recognized in an cialties over the past six years, offering 14 dif- served on the board from 2003 to 2011. interview article in the Journal and at the ferent exams on the same date is no longer Although not a lawyer, Steve was a good annual specialization luncheon where they administratively possible. The staff of the spe- friend to and advocate for the specialization were awarded 25 year anniversary pins. cilization program describes its effort to proc- program. Since his death we have learned that Last November the board certified 55 new tor the exams last year as not unlike those of service to others was central to Steve’s charac- specialists in ten specialty areas, including 16 the proverbial one-armed paper hanger. This ter. We are grateful that the specialization pro- lawyers who were certified as the first class of year the specialization exams will be offered gram was one of the many programs that ben- appellate practice specialists. There are cur- on different dates at the McKimmon Center, efited from his selfless volunteer service. rently 826 board certified specialists in the ten State Bar offices, and in Charlotte according Unfortunately, the term of public board specialty areas of appellate practice, bankrupt- to specialty. The board hopes that by offering member Carl W. Davis Jr. ended this year. cy law, criminal law, elder law, estate planning the exams in this way we can improve effi- While serving as board member from 2006 to and probate law, family law, immigration law, ciency in both the administration and the 2012, Carl used his experience from his career real property law, social security disability law, grading of the exams. in public television to bring a fresh and and workers’ compensation law. The proposed standards for a new specialty insightful perspective to the board’s delibera- In the spring we received just shy of a in trademark law considered by the council at tions. Carl made invaluable contributions to record number of applications from lawyers its October meeting are another sign of the the specialization program and he will be seeking certification—98 applications. This continuing growth of the specialization pro- missed. includes eight applications for the new juve- gram. This proposed specialty was requested Although we will miss Carl, we are excep- nile delinquency law subspecialty. Juvenile and supported by the Intellectual Property tionally pleased with the new board member defense lawyers often receive little compensa- Section of the Bar Association, and will help appointed by the council in July. Public tion or recognition for their dedication to the to identify trademark law as a unique practice member Delores S. Todd from Raleigh brings young clients who so desperately rely upon area. After adoption by the council, the stan- a wealth of experience and wisdom to the their skilled advocacy and good counsel. dards must be approved by the Supreme board from her former work as an Atlantic Providing these lawyers with an opportunity Court. We look forward to offering this new Coast Conference assistant commissioner to demonstrate their knowledge and skill will specialty for the first time in 2013. among many other achievements. Ms. Todd not only bring personal satisfaction, but will At the annual luncheon honoring 25 year hit the ground running at her first board also help to enhance their status in the bar at and newly certified specialists on April 26 in meeting in September. I extend the board’s large. Raleigh, the board’s three special recognition appreciation to the Council for this excellent Eric Zogry, North Carolina juvenile awards named in honor of past chairs of the appointment. defender, chaired the specialty committee board were presented by Board Chair Jeri In closing, on behalf of the board I am

70 WINTER 2012 pleased to report that the specialization pro- solid understanding of their professional and certified. Some of the applicants were denied gram is prospering and continues to fulfill its ethical obligations. However, mandatory certification because they did not meet the two key objectives: assisting the public by evaluations from the attendees reveal a luke- certification requirements, some did not pass identifying qualified practitioners who are warm reception for the program. In the the certification exam, but many paralegals proficient in specialty areas and improving spring, the board met with the key CLE who were certified have allowed their certifi- the competency of the bar. With your sup- providers to get their feedback on the costs to cations to lapse. port, the board will continue to establish spe- both attend and to produce the program, the This year the board explored and sought cialties in areas appropriate for certification content and organization of the program, and to address the reasons why paralegals are let- and to apply reasonable, objective standards the format for the program including the use ting their certifications lapse. We found that for certification that protect the interests of of alternative delivery systems such as video the expense of taking the required continuing the public. replays. No changes to the program are cur- paralegal education (CPE) hours is one of the rently proposed with one exception—the key reasons. A certified paralegal must earn Board of Continuing Legal Education board is transitioning to a new name to avoid six hours of CPE credit, including one hour Submitted by Marcia Armstrong, Board Member the acronym that has plagued the “New of ethics, every 12 months to maintain his or Despite tough economic times, lawyers Admittee Professionalism Program.” her certification. Fulfilling these requirements continue to meet and exceed their mandatory Unfortunately, the acronym has encouraged can be difficult for a paralegal who is unem- CLE requirements. By mid-March 2012 the young lawyers to compare the program to ployed or who is not reimbursed by an CLE department processed and filed over their secured transactions course in law employer for the costs of CPE courses. 23,500 annual report forms for the 2011 school—the NAPP. The new name for the In response to this problem, the board compliance year. I am pleased to report that program is Professionalism for New made grants to two paralegal organizations to 99% of the active members of the North Admittees—PNA. be used to provide low-cost or free CPE Carolina State Bar complied with the manda- The chair of the board, Heather C. Baker courses to all paralegals in North Carolina. A tory CLE requirements for 2011. The report of Cullowhee, and the vice-chair, Michael K. grant of $10,000 was made to the Paralegal forms show that North Carolina lawyers took Pratt of Brevard, end their terms on the board Division of the North Carolina Bar a total of 341,013 hours of CLE in 2011, or this year. Heather and Mike joined the board Association (NCBA) to fund a new series of 13 CLE hours on average per lawyer. This is in 2006, and they have provided invaluable monthly one-hour webcasts that are free to one hour above the mandated 12 CLE hours service to the CLE program for six years. The members of the Paralegal Division and only per year. board greatly appreciates their service. They $25 for non-members. The first webcast was The board continues to operate on a will be missed. presented by the NCBA on July 10, 2012, sound financial footing, supporting the The board will continue to strive to and it exceeded attendance expectations with administration of the CLE program from rev- improve the program of mandatory continu- 239 attendees. The response was so enthusi- enue from the attendee and non-compliance ing legal education for North Carolina astic, in fact, that the Paralegal Division may fees that it collects. The funds collected by the lawyers. We welcome any recommendations extend the webcast series to 18 months CLE program also help financially to support or suggestions that councilors may have in instead of the initial 12-month term. three programs that are fundamental to the this regard. On behalf of the other members The board also made a grant of $5,000 to administration of justice and the promotion of the board, I would like to thank you for the the North Carolina Paralegal Association of the professional conduct of lawyers in opportunity to contribute to the protection (NCPA) to be used towards providing free North Carolina. In 2011 the board used its of the public by advancing the competency of CPE programs to paralegals during a surplus to contribute $257,655 to the opera- North Carolina lawyers. lunchtime series via webcast. An additional tion of the Lawyers Assistance Program $5,000 has been set aside for the NCPA for (LAP). Another contribution to LAP will be Board of Paralegal Certification further free and reduced-price CPE. made at the end of 2012. To date in 2012 the Submitted by G. Gray Wilson, Board Member Another reason that certifications are laps- board has also collected and distributed The Board of Paralegal Certification ing is the inability of paralegals to pay the $124,492 to support the work of the Equal accepted the first application for certification costs or attend CPE courses or to pay the Access to Justice Commission and $242,608 on July 1, 2005. Since that date, over 6,170 annual renewal fee during a medical or finan- to support the work of the Chief Justice’s applications have been received by the board cial crisis. The rule establishing an inactive Commission on Professionalism. and I am proud to report that there are cur- status for certified paralegals was approved by The board supports the 12 hour profes- rently 4,297 North Carolina State Bar certi- the Supreme Court this summer and is now sionalism requirement for lawyers licensed on fied paralegals. During the past 12 months, in full effect. Under this rule, paralegals who or after January 1, 2011, and wants this pro- the board has: cannot fulfill the requirements of recertifica- gram—which is often a new lawyer’s first • administered the exam to 398 applicants tion based on financial hardship, illness, dis- interaction with the North Carolina State for certification, ability, or active military duty for the parale- Bar—to be the best it can be. The board is • certified 286 paralegals by exam, and gal or his/her spouse, can petition to be investigating, with the providers of the pro- • recertified 3,630 paralegals. placed on inactive status. The inactive status gram, ways to improve both its content and These figures demonstrate the success of will last for one year and can be renewed for format. The requirement is intended to help the program, but also reveal that 30% of up to five years. The board anticipates that new lawyers start the practice of law with a applicants did not become or are no longer the rule will enable qualified paralegals to

THE NORTH CAROLINA STATE BAR JOURNAL 71 return to fully certified status when their served as the vice-chair of the board from The Board of Trustees hardship situation ends. 2004 to 2007, and has served as chair of the The board is composed of five trustees The paralegal certification program con- board since 2008. For ten years he has con- appointed by the council of the State Bar. A tinues to support programs that assist North tributed his belief in the value of certifica- trustee may serve only one full five-year term. Carolina paralegals and lawyers to deliver tion for paralegals, his pragmatism, and his Four of the trustees must be attorneys admit- legal services to clients. This year the board efficient and fair leadership to the oversight ted to practice law in North Carolina and one agreed to fund and to staff the new of the paralegal certification program. must be a person who is not a licensed attor- Interpreter Reimbursement Program of the Renny’s forthright, positive approach and ney. Current members of the board are: State Bar. The board’s grant of $5,000 will allegiance to the certification program will M. Ann Reed, chair, a former president of provide funds to reimburse lawyers for the be missed. the North Carolina State Bar, retired senior out-of-pocket expenses associated with hiring The dedication and enthusiasm of all of deputy in the Administrative Division of the a licensed interpreter for a deaf client. the founding board members fostered the Attorney General’s Office. Eight years have passed since the first growth of this program from its conception Michael Schenck, the public member of Board of Paralegal Certification was appoint- through its infancy to the mature program it the board, is a former CFO of Penick Village ed in October 2004. Four paralegals were is today—an integral and important program in Southern Pines, NC, and is retired and liv- appointed to work with four lawyers and a of the North Carolina State Bar. ing in Asheboro, NC. paralegal educator to design and administer William O. King, a former president of the first state bar paralegal certification pro- Client Security Fund the North Carolina State Bar, is a partner gram in the country. It has been an unequiv- Submitted by M. Ann Reed, Chair with the firm of Moore & Van Allen, PLLC ocal success. Today is a turning point for the Pursuant to the Rules of Administration in Durham. program because it is the last day of service and Governance of the Client Security Fund LeAnn Nease Brown is an attorney with for the last three members of that founding of The North Carolina State Bar (the the firm of Brown & Bunch, PLLC in board: Tammy Moldovan, John M. Harris, “Fund”), the Board of Trustees submits this Chapel Hill. and Renny W. Deese. annual report covering the period October 1, Charles M. Davis, a former president of Paralegal board member Tammy 2011, through September 30, 2012. the North Carolina State Bar, is an attorney Moldovan played a key role in the formation The Fund was established by order of the mediator in Louisburg. of the grassroots organization called the Supreme Court dated October 10, 1984, and Alliance for Paralegal Professional Standards commenced operations January 1, 1985. As Subrogation Recoveries (APPS) in 2001. APPS initiated the effort to stated by the Supreme Court, the purpose of It is standard procedure to send a demand advance the paralegal profession by pursuing the Fund is “...to reimburse, in whole or in letter to each attorney or former attorney the formalized regulation of paralegals. She part in appropriate cases and subject to the whose misconduct results in any payment, served as a paralegal member of the State Bar’s provisions and limitations of the Supreme making demand that the attorney either Legislative Study Committee on Paralegal Court and [the] Rules, clients who have suf- reimburse the Fund in full or confess judg- Regulation from 2003-2004. Tammy’s belief fered financial loss as a result of dishonest ment and agree to a reasonable payment in the importance of certification for parale- conduct of lawyers engaged in the private schedule. If the attorney fails or refuses to do gals helped to shepherd the program from practice of law in North Carolina...” either, suit is filed seeking double damages idea to reality. Her straightforward manner pursuant to N.C.G.S. §84-13 unless the and enthusiasm for the certification program Claims Procedures investigative file clearly establishes that it will be missed. The Fund reimburses clients of North would be useless to do so. John M. Harris, a partner with the Harris Carolina attorneys where there was wrongful In cases in which the defrauded client has Law Firm in Morehead City, served as the taking of the clients’ money or property in the already obtained a judgment against the chair of the appeals panel since 2008 and as nature of embezzlement or conversion, which attorney, the Fund requires that the judg- the vice-chair of the board since 2011. money or property was entrusted to the attor- ment be assigned to it prior to any reim- During his time on the board, John helped to ney by the client by reason of an bursement. In North Carolina criminal create the procedures for administering the attorney/client relationship or a fiduciary rela- cases involving embezzlement of client certification program, and brought a compas- tionship customary in the practice of law. funds by attorneys, our counsel, working sionate approach to the many difficult deci- Applicants are required to show that they have with the district attorney, is sometimes able sions that the appeals panel and the board exhausted all viable means to collect those to have restitution ordered as part of the had to make relative to the certification or losses from sources other than the Fund as a criminal judgment. continuing certification of some applicants. condition to reimbursement by the Fund. Another method of recovering amounts We will miss John’s good humor, steady hand, Specific provisions in the Rules declare that the Fund pays to clients of a dishonest attor- and dedication to the certification program. certain types of losses are non-reimbursable. ney is by being subrogated to the rights of Renny W. Deese, former councilor and a All reimbursements are a matter of grace clients whose funds have been “frozen” in the partner with the Fayetteville firm of Lewis, in the sole discretion of the board and not a attorney’s trust account during the State Bar’s Deese & Nance, originally served on the matter of right. Reimbursement may not disciplinary investigation. When the court State Bar’s Legislative Study Committee on exceed $100,000 to any one applicant based disburses the funds from the trust account, Paralegal Regulation from 2003-2004. He on the dishonest conduct of an attorney. the Fund gets a pro-rata share.

72 WINTER 2012 During the year covered by this report, the Fund recovered $125,378.64 as a result of these efforts. Hopefully our efforts to recover under our subrogation rights will continue to show positive results.

Claims Decided During the period October 1, 2011 - September 30, 2012, the board decided 89 claims, compared to 76 claims decided the previous reporting year. For various reasons under its rules, the board denied 39 of the 89 claims in their entirety. Of the 50 remaining claims, some were paid in part and some in full. Reimbursements authorized and paid totaled $597,300.72. The most common basis for denying a claim in its entirety is that the claim is a “fee dispute” or “performance Without the continuous support of these or less of all referrals (“other combined”): dispute.” That is, there is no allegation or evi- people, our tasks would be much more diffi- Physician Local Bar dence that the attorney embezzled or misap- cult. We also express our appreciation to the Grievance Non-Lawyer propriated any money or property of the Bar of North Carolina for their continued DHC DA client. Rather, the client feels that the attor- support of the Client Security Fund and their Bar Examiner EAP ney did not earn all or some part of the fee efforts in reducing the incidents of defalca- Investigators/SCA Another LAP paid or mishandled or neglected the client’s tion on the part of a few members of our pro- Law School Therapist legal matter. However meritorious the client’s fession. Unknown Other contentions may be, the Fund’s rules do not authorize reimbursement under those cir- Lawyer Assistance Program Issues cumstances. Submitted by Mark Merritt, Chair Here is the list of issues that the LAP assists lawyers with (and has begun tracking Funding Operations and Clients in detail with the goal of providing meaning- The 1984 order of the Supreme Court It continues to be busy and productive for ful statistics next year): that created the Fund contained provisions the North Carolina Lawyer Assistance Addiction (Drugs) for an assessment of $50 to provide initial Program (“LAP”). In its 33rd year of opera- Al-Anon (Family Member w/ Alcoholism) funding for the program. In subsequent years, tion, NC LAP fielded over 600 telephone Alcoholism upon being advised of the financial condition calls from impaired attorneys, judges, law stu- Anger Management of the Fund, the Court in certain years dents, family members, managing partners, Anxiety Disorder waived the assessment and in other years set and colleagues. Of these calls, 143 resulted in Attention Deficit Disorder (ADD/ADHD) the assessment in varying amounts to provide newly opened files in 2012, bringing the total Axis II/Confirmed (Personality Disorders) for the anticipated needs of the Fund. number of current open cases to 631. Axis II/Tendencies In 2006 the Supreme Court approved a In 2012 the LAP conducted an extensive Bipolar $25 assessment per active lawyer that will audit of all files, an audit which is on-going Bipolar Tendencies continue from year-to-year until circum- and is a labor-intensive process, and began Burn Out/Stress stances require a modification. There is no closing files for clients who had successfully Career Counseling need for a change in the assessment for calen- completed the program, converted to volun- Codependency dar year 2013. teer status, or who had no meaningful activity Cognitive Impairment/Related to Aging for more than two years. By closing inactive Cognitive Impairment/Unrelated to Aging Financial Statements files, greater program resources can be dedi- Compassion Fatigue A copy of the audited financial statement cated to currently active cases, leading to Depression of the Fund as of September 30, 2010 has greater efficiency. The LAP closed 314 files in Food Addiction previously been furnished to each member of 2012. Gambling Addiction the council. Because the rate of new files being opened Grief and Loss far outpaces the rate at which a file is or can Obsessive Compulsive Disorder (OCD) Conclusion be closed, our annual case load has increased Physical Impairment or Disability The Board of Trustees wishes to convey to by an average of 100 cases a year. Schizophrenia the council our sincere appreciation to the A graph representing referral sources to Secondary Trauma staff personnel who have assisted us so effec- the LAP can be found above. Sex Addiction tively and generously during the past year. The following sources each represent 1% Suicidal Ideation and/or Prior Attempt

THE NORTH CAROLINA STATE BAR JOURNAL 73 Trauma: PTSD (Child Abuse, Rape, or attendance. Piedmont clinical coordinator; Joan Renken, Other) • FRIENDS 13th Annual Conference was Raleigh office coordinator; and Buffy Holt, Trauma: PTSD from Combat held at Pine Needles Lodge & Conference Charlotte office coordinator. Traumatic Brain Injury Center, Southern Pines, North Carolina, on Workaholism February 25, 2012. This conference was in LAP Board conjunction with BarCares and the NC Bar Mark W. Merritt, chair Education and Outreach Association Quality of Life Committee. Fred J. Williams, vice-chair The best intervention always begins with • The 33rd Annual PALS Conference and Joseph Jordan education. In addition to our four quarterly Workshop will be held November 2-4, 2012, Kathy Klotzberger articles appearing in the State Bar Journal, the at the Holiday Inn Resort, Wrightsville Beach, Nena Lekwauwua, MD LAP continues to provide presentations at law North Carolina. David W. Long schools, ethics CLE workshops, and local and • ABA Annual CoLAP Conference was Margaret J. McCreary specialty bar association meetings. The LAP held in Grand Rapids, Michigan October 8- Burley B. Mitchell Jr. completed 61 CLE programs this year. 11, 2012. Bert Nunley

Volunteer Development Local Volunteer Meetings LAP Board Meetings Scheduled For We currently have 234 LAP volunteers. The LAP continues the development of 2013 The LAP network of volunteers and lawyer local volunteer meetings to provide greater LAP Board meetings are usually scheduled support groups provide a major part of the continuity and support in meeting the needs for lunchtime on Wednesday of the week the assistance given by the LAP to lawyers around of lawyers new in recovery and allowing vol- Bar Council meets except in October, when the state. Without the extended volunteer net- unteers the chance to grow in their own recov- the LAP Board meets at the Annual LAP work, it would be impossible for the LAP to eries. Details on meeting locations are avail- Meeting and Conference held the first week- be as effective as it has been during the past able on the LAP website, nclap.org. end in November. The 2012-2013 schedule year. Staff and volunteer efforts have prevent- is: ed or limited possible harm to the public in Staff January 22-25, 2013 – Raleigh Marriott numerous instances. Don Carroll retired as LAP emeritus direc- City Center, Raleigh tor at the end of 2011. Cathy Killian, based in April 16-19, 2013 – Raleigh Marriott City Training Charlotte, was hired as the western clinical Center, Raleigh • The 32nd Annual PALS Meeting and coordinator effective September 13, 2012. July16-19, 2013 – Chetola Resort, Workshop was held November 4-6, 2011, at There were no other changes in the LAP staff: Blowing Rock the Crowne Plaza Resort, Asheville, North Robynn Moraites, executive director; Ed November 1-3, 2013 – Crown Plaza Carolina. Chief Justice Sarah Parker was in Ward, assistant director; Towanda Garner, Resort, Asheville n

In Memoriam Charles Franklin Lambeth Jr. Walter Wayne Vatcher Thomasville Jacksonville Brandon James Crouse Thomas Michael Lassiter Archibald Colin Walker Mooresville Statesville Winston-Salem David Watson Daniel William Bulgin McGuire Jr. Richard Beverly Raney Webb Wilson Denver Edenton Robert Burns Druar Joseph Martin Parker Jr. Randi Beth Weiss Cheektowaga, NY Winston-Salem Winston-Salem Larry Lee Eubanks Sr. John Rainey Parker Jr. Lon Hugh West Jr. Bermuda Run Clinton Statesville William H. Gammon Jimmy Dean Reeves Rosbon D. B. Whedbee Raleigh West Jefferson Winston-Salem David M. Ganly Charles G. Rose III Clawson Lee Williams Jr. Redlands, CA Albertville, AL West End Weston Poole Hatfield William Dale Talbert William Rudolph Winders Winston-Salem Cary Durham Joseph Allie Hayes III Jeffrey Paul Trent Charlotte Charlotte

74 WINTER 2012 History. Service. Education.

I talk to claims attorneys every day. It’s a cooperative effort.

JERRY PARNELL DEFENSE COUNSEL, POYNER SPRUILL LLP

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LAWYERS LIABILITY INSURANCE CONNECT WITH US COMPANY OF MUTUAL NORTH CAROLINA The North Carolina State Bar PO Box 25908 Raleigh, NC 27611

Winter 2012

Find people worthy of the name on the door. That was my mentor’s advice. But the landscape has changed over the last few years. Profi ts are harder earned and have to be more wisely spent. So I’m getting help to ensure we’re always healthy enough to attract and retain top talent. After all, it might as well be my name on the door.

SM

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