IN THE SUPREME COURT OF FLORIDA (Before a Referee) REPORT OF REFEREE. December 10, Thereafter, the Chief Judge of the Fifteenth Judicial Circuit

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1 IN THE SUPREME COURT OF FLORIDA (Before a Referee) THE FLORIDA BAR, Complainant, v. KURT S. HARMON, Respondent. / Supreme Court Case No. SC The Florida Bar File Nos ,741(17A) ,596(17A) ,611(17A) REPORT OF REFEREE I. SUMMARY OF PROCEEDINGS: The Florida Bar filed its complaint with the Supreme Court of Florida on December 10, Thereafter, the Chief Judge of the Fifteenth Judicial Circuit appointed the undersigned to serve as referee. Respondent failed to answer The Florida Bar's complaint (as mandated by R. Regulating Fla. Bar 3-7.6(g)(2)), and The Florida Bar served a Motion for Default Final Judgment, on January 12, Respondent filed no response. I entered an order granting The Bar s motion on January 14, Thereafter, and pursuant to timely notice, the matter came before me for final hearing on sanctions, on March 20, Respondent again failed to appear or file any paper in the proceeding. The pleadings, and all other papers filed in this cause, which are forwarded to the Supreme Court of Florida with this report, constitute the entire record.

2 During the course of these proceedings, respondent failed to appear personally, or through counsel. The Florida Bar was represented by Lorraine Christine Hoffmann. II. FINDINGS OF FACT: A. Jurisdictional Statement: Respondent is, and at all times mentioned during this investigation was, a member of The Florida Bar, and subject to the jurisdiction and Disciplinary Rules of the Supreme Court of Florida. B. Narrative Summary: COUNT I 1. Respondent was hired to represent Ron Rinklewicz (hereinafter Rinklewicz ) and Kenneth Caroli (hereinafter Caroli ), the sellers, in a certain real estate transaction. 2. Because there was a lien on the real property at the time of the sale, Rinklewicz and Caroli gave respondent $6,000 to hold in trust, for the express and exclusive purpose of satisfying the subject lien (if necessary), prior to closing. 3. Both Rinklewicz and Caroli expected respondent to hold their funds in trust, until and unless it was necessary to satisfy the subject lien. 4. Both Rinklewicz and Caroli expected respondent to refund the $6,000 to them if the closing could go forward without satisfying the subject lien. 2

3 5. On or about February 8, 2008, the United States Bankruptcy Court entered an order in the case styled as In Re: Kenneth R. Caroli, Debtor, Case No , United States Bankruptcy Court, Southern District of Florida. This bankruptcy court order granted the Debtor s Motion to Avoid Lien for Target National Bank. 6. The bankruptcy court s February 8, 2008 order released the lien for which respondent was holding his clients $6, Rinklewicz and Caroli provided a copy of the bankruptcy court s February 8, 2008 order to respondent. 8. Since the subject lien had been released, Rinklewicz and Caroli were entitled to a full refund of the $6,000 they entrusted to respondent for the express and exclusive purpose of satisfying the lien (if necessary). 9. After the bankruptcy court released the lien, Rinklewicz and Caroli directed respondent to refund the $6,000 to them in the following manner: a check in the amount of $3,500 made payable to the law offices of Hoffman, Larin, and Agnetti, P.A., and the remaining $2,500 balance to Rinklewicz and Caroli, in equal shares. 10. Respondent failed and refused to remit the $3,500 payment to Hoffman, Larin, and Agnetti, P.A, on his clients behalf. 3

4 11. Respondent also failed and refused to remit any funds to Rinklewicz and Caroli. 12. Further, respondent failed to give Rinklewicz and Caroli an accounting of the funds he should have been holding in trust for them. 13. By his complete failure and/or refusal to account for and to return to Rinklewicz and Caroli the $6,000 they paid to him for the specific and exclusive purpose of satisfying a lien, respondent misappropriated his clients funds and converted them to his own use. COUNT II 14. Both Ron Rinklewicz and Kenneth Caroli filed sworn Florida Bar complaints against respondent, in May On May 20, 2008, The Florida Bar s Attorney Consumer Assistance Program (ACAP) sent respondent identical investigative inquiries (on each file) requesting mandatory responses to the complaints filed by Rinklewicz and Caroli. Copies of the ACAP letters to respondent were attached to The Florida Bar s complaint as Exhibit A. 16. Respondent failed and refused to respond to The Florida Bar s investigative inquiries. 17. On June 10, 2008, the complaints filed by Rinklewicz and Caroli were referred to The Fort Lauderdale Branch of The Florida Bar, for investigation. 4

5 18. The Florida Bar s staff investigator, Richard Giannotti (hereinafter Giannotti ), made numerous attempts to locate respondent and to obtain his response to the complaints filed by Rinklewicz and Caroli. 19. On June 2, 2008, Giannotti went to respondent s record bar address of 500 West Cypress Creek Road, Suite 230, Fort Lauderdale, Florida. 20. Giannotti found the professional suite to be vacant. 21. Further, Giannotti learned that respondent s commercial landlord has filed suit against respondent (and his partners) for breaking their lease. 22. In a continued effort to locate respondent and obtain his response to the sworn complaints filed against him, Giannotti went to respondent s residence. 23. Giannotti found no one at home at respondent s residence. 24. A neighbor told Giannotti that she had not seen respondent for nearly two months. 25. Giannotti contacted respondent s former law partners, Stewart Karlin, Esq., and Kenneth Kavanaugh, Esq. (hereinafter Karlin and Kavanaugh ). 26. Karlin told Giannotti that he had not seen or heard from respondent since December Kavanaugh told Giannotti that although respondent utilized space in Kavanaugh s office suite, Kavanaugh had not seen respondent for approximately six weeks. 5

6 28. Additionally, Kavanaugh told Giannotti that he believed respondent visited the office to retrieve his mail, on weekends only. 29. Despite numerous messages left for him by bar investigator Giannotti, respondent failed and refused to respond to all investigative inquiries The Florida Bar directed to him. 30. On July 30, 2008, The Florida Bar sent respondent a notice of probable cause hearing. This notice was sent to respondent at his record bar address, by both regular and certified United States mail. 31. The hearing notice sent to respondent via certified United States mail was returned to The Florida Bar marked Unclaimed. 32. The hearing notice sent to respondent via regular United States mail was not returned to The Florida Bar, and is presumed to have been delivered. 33. To this date, respondent has failed and refused to respond to any of The Florida Bar s investigative inquiries. COUNT III 34. Ann Sorkin (hereinafter Sorkin ) hired respondent to probate the estate of Sorkin s mother, Rhoda Freidberg. 35. Respondent also agreed to create a guardianship for Sorkin s daughter. 36. Respondent accepted a $6,000 legal fee from Sorkin, for both matters. 6

7 37. After accepting his legal fee from Sorkin, respondent took no action in either case. 38. Respondent failed to file a petition for administration on behalf of Sorkin s mother or her estate. 39. Respondent failed to take any steps to initiate guardianship proceedings for Sorkin s daughter. 40. By failing to take action in either of Sorkin s cases, respondent failed to competently and diligently represent his client. 41. By failing to take action in either of Sorkin s cases, respondent failed to earn the $6,000 legal fee he obtained from Sorkin. 42. By failing to return the unearned legal fee he obtained from Sorkin, respondent charged (and retained) a clearly excessive fee. 43. By accepting Sorkin s cases and agreeing to advance her probate and guardianship matters, and then failing to do so, respondent made material misrepresentations to his client. 44. By accepting Sorkin s cases and agreeing to advance her probate and guardianship matters, and then failing to do so, respondent delayed Sorkin s cases and engaged in conduct which was prejudicial to the administration of justice. 7

8 COUNT IV 45. After hiring respondent, Sorkin made numerous attempts to contact him, to learn the status of her cases. 46. Respondent failed and refused to communicate with Sorkin, failed and refused to respond to many of her messages, and failed to keep her informed as to the status of either of her two cases. 47. Further, on the rare occasion that he did accept a call from Sorkin, respondent told her that her cases were proceeding in the ordinary course. 48. In truth and in fact, respondent took no action in either of Sorkin s cases. 49. At the time that he told Sorkin that her cases were progressing (when he knew that they were not), respondent knew his statements to be false and misleading, and prejudicial to the administration of justice. III. RECOMMENDATION AS TO WHETHER RESPONDENT SHOULD BE FOUND GUILTY: My recommendation as to guilt is as follows: A. As to Count I: By the conduct set forth above, respondent violated R. Regulating Fla. Bar [A lawyer shall comply with the Rules Regulating Trust Accounts.]; 4-8.4(a) [A lawyer shall not violate or attempt to violate the Rules of Professional Conduct, knowingly assist or induce another to do so, or do so through the acts of another.]; 4-8.4(d) [A lawyer shall not engage in conduct in 8

9 connection with the practice of law that is prejudicial to the administration of justice ]; 5-1.1(a)(1) [A lawyer shall hold in trust, separate from the lawyers own property, funds and property of clients or third persons that are in a lawyer s possession in connection with a representation. All funds, including advances for fees, costs, and expenses, shall be kept in a separate bank or savings and loan association account maintained in the state where the lawyer s office is situated or elsewhere with the consent of the client or third person and clearly labeled and designated as a trust account. A lawyer may maintain funds belonging to the lawyer in the trust account in an amount no more than is reasonably sufficient to pay bank charges related to the trust account.]; and 5-1.1(b) [Money or other property entrusted to an attorney for a specific purpose, including advances for fees, costs, and expenses, is held in trust and must be applied only to that purpose. Money and other property of clients coming into the hands of an attorney are not subject to counterclaim or setoff for attorney s fees, and a refusal to account for and deliver over such property upon demand shall be deemed a conversion.]. B. As to Count II: By the conduct set forth above, respondent violated R. Regulating Fla. Bar 4-8.4(a) [A lawyer shall not violate or attempt to violate the Rules of Professional Conduct, knowingly assist or induce another to do so, or do so through the acts of another.]; 4-8.4(d) [A lawyer shall not engage in conduct in connection with the practice of law that is prejudicial to the administration of 9

10 justice ]; and 4-8.4(g)(1) [A lawyer shall not fail to respond, in writing, to any official inquiry by bar counsel or a disciplinary agency, as defined elsewhere in these rules, when bar counsel or the agency is conducting an investigation into the lawyer s conduct. A written response shall be made within 15 days of the date of the initial written investigative inquiry by bar counsel, grievance committee, or board of governors.]. C. As to Count III: By the conduct set forth above, respondent violated R. Regulating Fla. Bar [A lawyer shall provide competent representation to a client. Competent representation requires the legal knowledge, skill, thoroughness, and preparation reasonably necessary for the representation.]; [A lawyer shall act with reasonable diligence and promptness in representing a client.]; 4-1.5(a) [An attorney shall not enter into an agreement for, charge, or collect an illegal, prohibited, or clearly excessive fee ]; (d) [Upon termination of representation, a lawyer shall take steps to the extent reasonably practicable to protect a client s interest, such as giving reasonable notice to the client, allowing time for employment of other counsel, surrendering papers and property to which the client is entitled, and refunding any advance payment of fee that has not been earned.]; 4-8.4(a) [A lawyer shall not violate or attempt to violate the Rules of Professional Conduct, knowingly assist or induce another to do so, or do so through the acts of another.]; 4-8.4(c) [A lawyer shall not engage in conduct 10

11 involving dishonesty, fraud, deceit or misrepresentation.]; and 4-8.4(d) [A lawyer shall not engage in conduct in connection with the practice of law that is prejudicial to the administration of justice ]. D. As to Count IV: By the conduct set forth above, respondent violated R. Regulating Fla. Bar 4-1.4(a) [A lawyer shall (1) promptly inform the client of any decision or circumstance with respect to which the client s informed consent, as defined in terminology is required by these rules; (2) reasonably consult with the client about the means by which the client s objectives are to be accomplished; (3) keep the client reasonably informed about the status of the matter; (4) promptly comply with reasonable requests for information; and (5) consult with the client about any relevant limitation on the lawyer s conduct when the lawyer knows or reasonably should know that the client expects assistance not permitted by the Rules of professional Conduct or other law.]; 4-1.4(b) [A lawyer shall explain a matter to the extent reasonably necessary to permit the client to make informed decisions regarding the representation.]; 4-8.4(a) [A lawyer shall not violate or attempt to violate the Rules of Professional Conduct, knowingly assist or induce another to do so, or do so through the acts of another.]; 4-8.4(c) [A lawyer shall not engage in conduct involving dishonesty, fraud, deceit or misrepresentation.]; and 4-8.4(d) [A lawyer shall not engage in conduct in connection with the practice of law that is prejudicial to the administration of justice ]. 11

12 IV. RECOMMENDATION AS TO DISCIPLINARY MEASURES TO BE APPLIED: I recommend that respondent be disbarred from the practice of law with leave to reapply in 5 years and be ordered to pay the costs of this matter. I have based my recommendation upon my review of the applicable case law and the applicable Florida Standards For Imposing Lawyer Sanctions. In the instant case, respondent engaged in incompetent and dilatory law practice, as well as conduct involving fraud, deceit and misrepresentation. He failed to communicate with his clients, he failed to return unearned legal fees to them, and he misappropriated funds entrusted to him. Finally, he abandoned his clients and his law practice. All of the foregoing was prejudicial to the administration of justice. The Supreme Court of Florida has repeatedly held that misuse of client funds held in trust is one of the most serious offenses a lawyer can commit and that disbarment is presumed to be the appropriate punishment. The Florida Bar v. Travis, 765 So. 2d 689, 691 (Fla. 2000). In the instant case, respondent misappropriated monies held in trust for Rinklewicz and Caroli, and thereafter disappeared. While there are cases in which mitigating factors have rebutted the assumption of disbarment, respondent has defaulted in the instant case, and presented no mitigation or defense to challenge the Court s rebuttable presumption of disbarment. 12

13 In the Sorkin case, respondent neglected and abandoned his client. Abandonment of clients also calls for disbarment. The Supreme Court of Florida has stated: We have not hesitated to disbar attorneys who injure their clients and abandon their practice. The Florida Bar v. Blunt, 564 So. 2d 129 (Fla. 1990). See also The Florida Bar v. Horowitz, 697 So. 2d 78 (Fla. 1997); The Florida Bar v. DeMarco, 601 So. 2d 1197 (Fla. 1992); and The Florida Bar v. Setien, 530 So. 2d 298 (Fla. 1988). In abandonment cases, it is the totality of the respondents misconduct and the severe harm it presents, not one single act, that leads the Supreme Court to order the most severe sanction of disbarment. The Supreme Court cited the totality of the misconduct as the determining factor in The Florida Bar v. Setien, 530 So. 2d 298 (Fla. 1988). In that case, Setien neglected and thereafter abandoned his clients. Despite the presentation of mitigating factors (which are not applicable in the case at bar), the Court reiterated its holding that where "the composite conduct of a lawyer is gross, disbarment is warranted." Setien at 300, citing The Florida Bar v. Penrose, 413 So. 2d 15 (Fla. 1982). In the instant case, respondent s misconduct is enhanced and magnified by his complete failure to participate in the grievance process. In The Florida Bar v. Bartlett, 509 So. 2d 287 (Fla. 1987), the Court stated that a lawyer s willful refusal to participate at all in the disciplinary process when he is accused of 13

14 misconduct calls into serious question the lawyer s fitness for the practice of law. Bartlett, at 289. Respondent s lack of fitness for the practice of law has been clearly demonstrated by his failure to respond to his clients, his failure to respond to the bar, and his failure to respond to the referee in this disciplinary process. The Florida Standards for Imposing Lawyer Sanctions also support disbarment as the appropriate discipline. Standard 4.11 states that disbarment is appropriate when a lawyer intentionally or knowingly converts client property, regardless of injury or potential injury. Standard 4.41 states that disbarment is appropriate when: (a) a lawyer abandons the practice and causes serious or potentially serious injury to a client; or (b) a lawyer knowingly fails to perform services for a client and causes serious or potentially serious injury to a client; or (c) a lawyer engages in a pattern of neglect with respect to client matters and causes serious or potentially serious injury to a client. Respondent s misconduct fits both Standards, as set forth above. Respondent knowingly failed and refused to return the $6,000 he was holding in trust for Rinklewicz and Caroli, despite their numerous requests for same. He also accepted fees from Sorkin but failed to take any action on her behalf, thereby abandoning his client and her cause of action. Throughout The Florida Bar s investigation and prosecution of respondent s misconduct, he has failed and refused to respond to the Bar s investigative inquiries. He has failed, also, to 14

15 respond to all pleadings filed in the instant action and suffered a default final judgment thereby admitting all allegations charged by The Florida Bar. V. PERSONAL HISTORY AND PAST DISCIPLINARY RECORD: I considered the following personal history and prior disciplinary record of respondent, to wit: A. Personal History of Respondent: Age: 61 Date Admitted to the Bar: July 3, 1978 B. Aggravating Factors: 9.22 (b) dishonest or selfish motive; (i) substantial experience in the practice of law [respondent was admitted to The Florida Bar on July 3, 1978]. C. Mitigating Factors: None D. Prior Discipline: None VI. STATEMENT OF COSTS AND MANNER IN WHICH COSTS SHOULD BE TAXED: I find that The Florida Bar has incurred reasonable costs in the matter and that same should be assessed against the respondent. A. Grievance Committee Level Costs: 1. Court Reporter Costs $ Bar Counsel Travel Costs $

16 B. Referee Level Costs: 1. Court Reporter Costs $ Bar Counsel Travel Costs $ C. Administrative Costs $1, D. Auditor Costs $ E. Miscellaneous Costs: 1. Investigator Costs $ Witness Fees $ Copy Costs $ Telephone Charges $ Translation Services Fees $ TOTAL COSTS $1, It is recommended that such costs be charged to respondent and that interest at the statutory rate shall accrue and that should such cost judgment not be satisfied within thirty days of said judgment becoming final, respondent shall be deemed delinquent and ineligible to practice law, pursuant to R. Regulating Fla. Bar 1-3.6, unless otherwise deferred by the Board of Governors of The Florida Bar. Dated this day of, DAVID F. CROW, REFEREE 16

17 CERTIFICATE OF SERVICE I HEREBY CERTIFY that the original of the foregoing Report of Referee has been mailed to THE HONORABLE THOMAS D. HALL, Clerk, Supreme Court of Florida, 500 South Duval Street, Tallahassee, Florida , and that copies were mailed by regular U.S. mail to the following: STAFF COUNSEL, The Florida Bar, 651 East Jefferson Street, Tallahassee, Florida ; and LORRAINE CHRISTINE HOFFMANN, Bar Counsel, The Florida Bar, Lake Shore Plaza II, 1300 Concord Terrace, Suite 130, Sunrise, Florida 33323; and KURT S. HARMON, respondent, c/o Kenneth Kavanaugh, 8358 W. Oakland Park Boulevard, #304, Sunrise, Florida on this day of, DAVID F. CROW, REFEREE J:\users\DMACHA\Respondents\Harmon\ROR disbar.doc 17