Barton v. State Bar

SEAWELL, J.

Charges were preferred against petitioner, a member of The State Bar of California, and a citation was duly issued thereon directing him to appear before the local administrative committee of San Francisco, No. 2, The State Bar of California, and show cause why he should not be disbarred, suspended or reproved by reason of his conduct, alleged to involve moral turpitude, dishonesty and corruption and the violation of the rules of professional conduct adopted by the board of governors of said The State Bar.

The particular reprehensible conduct recited in the order to show cause and which will hereafter appear, arose from a bankruptcy proceeding pending in the United States District Court, Southern Division, Northern District of California, which petitioner had engaged himself to institute and conduct to the procurement of the final order of discharge for an agreed fee. His clients, Victor Rose and Hilda Rose, husband and wife, had formerly conducted a copartnership business under the name of Rose Bros., and said eopartner

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ship being unable to meet its obligations, it was forced into insolvency by the petition of its creditors. The copartnership in the course of time received a final discharge, but later said Victor and Hilda Rose discovered that the order discharging the copartnership did not inure to their benefit as individuals, and they therefore petitioned to be adjudged bankrupts. It is in this proceeding that the petitioner was employed. The committee found and the evidence amply sustains the finding that petitioner agreed to put both individuals through insolvency upon payment to him of the sum of $200, petitioner herein to pay the costs of both proceedings. With the intent of salvaging as much as possible of said sum, which would ordinarily have been paid on account of costs, petitioner herein advised said petitioners in bankruptcy to take the paupers’ oath. In such cases the clerk’s fee, in the sum of $30 for each proceeding, is not exacted. This fee, however, in the absence of the filing of said oath, is payable upon filing the petition and schedules. A fee in the sum of $12.50 is necessary in each ease to take care of the publications and expense of calling the first meeting of creditors, which must be paid in every case. The petitioner, who was to be paid $50 at the time of employment, $50 at the time of the first hearing of creditors, and $100 upon the making of the orders of discharge, paid only the fees which must be paid in all cases, to wit, $12'.50 in each ease for expenses of calling of the first meeting of creditors, and none other, until it subsequently developed that he had received his second installment of $50 on account of his agreement with his clients. The petitioner in bankruptcy is required to answer under oath in his schedule an interrogatory as to what sum or sums have been paid to counsel, and to whom for services rendered in the bankruptcy proceedings. The answers given to said questions in each schedule was, “None”. The value of such information for the just administration of the bankrupt’s estate is obvious. Besides, the payment of a fee to an attorney is material to and an important element for consideration in determining whether or not petitioner is entitled to have his petition and schedule filed without the payment of said clerk’s filing fees.