Gelberg v. State Bar

THE COURT. This is a proceeding to review a recommendation of the Board of Governors of The State Bar that petitioner, Samuel S. Gelberg, be suspended from the practice of the law for a period of one year. The board of governors by a unanimous vote adopted the findings of fact made by the local committee which heard the charges against petitioner, but by a divided vote rejected the recommendation of the local committee that he be given only a public reprimand. The petitioner prays this court to adopt the recommendation of the local committee. He does not deny [142]that he was guilty of negligence in the conduct of his practice, as found by the committee.

The local committee found that petitioner had been “guilty of negligence in overlooking and overseeing his office, permitting a system of nonproperty owning employees to sign bonds of various kinds as an incident of and as a part of their employment without any recognition or knowledge on their part of what they were doing and without any expectation on their part to be bound”. The committee further found that investigation by the respondent of the course of conduct in his office would quickly have disclosed this practice, and proper supervision would have prevented it. In support of his plea that a public reprimand is the appropriate penalty, petitioner points to the fact that the local committee did not find that he had actual knowledge that his employees who were signing bonds did not own property.

The order to show cause listed ten bonds filed in eight different actions in which petitioner was the attorney of record. These bonds were filed between September 30, 1935, and September 8, 1936. Bight of the bonds were attachment bonds. The remaining two were filed pursuant to section 689 of the Code of Civil Procedure, which provides that property upon which execution has been levied shall be released where a third party claim is asserted unless an undertaking is filed. The bonds were respectively in the following amounts: $50, $216, $261, $301.24, $320, $500, $825, $1,000, $5,000 and $30,000. All except the bonds for $5,000 and $30,000 were filed in the Municipal Court of Los Angeles. The bond for $30,000, filed in the superior court, was inadvertently drawn in that amount, instead of for $3,000.

Petitioner had a large practice in the collection of accounts for clients. The actions in which the bonds were filed were all brought in the name of M. Moser, an employee of petitioner, as assignee for collection. The employees of petitioner who signed bonds were Dora Wallin, Eleanor Morales, Jerry Greenfield and Marie Moser. In two instances Marie Moser signed attachment undertakings both as principal and surety. These several employees were all young women vTho did clerical work in petitioner’s office at salaries of between $45 and $60 a month. Eleanor Morales was a minor and under the age of eighteen years when she signed bonds as a surety.