BEFORE THE SUPREME COURT COMMITTEE ON PROFESSIONAL CONDUCT
PANEL B
IN RE: JAMES EARL HENSLEY, JR., Respondent
Arkansas Bar ID#99069
CPC Docket No. 2004-003
FINDINGS AND ORDER
The formal charges of misconduct upon which this Findings and Order is based arose from information provided to the Committee by Jerry Kennedy on July 22, 2003. The information related to the representation of Mr. Kennedy by Respondent beginning in August 2002.
On January 6, 2004, Respondent was served with a formal complaint, supported by affidavit from Mr. Kennedy. On January 12, 2004, Mr. Hensley filed a timely response to the formal disciplinary complaint.
The information before the Committee revealed that during August 2002, Mr. Kennedy hired James Earl Hensley, Jr., an attorney practicing in Cabot, Arkansas, to assist him in attempting to recover funds owed to him by Fashion Park Cleaners and Brooksher Banks. Two months later, Mr. Kennedy hired Mr. Hensley to represent him in a bankruptcy proceeding. When Mr. Kennedy consulted Mr. Hensley about the debt owed to him, Mr. Hensley advised that both Fashion Park and Mr. Banks were liable for the debt since Mr. Kennedy had a personal guarantee. Mr. Kennedy was still owed $47,700 on the debt when he hired Mr. Hensley. The agreed upon fee was $2000 which was to cover everything up to and including court appearances. Mr. Hensley did not provide Mr. Kennedy any written information about the lawsuit he filed against Fashion Park Cleaners. According to Mr. Kennedy, Mr. Hensley’s verbal communication with him was minimal as well.
During October 2002, when Mr. Kennedy met with Mr. Hensley to discuss the possibility of pursuing bankruptcy relief, Mr. Hensley advised that he could represent Mr. Kennedy for a fee of $1200 which was paid by Mr. Kennedy. Mr. Hensley explained to Mr. Kennedy that the credit card debt would be “forgiven” and that he would file a “reaffirmation of debt” on the truck, home and Kenworth. The bankruptcy was filed and the Order relieving Mr. Kennedy of his credit card debt was entered on May 16, 2003.
Mr. Kennedy is a truck driver. On the Thursday before the alleged hearing in the matter filed by Mr. Hensley against Fashion Park, Mr. Kennedy called to make certain the hearing would still occur. Mr. Hensley advised Mr. Kennedy that because of the bankruptcy filing, the trustee would pursue the lawsuit through the bankruptcy proceeding and, accordingly, there was no need to go to Court. Mr. Hensley also advised that the lawsuit had been voluntarily withdrawn. Mr. Hensley never discussed the withdrawal with Mr. Kennedy prior to requesting the same.
During May of 2003, Mr. Hensley learned that First Arkansas Bank and Trust had filed a lawsuit against Mr. Banks after Mr. Hensley had done so and had collected some money owed to them. Based on this information, Mr. Kennedy sent Mr. Hensley a letter requesting a copy of everything in the file so he could see for himself what services had been provided to him by Mr. Hensley. Mr. Hensley did not reply to the letter.
On Friday morning June 20, 2003, Mr. Kennedy returned to his home to find that his pick up truck was gone. Mr. Kennedy was behind on his payment because he had not been home for almost a month. Mr. Kennedy called the finance company and learned that a reaffirmation agreement had never been approved by the Court or sent to them. Therefore, all he could do was obtain the full amount of the debt and forward it to them. Mr. Kennedy immediately called Mr. Hensley’s office but was unable to speak with him. Mr. Kennedy spoke with the secretary and explained to her what had happened. Mr. Hensley had the secretary return Mr. Kennedy’s call to set up an appointment for Mr. Kennedy to come into the office. Mr. Kennedy wanted a written explanation, which he did not receive until Mr. Hensley sent him a letter, dated June 24, 2003. In the letter, Mr. Hensley advised that the bankruptcy trustee continued to seek remuneration from the owner/lessor of the laundry. This proved to be a false statement.
In responding to the Committee, Mr. Hensley alleged that he contacted Mr. Kennedy several times throughout his cases. Mr. Hensley explained that he could not have performed many of the services without Mr. Kennedy’s direct assistance. Mr. Hensley advised that he called Mr. Kennedy often, as he does with all his clients. It was Mr. Hensley’s statement that he knows of no other attorney who takes Model Rule 1.4(a) as seriously as he does.
Mr. Hensley did agree that he did not fully discuss the repercussions of dismissing the civil lawsuit with Mr. Kennedy as it relates to the ability to re-file within one year of the dismissal. According to Mr. Hensley, he did explain that Mr. Kennedy’s creditors did have the authority to proceed with the suit through the Trustee’s office.
According to Mr. Hensley, he was advised that his services had been terminated by a letter from Mr. Kennedy dated May 26, 2003. His response to Mr. Kennedy was in a letter dated June 26, 2003, when he requested that Mr. Hensley contact him because he so wanted to please Mr. Kennedy. It is Mr. Hensley’s statement that Mr. Kennedy never responded to the letter but that he will send him a copy of the file whenever he wishes.
Upon consideration of the formal complaint and attached exhibit materials, the response to it, other matters before it, and the Arkansas Model Rules of Professional Conduct, Panel B of the Arkansas Supreme Court Committee on Professional Conduct finds:
1. That Mr. Hensley’s conduct violated Model Rule 1.4(a) when he did not keep Mr. Kennedy informed of the status of his actions, if any, which were being undertaken in the civil action Mr. Kennedy hired him to pursue on his behalf against Fashion Park Cleaners and Mr. Banks. Model Rule 1.4(a) requires that a lawyer keep a client reasonably informed about the status of a matter and promptly comply with reasonable requests for information.
2. That Mr. Hensley’s conduct violated Model Rule 1.4(b) when he failed to explain to Mr. Kennedy when he dismissed the lawsuit against Fashion Park Cleaners and Brooksher Banks that if Kennedy wanted to pursue it again, he would have to re-file within one (1) year of the dismissal, thereby denying Mr. Kennedy of the opportunity to seek other counsel to represent him in the action he wished to pursue. Model Rule 1.4(b) requires that a lawyer explain a matter to the extent reasonably necessary to permit the client to make informed decisions regarding the representation.
3. That Mr. Hensley’s conduct violated Model Rule 1.16(d) because when Mr. Kennedy terminated his representation, Mr. Hensley failed to provide Mr. Kennedy with the documentation, if any, in the file on his legal matter which would have demonstrated any actions Mr. Hensley might have taken on Mr. Kennedy’s behalf, in addition to filing the lawsuit. Model Rule 1.16(d) requires that upon termination of representation, a lawyer take steps to the extent reasonably practicable to protect a client’s interests, 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.
WHEREFORE, it is the decision and order of the Arkansas Supreme Court Committee on Professional Conduct, acting through its authorized Panel B, that JAMES EARL HENSLEY, JR., Arkansas Bar ID# 99069, be, and hereby is, REPRIMANDED for his conduct in this matter. Further, pursuant to Section 18.A. of the Procedures of the Arkansas Supreme Court Regulating Professional Conduct of Attorneys at Law (2002), Mr. Hensley is assessed the cost of this proceeding in the amount of $50. The costs assessed herein shall be payable by cashier’s check or money order payable to the “Clerk, Arkansas Supreme Court” delivered to the Office of Professional Conduct within thirty (30) days of the date this Findings and Order is filed of record with the Clerk of the Arkansas Supreme Court.
ARKANSAS SUPREME COURT COMMITTEE ON PROFESSIONAL CONDUCT - PANEL B
By: _____________________________________
J. Michael Cogbill, Chair, Panel B
Date: ____________________________________