George R. Neely v. Commission for Lawyer Discipline--Appeal from 164th District Court of Harris County

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State: Texas

Court: Texas Northern District Court

Docket No: 14-08-00526-CV

Case Date: 09/10/2009

Plaintiff: George R. Neely

Defendant: Commission for Lawyer Discipline--Appeal from 164th District Court of Harris County

Preview:Affirmed and Opinion filed September 10, 2009.

In The

Fourteenth Court of Appeals
____________ NO. 14-08-00526-CV ____________ GEORGE R. NEELY, Appellant V. COMMISSION FOR LAWYER DISCIPLINE, Appellee

On Appeal from the 164th District Court Harris County, Texas Trial Court Cause No. 2003-63182

OPINION
This appeal arises from an attorney disciplinary proceeding in which the trial court granted summary judgment on claims that the attorney violated Texas Disciplinary Rule of Professional Conduct 1.14(a), governing the safekeeping of others' property. The trial court entered a final judgment of disbarment. In nine appellate issues, the disbarred attorney challenges the trial court's jurisdiction as well as the trial court's granting of summary judgment, the admission of certain evidence, and various other aspects of the judgment. We affirm.

I. F ACTUAL AND P ROCEDURAL B ACKGROUND Appellant George R. Neely was licensed to practice law in Texas. He maintained a trust account under the Interest on Lawyers Trust Account (IOLTA) program. Appellee the Commission for Lawyer Discipline (the "Commission") initiated a disciplinary action against Neely for violation of the Texas Disciplinary Rules of Professional Conduct. In its live petition, the Commission alleged that Neely violated the trust account provisions set forth in Rule 1.14(a) by commingling his own funds with clients' funds in his IOLTA trust account ("Trust Account"), by paying employee wages and other business and personal expenses from the same account, and by failing to preserve five years of records on the Trust Account. The action stemmed from a grievance filed with the State Bar of Texas by Neely's former employee, Virginia Ploch. In her grievance, Ploch accused Neely of paying her wages and bonuses, Neely's office expenses, and Neely's household expenses from the Trust Account, which Ploch claimed was the same account in which Neely deposited clients' money. Ploch attached to the grievance copies of payroll checks and other checks written to Ploch and signed by Neely from the Trust Account (hereinafter the "Ploch Checks"), which Neely asserts Ploch stole from his office. In the course of discovery, on January 12, 2004, the Commission requested production of all records of any trust accounts maintained by Neely for the period beginning December 1, 1998, and running through January 12, 2004, including statements and cancelled checks, among other things. Neely objected to the Commission's request, asserting attorney-client privilege and a number of other objections; Neely did not produce the requested documents. The Commission indicated that it would file a motion to compel production of the records if Neely did not comply with the request for production. Shortly thereafter, on February 20, 2004, the Commission served a subpoena on Frost National Bank for records associated with the Trust Account. Neither party disputes that

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Neely did not receive notice of the Frost National Bank subpoena.1 Frost National Bank complied and provided 1,462 pages of records pertaining to the Trust Account (hereinafter "Trust Account Records").2 The Commission filed the Trust Account Records with the trial court on May 28, 2004, along with an affidavit of a Frost National Bank officer and custodian of records, Lisa Gonzales, under the business-records exception of Texas Rule of Evidence 902(10). The notice of filing associated with these records, in pertinent part, is provided below: You are hereby notified that Petitioner, Commission for Lawyer Discipline has filed in the above-styled and numbered case certain business records of Frost National Bank, with an affidavit by Lisa Gonzales, Custodian of Records. These records will be offered in evidence during the trial of this case. Pursuant to Rule 902(10)(a) of the Texas Rules of Evidence, these records will be made available to counsel for parties to the litigation for inspection and copying at the expense of the person desiring the copies. A certificate of service to Neely accompanied the notice. In June 2004 and July 2004, the Commission filed two other motions to compel Neely's production of records associated with the Trust Account. In an order dated April 19, 2007, the trial court granted the Commission's motions to compel, ordering Neely to provide a "full and complete response" to the Commission's request for production and interrogatories. Neely produced some records associated with the Trust Account. The record reflects that he admitted producing to the Commission "IOLTA account records" for the

The Commission, in serving the subpoena on Frost National Bank, operated under the belief that section 59.006 of the Texas Finance Code authorized the Commission to obtain the Trust Account Records by subpoena without notice to Neely. The trial court indicated at a hearing in October 2007, that the Finance Code did not authorize the Commission's conduct and that the Finance Code was inapplicable to the facts of this case. The Commission indicated that the records obtained from Frost National Bank spanned a period of sixteen months from April 2001 to July 2002, but did not encompass the entire period of time for which records were requested of Neely, from December 1998 through January 2004.
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period of April 2001 to July 2002.3 Neely provided no other documents pertaining to the Trust Account for the requested time-period (December 1, 1998, to January 12, 2004). The Commission moved for partial summary judgment on the Rule 1.14(a) claims.4 In support of its motion, the Commission submitted the following exhibits:

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