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24935 - In the Matter of Reynolds

Shearouse Adv. Sh. No. 14
S.E. 2d

THE STATE OF SOUTH CAROLINA

In The Supreme Court



In the Matter of Thomas

Timothy Reynolds, Respondent.



Opinion No. 24935

Submitted March 16, 1999 Filed April 19, 1999



PUBLIC REPRIMAND



Senior Assistant Attorney General James G. Bogle,

Jr., of Columbia, for the Office of Disciplinary

Counsel.



Susan Batten Lipscomb, of Columbia, for respondent.





PER CURIAM: In this attorney disciplinary matter,

respondent and disciplinary counsel have entered into an agreement under

Rule 21 of the Rules for Lawyer Disciplinary Enforcement (RLDE) contained

in Rule 413, SCACR. In the agreement, respondent admits misconduct and

consents to a public reprimand. We accept the agreement.





John Doe Matter, #1



In late 1987 or early 1988, while an associate of the law firm

Jones, Scheider & Patterson, respondent began representing John Doe (Doe)

regarding various business matters. Respondent advised Doe and also

represented him in business-related litigation. During this time, respondent

became acquainted with Doe's wife, Mary Doe (Mrs. Doe). In late December

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IN THE MATTER OF REYNOLDS





1989 or early January 1990, respondent traveled to Detroit, Michigan and

met with Mrs. Doe, who was there attending a class reunion. Respondent

admits that he engaged in one act of sexual intercourse with Mrs. Doe during

the Detroit visit.





Respondent continued to represent Doe after respondent's sexual

encounter with Mrs. Doe. In the spring of 1990, while in casual conversation

outside the office, Doe discussed with respondent domestic relations

problems he was having with Mrs. Doe, including his suspicion that Mrs.

Doe may have had an affair. Doe recalls that respondent gave casual, but

legal advice to him, including suggestions on how to detect an affair. In

mitigation, respondent offers that at the time of this discussion, all relations

between him and Mrs. Doe had been terminated for several months.

Respondent also feels he was not giving legal advice when he discussed these

matters with Doe.





Respondent continued to discuss business matters with Doe after

August 23, 1990 which was when he left the Scheider law firm and began a

solo practice. Doe remained respondent's client, and respondent represented

him in the sale of one of Doe's businesses in early 1992.





Respondent never disclosed the sexual relationship he had with

Mrs. Doe to his client Doe; however, Doe became aware of it in or about

January 1993 when Mrs. Doe disclosed it to him.





In November 1994, Doe commenced a malpractice lawsuit

against respondent and the Scheider law firm. The trial court granted

summary judgment to the law firm, and that decision was subsequently

affirmed by the Court of Appeals. Thereafter, the causes of action which Doe

brought against respondent personally remained; however, respondent

settled the case for approximately $5,000, without any admission of

wrongdoing.





Respondent's misconduct in this matter occurred prior to the

adoption of the Rules of Professional Conduct. See Rule 407, SCACR.

Therefore, the Code of Professional Responsibility applies. See Rule 32,

Supreme Court Rules. Respondent admits that his conduct violated the

following disciplinary rules: DR-1-102(A) (lawyer shall not violate

disciplinary rules); DR-5-101(A) (lawyer should refuse employment when the

interests of the lawyer may impair his independent professional judgment);

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IN THE MATTER OF REYNOLDS





and Canon 9 (lawyer should avoid the appearance of professional

impropriety).





John Doe Matter #2



In January 1991, while respondent was representing Doe's

business interests, respondent executed a Repayment Agreement with Doe,

acknowledging a loan of $25,000 from Doe to respondent. The loan was

made at 8% interest and was secured by respondent's assignment of the first

$50,000 of attorney's fees which respondent expected to receive from

representation of another client in unrelated litigation. Because respondent

associated another firm to handle the litigation and that firm settled the

case, respondent never realized the expected $50,000 in attorney's fees.





Thereafter, in March 1992, respondent executed a promissory

note with Doe, the principal sum being $26,500 plus interest at 12% per

year. Respondent was unable to pay, off this loan when it came due, and Doe

resorted to the services of a collection agency.





Respondent entered into business transactions with his client.

Respondent admits that he did not advise Doe as required by Rule 1.8 of the

Rules of Professional Conduct, Rule 407, SCACR. Other than the written

documents discussed above, Doe did not consent in writing to these business

transactions. In mitigation, respondent believes that Doe was an

experienced business, man, with an MBA degree, had access to other

attorneys, and was aware of the restrictions imposed by Rule 1.8. In

addition, respondent offers that he believed the loan was fair and reasonable

at the time it was made.





By his actions in this matter, respondent has violated Rule 1.8 of

the Rules of Professional Conduct, Rule 407, SCACR. Rule 1.8(a) provides as

follows:



(a) A lawyer shall not enter into a business transaction

with a client or knowingly acquire an ownership,

possessory, security or other pecuniary interest adverse to

a client unless:

(1) The transaction and terms on which the lawyer

acquires the interest are fair and reasonable to the

client and are fully disclosed and transmitted in

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IN THE MATTER OF REYNOLDS





writing to the client in a manner which can be

reasonably understood by the client;

(2) The client is given a reasonable opportunity to

seek the advice of independent counsel in the

transaction; and

(3) The client consents

in writing thereto.





Respondent failed to comply with the requirements of Rule 1.8(a).





In our opinion, respondent's misconduct warrants a public

reprimand. Accordingly, respondent is hereby publicly reprimanded for his

misconduct.



PUBLIC REPRIMAND.



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