No Single Transgression Reflects More Negatively On The Legal Profession Than A Lie Yet Punishment Mild in West Virginia

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No Single Transgression Reflects More Negatively On The Legal Profession Than A Lie Yet Punishment Mild in West Virginia

This lawyer disciplinary proceeding originated with a “Statement of Charges” by the Lawyer Disciplinary Board (“LDB”) against Scott A. Curnutte (“Mr. Curnutte”) alleging that he violated the West Virginia Rules of Professional Conduct by providing false information about his professional liability insurance coverage to the West Virginia State Bar (“State Bar”). For three consecutive fiscal years, Mr. Curnutte submitted his annual Financial Responsibility Disclosure (“FRD”) falsely certifying that he was covered under a policy of professional liability insurance, when, in fact, he had no such coverage. He also lied about having such coverage to a lawyer he employed, causing that lawyer to similarly provide false information to the State Bar.

In Lawyer Disciplinary Board v. Scott A. Curnutte, No. 19-0636, Supreme Court Of Appeals Of West Virginia (October 16, 2020) the Supreme Court dealt with the West Virginia Rules of Lawyer Disciplinary Procedure that enumerates factors to be considered in imposing sanctions and provides as follows:

“In imposing a sanction after a finding of lawyer misconduct, unless otherwise provided in these rules, the Court [West Virginia Supreme Court of Appeals] or Board [Lawyer Disciplinary Board] shall consider the following factors: (1) whether the lawyer has violated a duty owed to a client, to the public, to the legal system, or to the profession; (2) whether the lawyer acted intentionally, knowingly, or negligently; (3) the amount of the actual or potential injury caused by the lawyer’s misconduct; and (4) the existence of any aggravating or mitigating factors.”

FACTUAL HISTORY

Mr. Curnutte is a lawyer practicing in Elkins, West Virginia. By law every active lawyer must disclose to the West Virginia State Bar on or before September 1 of each year:

  1. whether the lawyer is engaged in the private practice of law;
  2. if so engaged, whether the lawyer is currently covered by professional liability insurance with limits of not less than $100,000 per claim and $300,000 policy aggregate covering generally insurable acts, errors and omissions occurring in the practice of law, other than an extended reporting endorsement;
  3. if the lawyer is so engaged and not covered by professional liability insurance in the above minimum amounts, whether the lawyer has another form of adequate financial responsibility which means funds, in an amount not less than $100,000, available to satisfy any liability of the lawyer …;
  4. whether there is any unsatisfied final judgment(s) after appeal against either the lawyer, or any firm or any professional corporation in which the lawyer has practiced, for acts, errors or omissions, including, but not limited to, acts of dishonesty, fraud or intentional wrongdoing, arising out of the performance of legal services by the lawyer.

For three consecutive fiscal years Mr. Curnutte certified to the State Bar that he and his law firm, Curnutte Law, were insured under a professional liability policy issued by ALPS. Contrary to his disclosure, his ALPS policy had lapsed in March 2014. He submitted the form falsely certifying that the policy was still in effect. Mr. Curnutte entered a fictitious policy number and submitted the form falsely certifying he had professional liability insurance.

DISCUSSION

The parties stipulated that Mr. Curnutte violated the duties he owed to his clients, to the public, and to the legal profession.  Because the disclosure was available to the public, he allowed for the possibility that this false information would be provided to clients or potential clients. He also allowed his employee lawyer to inaccurately believe she had the protection of professional liability insurance coverage when she did not. As an officer of the court, Mr. Curnutte’s duties include maintaining the integrity of the legal profession. His deceitful conduct fell short of this duty.

While there apparently was no actual harm to clients insofar as no legal malpractice claims have been made for the period in which the existence of insurance was misrepresented, Mr. Curnutte’s dishonesty created the potential for harm. By misrepresenting the existence of insurance, he allowed for the possibility that his clients or potential clients would believe he had such coverage.  The Supreme Court found Mr. Curnutte’s dishonesty clearly detrimental to his former attorney employee, the public, the legal system, and the legal profession.

The parties stipulated the following aggravating factors:

  1. a dishonest or selfish motive;
  2. a pattern of misconduct in that the conduct involved multiple reporting years; and
  3. substantial experience in the practice of law. 

Mitigating factors may be considered in determining the appropriate sanction. The parties stipulated the following mitigating factors:

  1. Mr. Curnutte does not have a prior disciplinary record;
  2. he has provided full and free disclosure  and has had a cooperative attitude toward this disciplinary proceeding;
  3. he has made a good faith effort to rectify the consequences of his conduct; and
  4. he has expressed remorse during this disciplinary proceeding.

The Supreme Court noted that “no single transgression reflects more negatively on the legal profession than a lie.” The honor of practicing law requires truth, candor, and honesty.

Considering mitigating factors and ignoring the egregious dishonesty, the Supreme Court concluded that a ninety-day suspension with automatic reinstatement along with the other recommended sanctions modified to comport with automatic reinstatement, provides an adequate sanction for Mr. Curnutte’s misconduct in this case. Mr. Curnutte’s law license was suspended for ninety days with automatic reinstatement under; Mr. Curnutte must complete an additional six hours of Continuing Legal Education in ethics prior to his automatic reinstatement; Mr. Curnutte must comply with the mandates of the rules of professional conduct, which sets out the duties of disbarred or suspended lawyers; Mr. Curnutte must reimburse the costs of these proceedings prior to his automatic reinstatement; and Mr. Curnutte shall, prior to his automatic reinstatement, fully and accurately disclose to the LDB what efforts, if any, he has made to procure professional liability insurance.

ZALMA OPINION

The West Virginia Supreme Court was very considerate of Mr. Curnutte’s mitigating circumstances in light of his blatant, wrongful, lie to the State Bar about the existence of malpractice insurance as required by state law. In so doing he harmed an employed lawyer who he caused to inadvertently lie to the state and the public who relied upon the existence of malpractice insurance. Since the lies he told negatively reflected on the practice of law, he should have been disbarred or, at the very least, been suspended for two or more years and required to obtain insurance, not just tell about his efforts. His remorse is commendable but one can only wonder if the remorse was about being caught rather than that he lied.


© 2020 – Barry Zalma

Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant  specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He also serves as an arbitrator or mediator for insurance related disputes. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 52 years in the insurance business. He is available at http://www.zalma.com and zalma@zalma.com.

Mr. Zalma is the first recipient of the first annual Claims Magazine/ACE Legend Award.

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