surveying business. Pursuant to the agreement, Respondent agreed to refer substantially all

Transcription

1 BEFORE THE HEARING BOARD OF THE ILLINOIS ATTORNEY REGISTRATION AND DISCIPLINARY COMMISSION In the Matter of: GARY K. DAVIDSON Attorney-Respondent, Commission No. 2017PR00099 No ANSWER TO FIRST AMENDED COMPLAINT Respondent, Gary K. Davidson, by his attorney, Stephanie L. Stewart of the Meyer Law Group, LLC, herby answers the Administrator's Complaint in this matter, as follows: RESPONDENT'S STATEMENT PURSUANT TO COMMISSION RULE 231 A. Respondent is also admitted to practice before the U.S. District Court for the Northern District of Illinois. B. Respondent does not hold any other professional licenses. COUNT I (Conflict ofinterest and Dishonesty) 1. Respondent is a member ofthe law firm Castle Law, LLC ("Castle Law"), which has offices in Joliet and Homer Glen, Illinois. The real estate department of Castle Law is headquartered in the Homer Glen office and, at all times relevant herein, was headed by Respondent. Respondent admits the allegations ofparagraph Prior to July 29, 2014, Respondent entered into an agreement with Samuel Winemiller ("WinemiUer"), a non-attorney, operating Winemiller & Associates, a property surveying business. Pursuant to the agreement, Respondent agreed to refer substantially all 1

2 property surveys in connection with his real estate practice at Castle Law to Winemiller & Associates. Respondent and Winemiller further agreed that Winemiller would increase his average surveyor charge of $300 to $475, which amount would include $100 that would be remitted to Respondent by Winemiller after the closings. Respondent admits the first sentence of Paragraph 2. Respondent admit that prior to July 29, 2014, Winemiller requested and Respondent agreed to an increase of his average surveyor charge from $300 to $475. The remaining allegations of Paragraph 2 are denied. In further answering, Respondent and Winemiller agreed that Winemiller would pay the firm $100 per survey for the services Castle Law provided Winemiller to assist him in preparing the survey. 3. Between July 29, 2014, and May 20, 2016, Respondent requested that Winemiller prepare at least 225 property surveys related to the real estate closings of Respondent's clients. In each ofthose matters, Winemiller submitted a bill to Castle Law for $ for surveying services to be charged to Respondent's clients for the survey. The $475 charge was then listed on the transaction's HUD settlement statement as a "surveyor charge" payable to Winemiller & Associates, with no mention ofthe $100 to be paid to Respondent. Respondent admits the allegations of Paragraph Respondent's statements that the surveyor charges were $475 as itemized by Respondent on the subject HUD settlement statements, as set forth in paragraph 3 above, were false because the $475 charge was not only a "surveyor charge" but included an undisclosed $100 fee to be paid to Respondent. Respondent denies the allegations of Paragraph 6.

3 5. Respondent knew that his inclusion of the $475 surveyor charge on the subject HUD settlement statements were false at the time he listed them on the HUD statements because he knew that the $475 "surveyor charge" included an undisclosed $100 fee to be paid to him. Respondent denies the allegations of Paragraph Following the closings, Castle Law submitted bulk invoices to Winemiller for "Professional Services" at $100 per closing. As set forth below, Winemiller, or someone at his direction, would then send Castle Law $100 per transaction, as follows: [see chart set forth in the Complaint] Respondent admits that invoices were sent to Winemiller for services provided in connection with the preparation of his surveys at $100 per real estate matter and that Winemiller paid the invoices. Respondent is unable to admit or deny whether Winemiller paid $100 as to all ofthe transactions alleged in Paragraph 8 due to lack of knowledge. 7. At no time during this period did Respondent advise his client that the $475 he told them that they were paying for a "surveyor charge" included $100 that was to be paid to Respondent after the closing on their property. Respondent denies the allegations ofparagraph Respondent's representation to his clients that they were paying $475 as a surveyor fee was false, because the surveyor fee included an undisclosed $100 to be paid to Respondent after the closing. Respondent denies the allegations of Paragraph Respondent knew that his representation to his clients regarding the $475 surveyor fee was false at the time he made the statement, because he knew that the $475 included an undisclosed $100 that was to be paid to him by Winemiller.

4 Respondent denies the allegations of Paragraph By reason of the conduct described above, Respondent has engaged in the following misconduct: a. Engaging in a conflict of interest with a current client where the representation of the client was materially limited by the personal interest of Respondent, by conduct including collecting a fee from the surveyor from monies paid by the client without disclosure to the client and waiver from the client, in violation of Rule 1.7(a)(2) of the Illinois Rules of Professional Conduct (2010); b. Failing to promptly inform clients ofa decision or circumstance with respect to which the client informed consent is required, by conduct including failure to explain to clients that what they thought they were paying as a surveyor fee included a $ 100 fee that would be paid to Respondent after the closing on the sale of their property, in violationof Rule 4.1(a)( 1) and 1.4(b ofthe Illinois Rules ofprofessional Conduct (2010); c. Knowingly making a false statement of material fact to a third party, by falsely including a $475 surveyor charge on HUD or other settlement statements without disclosing that $100 ofthat charge was going to be paid to Respondent, the seller's attorney, after the closing, in violation of Rule 4.1(a) ofthe Illinois Rules ofprofessional Conduct (2010); and d. Conduct involving dishonesty, fraud, deceit, or misrepresentation, by conduct including Respondent's failure to advise his clients that the fee they thought was a "surveyor charge" included an undisclosed $100 payment to Respondent,and violating 2607 (a) and (b) of 12U.S.C. by itemizing a $475 "surveyor charge" on the related HUD settlement statements without disclosing that $100 ofthat charge was to be paid to the seller's attorney, in violation ofrule 8.4(c) ofthe Illinois Rules ofprofessional Conduct (2010). The allegations of Paragraph 12 call for a legal conclusion and therefore no answer is required. To the extent any answer may be deemed necessary, the allegations of Paragraph 12 are denied. COUNT II (Dishonesty and Submission offalse Information to MCLE Board)

5 1. In 2005, the Supreme Court of Illinois adopted rules requiring Minimum Continuing Legal Education ("MCLE"). Supreme Court Rule 794 required that Respondent complete 30 hours of continuing legal education "(CLE") activity within the two-year reporting period ofjune 30, 2014-June30, 2016 ("the reporting period"). Respondent admits the allegations of Paragraph As ofjune 30, 2016, Respondent had not completed any ofthe required 30 hours ofcle activity for the reporting period. Respondent denies the allegations of Paragraph 2. In further answering, Respondent believes he completed some CLE activity during that time period. 3. Sometime prior to July 1, 2016, Respondent reported to the MCLE Board that he had completed 30 hours of CLE credit (including 4 hours of professional responsibility credit) during the reporting period. Respondent made the report on the MCLE Board's online reporting system and certified each statement set forth below: I am the attorney identified at the top ofthis form. I certify that the information contained in this certification to the MCLE Board is true and correct. I have read MCLE Rule 796 of the Supreme Court of Illinois which lists the penalties for submitting inaccurate or a false certification to the MCLE Board. Respondent admits the allegations ofparagraph Respondent's certified statements reported to the MCLE Board by Respondent, as described in paragraph 3 above, were false because Respondent had not completed 30 hours of CLE classes during the reporting period. Respondent admit that the statements described in Paragraph 3 were not accurate and he regrets that he made those statements prior to completing his CLE classes.

6 In further answering, Respondent's intention at the time was to complete the classes shortly thereafter. Respondent subsequently completed the CLE classes. 5. Respondent knew that his statements to the MCLE Board, as set forth in paragraph 3 above were false at the time that he made them sometime prior to July 1, 2016, because Respondent knew he had not completed 30 hours ofcle classes during the reporting period. Respondent admits that his statement to the MCLE Board were not accurate at the time he made them. Again, Respondent regrets that he made those statements prior to completing his CLE classes. In further answering, Respondent's intention at thetimewas to complete the classes shortly thereafter. Respondent subsequently completed the CLE classes. 6. By reason ofhis conduct described above, Respondent has engaged in the following misconduct: a. Conduct involving dishonesty, fraud, deceit, or misrepresentation, by conduct including his submission ofa false certification to the MCLE Board regarding his completion ofcle classes, in violation ofrule 8.4(c) ofthe Illinois Rules ofprofessional Conduct (2010). The allegations of Paragraph 6 state a legal conclusion and therefore no answer is required. To the extent any answer may be deemed required, the allegations of Paragraph 6 are denied. WHEREFORE, Respondent Gary Davidson, respectfully requests that the complaint be dismissed and for any other relief the Panel deems just. Respectfully Submitted, MEYER LAW GROUP, LLC.

7 Stephanie L. Stewart MEYER LAW GROUP, LLC. 30 N. LaSalle Street Suite 1410 Chicago, IL /