State Bar seeks to recoup unpaid discipline costs
By Amy Yarbrough
Staff Writer
The State Bar has stepped up its collection efforts to help recover
the millions of dollars it is owed as a result of disciplinary proceedings.
In the past year, the bar has filed nearly 600 money judgments
in superior courts against resigned or disbarred attorneys to help collect
disciplinary costs, nearly double the number from the several years prior,
according to Assistant General Counsel Danielle Lee. The State Bar has also
started renewing older judgments that are approaching the 10-year statute of
limitations.
Lee and a paralegal in the bar’s Office of General Counsel handle
the State Bar’s collection efforts, including the recent push to bring its
filed judgments up to date. The judgments, contained in California Supreme
Court discipline orders, are filed in either San Francisco or Los Angeles
County superior courts, the cities where the State Bar’s two offices are
located.
Since 2007, the State Bar has filed about 1,136 judgments against
disciplined attorneys totaling more than $10.8 million, according to the bar’s
Office of Finance.
“It’s something to be proud of,” Lee said of the effort. “We
have a good process going.”
The judgments also cover money owed to the Client
Security Fund, which reimburses clients who’ve lost money or property due
to theft or dishonesty by a California attorney.
Although it’s not a huge amount of money, any funds collected
do help, according to Lori Meloch, the fund’s director.
“The Client Security Fund is always appreciative of any
amounts that are collected and can be used to reimburse the victims of attorney
theft,” she said.
The State Bar started setting up the process to file
judgments in 2004, when changes in the law allowed it. The judgments can also give
the State Bar access to untapped assets, such as when a debtor attorney
attempts to sell or refinance a property.
To that end, Lee said she regularly gets calls from escrow
and title companies who encounter a State Bar lien when trying to transfer or
refinance property for a resigned or disbarred attorney. The attorney will
often pay the full amount of the debt, because if they don’t, the transaction
will not go through, Lee said.
Since 2014, the State Bar has also had another tool at its
disposal. That year, the Legislature enacted a law that allows the State Bar to
intercept tax refunds through the Franchise Tax Board. The money – $327,000 has
been brought in to date – goes into the Legal Services Trust Fund, which
provides free legal services to low-income people in the state.