Livonia lawyer disbarred after nearly $40K taken from client

By Lee Dryden
BridgeTower Media Newswires

A Livonia attorney has been disbarred by an Attorney Discipline Board panel after findings that he took nearly $40,000 from a client while acting as a fiduciary.

The disbarment of Neil A. McQuarrie was effective Dec. 7, according to an ADB notice issued that day.

The case was heard by Tri-County Hearing Panel No. 9, which included chairperson Kenneth R. Chadwell and members A. David Baumhart III and Christian J. Horkey. Kimberly L. Uhuru represented the Attorney Grievance Commission while McQuarrie represented himself.

The hearing panel found that McQuarrie committed acts of professional misconduct while acting as a court-appointed special fiduciary holding funds in trust for Derek Cornell Williams, the ADB notice stated.

McQuarrie failed to promptly pay or deliver funds to Williams, failed to render a full accounting of client funds upon request, and made false statements of material fact to a tribunal, according to the notice.

Derek Williams’ father, Warren Williams, died in 1994. Derek Williams, who was born in 1988, became sole beneficiary of a life insurance policy at a young age, according to an uncontested facts section of the hearing panel’s July 5 misconduct report for McQuarrie.

McQuarrie was appointed as a special fiduciary in 1996. After no incidents for a decade, McQuarrie took the funds via numerous withdrawals and filed a false receipt stating that Williams had received the money, the report stated.

“Rather than deny or contest the facts presented by the Grievance Administrator, Respondent offered an explanation for why Derek Williams did not receive the money held in trust for him,” the report stated. “Respondent testified that an individual falsely claiming to be Derek Williams came to his law office in 2008, presented what appeared to be a valid Michigan identification, and tricked Respondent into making each of the cash withdrawals.

“The panel unanimously finds by a preponderance of the evidence that this story is completely incredible; is contradicted and disproven by other facts; and was falsely concocted by Respondent to conceal his own embezzlement and misappropriation of the funds he held in trust for Derek Williams.”

The panel noted other evidence that McQuarrie misappropriated the funds.

“First, Respondent did not make any cash withdrawals from the account until more than two years after Derek Williams turned eighteen years old,” the report stated. “He had not heard from the client and did not take effective steps to locate the client. These circumstances indicate that Respondent believed that he could get away with helping himself to the money rightfully belonging to Derek Williams.

“Second, the cash withdrawals began at a time when Respondent was having serious financial problems, including two large tax liens and a lawsuit for nonpayment of his office rent. The motive for Respondent’s theft is quite obvious.”

The panel also cited a fictitious Detroit address provided for Williams and the similarities between Williams’ alleged signature and McQuarrie’s handwriting.

The hearing panel’s Nov. 16 sanction report cited the findings in the misconduct report, “In essence, Mr. McQuarrie stole all of the funds from the estate of Derek Williams’ father, held in trust for Derek, through a series of 37 cash withdrawals.”

“Mr. McQuarrie’s mental state was intentional, and not a result of accident or mistake or, as he claimed at the hearing, because he was defrauded into doing so,” the report stated. “The result of the intentional, premeditated, professional misconduct was that it caused very serious financial injury to his client: Derek Williams was deprived of the entire inheritance to which he was entitled after he was left fatherless.

“When he was caught, Mr. McQuarrie had the audacity of attempting to impugn the conduct and character of Derek Williams and his mother. In the opinion of the panel, Mr. Williams was quite dignified, restrained and respectful in responding to clear criminal conduct perpetrated upon him.”

The report stated that the American Bar Association Standards for Imposing Lawyer Sanctions favor disbarment for “these types of ethical violations.” Standard 4.11 states that disbarment is “generally appropriate when a lawyer knowingly converts client property and causes injury or potential injury to a client.”

McQuarrie’s lack of prior disciplinary history is mitigating, the report stated. While McQuarrie argued at the sanction hearing that his experience as an attorney since 1972 is mitigating, ABA Standard 9.22(i) lists “substantial experience in the practice of law” as an aggravating factor.

“In other words, someone like Neil McQuarrie who has been practicing law for 44 years is most certainly expected to know the rules of professional conduct,” the report stated.

As for other aggravating facts, McQuarrie had a dishonest or selfish motive, engaged in a pattern of misconduct, committed multiple offenses, made false statements during the disciplinary process, refused to acknowledge the wrongful nature of his conduct, took advantage of a vulnerable victim, showed a total indifference to making restitution, and engaged in illegal conduct, according to the report.

“Neil A. McQuarrie is a veritable case study in what one should never do as a member of the bar,” the report stated.

The panel also ordered that McQuarrie pay $39,016.76 in restitution to Williams, plus any attorney fees and costs expended in recovering restitution.

Costs totaling $3,569 were assessed.