Lawyer Disbarred for Defaulting on Student Loans

A Texas appeals court has upheld the disbarment of a lawyer for defaulting on student loans:  Texas appeals court revokes attorney's license for failing to repay student loan, other debts.

This is not an isolated decision.  Some years back a Minnesota lawyer was disbarred for defaulting on student loans.  In that case, the lawyer was living the high-life while stiffing the student loan administration.

In the Texas case the court's ruling stems from several chances given to the attorney.  He was warned and given a provisional license on condition of paying down debts.  He was given at least one extension.  Ultimately, as reported by Law.com, the judges found:

that because Santulli, a Houston solo practitioner, did not adhere to a previous order requiring him to pay his debts, he lacked the trustworthiness necessary to represent clients.

Defaulting on student loans and indebtedness in general is a serious issue potentially subject to discipline.  Typically it is not just default, it is failing to pay on a judgment where the lawyer has the ability to pay using Rule 3.4(c) (violate rules of tribunal) or 8.4(d) under the ABA Model Code as the basis for discipline according to Eric Cooperstein, a former Assistant to the Director of the Minnesota Lawyers Board of Professional Responsibility.

Based on the Law.com account, it appears that Mr. Santulli had about $64,000 of debt.  He had been previously ordered, in 2002, to "repay a 'substantial amount of student loan and personal debt' under a plan with the Consumer Credit Counseling Service" because he would be "tempted to "short-shrift" his clients or 'convert money' from his clients to cover his debt."  There doesn't seem to be any indication that he ever did "short-shrift" clients or "convert money" from them.  Yet, the appeals court determined that there was "clear and rational connection between Santulli's lack of trustworthiness or reliability in carrying out responsibilities and the likelihood that he will harm a client, obstruct administration of justice or violate the disciplinary rules."

This troubles me.  This lawyer appears to be being disciplined for violations the board fears he might do because he is in debt.  Since when do we discipline for inchoate prospective violations?  We do not discipline lawyers for chemical dependency even though there is known correlation between chemical dependency and ethics violations.  We have LAP programs, in part, to pro-actively prevent violations and discipline only where there is an actual violation.  Is debt any different, particularly here where there is no indication that since 2002 this lawyer committed no violation even though he has consistently had debt problems.  Granted, I have not seen the decision much less the underlying record, but one suspects there would mention of actual violations if there were any.

I have no qualms with disciplining a lawyer who refuses to pay debts even though he has the means to - indeed, in my work with the local ethics committee I have voted to find violations where a lawyer unreasonably refused to pay a court reporter.  But, with the economy as it is, and with some lawyers definitely feeling its pinch, it strikes me that some very well intentioned but unfortunate attorneys are going to find themselves in debt and unable to pay.  I would hope there would be some leniency and understanding by PR Boards given the times and that discipline reserved for those deserving of it:  those for who are unreasonably refusing to pay.

- Peter H. Berge

Comments (0)

Subscribe to this comment's feed