TEXAS
JD Supra Business Advisor
3/20/2017
by David Fowler Johnson | Winstead PC
In First United Pentecostal Church of Beaumont v. Parker, a church hired an attorney to defend it against sexual abuse allegations. 2017 Tex. LEXIS 295 (Tex. March 17, 2017). During the same time, the church also engaged the attorney to assist in a hurricane/insurance claim. When the insurance company offered to pay over $1 million to settle the claim, the attorney generously suggested that the church leave those funds in the attorney’s trust account to assist with creditor protection. The attorney then withdrew those funds in 2008 and used them for his personal expenses and the expenses of his firm. The attorney had a contract attorney working with his firm. The contract attorney did not know about the improper use of the money at the time that it was done. Rather, he learned about it in 2010, but failed to disclose that information to the client. Eventually, the contract attorney did disclose the information and sent a letter wherein he repented and admitted to breaching his fiduciary duty. The original attorney fled to Arkansas, but was later caught. He pled guilty to misappropriation of fiduciary property and received a fifteen-year sentence.
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