In the Matter of Stephen J. Heiser (Review Dept. 1990) 1 Cal. State Bar Ct. Rptr. 47

Court: State Bar Court of California, Review Department | Date: April 26, 1990 | Judge: Stovitz, J. (opinion), joined by Pearlman, P.J., and Norian, J.

Charges Brought Against Respondent

Attorney Stephen J. Heiser, admitted to practice in 1973, was charged with serious professional misconduct arising from his repeated issuance of seven dishonored checks totaling over $5,400. Some were written from his personal account and others from closed client trust accounts to pay personal debts such as rent, bar tabs, and dry cleaning. At the time, the accounts either had insufficient funds or were already closed. Heiser also failed to keep his membership address current with the State Bar and did not respond to repeated investigative letters. The State Bar’s hearing referee recommended a one-year suspension (stayed) with six months’ actual suspension. The Office of Trial Counsel sought review, requesting findings of additional misconduct and disbarment.

Defenses and Proceedings

Heiser did not respond to the Notice to Show Cause and default was entered. The State Bar proceeded by default, and no mitigating evidence was presented. The hearing referee found moral turpitude and dishonesty in writing checks he knew would bounce, and violations of Business & Professions Code §§ 6068(j), 6103, and 6106. However, the referee declined to find misrepresentation or failure to cooperate, concluding intent was not proven. The Office of Trial Counsel appealed, seeking additional findings for failure to cooperate and urging disbarment due to Heiser’s misuse of client trust accounts.

Review Department Findings

The Review Department independently reviewed the record under Rule 453(a) and agreed that Heiser’s conduct demonstrated moral turpitude. It emphasized that issuing multiple bad checks violates “the fundamental rule of ethics—common honesty—without which the profession is worse than valueless.” Even when checks are written for personal expenses, repeated NSF checks constitute moral turpitude under §6106. However, the Department rejected the examiner’s claim that Heiser misappropriated client funds because there was no evidence any client funds were in the trust account at the time; the accounts were closed and empty. The Department therefore found a violation of former Rule 8-101(A) (use of trust account for personal purposes), but not misappropriation.

Findings on Cooperation and Misrepresentation

The Review Department modified the findings to hold Heiser culpable of failing to cooperate with the State Bar under §6068(i). Evidence showed he received notice of the investigation and failed to respond. However, it declined to find he made misrepresentations to the State Bar investigator, resolving testimonial inconsistencies in his favor. The Department noted that reasonable doubts must be resolved in favor of the accused attorney, but that failure to respond to official inquiries is itself serious misconduct.

Mitigation and Aggravation

Heiser had practiced for sixteen years with no prior discipline, which weighed slightly in mitigation. However, aggravating factors were substantial: (1) multiple acts of dishonesty over eight months; (2) misuse of client trust accounts for personal benefit; (3) failure to cooperate with the Bar; and (4) failure to make restitution to victims. Two payees remained unpaid. The Review Department concluded that his conduct reflected indifference toward his professional obligations and the disciplinary process.

Outcome and Sanctions

The Review Department declined to recommend disbarment but strengthened the sanctions. Heiser was suspended for one year, the suspension stayed, with a two-year probation period including six months’ actual suspension and conditions requiring restitution to two victims—Kenneth G. Martin ($200) and David Lewis ($203.50)—with 10% annual interest. He was required to take and pass the Professional Responsibility Examination, comply with Rule 955, California Rules of Court, and maintain proper accounting records subject to CPA certification and probation monitoring. If his actual suspension exceeded two years, reinstatement would require proof of rehabilitation, fitness to practice, and learning in the law under Standard 1.4(c)(ii).