Overview

Timothy John MacKenzie sought reinstatement to the State Bar after resigning in 2000 amid charges of misappropriation that had led to a recommendation for disbarment. The Client Security Fund (CSF) had reimbursed two claimants harmed by his misconduct, but MacKenzie filed his petition without repaying the fund as required under Business and Professions Code §6140.5(c) and Rule 5.441(B)(2) of the State Bar Rules of Procedure. The Review Department held that reimbursement of the CSF is a mandatory prefiling requirement for reinstatement and that failure to satisfy it requires mandatory dismissal of the petition, rejecting MacKenzie’s claim that due process entitled him to an evidentiary hearing on rehabilitation.

Key Facts

• MacKenzie resigned with disciplinary charges pending in 2000 after the State Bar recommended his disbarment for misappropriating $162,400.
• By 2009, the Client Security Fund had paid $52,757.17 to two claimants as a result of his misconduct.
• As of 2016, he owed $96,121.13 including interest and costs, but had made no voluntary payments aside from $613 intercepted by the Franchise Tax Board.
• He filed a reinstatement petition on November 17, 2016 without reimbursing CSF and argued that he should be allowed to repay it after reinstatement.
• The hearing judge dismissed the petition, and the Review Department affirmed, ruling the dismissal was mandatory rather than discretionary.

Issues Presented

• Whether CSF reimbursement is a mandatory prefiling condition or merely a condition of reinstatement.
• Whether the requirement conflicts with §6140.5(c) of the Business and Professions Code.
• Whether the dismissal of the petition violated MacKenzie’s due process rights by denying an evidentiary hearing on rehabilitation.

Holding and Reasoning

• The Review Department interpreted §6140.5(c) and Rule 5.441(B)(2) together, finding that reimbursement is a mandatory prefiling requirement that must be satisfied before a reinstatement petition can be filed.
• Failure to meet this prefiling condition requires dismissal; the State Bar Court has no discretion to waive or delay repayment obligations.
• The Court cited Hippard v. State Bar (1989) 49 Cal.3d 1084, which held that restitution is an essential part of rehabilitation and must be completed before reinstatement, not as a condition after the fact.
• The Review Department reasoned that the rule supports key policy goals — maintaining CSF solvency and conserving judicial resources by preventing hearings when repayment is unlikely.
• Due process does not entitle a petitioner to a hearing when mandatory prefiling requirements are unmet; dismissal itself satisfies the “hearing in the first instance” standard under Rule 9.10(f).

Aggravation and Mitigation

• Aggravation: Prior serious misconduct involving misappropriation and significant harm to clients.
• Mitigation: Limited financial hardship arguments were presented but did not justify nonpayment of CSF obligations.
• Net Effect: The petitioner’s inability or refusal to repay the CSF precluded any evaluation of rehabilitation or fitness to practice law.

Sanctions & Disposition Table

Notes: The Review Department confirmed that CSF reimbursement is a strict precondition to filing and cannot be deferred or waived, reaffirming that restitution is a prerequisite to demonstrating rehabilitation and moral fitness for reinstatement.

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