Law Practice Management

Lawyer not liable for $80K put in client trust account--and stolen--by his secretary, judge rules

An Alabama judge has ruled against the plaintiff in a lawsuit that seeks to recover from a Saraland lawyer an $80,000 payment that was put into a client trust account—and subsequently stolen—by the attorney’s longtime secretary.

Because the payment was a private deal between the plaintiff, Daniel Burrage, and legal secretary Susan Pack, Mobile County Circuit Judge Michael Youngpeter ruled Tuesday, the attorney for whom Pack had worked for 27 years, Johnny Lane, wasn’t responsible for Pack’s theft of the money,

Burrage had planned to use the money to pay off the mortgage on Pack’s home, which was in foreclosure, and then split the proceeds with her when it was subsequently sold by Pack at fair-market value after she fixed it up. But due to a drug issue, Pack was fired by Lane, and when Burrage asked for his money back, it was missing from the client trust account, along with another $115,000 or so, the Birmingham News reports. She is also accused of forging signatures on client settlement checks to obtain the money for herself.

Pack has pleaded guilty in a related case to embezzling $195,000 from the law firm, the newspaper notes. But she is not likely to be able to make good on court-ordered restitution. Burrage sued Lane, arguing that the attorney had been negligent in not supervising Pack more closely and hadn’t even looked at his client trust account bank records from 2008, after the death of his former law partner, until 2010, when he fired Pack.

Testimony differed on whether Lane had allowed Pack to deposit the $80,000 into the client trust account.

Attorney Robert Stankoski, who represents Burrage, said he would discuss an appeal with his client.

“You can’t stick your head in the sand like an ostrich and say you’re a victim,” Stankoski said, referring to Lane.

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