CHARLESTON – A Point Pleasant attorney faces possible disciplinary action for his mishandling of a settlement awarded to a Mason County physician in a 2001 civil case.
On March 11, the Lawyer Disciplinary Board, the prosecutorial arm of the state Bar Association, notified Raymond G. Musgrave of its intention to file a formal statement of charges against him with the state Supreme Court. Three days earlier the Board's investigative panel found probable cause that Musgrave violated at least two Rules of Professional Conduct in his handling of a settlement awarded to Mason physician Dr. Danny R. Westmoreland.
According to the statement, Westmoreland filed a complaint against Musgrave with the Office of Disciplinary Counsel, the Bar's investigative arm, three years ago on April 1, 2005. In his complaint, Westmoreland maintained that Musgrave failed to turn over a $15,000 settlement Westmoreland and his wife, Kim, won in a civil suit the year before.
In 2001, Gary Barry, a Gallipolis, Ohio contractor brought suit against the Westmorelands alleging their failure to pay him for materials used in refurbishing the Westmoreland Family Care office, which sustained damage from a fire the year before. On March 3, 2004, the Westmorelands, with the assistance of Musgrave, reached a settlement with Barry in which he was to pay them $15,000 within 30 days of the date of the agreement.
On April 15, 2004, the statement says, Musgrave deposited the $15,000 into an escrow account, and made a check payable to himself for $5,000. The remaining $10,000 stayed in the escrow account.
After a year of inquiring about the settlement, Westmoreland severed his relationship with Musgrave, "and demanded that Respondent [Musgrave] pay him the full $15,000 from the March 2004 settlement."
In addition to his ODC complaint, Westmoreland filed a collateral civil suit against Musgrave, which was halted in October 2005 due to Musgrave filing for bankruptcy.
In response to ODC's inquiry, Musgrave alleged he reached an understanding with the Westmorelands in May 2004 that he could apply the remaining $10,000 "as payment for previously earned attorney fees." In a statement dated March 30, 2005 – the same day Westmoreland filed his civil suit – Musgrave produced a billing statement for $10,865.75 for legal services performed from 2001 through January 2005.
Though the statement is unclear as to when, but the Westmorelands aver that the first time they saw the bill was "in response to the ethics complaint." Nevertheless, they denied giving Musgrave any authorization to apply any part of the settlement to any legal work.
Despite submitting a billing statement, Musgrave "did not provide any written documentation of [an] agreement" to apply the settlement for prior legal services. Also, even after being served with Westmoreland's civil suit on May 16, 2005, Musgrave did not place the disputed funds into a third account, but instead continued to withdraw them for his own use.
Musgrave's failure to reach an agreement with the Westmorelands over the supposed prior legal work, and his unauthorized withdrawals from the escrow account were the grounds on which the Board found probable cause to issue its statement. In the statement, the Board said Musgrave's actions violated Rule 1.5 ( c ) and 1.15 dealing with fees, and the safekeeping of property, respectively.
The Board notified Musgrave of his right to file a response to the statement within 30 days of it being filed with the clerk of the Supreme Court. According to court records, the statement was filed on April 4.
Regardless of Musgrave filing a reply, the Board's Hearing Panel Subcommittee will hold a hearing to consider the charges against him. Based on the severity of Musgrave's actions, it will then make a recommendation to the Board as to the level of discipline.
More at issue than $15,000
The West Virginia Record contacted Musgrave's attorney, Stephen R. Crislip, with the Charleston law firm of Jackson Kelly, for a comment. However, he deferred any comment until the reply was filed.
"I feel partially vindicated," Westmoreland said when reached for a comment. "I still want my $15,000. His bankruptcy does not protect illegal acts."
In reality, Westmoreland said the dispute between he and Musgrave isn't over just $15,000, which he would donate to charity upon receiving it. Rather, the issue is him losing out on the ability to recover an additional $77,000 as a crime victim.
After Barry filed his civil suit against them, the Westmorelands filed criminal charges against him for larceny. According to court records, Barry was convicted on one count of larceny in January 2004, partially prompting him to settle the suit.
Despite only receiving $15,000, Westmoreland said he hoped to recoup the remaining $77,000 in materials Barry stole from him with the assistance of the county's victim advocate. However, at Barry's sentencing, Westmoreland was shocked to learn from Mason Circuit Judge Thomas C. Evans III, and Mason County Prosecutor Damon Morgan that he was barred from collecting any more money because of a release he supposedly signed from the civil suit.
Westmoreland has adamantly denied he released Barry from any further liability, and any signature of his on the release is a forgery.
Given the Board's findings in his complaint against Musgrave, Westmoreland said he probably could make a case to reclaim the money that's rightful due him. However, because of the pace most legal proceedings take, Westmoreland said it isn't worth the hassle.
"The system has to be pretty bad to walk away from $77,000 because I don't want to take another five years to get justice," he said.