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Committee on Professional Ethics and Conduct of Iowa State Bar Ass'n v. Mershon

Supreme Court of Iowa
316 N.W. 2d 895 (1982)


Facts

Attorney Robert Mershon (defendant) began providing legal services to a farmer, Leonard Miller, in 1951. Miller owned land next to a country club and was interested in developing the land. Miller hired R. O. Schenk, an architect, to work on the project. To fund the project, Miller, Schenk, and Mershon formed a corporation named Union Township Development, Inc. (Union). Miller conveyed the land to Union and received 400 shares of stock. Schenk gave a promissory note to Union for architectural services and received 400 shares of stock. Mershon gave a promissory note to Union for future legal services and received 200 shares of stock based on Schenk’s estimation of legal fees. Mershon did not suggest, as Miller’s attorney, that Miller obtain independent advice about the transaction. Mershon also did not put protections in place for Miller in the event of death. Union could not obtain financing, and the project was at a stalemate when Miller died in 1978. Three days later, Mershon transferred his own stock back to Union. The Committee on Professional Ethics and Conduct of the Iowa State Bar Association (plaintiff) filed a complaint with the state bar’s disciplinary commission about Mershon’s conduct. The commission recommended that Mershon be reprimanded. The state supreme court granted review.

Rule of Law

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Issue

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Holding and Reasoning (McCormick, J.)

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  • A "yes" or "no" answer to the question framed in the issue section;
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  • The procedural disposition (e.g. reversed and remanded, affirmed, etc.).

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