                                                              TO BE PUBLISHED


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                               2007-SC-000149-KB
                                                    D
GENON G . HENSLEY                                                          MOVANT



V.                            IN SUPREME COURT



KENTUCKY BAR ASSOCIATION                                           RESPONDENT



                             OPINION AND ORDER

              Genon G . Hensley, whose Bar Roster Address is 11921 Berry Hill

Road ; Louisville, Kentucky 40243, and whose Kentucky Bar Association (KBA)

Member Number is 31273, filed a motion for consensual discipline in this Court,

under SCR 3.480 (2), asking that the Court suspend her from the practice of law

for sixty-one days, probated for two years, conditioned on no additional

disciplinary charges arising against her and her completion of ten hours of

remedial ethics education . The KBA filed its response to the motion, stating that

it had no objection to the motion and agreeing with the proposed discipline.

             Hensley admits that she is guilty of violating the Rules of

Professional Conduct as set out in all three counts of the Charge in KBA File

No. 5938 and in the complaint in KBA File No. 12623. She acknowledges she

has agreed to the imposition of discipline and requests the Court to impose the
discipline as set forth in the preceding paragraph . In light of the serious nature of

the admitted misconduct, this Court rejected the parties' negotiated sanction and

remanded for further disciplinary proceedings by order, dated March 22, 2007.

Hensley has moved for reconsideration of our order .

              We GRANT Hensley's motion to reconsider due to the unlikelihood

of a full and fair evidentiary hearing for Hensley as a result of the KBA's admitted

prolonged delay in prosecution, which has only now come to our attention by way

of the KBA's response to the motion for reconsideration . We also take note of

mitigating factors highlighted by the KBA: lack of other disciplinary history,

restoration of funds at issue to clients, full cooperation with the disciplinary

process, and understanding of the seriousness of the admitted misconduct .

              We glean the underlying facts from the Motion for Suspension with

Conditions:


                           I. KBA FILE NO. 5938.

                              A. Background .

              On November 13, 1995, Oranell Seward filed a complaint with the

KBA to which Hensley timely responded . On November 14, 1997, January 22,

1998, and May 6, 1998, counsel for the KBA requested that Hensley supply the

KBA with additional information bearing on the complaint. Hensley timely

responded to each of these requests and supplied all information sought by the

KBA . Hensley has fully cooperated with the KBA in this investigation .

              On October 3, 1993, Seward's husband died. Hensley had been a

friend and colleague of Seward's husband, and Seward requested Hensley's
assistance in settling the estate . Later, Seward asked Hensley to draft a will, a

living will, a power of attorney, and to prepare her 1995 income tax returns .

These specific services are not the subject of any complaint . An attorney-client

relationship thus existed between Hensley and Seward from approximately 1993

through early 1995.

                      B. The TMG Investment Partnership.

              During the time that an attorney-client relationship existed, Seward

sought Hensley's advice concerning investing a portion of the proceeds left to her

by her late husband. Hensley referred Seward to Susie Schaff of Cotton & Allen,

CPA, concerning mutual funds that would be appropriate for Seward, and

attended a meeting at Seward's request with Duane Regan, a financial advisor,

to review Seward's overall financial plan.

              In December 1993, Hensley advised Seward of the potential for

investing in a real estate development known as "Pleasant Hill Properties, L.P.,"

in San Francisco, California . Hensley and Seward later formed an investment

partnership called TMG Investments . Relying on Hensley's assurance that the

real estate investment was appropriate for investing some of the monies Seward

had received from her late husband, Seward contributed $7,000.00 to the

partnership, which was paid by personal check to Hensley. Hensley did not

invest the entire $7,000.00 in the California venture . Instead, she invested

$5,000 .00 and placed the investment in her own name. The remaining

$2,000 .00 was not invested in the California real estate development project but

was invested in another stock portfolio . Hensley has supplied the KBA with
documentation concerning the existence and validity of the Pleasant Hill

Properties, L.P ., real estate development project .

        C. Ms. Seward's Purchase of a Residence in Trimble County.

              In 1993, Irene Long, an attorney and personal friend of Hensley,

died. Hensley was requested to handle the probate of Ms. Long's will, and, while

attorney of record for the Long estate, purchased, with the heir's approval, a

small office in Trimble County. Next door to the office was a residence also

owned by the Irene Long estate, which had been rented for $200.00 per month.

              In December 1994, while Hensley was still counsel of record for

Long's estate, Hensley asked Seward if she would be interested in buying the

residence as investment property . Hensley failed to tell Seward that she was

representing the Long estate . Hensley stated that if Seward purchased the

property, that Hensley would lease the residence from Seward for $400.00 per

month . Hensley further advised Seward that the residence could be purchased

for $50,000.00.

              Hensley failed to tell Seward that James F. Long, administrator of

the Long Estate, had estimated the property's value at $45,300.00 four months

earlier . And Seward _authorized Hensley to offer the Irene Long estate

$50,000.00 for the residence, and that offer was accepted. The property was

appraised eleven months later at $54,000.00.

              Seward directed Hensley to obtain financing for the purchase of the

property. Instead, Hensley contacted Fidelity Investments, and without

disclosing that Hensley- held a power of attorney for Seward, directed Fidelity to
liquidate $50,000 .00 in mutual funds owned by Seward to raise funds for

purchasing the house. Hensley directed the Fidelity representative with whom

she spoke to send the proceeds directly to Seward at Seward's home address .

Instead of using the power of attorney that Hensley held for Steward, Hensley

represented herself to the Fidelity representative with whom she spoke as

Oranell Steward . Fidelity mailed the proceeds of the sale to Seward and they

were received by Seward .

                 Hensley handled all aspects of the real estate closing, including

preparation of the deed, which was dated December 30, 2004, even though

funds were not exchanged until after that date . Hensley was not paid by either

Seward or the Irene Long Estate for preparing the closing documents. Seward

had not seen the inside of the property at the time of the closing but visited

several weeks later with her new husband. Seward was shocked by its

condition . Seward later had the lot surveyed and found that Hensley's law office

encroached approximately two feet over the property line between the parcels .

                This caused great concern for Seward, who later retained counsel

to pursue her concerns. Ultimately, Hensley settled with Seward for a total of

$86,000.00. Under the settlement agreement, Seward was reimbursed all

money she invested in the investment partnership ; all money she invested in the

house in Trimble County; interest on these investments ; her attorney's fees ; and

an additional $5,000 .00. The settlement was funded primarily by Hensley and

not her liability carrier .
              Hensley admits she violated SCR 3.130-1 .8(a) in that she

suggested Seward purchase the real property in Trimble County, Kentucky, on

terms which appeared to benefit Hensley, while she was representing the Irene

Long Estate in the sale; and by entering into the "investment partnership" with

Seward, and failing to invest a portion of her client's money as directed by the

client .

              Hensley acknowledges that she violated SCR 3.130-1 .7(a) and (b),

by representing both Seward and the Irene Long Estate in the sale and purchase

of the Trimble County real estate . The representation of both clients was directly

adverse, and Hensley did not inform Seward that she represented the Irene Long

Estate, nor did she obtain Seward's consent to represent the Irene Long Estate .

Furthermore, Hensley's representation of Seward in purchasing the real estate

was adverse to Hensley's interest in renting the property.

              Hensley admits that she violated SCR 3.130-8 .3(c) by

misrepresenting and/or omitting relevant information to Seward in connection

with both transactions. She also admits violating this rule by failing to disclose

that her small office building extended onto the property that she suggested

Seward purchase, even though Hensley had not previously had a survey made

and was unaware that her office encroached on Seward's property ; securing

funds from Seward for an investment partnership to purchase stock in a real

estate development but only investing a portion of the funds thereof and in her

own name ; and representing herself as Seward in the sale of stock held

by Seward .
                            II. KBA FILE NO. 12623.

              In KBA file 12623, the complainant hired Hensley to represent him

in a civil matter before the Henry Circuit Court . The complainant was a

defendant in the case. Essentially, the case was a property dispute between two

adjoining landowners brought to enforce deed restrictions that would not allow

the complainant to continue` his cattle business on his property or use a waterline

easement that crossed the adjoining property . Hensley began representing the

complainant in 1999 and continued representing him until March of 2004.

              Hensley sold the building in which her practice was located and

moved from Bedford to LaGrange in April 2003. Hensley failed to take adequate

steps to notify complainant of her address change . She also failed to notify him

adequately of hearing dates, and she did not notify him of the entry of a summary

judgment until twenty days after entry. A charge has been authorized in this

matter.

              Hensley admits violating SCR 3.130-1 .3, inasmuch as she did not

act with reasonable diligence and promptness in representing the client . She

also acknowledges a violation of SCR 3.130-1 .4(a) and (b) because she failed to

advise her client directly of the office location change, which severely reduced

communication with him.

              Since we now accept the sanctions negotiated by the parties due to

the evidentiary problems posed by the KBA's delay in prosecution, Hensley's

motion for consensual discipline is GRANTED .
              ACCORDINGLY, IT IS HEREBY ORDERED :

              1)     Genon G . Hensley, KBA Member No. 31273, is hereby

suspended from the practice of law in the Commonwealth of Kentucky for a

period of sixty-one (61) days, with such suspension to be probated for a period of

two (2) years, conditioned on her not receiving any more disciplinary charges and

on her completion of ten (10) hours of remedial ethics education at her own

expense during the two year period following the date of this order;

              2)     Hensley's completion of ten (10) hours of remedial ethics

education shall be separate and apart from her fulfillment of any other continuing

education requirement during the two (2) year period after the entry of the Court

order approving this consensual discipline. She will not apply for Continuing

Legal Education (CLE) credit for any of these remedial hours, even if the course

attended is approved for CLE in Kentucky. She must furnish a release and

waiver to the Office of Bar Counsel (OBC) to review her records in the CLE

Department that might otherwise be confidential, with such release to continue in

effect until one year after she completes her remedial education, in order to allow

the OBC to verify she has not reported any hours to the CLE Commission that

are being taken as remedial education ;

              3)     The remedial ethics education must be satisfied by

Hensley's personal attendance at live continuing education or other education

programs approved or required by the OBC in advance and must be appropriate

for her remedial education regarding her ethical obligations to clients, third

parties, and the public;
              4)      Hensley is not required to report this probated suspension to

her clients unless and until the Court imposes suspension for the period of sixty-

one (61) days following her failure to comply with the above conditions;

              5)      If Hensley fails to comply with any of these conditions, the

KBA may move the Court to impose sanctions for the period of sixty-one (61)

days. Should the Court impose the sixty-one (61) day suspension, Hensley

would then be required to report her suspension to her clients ; and

              6)      In accordance with SCR 3.450, Hensley is directed to pay all

costs associated with these disciplinary proceedings in the amount of $48 .01 for

which execution may issue from this Court upon finality of this order.

              All sitting . All concur.

              ENTERED : May 24, 2007 .
