The commission claimed that Holzman should have fired Lippman immediately and reported him to the Departmental Disciplinary Committee and to law enforcement authorities.
Lippman was finally fired in 2009 by a new counsel to the public administrator, John Reddy. In 2010, Lippman was indicted (NYLJ, July 9, 2010) and is awaiting trial.
The charges against Holzman first went before a referee, former Manhattan Supreme Court Justice Felice Shea. In July, Shea found that Holzman should have fired and reported Lippman. However, she rejected the commission's claim that Lippman's conduct resulted from Holzman's failure to supervise him. She also rejected the claim that Holzman's approval of boilerplate fee requests was misconduct, saying that the problem was not unique to Holzman but "systemic" in surrogate courts.
The full commission heard arguments in September (NYLJ, Sept. 20).
The majority's decision affirmed that Holzman should have fired Lippman and reported him to authorities as soon as he learned of the misconduct.
"By allowing a lawyer who had cheated the PA's office, overcharged estates, lied to him and breached his trust to continue to represent the PA in the administration of estates, respondent put at further risk the estates under his care," the majority said.
"Respondent's abdication of his ethical responsibilities, which was influenced by his long and close professional relationship with Mr. Lippman, constitutes serious misconduct," the majority said.
Nonetheless, the majority said it was "persuaded by the record before us that respondent's repayment plan, while misguided and ill-conceived, was motivated by a sincere desire to ensure that the estates under his care were made whole by the individual who had already been paid and who was perhaps in the best position to complete the work expeditiously."
The majority also noted Holzman's cooperation with law enforcement, his otherwise unmarred record of service and his impending retirement.
Moore said in her dissent that Shea and the commission should have sustained the charge that Holzman approved fee requests based on insufficient information.