Facts

Plaintiff Kiowa Michaels' home burned down in 2010, but it was covered by insurance. He retained defendant Verne Scholl, who owned and operated VS Legal Center, to administer the insurance proceeds. Frank Trotman worked for defendants, but he was not an attorney. Michaels also hired Maple Ridge Mobile Home Sales Inc. to help him locate a replacement mobile home.

Kiowa Michaels sued Scholl and VS Legal Center.

PLAINTIFFS' CONTENTIONS:
Plaintiff alleged that Cimarron Escrow Inc., after having received insurance proceeds for the replacement of his home, issued a check to Maple Ridge, which then paid out $9,640 to VS Legal Center. Maple Ridge subsequently paid $8,800 to a contractor whom plaintiff claimed was not authorized. Next, Maple Ridge paid another $40,000 to VS Legal Center. Trottman then paid $3,000 for the electricity installation. The contractor eventually returned the $8,800.

Damages

Michaels sought $6,000, the retainer fee he paid Scholl plus the additional $1,200 fee he paid, $20,000 for being out of the house for 12 months, $5,200 for his son being forced to move out of the house, $2,544 in fuel costs, and $1,020 in laundry costs.

Result

The arbitrator awarded Michaels $25,000 in damages and $15,000 in punitive damages plus interest for a total recovery of $50,135. The State Bar disciplined Scholl in connection with this matter.

Other Information

According to plaintiff, after Kiowa Michaels reported it to the State Bar, the defendant replenished all the misappropriated money, but did not return the retainer or pay for any of the damages. FILING DATE: March 13, 2012.