Alaska Supreme Court disbars Palmer attorney for taking dead client's money

PALMER -- The Alaska Supreme Court has disbarred a Palmer civil attorney with a dog mushing background for misappropriating more than $20,000 from a dead client and hiding it from his family.

The state's highest court on Friday issued a ruling that upholds an earlier recommendation from the Alaska Bar Association's Disciplinary Board and refers to attorney Melinda Miles' action as "duplicitous" -- one that "damages the reputation of the legal profession and the legal system at large."

Miles moved money out of a dead client's bank accounts and into her own, according to the opinion written by Justice Daniel E. Winfree. Then she told relatives the dead man "gifted" the money to her and she was following his wishes in deceiving relatives over more than three years of disciplinary proceedings.

"Given the egregiousness of Miles' conduct and the aggravating factors involved, we agree with the board that disbarment is appropriate in this case," Winfree wrote.

The disbarment is effective 30 days from Friday. Miles is not allowed to take on new clients and must transfer open matters to other attorneys. She can petition for rehearing.

Miles could not be reached Friday. A man who answered the phone at her downtown Palmer office Friday morning said "no comment" before abruptly hanging up.

The lawyer who represented her before the Supreme Court -- John Murtagh-- did not return a call for comment.

Miles was admitted to the Alaska Bar in 1989 and has handled matters ranging from divorces and landlord-tenant disputes to will preparation and other estate planning and probate services.

She also has a history as an avid dog musher, establishing a kennel in Chugiak in 2000 and completing her first race, the 2001 Denali 300, the next year in 11th place, according to an Iditarod Trail Sled Dog Race bio.

According to her professional bio, Miles started her own business in 1994, "taking a short break from practicing law to run the Iditarod" in 2004.

She scratched that year but finished other races, including the Yukon Quest 250 -- a quarter-length of the famously grueling 1,000-mile race -- in which she placed seventh in 2003.

Her law office in a two-story building on South Bailey Street near Palmer's Fred Meyer was open but quiet early Friday afternoon. The office door was shut but not locked. Inside, an assistant looked through a file folder at his desk; a woman could be heard on the phone in an inner office behind a closed door. No clients sat in a small waiting room with magazines on a coffee table.

The 24-page Supreme Court opinion says the situation that led to the disbarment began in 2006. That's when Miles met a man who built a fence for her. She claimed they were close friends and she occasionally did legal work for him.

The man in 2008 paid Miles to form a business for him, according to the opinion. Miles was authorized to sign for the account, as was the man. He died suddenly in 2009. He had no will but his mother was his sole heir and his brother had power of attorney to act on her behalf.

Miles didn't know the man died until the brother contacted her, the opinion says. The next month, she withdrew $1,162 from the business's checking account and $20,072 from its savings account.

Miles claimed he'd told her he'd rather she got his money than his relatives, according to the document. She eventually transferred it into her own law office and personal accounts and began spending some of it, the document says.

The brother kept unsuccessfully pressing for details of the bank accounts, Winfree wrote, and eventually hired an attorney.

He filed a grievance against her with the Alaska Bar Association in July 2010. The man's mother died a few months later. During a bar association hearing, friends of the man said he wasn't that close to Miles but friends of the attorney spoke of her regret and general truthfulness.

Miles eventually paid back all the money, said Steve Van Goor, counsel for the bar association, which has about 3,000 active members.

The bar recommended Miles be disbarred based on "reasonable doubt" that the man intended to make a gift of the funds and the fact Miles knew the business accounts were owned solely by the man when she withdrew the money, according to the state Supreme Court opinion. The one mitigating factor in her defense was her cooperation with the Bar.

The decision to disbar Miles ends her ability to practice law in Alaska or most likely anywhere in the United States for at least five years, Van Goor said. But getting reinstated is so rigorous that, until a year ago, the Alaska Supreme Court had never readmitted a disbarred lawyer.

"Theft, misappropriation or mishandling of a client's money is a very serious offense," he said. "It's important not only that the public understand this but other lawyers understand this. There's really no excuse for this kind of behavior. It's such an important responsibility that when lawyers don't meet that responsibility they should no longer practice law."

Update, Dec. 13, 2014:

Following the publication of this article, Melinda Miles contacted Alaska Dispatch News with the following statement:

"The only individual who can exonerate me is dead. (The deceased client) was a good friend who asked me to help protect his assets from his estranged family. He set up a bank account with me as the primary and used my Social Security number. I considered the money legally mine. (The client) died a ... premature death and I ask that now his memory be respected. If he would have lived, this debacle would have righted itself as his wishes would be known.

"Once I realized that the Bar did not find my testimony truthful regarding this matter, I took and passed a lie detector test. My hope that that would change the Bar's position on the matter was not realized.

"I apologize to my fellow bar members for any disdain that I have caused the profession. I have always endeavored to provide zealous and ethical representation of my clients. For twenty-five years I have pursued and attained justice for many Alaskans, and I regret that I will be unable to do so into the future."