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Montgomery County lawyer faces malpractice lawsuit

A Montgomery County attorney who advised an illiterate, intellectually disabled young woman on the sale of her structured settlement is now facing a legal malpractice suit alleging he failed to meet with her or counsel her on the potential consequences of selling the settlement.

As a result of Charles E. Smith’s negligent representation, the suit claims, Baltimore resident Maryalice Rose lost a significant portion of the settlement she was set to receive after filing a lawsuit seeking compensation for brain-related injuries from childhood exposure to lead-based paint.

The malpractice lawsuit, filed in Baltimore City Circuit Court last week, alleges Smith intentionally misrepresented and deceived Rose and seeks $5 million in punitive damages, in addition to compensatory damages. The suit also names Smith’s firm, CES Law Group LLC in Derwood, as a defendant.

“Maryalice Rose is only 20 years old and does not have the cognitive ability to work,” the lawsuit states. “The structured settlement was designed to protect her throughout her lifetime, and that protection has now been taken away from her for a small and severely discounted sum of cash.”

Brian S. Brown of Saul E. Kerpelman & Associates P.A. in Baltimore, one of Rose’s attorneys, said the circumstances of the case are “highly unusual.”

“This lawyer breached his duty to our client. That’s the bottom line,” said Brown, who frequently handles lead-paint cases.

Smith said on Tuesday that he had not yet seen the lawsuit. According to the Maryland Judiciary’s Client Protection Fund listing of Maryland attorneys, he was admitted to the Maryland Bar in 2005.

Settlement sale

The proposed sale of the settlement began when Rose received an unsolicited phone call from a representative of a company called Access Funding LLC, who told her she would receive a “fair and substantial sum of cash” if she agreed to sell her settlement to the company, the lawsuit claims.

When the representative, a man named Brendan Franks, asked Rose what she planned to do with the money, she responded that she wanted to help her mother out financially with her mother’s house. Because Franks knew a Maryland court had to approve the transaction, he told Rose to say that she wanted the cash payout so she could purchase her own home, according to the complaint.

The Maryland Structured Settlement Act requires payees of structured settlements to first receive independent financial advice from an attorney, accountant or similarly qualified professional before selling the settlement.

According to the lawsuit, Smith served as Rose’s adviser but did not meet with her in person or analyze her financial situation to determine the impact the sale of the settlement might have on her future.

“Attorney Smith did not make any inquiry or investigation into whether Maryalice Rose had the financial capacity and ability to handle a sum of money all at once,” the suit states. “…Had it truly been Maryalice Rose’s intent to purchase her own home, the income stream from the structured settlement annuity that she was already receiving would have better suited her than receiving a severely discounted present sum of cash.”

In November 2013, a notary public hired by Access Funding gave Rose multiple documents to sign, but she was unable to read them or determine if they were accurate before signing them, the suit states. No “reasonable attorney” would have recommended the transaction, the lawsuit claims.

In addition to Brown, Rose is also represented by Leah K. Barron of Saul E. Kerpelman & Associates, as well as Raymond L. Marshall and Matthew M. Somers, both of Chason, Rosner, Leary & Marshall LLC in Towson.

The case is Maryalice Rose v. Charles E. Smith and CES Law Group LLC, 24-C-15-002960.

About Lauren Kirkwood

Lauren Kirkwood covers the business of law beat at The Daily Record.